[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.
Exhibit 10.32
License Agreement
COLEY PHARMACEUTICAL GROUP, INC.
And
DYNAVAX TECHNOLOGIES CORPORATION
LICENSE AGREEMENT
 
Dated June 26, 2007

 

--------------------------------------------------------------------------------

 

License Agreement
LICENSE AGREEMENT
This LICENSE AGREEMENT (this “Agreement”), effective as of June 26, 2007 (the
“Effective Date”), is between Coley Pharmaceutical Group, Inc., a Delaware
corporation located at 93 Worcester Street, Suite 101, Wellesley, Massachusetts
02481 USA, and its Affiliates (collectively, “Coley”), and Dynavax Technologies
Corporation, a Delaware corporation having a principal place of business at 2929
Seventh Street, Suite 100, Berkeley, California 94710 USA and its Affiliates
(“Licensee”) (each, a “Party” and collectively, the “Parties”).
RECITALS
WHEREAS, Coley is the owner or licensee of certain rights, title, and interests
in proprietary technologies involving immunomodulatory oligonucleotides; and
WHEREAS, Licensee has developed and/or is developing or evaluating a vaccine
containing an HBsAg Antigen (as hereinafter defined) for the prevention of
infection by Hepatitis B Virus in humans; and
WHEREAS, Licensee desires to obtain a license under the Patents (as hereinafter
defined) in the Field (as hereinafter defined) and in the Territory (as
hereinafter defined), and Coley desires to grant Licensee such rights and
license; and
NOW, THEREFORE, in consideration of the premises and covenants contained herein
and other good and valuable consideration, the adequacy of which is hereby
acknowledged, and intending to be legally bound, the Parties hereby agree as
follows:
     1. DEFINITIONS.
1.1 General.
Unless otherwise specified, references in this Agreement to any section are
references to such section of this Agreement and, unless otherwise specified,
references in any section or definition to any clause are references to such
clause of such section or definition. Terms which are defined in this Agreement
shall apply equally to the singular and plural forms of the terms defined.
Whenever the context may permit or require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The term “including” means
including, without limiting the generality of any description proceeding such
term. Each reference herein to any Person shall include a reference to such
Person’s permitted successors and assigns. Unless otherwise specified,
references to any agreement, instrument or other document in this Agreement
refer to such agreement, instrument or other document as originally executed or,
if subsequently varied, replaced or supplemented from time to time, as so
varied, replaced or supplemented and in effect at the relevant time of reference
thereto. References to “dollars” or “$” are to United States dollars.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

1

--------------------------------------------------------------------------------

 

License Agreement
1.2 Defined Terms.
As used in this Agreement, the following terms shall have the following
respective meanings:
               (a) “Affiliate” shall mean any individual or entity directly or
indirectly controlling, controlled by or under common control with a Party to
this Agreement. For purposes of this definition, the term “control” means
(i) direct or indirect ownership of more than fifty percent (50%) of the voting
interest in the entity in question, or more than fifty percent (50%) interest in
the income of the entity in question; provided, however, that if local law
requires a minimum percentage of local ownership, in addition to the foregoing
clause, control will also be established by direct or indirect beneficial
ownership of one hundred percent (100%) of the maximum ownership percentage that
may, under such local law, be owned by foreign interests; or (ii) possession,
directly or indirectly, of the power to direct or cause the direction of
management or policies of the entity in question (whether through ownership of
securities or other ownership interests, by contract or otherwise).
               (b) “Agreement” shall have the meaning set forth in the first
paragraph of this Agreement.
               (c) “Antigen” shall mean the [ * ] antigen.
               (d) “Business Day” shall mean a day other than a Saturday or
Sunday on which banking institutions in New York, New York are open for
business.
               (e) “Claim” shall mean any claim, demand, action or other
proceedings (including for personal injury, death or disability) by a Third
Party.
               (f) “Coley” shall have the meaning set forth in the first
paragraph of this Agreement.
               (g) “Coley Indemnified Party” shall have the meaning set forth in
Section 10.1.
               (h) “Commercially Reasonable Efforts” shall have the meaning set
forth in Section 4.1.
               (i) “Compound” shall mean an immunomodulatory oligonucleotide
identified by Licensee as [ * ], having a [ * ] and the nucleotide base sequence
[ * ].
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

2

--------------------------------------------------------------------------------

 

License Agreement
               (j) “Confidential Information” shall mean any confidential and
proprietary scientific, technical, commercial, marketing or other business
information or Data furnished, directly or indirectly (including in connection
with meetings with Regulatory Authorities or Third Parties), and whether in
writing, orally or otherwise, by one Party or one of its Affiliates (the
“Disclosing Party”) to the other Party or one of its Affiliates (the “Receiving
Party”) pursuant to or in connection with this Agreement (including the
negotiation of this Agreement) or the activities or transactions contemplated
hereby or thereby.
               (k) “Data” shall mean all data and other information included or
referenced in a Submission.
               (l) “Delivery Method” for the Licensed Product shall mean [ * ]
delivery.
               (m) “Develop” shall mean to engage in Development.
               (n) “Development” shall mean all activities related to research,
preclinical and other non-clinical testing, test method development, process
development, Manufacturing scale-up, qualification and validation, quality
assurance/quality control and clinical trials, including Manufacturing in
support thereof, statistical analysis and report writing, the preparation and
submission of any application for Regulatory Approval, regulatory affairs with
respect to the foregoing and all other activities necessary or reasonably useful
or otherwise requested or required by a Regulatory Authority as a condition or
in support of obtaining or maintaining a Regulatory Approval.
               (o) “Disclosing Party” shall have the meaning set forth in
Section 1.2(j).
               (p) “Effective Date” shall have the meaning set forth in the
first paragraph of this Agreement.
               (q) “EU Major Market Country” shall mean [ * ].
               (r) “Exploit” and cognates thereof shall mean to make, have made,
import, use, sell, or offer for sale, including to Develop, register, modify,
enhance, improve, Manufacture, have Manufactured, store, formulate, export,
transport, distribute, promote, market, or otherwise dispose of.
               (s) “FDA” shall mean the United States Food and Drug
Administration or any successor entity.
               (t) “Field” shall mean the use of the Licensed Product for the
prevention of infection by Hepatitis B Virus in humans. The Field specifically
excludes any product for the prevention of disease, indications or disorders
other
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

3

--------------------------------------------------------------------------------

 

License Agreement
than Hepatitis B Virus in humans and any product for the treatment of any
disease, indications or disorders.
               (u) “First Commercial Sale” shall mean, with respect to the
Licensed Product and a particular country in the Territory, the first
transaction by Licensee or a Sublicensee that transfers to an arm’s-length Third
Party purchaser, for value, title and right of physical possession of the
Licensed Product for use in the Field in the country (other than named patient
sales). Notwithstanding the provisions of the preceding sentence, transfer of
possession and title to an Affiliate shall not constitute a First Commercial
Sale unless the Affiliate is an end user of the Licensed Product.
               (v) “Indemnitee” shall have the meaning set forth in
Section 10.3.
               (w) “Indemnitor” shall have the meaning set forth in
Section 10.3.
               (x) “Iowa Agreement” shall mean that certain License Agreement by
and between CpG ImmunoPharmaceuticals, Inc. (the predecessor corporation to
Coley) and UIRF, dated March 31, 1997, as amended March 7, 2001, as it exists on
the Effective Date. A redacted copy of the Iowa Agreement is attached hereto as
Exhibit B.
               (y) “Large Pharmaceutical Company” shall mean any pharmaceutical
or biotechnology company that has at least [ * ] in aggregate annual
pharmaceutical net sales for its most recently-completed fiscal year (consisting
of 12 consecutive months) based on data provided by IMS International, or if
such data is not available, such other reliable data as determined by Licensee
and agreed to in writing by Coley, such agreement not to be unreasonably
withheld.
               (z) “Liability” shall have the meaning set forth in Section 10.1.
               (aa) “Licensed Product” shall mean a prophylactic vaccine
containing the Compound co-formulated with the Antigen for delivery by the
Delivery Method. No Licensed Product(s) may be developed for the prevention,
treatment or control of any cancer nor may any clinical trial be conducted with
clinical endpoints of prevention, treatment or control of any cancer.
               (bb) “Licensee” shall have the meaning set forth in the first
paragraph of this Agreement.
               (cc) “Licensee Indemnified Party” shall have the meaning set
forth in Section 10.2.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

4

--------------------------------------------------------------------------------

 

License Agreement
               (dd) “Manufacture” and “Manufacturing” shall mean, with respect
to a product or compound, the manufacturing, processing, formulating, packaging,
labeling, holding and quality control testing of such product or compound.
               (ee) “Net Sales” shall mean the gross amount invoiced by Licensee
and its Affiliates and its Sublicensees for sales of the Licensed Product for
end use or consumption to Third Parties that are not Affiliates or Sublicensees
of the selling party (unless such purchasing Affiliate or Sublicensee is the end
user of the Licensed Product, in which case the amount billed therefore shall be
deemed to be the same amount that would be billed to a Third Party end user in
an arms-length transaction) in the Territory, less the total of the following
deductions to the extent they are included in the gross invoiced sale price of
the Licensed Product or otherwise directly paid or incurred by Licensee or its
Affiliates or its Sublicensees with respect to the sale of the Licensed Product:
               (i) trade, cash, and/or quantity discounts not already reflected
in the amount invoiced;
               (ii) excise, sales and other consumption taxes and customs duties
to the extent included in the invoice price;
               (iii) freight, insurance and other transportation charges to the
extent included in the invoice price;
               (iv) amounts repaid or credited by reason of rejections and
defects;
               (v) returns or retroactive price reductions;
               (vi) payments and rebates directly related to the sale of the
Licensed Product, and
any other specifically identifiable amounts included in gross amounts invoiced
for the Licensed Product[ * ]. Any such exclusions shall be negotiated in good
faith between the Parties and, if they are unable to agree, resolved in
accordance with the dispute resolution mechanism in Section 11.3, as determined
in accordance with Licensee’s accounting methods (which are in accordance with
its or its Sublicensee’s accounting standards as generally and consistently
applied).
In the case of any sale or other disposal for value, such as barter or
counter-trade, of the Licensed Product or part thereof, other than in an arm’s
length transaction exclusively for money, Net Sales shall be calculated as above
on the fair market value of the consideration received by Licensee or its
Affiliates or Sublicensees.
               (ff) “OHRI Agreement” shall mean the License Agreement, effective
as of September 1, 1998 between The Ottawa Health Research Institute at
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

5

--------------------------------------------------------------------------------

 

License Agreement
the Ottawa Hospital (successor in interest to The Loeb Health Research Institute
at Ottawa Hospital) (“OHRI”) and Coley Pharmaceutical Group, Inc. (formerly
known as CpG ImmunoPharmaceuticals, Inc.), as amended on September 25, 2001. A
redacted copy of the OHRI Agreement is attached hereto as Exhibit C.
               (gg) “Party” and “Parties” shall have the meaning set forth in
the first paragraph of this Agreement.
               (hh) “Patents” shall mean the patents and patent applications
listed on Exhibit A including (a) utility models, petty patents, design patents
and certificates of invention, (b) any substitutions, divisions, continuations,
continuations-in-part, reissues, renewals, registrations, confirmations,
re-examinations, extensions, supplementary protection certificates and the like,
and any provisional applications, of any such patent or patent application, and
(c) any unissued or ungranted foreign or international equivalent of any of the
foregoing.
               (ii) “Permitted Assignment” shall have the meaning set forth in
Section 11.1;
               (jj) “Person” shall mean an individual, sole proprietorship,
partnership, limited partnership, limited liability partnership, corporation,
limited liability company, business trust, joint stock company, trust,
unincorporated association, joint venture, or similar entity or organization,
including a government or political subdivision, department or agency of a
government, or an academic or research institution.
               (kk) “Receiving Party” shall have the meaning set forth in
Section 1.2(j).
               (ll) “Regulatory Approval” shall mean the marketing authorization
(including pricing approval or reimbursement approval, if applicable to the
sale) of the Licensed Product in a country in the Territory, in each case by the
appropriate Regulatory Authority.
               (mm) “Regulatory Authority” shall mean, with respect to each
country in the Territory, the government agency or health authority that
regulates and is responsible for granting approvals for the Manufacture,
marketing and/or sale of pharmaceutical products in such country.
               (nn) “Regulatory Milestone” shall have the meaning set forth in
Section 3.2.
               (oo) “Regulatory Milestone Payment” shall have the meaning set
forth in Section 3.2.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

6

--------------------------------------------------------------------------------

 

License Agreement
               (pp) “Royalty Payments” has the meaning set forth in
Section 3.3(a).
               (qq) “Royalty Period” shall mean the initial partial Royalty
Quarter commencing on the date of the First Commercial Sale in any country in
the Territory and every complete or partial Royalty Quarter thereafter with
respect to which Licensee has the obligation to make Royalty Payments under
Section 3.
               (rr) “Royalty Report” shall have the meaning set forth in
Section 3.3(b).
               (ss) “Royalty Quarter” shall mean the respective periods of three
(3) consecutive calendar months ending on March 31, June 30, September 30 and
December 31.
               (tt) “Royalty Year” shall mean each successive period of twelve
(12) months commencing on January 1 and ending on December 31.
               (uu) ”Submission” shall mean an application to obtain Regulatory
Approval by a Regulatory Authority.
               (vv) “Sublicensee” shall mean a Third Party who has been granted
the right by Licensee strictly for the purpose of commercializing the Licensed
Product.
               (ww) “Term” shall have the meaning set forth in Section 6.1.
               (xx) “Territory” shall mean all the countries of the world.
               (yy) “Third Party” shall mean any Person other than Coley or
Licensee.
               (zz) “Third Party Claim” shall mean all claims of any Third Party
that are subject to indemnification as provided for in Sections 10.1 or 10.2.
               (aaa) “UIRF” shall mean the University of Iowa Research
Foundation.
               (bbb) “Valid Claim” shall mean any claim from an issued and
unexpired Patent that (a) has not been revoked or held unenforceable or invalid
by a decision of a court or other governmental agency of competent jurisdiction
from which no appeal can be taken or has been taken within the time allowed for
appeal, (b) has not been abandoned, disclaimed, denied or admitted to be invalid
or unenforceable through reissue or disclaimer or otherwise, and (c) provides
exclusionary and enforceable rights with respect to the claimed subject matter.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

7

--------------------------------------------------------------------------------

 

License Agreement
               (ccc) “Withholding Taxes” shall have the meaning set forth in
Section 3.1(a).
     2. LICENSE GRANT.
2.1 Non-Exclusive License Grant to Licensee.
Subject to the terms of this Agreement, Coley shall grant, and hereby grants, to
Licensee and Licensee hereby accepts, a non-exclusive, royalty-bearing license,
with the right to grant sublicenses as defined in Section 2.2, below, under the
Patents, including the patents listed in Exhibit A which are subject to the
terms of the OHRI Agreement and the UIRF Agreement (i) to Exploit the Licensed
Product in the Field in the Territory and (ii) to Manufacture or have
Manufactured the Compound in connection with such Exploitation of the Licensed
Product.
2.2 Right to Grant Sublicenses.
          (a) Sublicensees.
Licensee shall have the right to grant sublicenses to Sublicensees solely to
Exploit the Licensed Product on behalf of Licensee provided that: (i) it shall
be a condition of any such sublicense that the Sublicensee agrees to be bound by
all of the applicable obligations set forth in this Agreement; (ii) if Licensee
grants such sublicense, Licensee shall be deemed to have guaranteed that such
Sublicensee shall fulfill all of Licensee’s obligations under this Agreement
applicable to the subject matter of such sublicense; and (iii) such sublicense
shall not reduce or delay payments otherwise due and owing to Coley by Licensee
under this Agreement
          (b) Large Pharmaceutical Company.
Licensee shall have the right to grant [ * ] of all of the provisions of this
Agreement to a Large Pharmaceutical Company provided that: (i) it shall be a
condition of the sublicense that the Large Pharmaceutical Company agrees to be
bound by all of the applicable obligations set forth in this Agreement; (ii) if
Licensee grants such sublicense, Licensee shall be deemed to have guaranteed
that such Large Pharmaceutical Company shall fulfill all of Licensee’s
obligations under this Agreement applicable to the subject matter of such
sublicense; and (iii) the sublicense shall not reduce or delay payments
otherwise due and owing to Coley by Licensee under this Agreement.
Any sublicense agreement with a Large Pharmaceutical Company shall provide in
the event of an early termination of this Agreement (other than a termination
for convenience by Licensee pursuant to Section 6.2 (a) or by Coley pursuant to
Section 6.2 (b) (ii)) for the termination of the sublicense and the conversion
of the sublicense to a license directly between Coley and the Large
Pharmaceutical Company on substantially the same terms as this Agreement.
Further, if Licensee has agreed to grant a sublicense to a Large Pharmaceutical
Company and [ * ] For the avoidance of doubt, [ * ]
          2.3 Limitations.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

8

--------------------------------------------------------------------------------

 

License Agreement
Except as specifically provided in Section 2.1 (including the right to grant
sublicenses pursuant to Section 2.2), Licensee shall have no rights to use the
Patents for any other purpose. Licensee acknowledges and agrees that Coley’s
right to terminate the Agreement in the event that Licensee takes any of the
actions described in Section 6.2 (c) was expressly bargained for and agreed to
by the parties and is a necessary condition for obtaining and maintaining the
licenses provided in this Section 2. No other rights, express or implied, are
granted to Licensee pursuant to this Agreement except as expressly granted
herein.
          2.4 Option.
Effective upon written notice to Coley, Licensee may [ * ]
     3. PAYMENTS AND ROYALTIES.
3.1 Up-Front Payment.
In partial consideration of (i) Coley’s investment in the Patents and (ii) the
license granted to Licensee pursuant to Section 2.1, Licensee shall make a
non-refundable, non-creditable up-front license fee payment of Five Million
Dollars ($5,000,000.00). Such up-front license fee shall be payable by Licensee
within two business days of the execution of this Agreement by both Parties.
3.2 Regulatory Milestone Payments.
At any point in time when a Regulatory Milestone (as defined below) is achieved
for the Licensed Product by either Licensee, its Affiliates or Sublicensees,
Licensee shall promptly notify Coley of the achievement of said Regulatory
Milestone and shall pay Coley the amount corresponding to the Regulatory
Milestone achieved hereunder (the “Regulatory Milestones”) set forth below
(each, a “Regulatory Milestone Payment”). Each Regulatory Milestone Payment
shall be immediately due and payable by Licensee. Each Regulatory Milestone
Payment shall be payable only once.

      Regulatory Milestone Payments   Regulatory Milestone Payment
 
   
[ * ]
  [ * ]

3.3 Royalty Payments.
               (a) Royalty Payments Due. Licensee and its Sublicensees shall pay
to Coley royalty payments on the Net Sales of the Licensed Product in the
amounts set forth below (“Royalty Payments”):
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

9

--------------------------------------------------------------------------------

 

License Agreement
                    (i) With respect to Net Sales of the Licensed Product during
the period in which the Licensed Product is covered by a Valid Claim, Licensee
shall pay Coley a royalty of [ * ] percent ([ * ]%) of such Net Sales.
Royalty Payments shall be due for sale of the Licensed Product under this
Section 3.3(a) if there is a Valid Claim in either the country in which the
Licensed Product is sold or in the country in which the Licensed Product is
Manufactured. In any event, only one (1) Royalty Payment shall be due under this
Section 3.3(a) for the Licensed Product sold even if more than one Valid Claim
covers the Licensed Product. Royalty Payments shall [ * ] for royalties or
payments made to Third Parties by Licensee for Third Parties’ technologies which
are utilized or incorporated into or otherwise required to be paid regarding the
Licensed Product. Coley shall be solely responsible for any payments owed to
UIRF and OHRI due to the rights granted to Licensee pursuant to Section 2.1.
               (b) Tender of Royalty Payments and Royalty Reports. Within [ * ]
after the conclusion of each Royalty Quarter, Licensee shall tender payment of
any Royalty Payments due under this Agreement and shall concurrently deliver to
Coley a report on the Net Sales activity of Licensee during such Royalty Quarter
(the “Royalty Report”). If no Royalty Payment is due, the Royalty Report shall
so state. All such Royalty Reports shall be considered Confidential Information
of Licensee under this Agreement. Royalty Reports shall contain at least the
following information:
                    (i) Net Sales of the Licensed Product sold by Licensee and
Sublicensee(s) on a country-by-country basis (including number of units sold
during the applicable Royalty Quarter); and
                    (ii) total Royalty Payments due with respect to Net Sales of
the Licensed Product sold by Licensee and Sublicensee(s) in each country.
               (c) Period During Which Royalties Are Payable. Royalty Payment
obligations under this Section 3.3 shall become effective on a
country-by-country basis upon the First Commercial Sale of the Licensed Product
and continue thereafter until there are no Valid Claims covering the Licensed
Product in such country. Upon expiration of the period during which Licensee or
Sublicensee is obligated to make Royalty Payments with respect to the Licensed
Product, on a country-by-country basis, the rights granted to Licensee pursuant
to Section 2.1 with respect to the Licensed Product shall become perpetual,
irrevocable, fully paid-up and royalty-free.
3.4 Withholding; Payments.
               (a) Any payments made by Licensee or Sublicensee to Coley under
this Agreement shall be reduced by the amount that Licensee or Sublicensee is
required to withhold pursuant to any applicable tax law (“Withholding Taxes”).
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

10

--------------------------------------------------------------------------------

 

License Agreement
Licensee shall submit reasonable proof of payment of the Withholding Taxes to
Coley within a reasonable period of time after such Withholding Taxes are
remitted to the proper taxing authority.
               (b) Any payments due under this Section 3 shall be made in
dollars, using a mutually acceptable method of payment. With respect to sales of
the Licensed Product invoiced in a currency other than dollars, the Net Sales
and amounts due to Coley hereunder shall be expressed in the domestic currency
of the Person making the sale, together with the dollar equivalent of the amount
payable to Coley For each Royalty Quarter and each currency, such dollar
equivalent shall be calculated using an exchange rate equal to [ * ], or, if not
so available, as otherwise agreed by the Parties.
               (c) Payments shall be made via wire transfer to:
                     [ * ]
3.5 Late Payments.
Any payments due under this Section 3 that are not made on or before the date
specified under the terms of this Agreement shall bear interest, to the extent
permitted by law, at a rate equal at all times to the prime rate of interest
announced publicly from time to time by Citibank, N.A., plus [ * ] percent ([ *
]%), but in no case higher than the maximum rate permitted by applicable law,
for the number of days delinquent.
3.6 Audit of Records.
               (a) Records. Licensee and Sublicensees shall keep and maintain
records of sales, importations, and other dispositions of the Licensed Product.
The records required by this Section 3.6 shall be maintained and available for
inspection for a period of [ * ] following the Royalty Year to which they
pertain.
               (b) Audit. Coley shall have the right, at Coley’s expense, to
examine, through an independent certified public accounting firm reasonably
acceptable to Licensee, those records of Licensee and Sublicensee as may be
reasonably necessary to confirm the accuracy of the Royalty Reports. Any such
examination shall be made only upon not less than [ * ] prior written notice to
Licensee or Sublicensee, as the case may be, during regular business hours, and
within [ * ] after the end of Royalty Period; provided, however, that such
examination shall not take place more often than [ * ] per Royalty Year and
shall not cover such records for more than the preceding [ * ] Royalty Years.
Such accounting firm shall disclose to Coley only the final audited Royalty
Payment amounts to be paid by Licensee or Sublicensee. Upon the completion of an
audit hereunder for any Royalty Year, the calculation of amounts payable with
respect to
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

11

--------------------------------------------------------------------------------

 

License Agreement
such year shall be binding and conclusive upon Coley, and Licensee and its
Sublicensees shall be released from any liability or accountability with respect
to amounts payable for such year.
               (c) Audit Costs. In the event that any such inspection shows an
underreporting or an underpayment in excess of [ * ] percent ([ * ]%) for any
Royalty Year, then (i) Licensee or Sublicensee, as the case may be, shall pay
the reasonable costs of such examination charged by such accounting firm and in
any event shall pay any additional sum, including interest charges as provided
in Section 3.5 on any such additional sum shown to be due to Coley and (ii) such
audit will not count against the [ * ] per Calendar Year limit set forth in
Section 3.6 (b) above.
     4. DEVELOPMENT; DILIGENCE OBLIGATIONS.
4.1 Diligence Generally. Licensee shall use commercially reasonable efforts
consistent with the efforts and resources normally used for a product of its own
discovery of similar market potential at a similar stage in its product life,
taking into account the competitiveness of the market place, the proprietary
position of the product, the regulatory structure involved, the profitability of
the applicable products and other relevant factors (“Commercially Reasonable
Efforts”), (a) to pursue the Exploitation of the Licensed Product in the U.S.
and in one or more EU Major Market Countries and (b) to undertake investigations
and actions required to obtain appropriate Regulatory Approval therefor. The
Parties agree that the diligence obligations set forth in this Section 4.1 shall
[ * ] and the Parties further agree that [ * ].
     5. SUPPLY OF MATERIALS; MARKING.
5.1 Manufacture of Compound and Manufacturing Information.
          (a) Supply of Compound. Coley shall not be obligated to supply any
quantities of the Compound to Licensee or Sublicensee(s).
               (b) Licensee agrees that, to the extent required by the Iowa
Agreement and applicable law, the Licensed Product produced for sale in the
United States and embraced by a Valid Claim under a Patent Right listed on
Exhibit A with UIRF identified as an Assignee will be Manufactured substantially
in the United States, unless any waiver of such requirement is obtained.
               (c) Manufacturing Information. In the event that Licensee or
Sublicensee(s) Manufacture(s) or has a Third Party Manufacture Compound and uses
information and/or intellectual property rights which result in a Regulatory
Authority mandating changes to specifications for any immunomodulatory
oligonucleotide and, as a result, Coley is unable to obtain or Manufacture
reasonable quantities of other immunomodulatory oligonucleotides and/or other
immunomodulatory oligonucleotides in
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

12

--------------------------------------------------------------------------------

 

License Agreement
compliance with the mandate by such Regulatory Authority with respect to such
materials, Licensee or Sublicensee(s), as the case may be, shall use
commercially reasonable efforts to provide Coley and its licensees with a
license on commercially reasonable terms to the necessary information and/or
intellectual property rights to Manufacture the Compound and/or other
immunomodulatory oligonucleotides in compliance with such specifications for any
immunomodulatory oligonucleotide or the applicable mandate. In the event that
Coley or Sublicensee(s) Manufacture(s) or has a Third Party Manufacture Compound
and uses information and/or intellectual property rights which result in a
Regulatory Authority mandating changes to specifications for the Compound and,
as a result, Licensee or its Sublicensee(s) is unable to obtain or Manufacture
reasonable quantities of the Compound in compliance with the mandate by such
Regulatory Authority with respect to such materials, Coley shall use
commercially reasonable efforts to provide Licensees and its sublicensees with a
license on commercially reasonable terms to the necessary information and/or
intellectual property rights to Manufacture the Compound in compliance with such
specifications for the Compound or the applicable mandate.
5.2 Marking.
Licensee shall comply with the requirements as to the marking of the Licensed
Product set forth in Article 7 of the Iowa Agreement.
     6. TERM AND TERMINATION.
6.1 Term.
The term of this Agreement shall begin on the Effective Date and, unless earlier
terminated pursuant to this Section 6, continue on a country-by country basis
until the expiration or termination of the last Valid Claim with respect to such
country (the “Term”).
6.2 Termination.
          (a) Termination by Either Party; Termination by Licensee. Upon a
material breach of this Agreement by either Party, the non-breaching Party may
provide written notice to the breaching Party specifying the material breach. If
the breaching Party fails to cure the material breach during a [ * ] period (or
in the case of a material breach of Section 4.1, a [ * ] period) following the
date on which the notice of breach is provided then the non-breaching Party
shall have the right to terminate this Agreement. If such breach is not
reasonably cured within such [ * ] but (1) the breaching Party is making a bona
fide effort to cure any such breach, such termination shall be delayed in order
to permit the breaching Party a reasonable period of time to remedy the breach,
or (2) if the breaching Party initiates a dispute resolution proceeding pursuant
to Section 11.3 with respect to such breach prior to the expiration of such [ *
] period, then such termination shall not become effective until [ * ] following
the final conclusion of the
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

13

--------------------------------------------------------------------------------

 

License Agreement
dispute resolution proceeding if termination is permitted by such resolution.
Licensee shall have the right to terminate this Agreement for convenience upon [
* ] prior written notice to Coley.
          (b) Termination by Coley.
               (i) Coley shall have the right upon written notice to Licensee to
terminate this Agreement for non-payment of any amount due hereunder from
Licensee to Coley if such non-payment shall continue uncured for a period ending
(1) [ * ] following notice of such non-payment given by Coley to Licensee or,
(2) if Licensee initiates a dispute resolution proceeding pursuant to
Section 11.3 with respect to such payment prior to the expiration of such [ * ]
period, then [ * ] following the final conclusion of the dispute resolution
proceeding if termination is permitted by such resolution.
               (ii) Coley may terminate this Agreement in the event that
Licensee or its Affiliates take any action, direct or indirect: (a) to challenge
the validity, scope, or enforceability of the Patents licensed to Licensee
hereunder; or (b) to oppose, object to, provoke an interference toward or
initiate or support any re-examination proceedings challenging the Patents;
provided that it shall not be grounds for terminating this Agreement if Licensee
challenges the validity, scope, or enforceability of the Patents licensed to
Licensee hereunder in defense of an action for infringement of the Patents
brought by Coley arising from Licensee’s activities outside of the scope of this
Agreement.
               (c) Termination for Insolvency.
               (i) To the extent permitted by law, upon the filing or
institution of bankruptcy, reorganization, liquidation or receivership
proceedings, or upon an assignment of a substantial portion of the assets for
the benefit of creditors (a “Bankruptcy Event”) by either Party, Coley, in the
case of a Bankruptcy Event by Licensee, or Licensee, in the case of a Bankruptcy
Event by Coley, may terminate this Agreement; provided, however, that, in the
case of any involuntary bankruptcy proceeding, such right to terminate shall
only become effective if the subject Party consents to the involuntary
bankruptcy or such proceeding is not dismissed within ninety (90) days after the
filing thereof.
               (ii) This Section 6.2(c) is without prejudice to any rights the
non-Affected Party may have arising under any bankruptcy, reorganization,
insolvency or similar laws, and Licensee expressly reserves the right to
maintain its license in effect pursuant to Section 11.17 with respect to a
Bankruptcy Event involving Coley.
               (d) No Limitation on Other Rights. Nothing in this Agreement
shall be construed to limit the rights of Licensee, upon a material breach by
Coley, to maintain its license in full force and effect and pursue any remedies
otherwise available at law or equity.
6.3 Effects of Expiration or Termination.
               (a) Surviving Provisions. The provisions of Sections 3 (with
respect to payment obligations accruing prior to the date of expiration or
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

14

--------------------------------------------------------------------------------

 

License Agreement
termination), 6, 7, 8, 9, 10, and 11 shall survive expiration or termination of
this Agreement for any reason.
               (b) Licensee Rights. Subject to the provisions of Section 6.3(a),
(i) upon expiration of the Term, the rights granted to Licensee pursuant to
Section 2.1 shall become perpetual, irrevocable, fully paid-up and royalty-free,
and (ii) subject to the following sentence, upon termination of this Agreement
by Coley pursuant to Section 6.2(a), 6.2(b) or 6.2(c) , the rights granted to
Licensee pursuant to Section 2.1 shall terminate. Upon termination of this
Agreement by Coley pursuant to Section 6.2(a), 6.2(b) or 6.2(c), (i) Licensee
shall [ * ] and (ii) Licensee shall with respect to any sales of the Licensed
Product made prior to the termination of this Agreement [ * ], continue to
provide Royalty Reports and to pay royalties on all Net Sales of the Licensed
Product as required hereunder.
               (c) Obligations Survive. Any termination of this Agreement shall
be without prejudice to the rights of either Party against the other accrued or
accruing under this Agreement prior to termination.
     7. CONFIDENTIALITY.
7.1 Nondisclosure Obligation.
Each Party shall use the Confidential Information of the other Party only in
accordance with the activities contemplated by this Agreement and shall not
disclose to any Third Party any Confidential Information of the other Party,
without the prior written consent of the other party or as expressly provided
below. This obligation shall not apply to Confidential Information that:
               (a) is known by the Receiving Party at the time of its receipt,
and not through a prior disclosure by the Disclosing Party to the Receiving
Party, as documented by business records;
               (b) at the time of disclosure or thereafter becomes published or
otherwise part of the public domain without breach of this Agreement by the
Receiving Party;
               (c) is subsequently disclosed to the Receiving Party by a Third
Party who has the right to make such disclosure; or
               (d) is developed by the Receiving Party independently of
Confidential Information received from the Disclosing Party and such independent
development can be properly demonstrated by the Receiving Party.
7.2 Permitted Disclosures.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

15

--------------------------------------------------------------------------------

 

License Agreement
Notwithstanding the provisions of Section 7.1, a Receiving Party may make the
following disclosures of Confidential Information received from the Disclosing
Party:
               (a) disclosures to governmental or other regulatory agencies in
order to gain approval to conduct Licensed Product trials or to market the
Licensed Product, but such disclosure may be only to the extent reasonably
necessary to obtain such authorizations upon consultation with the other Party;
               (b) disclosures to agents, consultants, Affiliates and/or other
Third Parties as necessary for the research and development, Manufacturing
and/or marketing of the Licensed Product, or to complete a Permitted Assignment
(as defined in Section 11.1), (or for such Persons to determine their interest
in performing such activities or such Permitted Assignment), in accordance with
this Agreement on the condition that such Third Parties are or agree to be bound
by confidentiality obligations substantially as restrictive and long as those
contained in this Agreement; or
               (c) disclosures required by law or court order, provided that
notice is promptly delivered to the Disclosing Party in order to provide it with
an opportunity to seek a protective order or other similar order with respect to
such Confidential Information and the Receiving Party thereafter discloses only
the minimum information reasonably required to be disclosed in order to comply
with the request, whether or not a protective order or other similar order is
obtained by the Disclosing Party.
7.3 Partial Disclosures.
Specific aspects or details of Confidential Information shall not be deemed to
be within the public domain or in the possession of a Party merely because the
Confidential Information is embraced by more general information in the public
domain or in the possession of such Party. Further, any combination of
Confidential Information shall not be considered in the public domain or in the
possession of a Party merely because one or more individual elements of such
Confidential Information are in the public domain or in the possession of such
Party unless every feature of the Confidential Information has been disclosed in
accordance with the provisions herein.
7.4 Publicity.
Neither Coley nor Licensee shall issue any press release or other public
disclosure relating to this Agreement except as mutually agreed. The joint press
release announcing the execution of this Agreement shall be substantially in the
form as Exhibit D attached. Notwithstanding any other provision contained in
this Section 7.4, either Party may make such public disclosure relating to this
Agreement as may be required by applicable law. Prior to any public disclosure
relating to this Agreement pursuant to the preceding sentence, the Party
proposing to make such disclosure shall provide reasonable notice thereof and
the proposed contents of such disclosure to the other
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

16

--------------------------------------------------------------------------------

 

License Agreement
Party and shall consult in good faith with the other Party regarding the timing
and contents of any such disclosure.
     8. MAINTENANCE AND ENFORCEMENT OF PATENTS.
8.1 Responsibility for Patents.
Coley, by counsel it selects, shall have the sole right, but not the obligation,
to prepare, file, prosecute and maintain all Patents in Coley’s name and in
countries designated by Coley at the sole discretion of Coley.
8.2 Infringement by Third Parties.
The Parties agree to provide each other written notice promptly after becoming
aware of any infringement of the Patents in the Field (irrespective of the
delivery method used for the vaccine). Coley shall have the right, but not the
obligation, under its own control and at its own expense, to prosecute any Third
Party infringement of the Patents and/or to defend the Patents in any
declaratory judgment action brought by a Third Party which alleges invalidity,
unenforceability, or non-infringement of the Patents. Subject to Section 8.4
below, Coley may enter into any settlement, consent judgment, or other voluntary
final disposition of any infringement or declaratory judgment action hereunder
without the prior written consent of Licensee.
8.3 Infringement Claims.
If the Manufacture, sale or use of the Compound as used in the Licensed Product
in the Field results in any claim, suit or proceeding filed by a Third Party
alleging patent infringement by Coley or Licensee or Sublicensee, such Party
shall promptly notify the other Party in writing. In the event that one Party is
sued subject to Section 8.4, the Party subject to such claim shall have the
exclusive right to defend and control the defense of any such claim, suit or
proceeding, at its own expense, using counsel of its own choice; provided,
however, that if Coley or Licensee and Coley together are sued with respect to
the Licensed Product sold by Licensee or Sublicensee, Coley shall have the
exclusive right to take control of such defense. Licensee shall have the right
to retain its own counsel at its sole cost and expense, and shall have the right
to consult with Coley in any proceeding under this Section 8.3. The Party
subject to the claim shall keep the other Party hereto reasonably informed of
all material developments in connection with any such claim, suit or proceeding.
The Party not subject to the claim shall cooperate in all reasonable respects
with the Party subject to the claim in the defense of the claim.
8.4 Settlements.
No settlements, consent judgments, or other voluntary final dispositions of a
dispute adversely affecting the rights or obligations of a Party or Sublicensee,
including the rights or obligations of the Party under this Agreement, shall be
entered into in connection with any dispute, claim or
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

17

--------------------------------------------------------------------------------

 

License Agreement
proceeding described in Section 8.2 or 0 without the prior written consent of
the adversely affected Party or Sublicensee, such consent not to be unreasonably
withheld or delayed. Without limiting the foregoing, no settlements, consent
judgments, or other voluntary final dispositions of any dispute, claim or
proceeding described in Section 8.2 or 0 adversely affecting the rights or
obligations of Coley under the Patents shall be entered into without the prior
written consent of Coley, such consent not to be unreasonably withheld or
delayed. The Parties shall comply with the provisions of Section 8.4 of the Iowa
Agreement with respect to any settlement, consent judgment, or other voluntary
final disposition of any suit relating to the subject matter of this Agreement.
8.5 Recoveries and Damages.
Any recoveries and damages received as a result of a dispute, claim or
proceeding described in Section 8.2 or 8.3 or any settlement, consent judgment,
or other voluntary final disposition thereof shall first go toward reimbursing
the Parties or Sublicensee for their respective costs and expenses of such suit.
Thereafter, any remainder shall be [ * ].
8.6 Subject to Iowa Agreement.
To the extent related to Patents under the Iowa agreement, the provisions of
this Section 8 are subject to in all respects the provisions of the Iowa
Agreement, including Article 8 thereof.
     9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PARTIES.
9.1 Representations and Warranties of Each Party to the Other.
Each Party hereby represents and warrants to the other Party hereto, effective
as of the Effective Date, that:
               (a) Such Party is a corporation duly organized and validly
existing under the laws of the state or other jurisdiction of its incorporation
or formation;
               (b) The execution and performance of this Agreement by such Party
has been duly authorized by all requisite corporate action;
               (c) Such Party has the power and authority to execute and deliver
this Agreement and to perform its obligations hereunder, including the right,
power and authority to grant the licenses granted herein;
               (d) The execution and performance by such Party of this Agreement
and its compliance with the terms and provisions hereof does not and will not
conflict with or result in a breach of any of the terms and provisions of or
constitute a default under (i) any loan agreement, guaranty, financing
agreement,
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

18

--------------------------------------------------------------------------------

 

License Agreement
agreement affecting the Licensed Product or the Compound, or other agreement or
instrument binding or affecting it or its property; (ii) the provisions of its
charter documents or bylaws; or (iii) any order, writ, injunction or decree of
any court or governmental authority entered against it or by which it or any of
its property is bound;
               (e) The execution and performance by such Party of this Agreement
and its compliance with the terms and provisions hereof do not and will not
violate any law or regulation applicable to it; and
               (f) This Agreement has been duly authorized by all necessary
corporate action on the part of such Party, has been executed and delivered by
such Party and constitutes such Party’s legal, valid and binding obligation,
enforceable against such Party in accordance with its terms subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors’ rights and to the availability
of particular remedies under general equity principles.
9.2 Covenants of Licensee.
Licensee hereby covenants with Coley that:
               (a) It will comply with all of the obligations applicable to
sublicensees of Coley under the Iowa Agreement and OHRI Agreement;
               (b) Licensee will not market or actively promote the Licensed
Product for off-label use outside the Field; and
               (c) Licensee agrees not to take any further action, direct or
indirect, in connection with current patent opposition proceedings in Europe for
the Patents, shall withdraw its participation in such proceedings, and shall not
initiate any additional opposition proceedings for the Patents currently in
opposition proceedings by the European Patent Office. Licensee agrees to take
any actions reasonably requested by Coley in connection with its withdrawal from
opposition proceedings, shall not directly or indirectly oppose, object to,
provoke an interference toward or initiate or support any re-examination
proceedings challenging the Patents and agrees to withdraw any challenge to the
Patents, other than in defense of an action for infringement of the Patents.
9.3 Representations, Warranties and Covenants of Coley.
Coley hereby represents, warrants and covenants to Licensee, effective as of the
Effective Date, that:
               (a) Coley owns or possesses adequate licenses or other rights to
use the Patents in the Field and to grant the rights and licenses herein; and
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

19

--------------------------------------------------------------------------------

 

License Agreement
               (b) (i) The Patents existing as of the Effective Date are
subsisting and have not been held by a court of competent jurisdiction to be
invalid or unenforceable, in whole or in part; (ii) there are no claims,
judgments or settlements against or amounts with respect thereto owed by Coley
or any of its Affiliates relating to the Patents, (iii) except as listed in
Exhibit E, no claim or litigation has been brought or threatened by any Person
alleging (A) that any Patent is invalid or unenforceable or (B) the Patents or
the disclosing, copying, making, assigning, licensing or Exploitation of the
Patents or products embodying the Patents, including the Exploitation of the
Licensed Product, violates, infringes or otherwise conflicts with any
intellectual property or proprietary right of any Third Party; (iv) the
conception, development and reduction to practice of the Patents existing as of
the Effective Date have not constituted or involved the misappropriation of
trade secrets or other rights or property of any Person; and (v) it has not
received notice of any claim or litigation asserted or commenced against it that
would have an adverse effect on the rights granted to Licensee under this
Agreement.
               (c) (i) The OHRI Agreement and Iowa Agreement are in full force
and effect, Coley has the right to grant any and all sublicenses granted under
this Agreement under each of the OHRI Agreement and Iowa Agreement and
(ii) Coley has not received notice of termination and is not aware of any facts
or information that would, with the passage of time result in the termination of
the OHRI Agreement or Iowa Agreement, respectively.
               (d) Except as may be listed on Exhibit A , to the best of Coley’s
knowledge, there are no patents or patent applications owned or controlled by
Coley as of the effective date of this Agreement that, but for the licenses
granted in this Agreement, would be infringed by the Exploitation of the
Licensed Product by the Licensee or its Sublicensees. If any such patent or
patent application is identified during the Term, at Licensees option it shall
be included in the Patents licensed under this Agreement, without the payment of
additional consideration by Licensee to Coley.
9.4 Bayh-Dole.
Both Parties acknowledge that the U.S. Public Health Service may have certain
rights, as provided in Bayh-Dole (Public Law 96-517 of 1980), to the Patents.
     10. INDEMNIFICATION AND LIMITATION OF LIABILITY.
10.1 Indemnification by Licensee.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

20

--------------------------------------------------------------------------------

 

License Agreement
Licensee shall indemnify, defend and hold harmless Coley, and each of its
employees, officers, directors and agents (each, a “Coley Indemnified Party”),
from and against any and all liability, loss, damage, cost, and expense,
including reasonable attorneys’ fees and reasonable expenses of litigation
(collectively, a “Liability”), arising out of any Third Party Claim which the
Coley Indemnified Party may incur, suffer or be required to pay to the extent
resulting from or arising in connection with (i) the breach by Licensee of any
covenant, representation or warranty contained in this Agreement; (ii) any
negligent or wrongful act or omission of Licensee (its directors, officers, or
agents, or distributors thereof) which is the proximate cause of injury, death
or property damage to a Third Party; (iii) actual or asserted violations of any
applicable law or regulation (other than patent or other intellectual property
law or regulation) by Licensee, Sublicensees or distributors by virtue of which
the Licensed Product in the Field Manufactured, distributed or sold by Licensee,
Sublicensees or distributors shall be alleged or determined to be adulterated,
misbranded, mislabeled or otherwise not in compliance with any such applicable
law or regulation; (iv) claims for bodily injury, death, product liability,
warranty of fitness or merchantability, or property damage attributable to the
development, Manufacture, distribution, sale or use of the Licensed Product in
the Field by Licensee, Sublicensees or distributors; or (v) a recall of the
Licensed Product in the Field Manufactured, distributed or sold by Licensee,
Sublicensees or distributors ordered by a governmental agency or required by a
confirmed product failure as reasonably determined by Licensee, Sublicensees or
distributors; except to the extent that such Liability arises in connection with
or is otherwise attributable to (A) a breach by Coley of this Agreement or
(B) any manufacturing agreement into which Coley may enter pursuant to
Section 5.1 or (C), in the case of clauses (ii) through (v), any negligent act
or omission or intentional misconduct on the part of Coley or any Liability for
which Coley is required to provide indemnification under Section 10.2.
10.2 Indemnification by Coley.
Coley shall indemnify, defend and hold harmless Licensee and its employees,
officers, directors and agents and its Sublicensees (each, a “Licensee
Indemnified Party”) from and against any Liability arising out of any Third
Party Claim, which Licensee Indemnified Party may incur, suffer or be required
to pay to the extent resulting from or arising in connection with (i) the breach
by Coley of any covenant, representation or warranty contained in this
Agreement; (ii) any negligent or wrongful act or omission by Coley (or any of
its licensees, licensors or their respective directors, officers, or agents, or
distributors thereof) which is the proximate cause of injury, death or property
damage to a Third Party; (iii) any Third Party Claim that the granting of the
rights and licenses herein by Coley violates any rights of any Third Party, or
(iv) claims for bodily injury, death, product liability, warranty of fitness or
merchantability, or property damage attributable to the development,
Manufacture, distribution, sale or use of the Compound or pharmaceutical
products incorporating the Compound by Coley, any of its licensees other than
Licensee or their respective agents or distributors; except to the extent that
such Liability arises in connection with or is otherwise attributable to (A) a
breach by Licensee of this Agreement or (B), in the case of clauses (ii) through
(v), any negligent act or omission or intentional misconduct on the part of
Licensee or any Liability for which Licensee is required to provide
indemnification under Section 10.1.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

21

--------------------------------------------------------------------------------

 

License Agreement
10.3 Indemnification Procedure.
Any Person seeking indemnification under this Section 10 (the “Indemnitee”)
shall promptly notify the Party from whom indemnification is sought (the
“Indemnitor”) in writing of any Claim, and, subject to Section 8.3, the
Indemnitor shall have the right to participate in, and, to the extent the
Indemnitor so desires, to assume the defense thereof with counsel mutually
satisfactory (consent not to be unreasonably withheld or delayed) to the other
Party by giving written notice to the Indemnitee and the other Party within
thirty (30) days after receipt of written notice of such Claim from the
Indemnitee; provided, however, that an Indemnitee shall have the right to retain
its own counsel, with the fees and expenses to be paid (a) by the Indemnitor, if
representation of such Indemnitee by the counsel retained by the Indemnitor
would be inappropriate due to actual or potential differing interests between
the Indemnitee and any other party represented by such counsel in such
proceeding; or (b) by Indemnitee in all other cases. In no event shall the
Indemnitor be liable for any Liabilities that result from any unreasonable delay
by the Indemnitee in providing the written notice pursuant to the first sentence
of this Section 10.3. In the event that it is ultimately determined that the
Indemnitor is not obligated to indemnify, defend or hold harmless an Indemnitee
from and against such Claim, the Indemnitee shall reimburse the Indemnitor for
any and all costs and expenses (including attorneys’ fees and costs of suit) and
any Liabilities incurred by the Indemnitor in its defense of such Claim with
respect to the Indemnitee. The Indemnitee and its employees and agents shall
reasonably cooperate with, and at the expense of, the Indemnitor and its legal
representatives in the investigation of any Claim covered by this Section 10.
10.4 Settlements.
Neither Party may settle a Claim without the consent of the other Party if such
settlement would (a) impose any monetary obligation on the other Party,
(b) require the other Party to submit to an injunction, or (c) otherwise limit
the other Party’s rights under this Agreement, such consent not to be
unreasonably withheld or delayed in the case of clauses (b) and (c). Any payment
made by a Party to settle a Claim shall be, unless otherwise provided in
Section 10.1 or 10.2, as the case may be, at its own cost and expense.
10.5 Limitation of Liability.
With respect to any claim by one Party against the other Party arising out of
the performance or failure of performance of the other Party under this
Agreement, the Parties expressly agree that, except for a Party’s
indemnification obligations pursuant to Section 10.1 or 10.2 with respect to
Third Party claims, the liability of such Party to the other Party for such
breach shall be limited under this Agreement or otherwise at law or equity to
direct damages only and in no event shall a Party be liable for punitive,
special, incidental, multiple, exemplary or consequential damages.
10.6 Insurance.
               (a) Licensee. Prior to or immediately upon the first
administration of the Licensed Product in the Field to a human in accordance
with this Agreement, and for a period of
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

22

--------------------------------------------------------------------------------

 

License Agreement
[ * ] after the last sale of the Licensed Product in the Field hereunder,
Licensee shall obtain and/or maintain, at its expense, product liability
insurance in amounts which are reasonable and customary in the industry for
companies of comparable size and activities. Such product liability insurance
shall insure against liability for personal injury, physical injury, and
property damage. Licensee shall provide proof of insurance to Coley upon
request. Licensee may satisfy this requirement by a representation that it is
self-insured and/or maintains Third Party liability insurance in amounts
sufficient to meet the foregoing requirement.
               (b) Coley. Prior to or immediately upon the first administration
of the Licensed Product in the Field to a human in accordance with this
Agreement, as notified by Licensee to Coley, and for a period of [ * ] after the
last sale of the Licensed Product in the Field hereunder, as notified by
Licensee to Coley, Coley shall obtain and/or maintain, at its expense, product
liability insurance in amounts which are reasonable and customary in the
industry for companies of comparable size and activities. Such product liability
insurance shall insure against liability for personal injury, physical injury,
and property damage. Coley shall provide proof of insurance to Licensee upon
request. Coley may satisfy this requirement by a representation that it is
self-insured and/or maintains Third Party liability insurance in amounts
sufficient to meet the foregoing requirement.
10.7 Warranty Disclaimer.
EXCEPT AS EXPRESSLY MADE UNDER THIS AGREEMENT, NEITHER PARTY MAKES ANY
REPRESENTATIONS, NOR EXTENDS ANY WARRANTIES OF ANY KIND, EITHER EXPRESS OR
IMPLIED, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE OR NON-INFRINGEMENT, WITH RESPECT, IN THE CASE OF COLEY, TO
THE PATENTS OR, IN THE CASE OF LICENSEE, TO THE LICENSED PRODUCT OR THE COMPOUND
USED THEREIN.
10.8 Performance by Subcontractors.
The Parties recognize that the Licensee may perform some or all of its
obligations under this Agreement through Third Party subcontractors, provided,
however, that the Licensee shall remain responsible and liable for the
performance by its Third Party subcontractors and shall cause its Third Party
subcontractors to comply with the provisions of this Agreement in connection
therewith.
     11. MISCELLANEOUS.
11.1 Assignment.
Neither this Agreement nor any or all of the rights and obligations of a Party
shall be assigned, delegated, sold, transferred, sublicensed (except as
otherwise provided herein) or otherwise disposed of, by operation of law or
otherwise, to any Third Party without the prior written
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

23

--------------------------------------------------------------------------------

 

License Agreement
consent of the other Party, which shall not be unreasonably withheld, and any
attempted assignment, delegation, sale, transfer, sublicense or other
disposition, by operation of law or otherwise, of this Agreement or of any
rights or obligations hereunder contrary to this Agreement shall be a material
breach of this Agreement by the attempting Party and shall be void and without
force or effect; provided, however, that either Party may, without such consent,
assign this Agreement and its rights and obligations hereunder in connection
with the transfer or sale of all or substantially all of its assets or stock, in
the event of its merger or consolidation or change in control or similar
transaction, or, in the case of Licensee, in the event of a sale or transfer by
Licensee of all or substantially all of its vaccine business related to the
Licensed Product in connection with the transfer or sale of all or substantially
all of its business related to a Licensed Product (any such transaction
described in this proviso, a “Permitted Assignment”). In the event of a
Permitted Assignment by Licensee, [ * ]. In addition, either Party may, without
such consent, assign this Agreement and delegate its rights and obligations
hereunder, in whole or in part, to an Affiliate; provided, however, that the
Party making any such assignment or delegations shall, notwithstanding such
assignment or delegation, remain responsible for the full, complete and faithful
performance of its obligations hereunder. This Agreement shall be binding upon,
and inure to the benefit of, each Party, and its permitted successors and
assigns.
11.2 Governing Law.
This Agreement shall be governed by and construed in accordance with the laws of
the state of New York, U.S.A. without regard to its conflict of law rules.
11.3 Dispute Resolution.
In the event of any dispute, controversy or claim arising out of, relating to or
in connection with any provision of this Agreement, the Parties shall try to
settle their differences amicably and in good faith between themselves first, by
referring the disputed matter to the respective Chief Executive Officers of each
Party, or any direct report designated by such Chief Executive Officer. In the
event such executives are unable to resolve such dispute within a thirty
(30) day period, either Party may invoke the provisions of this Section 11.3.
Except as provided in Section 11.4, any dispute, controversy or claim arising
out of or relating to this Agreement, or the breach thereof, including any
question regarding this Agreement’s existence, termination or validity, shall be
referred to and finally settled by binding arbitration, in accordance with the
rules of the American Arbitration Association in force on the date the demand
for arbitration is filed. The demand for arbitration may be filed by either
Party within a reasonable time after the controversy or claim has arisen, but no
later than after the date upon which institution of legal proceedings shall be
barred by the applicable statute of limitations. There shall be three
(3) arbitrators, each Party to designate one arbitrator and the two
Party-designated arbitrators to select the third arbitrator. The Party
initiating recourse to arbitration shall include in its notice of arbitration
its appointment of an arbitrator. The place of arbitration shall be New York,
New York. The language to be used in the arbitral proceedings shall be English.
Any determination by such arbitration shall be final and conclusively binding,
and shall not include any damages expressly prohibited by Section 10.5. Judgment
on the arbitral award may be entered in any
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

24

--------------------------------------------------------------------------------

 

License Agreement
court having jurisdiction thereof. All costs incurred in connection with such
arbitration, including reasonable attorneys’ fees, shall be borne by the Party
which incurs the costs.
11.4 No Arbitration of Patent Disputes.
Unless otherwise agreed by the Parties, disputes relating to the scope,
validity, enforceability or infringement of Patents shall not be subject to
arbitration, and shall be submitted to a court or patent office of competent
jurisdiction.
11.5 Injunctive Relief and Jurisdiction.
Nothing in this Agreement shall be construed to limit or preclude a Party from
bringing any action in any court of competent jurisdiction for injunctive or
other provisional relief to compel the other Party to comply with its
obligations hereunder, whether before or during the pendancy of arbitration
proceedings. The Parties agree that all such suits may, at the option of either
Party, be initiated and maintained before the United States District Court for
the Southern or Eastern District of New York U.S.A. and both Parties submit to
personal jurisdiction and to the service of process, pleadings and notices in
connection with any and all actions seeking such injunctive or provisional
relief to the court referred to above. Notwithstanding the foregoing, any
dispute regarding the validity, scope or enforceability of patents, trademarks
or other intellectual property that is or can be the subject of registration
with a governmental entity shall be submitted to a court of competent
jurisdiction in the territory in which such rights apply.
11.6 Waiver.
Any delay or failure in enforcing a Party’s rights under this Agreement or any
waiver as to a particular default or other matter shall not constitute a waiver
of such Party’s rights to the future enforcement of its rights under this
Agreement, nor operate to bar the exercise or enforcement thereof at any time or
times thereafter, excepting only as to an express written and signed waiver as
to a particular matter for a particular period of time. No waiver of a breach
shall be deemed to be a waiver of a different or subsequent breach.
11.7 Independent Relationship.
Nothing herein contained shall be deemed to create an employment, agency, joint
venture or partnership relationship between the Parties hereto or any of their
agents or employees, or any other legal arrangement that would impose liability
upon one Party for the act or failure to act of the other Party. Neither Party
shall have any power to enter into any contracts or commitments or to incur any
liabilities in the name of, or on behalf of, the other Party, or to bind the
other Party in any respect whatsoever.
11.8 Export Control.
This Agreement is made subject to any restrictions concerning the export of the
Licensed Product or technical information from the United States of America
which may be imposed upon or related to the Parties from time to time by the
government of the United States of America.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

25

--------------------------------------------------------------------------------

 

License Agreement
Licensee agrees that it will not export, directly or indirectly, any technical
information acquired from Coley under this Agreement, and Licensee agrees that
it will not export, directly or indirectly, the Licensed Product using such
technical information, to any country for which the United States government or
any agency thereof at the time of export requires an export license or other
governmental approval, without first obtaining any consent that may be required
by applicable law or regulation.
11.9 Entire Agreement; Amendment.
This Agreement (along with the Exhibits attached hereto) sets forth the
complete, final and entire agreement of the Parties relating to the subject
matter hereof and all the covenants, promises, agreements, warranties,
representations, conditions and understandings between the Parties with respect
thereto and supersedes and terminates all prior agreements, writings and
understandings between the Parties to the extent they relate to the subject
matter hereof, including the term sheet agreed to by the Parties. There are no
covenants, promises, agreements, warranties, representations, conditions or
understandings, either oral or written, between the Parties relating to the
subject matter hereof other than as are set forth herein or otherwise
contemplated by this Section 11.9. No terms or provisions of this Agreement
shall be varied or modified and no subsequent alteration, amendment, change or
addition to this Agreement shall be binding upon the Parties unless reduced to
writing and signed by an authorized officer of each Party.
11.10 Notices.
Each notice required or permitted to be given or sent under this Agreement shall
be in writing and delivered personally or given by facsimile transmission (with
confirmation copy by registered first-class mail) or by registered or certified
mail (return receipt requested) or internationally-recognized overnight courier,
to the Parties at the addresses and facsimile numbers indicated below.

     
If to Coley, to:
  Coley Pharmaceutical Group, Inc.
 
  Wellesley Gateway
 
  93 Worcester Street, Suite 101
 
  Wellesley, MA 02481, U.S.A.
 
  Attention: President and CEO
 
  Facsimile: 1-781-431-6403
 
   
with a copy to:
  Coley Pharmaceutical Group, Inc.
 
  Wellesley Gateway
 
  93 Worcester Street, Suite 101
 
  Wellesley, MA 02481, U.S.A.
 
  Attention: Senior Vice President and General Counsel
 
  Facsimile: 1-781-431-6403
 
   
If to Licensee, to:
  Dynavax Technologies Corporation
 
  2929 Seventh Street, Suite 100

 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

26

--------------------------------------------------------------------------------

 

License Agreement

     
 
  Berkeley, California 94710
 
  Attn: Chief Executive Officer
 
   
with a copy to:
  Dynavax Technologies Corporation
 
  2929 Seventh Street, Suite 100
 
  Berkeley, California 94710
 
  Attn: General Counsel

All notices, requests, reports, approvals or other communications required or
permitted under this Agreement shall be in writing (except in the case of verbal
communications and teleconferences updating either Party as to the status of
work hereunder), and shall be deemed given (a) when delivered personally;
(b) five (5) days after having been sent by registered or certified mail, return
receipt requested, postage prepaid; or (c) one (1) day after deposited with a
commercial express courier specifying next day delivery, with written
verification of receipt. No notice of default or termination shall be deemed
effective unless delivered by two (2) of the aforementioned delivery routes.
Either Party may change its address or its facsimile number by giving the other
Party written notice, delivered in accordance with this Section 11.10.
11.11 Force Majeure.
Failure of any Party to perform its obligations under this Agreement (except the
obligation to make payments when properly due) shall not subject such Party to
any liability or place them in breach of any term or condition of this Agreement
to the other Party if such failure is caused by any cause beyond the reasonable
control of such non-performing Party, including acts of God, fire, explosion,
flood, drought, war (whether or not declared), terrorism, riot, sabotage,
embargo, strikes or other labor trouble, failure in whole or in part of
suppliers to deliver on schedule materials, equipment or machinery, interruption
of or delay in transportation, a national health emergency or compliance with
any order or regulation of any government entity acting with color of right
unless such governmental order or regulation was the direct result of a Party’s
failure to comply with applicable law; provided, however, that the Party
affected shall promptly notify the other Party of the condition constituting
force majeure as defined herein and shall exert reasonable efforts to eliminate,
cure and overcome any such causes and to resume performance of its obligations
with all possible speed. If a condition constituting force majeure as defined
herein exists for more than ninety (90) consecutive days, the Parties shall meet
to negotiate a mutually satisfactory solution to the problem, if practicable.
11.12 Severability.
If any provision of this Agreement is declared invalid or unenforceable by a
court having competent jurisdiction, it is mutually agreed that, except to the
extent that either Party would be adversely affected thereby, this Agreement
shall endure except for the part declared invalid or unenforceable by order of
such court; provided, however, that in the event that the terms and conditions
of this Agreement are materially altered, the Parties will, in good faith,
renegotiate the terms and conditions of this Agreement to reasonably substitute
a valid and enforceable
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

27

--------------------------------------------------------------------------------

 

License Agreement
provision consistent with the intent of this Agreement for such invalid or
unenforceable provision.
11.13 Further Actions.
Each Party agrees to execute, acknowledge and deliver such further instruments,
and to do all such other acts, as may be necessary or appropriate in order to
carry out the purposes and intent of this Agreement.
11.14 Headings.
The captions to the several Sections hereof are not a part of this Agreement,
but are merely guides or labels to assist in locating and reading the several
Sections hereof.
11.15 Waiver of Rule of Construction.
Each Party has had the opportunity to consult with counsel in connection with
the review, drafting and negotiation of this Agreement. Accordingly, the rule of
construction that any ambiguity in this Agreement shall be construed against the
drafting party shall not apply.
11.16 Counterparts.
This Agreement may be executed in any number of counterparts, each of which
shall be an original as against either Party whose signature appears thereon,
but all of which taken together shall constitute but one and the same
instrument. Copies of executed counterparts of this Agreement transmitted by
facsimile shall be considered original executed counterparts provided receipt of
such facsimile is confirmed.
11.17 Bankruptcy.
All rights and licenses granted under this Agreement are, and shall otherwise be
deemed to be, for purposes of Section 365(n) of Title 11, U.S. Code (the
“Bankruptcy Code”), licenses of rights to “intellectual property” as defined
under Section 101 of the Bankruptcy Code. Licensee, as a holder of such rights
under this Agreement, shall retain and may fully exercise any or all of its
rights and elections under the Bankruptcy Code. In the event of commencement of
a bankruptcy proceeding by or against Coley under the Bankruptcy Code, Licensee
shall be entitled to a complete duplicate of (or complete access to, as
appropriate) any intellectual property licensed by Licensee hereunder, and all
embodiments of such intellectual property, if not already in its possession,
shall be promptly delivered to Licensee.
BALANCE OF PAGE INTENTIONALLY LEFT BLANK
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

28

--------------------------------------------------------------------------------

 

License Agreement
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first set forth above.

                      Coley Pharmaceutical Group, Inc.       Dynavax
Technologies Corporation    
 
                   
By:
Title:
  /s/ Robert L. Bratzler
 
President & CEO       By:
Title:   /s/ Dino Dina
 
President & CEO    

 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

29

--------------------------------------------------------------------------------

 

License Agreement
EXHIBIT A
[ * ]

                                  Filing                 WGS #   SN   Date  
Inventors   Assignee   Title   Status
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]

[ * ]

                                  Filing                 WGS #   SN   Date  
Inventors   Assignee   Title   Status
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]

[ * ]

                                  Filing                 WGS #   SN   Date  
Inventors   Assignee   Title   Status
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]

[ * ]

                                  Filing                 WGS #   SN   Date  
Inventors   Assignee   Title   Status
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]

[ * ]

                                  Filing                 WGS #   SN   Date  
Inventors   Assignee   Title   Status
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]

 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

30

--------------------------------------------------------------------------------

 

License Agreement
[ * ]

                                  Filing                 WGS #   SN   Date  
Inventors   Assignee   Title   Status
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]

[ * ]

                                  Filing                 WGS #   SN   Date  
Inventors   Assignee   Title   Status
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]

[ * ]

                                  Filing                 WGS #   SN   Date  
Inventors   Assignee   Title   Status
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]

[ * ]

                                  Filing                 WGS #   SN   Date  
Inventors   Assignee   Title   Status
[ * ]
  [ * ]   [ * ]   [ * ]   [ * ]   [ * ]   [ * ]

 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

31

--------------------------------------------------------------------------------

 

License Agreement
EXHIBIT B
Iowa Agreement
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

32

--------------------------------------------------------------------------------

 

License Agreement
Exhibit 10.16 to Coley Pharmaceutical Group, Inc. Form S-1 filed April 20, 2005
LICENSE AGREEMENT
     This Agreement is made and entered into as of March 31, 1997 (the
“Effective Date”) by and between the University of Iowa Research Foundation
(hereinafter “UIRF”) having offices at 214 Technology Innovation Center, Iowa
City, Iowa 52242-5000 and CpG ImmunoPharmaceuticals, Inc. (hereinafter
“Licensee”), a Delaware corporation.
     WHEREAS, under the patent policy of The University of Iowa (“UI”), all
inventions and technology arising during the normal course of research and
teaching at the UI are assigned and entrusted to the UIRF to obtain patent or
other appropriate intellectual property protection and license said technology;
     WHEREAS, UIRF is, therefore, owner by assignment from Arthur M. Krieg
(inventor/s) of his entire right, title and interest in United States Patent
Application Serial No. [**********] filed [*************] titled
“[*****************************],” (UIRF #[*****] and in the foreign patent
applications corresponding thereto, and in the inventions described and claimed
herein;
     WHEREAS, Licensee wishes to obtain an exclusive world-wide license in order
to practice the above-referenced invention covered by patent rights in the
United States and in certain foreign countries, and to manufacture, use and sell
in the commercial market the products made in accordance therewith; and
     WHEREAS, UIRF wishes to grant such a license to Licensee in accordance with
the terms of this Agreement.
     NOW, THEREFORE, in consideration of the foregoing premises, the parties
agree as follows:
ARTICLE 1.
DEFINITIONS
     1.1 PARENT RIGHTS shall mean U.S. patent application Serial No.
[**********] filed [************], the inventions described and claimed therein,
and any divisions, continuations, continuations-in-part to the extent the claims
are directed to subject matter specifically described in USSN [**********],
patents issuing thereon or reissues thereof; and any and all foreign patents and
patent applications corresponding thereto; which will be automatically
incorporated in and added to this Agreement and shall periodically be added to
Appendix A attached to this Agreement and made part thereof.
     1.2 LICENSED PRODUCTS shall mean any product the sale, use or manufacture
of which would infringe a pending or issued claim of the PATENT RIGHTS but for
the license granted hereunder.
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

33

--------------------------------------------------------------------------------

 

License Agreement
     1.3 LICENSED PROCESSES shall mean the processes claimed in PATENT RIGHTS or
some portion thereof.
     1.4 NET SALES shall mean the amount billed or invoiced on sales of LICENSED
PRODUCTS less: (a) Customary trade, quantity or cash discounts and
non-affiliated brokers’ or agents’ commissions actually allowed and taken;
(b) Amounts repaid or credited by reason of rejection or return; (c) To the
extent separately stated on purchase orders, invoices or other documents of
sale, taxes levied on and/or other governmental charges made as to production,
sale, transportation, delivery or use and paid by or on behalf of Licensee;
and/or (d) Shipping and insurance charges.
     In the event that a LICENSED PRODUCT under this Agreement is sold in
combination with another active ingredient or component having independent
therapeutic effect or diagnostic utility , then “NET SALES,” for purposes of
determining royalty payments on the combination, shall be calculated using one
of the following methods:

  (e)   By multiplying the NET SALES of the combination by the fraction A/A+B,
where A is the gross selling price, during the royalty paying period in
question, of the LICENSED PRODUCT sold separately, and B is the gross selling
price, during the royalty period in question, of the other active ingredients or
components sold separately; or     (f)   In the event that no such separate
sales are made of the LICENSED PRODUCT or any of the active ingredients or
components in such combination package during the royalty paying period in
question, NET SALES, for the purposes of determining royalty payments, shall be
calculated using the above formula where A is the reasonably estimated
commercial value of the LICENSED PRODUCT sold separately and B is the reasonably
estimated commercial value of the other active ingredients or components sold
separately. Any such estimates shall be determined using criteria to be mutually
agreed upon by the parties. Such estimates shall be reported to UIRF with the
reports to be provided to UIRF pursuant to Section 4.3 hereof.

     1.5 AFFILIATE shall mean any company, corporation, or business in which the
entity in question owns or controls at-least fifty percent (50%) of the voting
stock.
     1.6 AGREEMENT YEAR shall mean the annual period commencing upon an
anniversary of the Effective Date.
     1.7 QIAGEN shall mean QIAGEN GmbH, a German corporation, having its
principal address at Max-Volmer-Str. 4, 40724 Hilden, Germany.
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

34

--------------------------------------------------------------------------------

 

License Agreement
ARTICLE 2.
GRANT
     2.1 UIRF hereby grants to Licensee and Licensee hereby accepts, subject to
the terms and conditions hereof a worldwide exclusive license under the PATENT
RIGHTS to make and have made, to use and have used, to import and have imported,
to offer for sale and have offered for sale, and to sell and have sold the
LICENSED PRODUCTS, and to practice the LICENSED PROCESSES. Such license shall
include the right to grant sublicenses, provided, however, that Licensee shall
provide UIRF with a copy of any sublicense agreement promptly upon its execution
and that such sublicense agreement must contain terms that do not diminish any
of the legal or financial rights of UIRF hereunder, including but not limited to
the indemnification and insurance provided under this Agreement. In recognition
of the exclusive nature of this license, UIRF agrees that it will not grant
licenses under PATENT RIGHTS to others except as required by UIRF’s obligations
in Paragraph 2.3(a) and that it will not provide any proprietary materials
relating to the PATENT RIGHTS to any commercial entity for any purpose or to
entities other than commercial entities for any commercial purpose unless
otherwise approved by Licensee.
     2.2 The term of this Agreement and the exclusive license set forth in
Paragraph 2.1 shall be from the Effective Date of this Agreement until the
expiration of the last to expire of the PATENT RIGHTS or for a period of fifteen
years, whichever is longer.
     2.3 The granting and acceptance of this license is subject to the following
conditions:

  (a)   The UI Patent Policy approved in 1983, Public Law 96-517 and Public Law
98-620. Any right granted in this Agreement greater than that permitted under
Public Law 96-517 or Public Law 98-620 shall be subject to modification as may
be required to conform to the provision of that statute.     (b)   UIRF shall
have the right to make and to use for research purposes only and not for any
commercial purpose unless otherwise approved by Licensee, the subject matter
described and claimed in PATENT RIGHTS. UIRF shall not disclose any confidential
information or proprietary materials relating to the PATENT RIGHTS to any other
party without prior written consent of Licensee and without use of a
confidentiality agreement in the form of Appendix B or a material transfer
agreement in the form of Appendix C, an executed copy of which shall be provided
to Licensee.     (c)   Licensee shall pay all future costs connected with the
commercial development of the LICENSED PRODUCTS, including but not limited to
the costs of complying with applicable government testing, approvals and
regulations.     (d)   Licensee shall use reasonable efforts to effect
introduction of the LICENSED PRODUCTS into the commercial market as soon as
practicable,

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

35

--------------------------------------------------------------------------------

 

License Agreement
consistent with sound and reasonable business practices and judgement;
thereafter, until the expiration of this Agreement, Licensee shall endeavor to
keep LICENSED PRODUCTS reasonably available to the public.

  (e)   UIRF shall have the right to terminate or render this license
non-exclusive if Licensee shall not be capitalized with an aggregate investment
of at least [***** ******] U.S. dollars (US $[*********]) prior to the first
anniversary of the Effective Date.     (f)   UIRF shall have the right to
terminate or render this license non-exclusive at any time after three (3) years
from the Effective Date if, in UIRF’s reasonable judgment, Licensee:

  (i)   has not put the licensed subject matter into commercial use in the
country or countries where licensed, directly or through a sublicense, and is
not keeping the licensed subject matter reasonably available to the public, or  
  (ii)   is not demonstrably engaged in a research, development, manufacturing,
marketing, or licensing program, as appropriate, directed toward this end.

    In making this determination, UIRF shall take into account the normal course
of such programs conducted with sound and reasonable business practice and
judgment and shall take into account the reports provided hereunder by Licensee.

  (g)   All sublicenses granted by Licensee hereunder shall include a
requirement that the sublicensee use reasonable efforts to effect introduction
of the LICENSED PRODUCTS into the commercial market as soon as practicable,
consistent with sound and reasonable business practices and judgement and shall
bind the sublicensee to meet Licensee’s obligations to UIRF under this Agreement
and a copy of this Agreement shall be attached to such sublicense agreements.
Copies of all sublicense agreements shall be provided to UIRF.

     2.4 Upon expiration of the period of exclusivity of this license, Licensee
shall receive a fully paid up perpetual license to make and have made, to use
and have used, to import and have imported, to offer for sale and have offered
for sale, and to sell and have sold the LICENSED PRODUCTS, and to practice the
LICENSED PROCESSES.
     2.5 Licensee agrees during the exclusive period of this license in the
United States that any LICENSED PRODUCT produced for sale in the United States
will be manufactured substantially in the United States unless any waiver of
such requirement is obtained. UIRF shall, at Licensee’s request and expense,
assist Licensee in attempting to obtain such a waiver, should Licensee determine
to do so.
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

36

--------------------------------------------------------------------------------

 

License Agreement
     2.6 UIRF hereby grants to Licensee the right to extend the licenses granted
in Paragraph 2.1 to an AFFILIATE subject to the terms and conditions hereof.
     2.7 All rights reserved to the United States Government and others under
Public Law 96-517 and 98-620 shall remain and shall in no way be affected by
this Agreement.
ARTICLE 3.
ROYALTIES, PAYMNTS
     3.1 Licensee shall pay to UIRF a non-refundable license fee in the sum of
$[*******] as follows:
$[******] payable within thirty days of the Effective Date
$[******] payable six months after the Effective Date
$[******] payable twelve months after the Effective Date
$[******] payable eighteen months after the Effective Date
$[******] payable twenty-four months after the Effective Date

  3.2   (a) Licensee shall pay UIRF within forty-five (45) days after the end of
each calendar quarter, during the term of the license of Paragraph 2.1,
royalties on NET SALES of all LICENSED PRODUCTS sold by Licensee and its
AFFILIATES or sublicensees as follows:

     In the human field:
[*]%, if total royalty being paid on the LICENSED PRODUCT to all parties, other
than by Licensee to [******] and its AFFILIATES for anything other than licenses
under issued patents, is less than [*]%
[****]%, if total royalty being paid on the LICENSED PRODUCT to all parties,
other than by Licensee to [******] and its AFFILIATES for anything other than
licenses under issued patents, is greater than or equal to [*]%, but less than
[*]%
[*]%, if total royalty being paid on the LICENSED PRODUCT to all parties, other
than by Licensee to [******] and its AFFILIATES for anything other than licenses
under issued patents, is greater than or equal to [*]%
     In the animal field:
     [***]% on NET SALES of LICENSED PRODUCTS
     (b) On sales between Licensee and its AFFILATES or sublicensees for resale,
the royalty shall be paid on the resale.

  3.3   Commencing in the fifth AGREEMENT YEAR, an annual license maintenance
fee

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

37

--------------------------------------------------------------------------------

 

License Agreement
payment of $[*******] shall be payable to the UIRF, payable within forty-five
(45) days of the end of each AGREEMENT YEAR. This payment shall be reduced by
the amount of any milestones, royalties or non-royalty sub-license income
accrued to the UIRF solely during that AGREEMENT YEAR but shall not be reduced
by (a) any royalties accruing in any other AGREEMENT YEAR or (b) contract
research funding payable to the University of Iowa pursuant to the terms of any
Sponsored Research Agreement.
     3.4 Licensee shall pay to UIRF the following sums within thirty (30) days
of the achievement of the indicated milestones;
$[******] payable upon the
[******************************************************************] LICENSED
PRODUCTS in the animal field in the United States
$[******] payable upon
[****************************************************************************]
LICENSED PRODUCTS in the human field
$[******] payable upon
[*****************************************************************] LICENSED
PRODUCTS in the human field in [**********************************]
     3.5 In the case of sublicenses, Licensee shall also pay to UIRF
[***********] percent [**]% of all license issue fees and license maintenance
fees, excluding equity investments in Licensee and any funds received by
Licensee for the conduct of research.
ARTICLE 4.
REPORTING, CONFIDENTIALITY
     4.1 Prior to signing this Agreement, Licensee has provided to UIRF a
written business plan pertaining to the subject matter of the licenses granted
hereunder. UIRF hereby acknowledges receipt of such business plan.
     4.2 Licensee shall provide brief written annual reports within sixty
(60) days after each anniversary of the Effective Date which shall include but
not be limited to: summaries of progress on research and development, regulatory
approvals, manufacturing, sublicensing, marketing and sales during the preceding
twelve (12) months as well as plans for the coming year. If progress differs
from that anticipated in the plan provided under 4.1, or in the previous annual
report, Licensee shall explain the reasons for the differences and propose a
modified plan for UIRF’s review and approval. Licensee shall also provide any
reasonable additional data UIRF requires to evaluate Licensee’s performance.

  4.3   (a) Commencing upon the first sale of LICENSED PRODUCTS, Licensee agrees
to submit to UIRF within forty-five (45) days after the calendar quarters ending

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

38

--------------------------------------------------------------------------------

 

License Agreement
March 31, June 30, September 30, and December 31, reports setting forth for the
preceding three (3) month period at least the following information:

  i)   the number of LICENSED PRODUCTS sold by Licensee, its AFFILIATES and
sublicensees;     ii)   total billings for each LICENSED PRODUCT;     iii)   an
accounting for all LICENSED PROCESSES used or sold;     iv)   deductions
applicable to determine the NET SALES thereof     v)   the amount of royalty due
thereon;

and with each such royalty report to pay the amount of royalty due. Such report
shall be certified as correct by an officer of Licensee and shall include a
detailed listing of all deductions from royalties as specified herein. If no
royalties are due to UIRF for any reporting period, the written report shall so
state.
     b) All payments due hereunder shall be payable in United States dollars.
Conversion of foreign currency to US, 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 each royalty period. Such payments shall be without
deduction of exchange, collection or other charges.
     (c) All such reports shall be maintained in confidence by UIRF, except as
required by law, including Public Law 96-517 and 98-620.
     (d) Late payments shall be subject to an interest charge of
[****************] percent ([*****]%) per month.
     4.4 UIRF shall not disclose the contents of the business plan or any report
provided by Licensee hereunder to any third party without the prior written
consent of Licensee, which consent shall not be unreasonably withheld, except to
the extent that disclosure of any such information shall be required by
government agencies.
ARTICLE 5.
RECORD KEEPING
     Licensee shall keep, and shall require its AFFILIATES and sublicensees to
keep, accurate and correct records of LICENSED PRODUCTS made, used, imported or
sold under this Agreement, appropriate to determine the amount of royalties due
hereunder to UIRF. Such records shall be retained for at least three (3) years
following a given reporting period. They shall be available during normal
business hours for inspection at the expense of UIRF by UIRF’s
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

39

--------------------------------------------------------------------------------

 

License Agreement
Internal Audit Department or by a Certified Public Accountant selected by UIRF
and approved by Licensee for the sole purpose of verifying reports and payments
hereunder. Such accountant shall not disclose to UIRF any information other than
information relating to accuracy of reports and payments made under this
Agreement. In the event that any such inspection shows an underreporting and
underpayment in excess of [****] percent ([*]%) for any twelve (12) month
period, then Licensee shall pay the cost of such examination as well as any
additional sum that would have been payable to UIRF had the Licensee reported
correctly, plus interest.
ARTICLE 6.
FILING, PROSECUTION AND MAINTENANCE OF PATENTS
     6.1 Licensee shall reimburse UIRF for all reasonable expenses heretobefore
incurred by UIRF for the preparation, filing, prosecution and maintenance of
PATENT RIGHTS and not previously reimbursed by or on behalf of Licensee promptly
upon execution of this Agreement and shall reimburse UIRF for all such ongoing
expenses within thirty (30) days of receipt of invoices from UIRF. Late payment
of these invoices shall be subject to interest charges of [*****************]
percent ([***]%) per month. UIRF shall take responsibility for the preparation,
filing, prosecution and maintenance of any and all patent applications and
patents included in PATENT RIGHTS using patent counsel approved by Licensee,
such approval to not be unreasonably withheld. UIRF shall promptly inform
Licensee regarding all matters directly pertaining to prosecution of LICENSED
PATENTS, and shall seek Licensee’s counsel concerning all proposed courses of
action affecting the LICENSED PATENTS, including but not limited to in which
countries patent prosecution should be obtained and all proposed courses of
action in any interference proceedings. UIRF shall cause its patent counsel to
provide Licensee with copies of all correspondence regarding PATENT RIGHTS and
UIRF shall provide Licensee sufficient opportunity to comment on any document
that UIRF intends to file or to cause to be filed with the relevant intellectual
property or patent office.
     6.2 UIRF and Licensee shall cooperate fully in the preparation, filing,
prosecution and maintenance of PATENT RIGHTS and of all patents and patent
applications licensed to Licensee hereunder, executing all papers and
instruments or requiring members of UIRF to execute such papers and instruments
as to enable UIRF to apply for, to prosecute and to maintain patent applications
and patents in UIRF’s name in any country. Each party shall provide to the other
prompt notice as to all matters which come to its attention and which may affect
the preparation, filing, prosecution or maintenance of any such patent
applications or patents.
     6.3 If Licensee elects to no longer pay the expenses of prosecution or
maintenance of a patent application or patent included with PATENT RIGHTS,
Licensee shall notify UIRF not less than sixty (60) days prior to such action
and shall thereby surrender its rights hereunder to such patent or patent
application.
ARTICLE 7.
MARKING
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

40

--------------------------------------------------------------------------------

 

License Agreement
     7.1 If a PATENT RIGHT has been or is subsequently issued to UIRF covering
any feature or features of the LICENSED PRODUCTS, Licensee agrees to mark each
and every package or container in which the LICENSED PRODUCTS are used or sold
by or for Licensee with marking complying with the provisions of Title 35, U.S.
Code, Section 287, if required, or any future equivalent provisions of the
United States relating to the marking of patented devices, or with marking
complying with the law of the country where the LICENSED PRODUCTS are shipped,
used or sold.
ARTICLE 8.
INFRINGEMENT
     8.1 With respect to any PATENT RIGHTS under which Licensee is exclusively
licensed pursuant to this Agreement, Licensee or its sublicensee shall have the
right to prosecute in its own name and at its own expense any infringement of
such patent, so long as such license is exclusive at the time of the
commencement of such action. UIRF agrees to notify Licensee promptly of each
infringement of such patents of which UIRF is or becomes aware, Before Licensee
or its sublicensees commences an action with respect to any infringement of such
patents, Licensee shall give careful consideration to the views of UIRF and to
potential effects on the public interest in making its decision whether or not
to sue and in the case of a Licensee sublicense, shall report such views to the
sublicensee.
     8.2 If Licensee elects to sue for patent infringement, UIRF agrees to be
named as nominal third party plaintiff if necessary to the commencement of any
such action, and further agrees to provide any information available to UIRF and
needed by Licensee in prosecuting such action. Licensee shall reimburse UIRF for
any costs it incurs as part of an action brought by Licensee or its sublicensee,
irrespective of whether UIRF shall become a co-plaintiff.
     8.3 If Licensee or its sublicensee elects to commence an action as
described above, Licensee may reduce, by up to [*****] percent ([**]%), the
royalty due to UIRF earned under the patent subject to suit by [*****] percent
([**]%) of the amount of the expenses and costs of such action, including
attorney fees. In the event that such [*****] percent ([**]%) of such expenses
and costs exceed the amount of royalties withheld by Licensee for any calendar
year, Licensee may to that extent reduce the royalties due to UIRF from Licensee
in succeeding calendar years, but never by more than [*****] percent ([**]%) of
the royalty otherwise due in any one year.
     8.4 No settlement, consent judgment or other voluntary final disposition of
the suit may be entered into without the consent of UIRF, which consent shall
not be unreasonably withheld.
     8.5 Recoveries or reimbursements from such action shall first be applied to
reimburse Licensee and UIRF for litigation costs not paid from royalties and
then to reimburse UIRF for royalties withheld. Any remaining recoveries or
reimbursements shall be divided [**]% to Licensee and [**]% to UIRF.
     8.6 In the event that Licensee and its sublicensee, if any, elect not to
exercise their right
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

41

--------------------------------------------------------------------------------

 

License Agreement
to prosecute an infringement of the PATENT RIGHTS pursuant to the above
paragraphs, UIRF may do so at its own expense, controlling such action and
retaining all recoveries therefrom.
     8.7 If a declaratory judgment action alleging invalidity of any of the
PATENT RIGHTS shall be brought against Licensee or UIRF, then UIRF, at its sole
option, shall have the right to intervene and take over the sole defense of the
action at its own expense.
     8.8 UIRF shall have no obligation to defend any action for infringement
brought against Licensee by a third party. In the event Licensee is sued by a
third party, and as a result of the settlement of such suit is required to pay a
royalty to a third party on a LICENSED PRODUCT, the amount of royalty paid will
be deducted from the royalty payment due to the UIRF for that LICENSED PRODUCT.
In the event the settlement prevents the Licensee from continuing sales of a
LICENSED PRODUCT, no additional royalties and/or minimum royalties will apply
for that LICENSED PRODUCT.
ARTICLE 9.
TERMINATION OF AGREEMENT
     9.1 Upon any termination of this Agreement, and except as provided herein
to the contrary, all rights and obligations of the Parties hereunder shall
cease, except as follows:
     (a) UIRF’s right to receive or recover and Licensee’s obligation to pay
royalties accrued or accruable for payment at the time of any termination;
     (b) Licensee’s obligation to maintain records and UIRF’s right to conduct a
final audit as provided in Article 5 of this Agreement; and
     (c) Any cause of action or claim of either party, accrued or to accrued
because of any breach or default by the other party.
     9.2 In the event Licensee fails to make payments due hereunder, UIRF shall
have the right to terminate this Agreement upon forty-five (45) days’ written
notice, unless Licensee makes such payments plus interest within the forty-five
(45) day notice period or unless any such payment is contested in good faith, in
which event UIRF shall not have the right to terminate this Agreement until the
matter is resolved and Licensee still fails to make any such payment. If
payments are not so made, UIRF may immediately terminate this Agreement.
     9.3 In the event that Licensee shall be in default in the performance of
any obligations under this Agreement (other than as provided in 9.2 above which
shall take precedence over any other default), and if the default has not been
remedied within ninety (90) days after the date of notice in writing of such
default, UIRF may terminate this Agreement immediately by written notice, unless
any such obligation is contested in good faith, in which event UIRF shall not
have the right to terminate this Agreement until the matter is resolved and
Licensee still fails to perform any such obligation.
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

42

--------------------------------------------------------------------------------

 

License Agreement
     9.4 In the event that Licensee shall become insolvent, shall make an
assignment for the benefit of creditors, or shall have a petition in bankruptcy
filed for or against it, which petition shall remain unstayed for a period of
ninety (90) days, UIRF shall have the right to terminate this entire Agreement
immediately upon giving Licensee written notice of such termination.
     9.5 In the event the license granted to Licensee hereunder terminates for
any reason, any sublicenses granted by Licensee under this Agreement shall
continue; provided that, such sublicensee agrees in writing that UIRF is
entitled to enforce such agreements directly against such sublicensee.
     9.6 Licensee shall have the tight to terminate this Agreement by giving
ninety (90) days advance written notice to UIRF to that effect and paying a
termination fee of $[******]. Upon termination, a final report shall be
submitted and any royalty payments and unreimbursed patent expenses due to UIRF
shall become immediately payable.
     9.7 Licensee shall have the right during a period of six (6) months
following the effective date of any termination to sell or otherwise dispose of
the LICENSED PRODUCT existing at the time of such termination, and shall make a
final report and payment of all royalties related thereto within sixty (60) days
following the end of such period or the date of the final disposition of such
inventory, whichever first occurs.
     9.8 Termination of this agreement with respect to a particular LICENSED
PRODUCT shall not alter the rights and obligations of the parties with respect
to the remaining LICENSED PRODUCTS.
ARTICLE 10
ASSIGNMENT
     10.1 The rights and licenses granted by UIRF in this agreement are specific
and may not be assigned or otherwise transferred to any party other than to an
AFFILIATE of Licensee without the prior written approval of UIRF, which approval
shall not be unreasonably withheld; provided, however, that Licensee, without
such approval, may assign subject to Public Law 96- 517 and Public Law 98-620,
all of its rights hereunder to the acquiring party in connection with the
transfer of all or substantially all of its business and assets to an acquiring
party or in the event of its merger or consolidation with that acquiring party,
if and only if the assignee shall assume all obligations of Licensee under this
Agreement. Any attempted assignment or transfer without any such approval, if
required, shall be void and shall automatically terminate all rights of Licensee
under this Agreement.
ARTICLE 11.
REPRESENTATIONS AND WARRANTIES: LIMITATIONS
     11.1 Nothing in this agreement shall be construed as:
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

43

--------------------------------------------------------------------------------

 

License Agreement

  (a)   A warranty or representation by UIRF as to the validity or scope of any
PATENT RIGHT; or     (b)   A warranty or representation that anything made, used
or sold under the license granted in this agreement is or will be free from
infringement of patents owned by third parties, or     (c)   Conferring a right
to use in advertising, publicity or otherwise the name of the UI or UIRF, or the
inventors, unless UIRF has specifically approved the same in writing.

     11.2 UIRF represents that, to the best of its knowledge, any patents issued
in respect of the PATENT RIGHTS will, when issued, be free of any restrictions
except for any non-exclusive rights held by the U.S. Government under the
Federal Patent Policy as a result of previous or present sponsorship.
     11.3 UIRF EXPRESSLY DISCLAIMS ANY AND ALL IMPLIED OR EXPRESS WARRANTIES AND
MAKES NO EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY
PARTICULAR PURPOSE OF THE PATENT RIGHTS, BIOLOGICAL MATERIAL, INFORMATION
SUPPLIED BY UIRF, LICENSED PROCESSES OR LICENSED PRODUCTS CONTEMPLATED BY THIS
AGREEMENT. UIRF assumes no responsibilities whatever with respect to design,
development, manufacture, use, sale or other disposition by Licensee or
AFFILIATES of LICENSED PRODUCTS or LICENSED PROCESSES. The entire risk as to the
design, development, manufacture, offering for sale, sale, or other disposition
and performance of LICENSED PRODUCTS and LICENSED PROCESSES is assumed by
Licensee and AFFILIATES.
ARTICLE 12.
GENERAL

  12.1   (a) Licensee, its AFFILIATES and sublicensees, shall indemnify, defend
and hold harmless UIRF and the University of Iowa and their current or former
directors, governing board members, trustees, officers, faculty, medical and
professional staff, employees, students, and agents and their respective
successors, heirs and assigns (the “Indemnities”), against any liability,
damage, loss or expenses (including reasonable attorneys’ fees and expenses of
litigation) incurred by or imposed upon the Indemnities or any one of them in
connection with any claims, suits, actions, demands or judgments arising out any
theory of product liability (including, but not limited to, actions in the fours
of tort, warranty, or strict liability) concerning any product, process or
service made, used or sold by Licensee, or its AFFILIATES or sublicensees
pursuant to any right or license granted under this Agreement.

(b) Licensee agrees, at its own expense, to provide attorneys reasonably
acceptable to UIRF to defend against any actions brought or filed against any
party indemnified hereunder with respect to the subject of indemnity contained
herein,
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

44

--------------------------------------------------------------------------------

 

License Agreement
whether or not such actions are rightfully brought.
(c) Beginning at the time as any such product, process or service is being
commercially distributed or sold (other than for the purpose of obtaining
regulatory approvals) by Licensee or by a sublicensee, AFFILIATE or agent of
Licensee, Licensee shall, at its sole cost and expense procure and maintain
comprehensive general liability insurance in amounts not less than $[*********]
per incident and $[*********] annual aggregate and naming the Indemnities as
additional insureds. During clinical trials of any such product, process or
service Licensee shall, at its sole cost and expense, procure and maintain
comprehensive general liability insurance in such equal or lesser amounts as
UIRF shall require, naming the Indemnities as additional insureds. Such
comprehensive general liability insurance shall provide (i) product liability
coverage and (ii) broad form contractual liability coverage for Licensee’s
indemnification under this Agreement. If Licensee elects to self-insure all or
part of the limits described above (including deductibles or retentions which
are in excess of $[*******] annual aggregate) such self-insurance program must
be acceptable to UIRF. The minimum amounts of insurance coverage required shall
not be construed to create a limit of Licensee’s liability with respect to its
indemnification under this Agreement.
(d) Licensee shall provide UIRF with written evidence of such insurance upon
request of UIRF. Licensee shall provide UIRF with written notice at least
fifteen (15) days prior to the cancellation, non-renewal or material change in
such insurance; if Licensee does not obtain replacement insurance providing
comparable coverage within such fifteen (15) day period, UIRF shall have the
right to terminate this Agreement effective at the end of such fifteen (15) day
period without notice or any additional waiting periods.
(e) Licensee shall maintain such comprehensive general liability insurance
beyond the expiration or termination of this Agreement during (i) the period
that any product, process, or service, relating to, or developed pursuant to,
this Agreement is being commercially distributed or sold by Licensee or by a
sublicensee, AFFILIATE or agent of Licensee and (ii) a reasonable period after
the period referred to in (e)(i) above which in no event shall be less than
fifteen (15) years.
     12.2 In the event of any controversy or claim arising out of or relating to
any provision of this Agreement or the breach thereof, the parties shall try to
settle such conflicts amicably between themselves. Subject to the limitation
stated in the final sentence of this section, any such conflict which the
parties are unable to resolve shall be settled through arbitration conducted in
accordance with the rules of the American Arbitration Association. The demand
for arbitration shall be filed within a reasonable time after the controversy or
claim has arisen, and in no event after the date upon which institution of legal
proceedings based on such controversy or claim would be barred by the applicable
statutes of limitation. Such arbitration shall be held in Chicago,
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

45

--------------------------------------------------------------------------------

 

License Agreement
Illinois. The award through arbitration shall be final and binding. Either party
may enter any such award in a court having jurisdiction or may make application
to such court for judicial acceptance of the award and an order of enforcement,
as the case may be. Notwithstanding the foregoing, either party may, without
recourse to arbitration, assert against the other party a third-party claim or
cross-claim in any action brought by a third party, to which the subject matter
of this Agreement may be relevant.
     12.3 Should a court of competent jurisdiction later consider any provision
of this Agreement to be invalid, illegal, or unenforceable, it shall be
considered severed from this Agreement. All other provisions, rights and
obligations shall continue without regard to the severed provision, provided
that the remaining provisions of this Agreement are in accordance with the
intention of the parties.
     12.4 No waiver by a Party of any breach of this Agreement, no matter how
long continuing or how often repeated, shall be deemed a waiver of any
subsequent breach thereof, nor shall any delay or omission on the part of a
Party to exercise any right, power or privilege hereunder be deemed a waiver of
such right, power or privilege.
     12.5 The relationship between the Parties is that of independent contractor
and contractee. Licensee shall not be deemed to be an agent of UIRF in
connection with the exercise of any rights hereunder, and shall not have any
right or authority to assume or create any obligation or responsibility on
behalf of UIRF.
     12.6 No party hereto shall be deemed to be in default of any provision of
this Agreement, or for any failure in performance, resulting from acts or events
beyond the reasonable control of such Party, such acts of God, acts of civil or
military authority, civil disturbance, war, strives, fires, power failures,
natural catastrophes or other “force majeure” events.
ARTICLE 13.
NOTICES; APPLICABLY LAW
     13.1 Any notice, report or payment provided for in this Agreement shall be
deemed sufficiently given if in writing and when sent by express courier,
certified or registered mail addressed to the party for whom intended at the
address set forth below, or to such address as either party may hereafter
designate in writing to the other:

         
 
  (a) For the UIRF:   University of Iowa Research Foundation
Attn: Executive Director
100 Oakdale Campus
214 Technology Innovation Center
Iowa City, Iowa 52242-5000
 
       
 
  (b) For the Licensee:   CpG ImmunoPharmaceuticals, Inc.
c/o QIAGEN GmbH
Max-Volmer Strasse 4

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

46

--------------------------------------------------------------------------------

 

License Agreement
40724 Hilden
GERMANY
Attn: Joachim Schorr
     Business Development Manager
     13.2 This Agreement shall be construed, interpreted and applied in
accordance with the laws of the State of Iowa.
     13.3 Licensee agrees to comply with all laws and regulations applicable to
the subject matter of this Agreement. In particular, it is understood and
acknowledged that the transfer of certain commodities and technical data is
subject to United States laws and regulations controlling the export of such
commodities and technical data, including all Export Administration Regulations
of the United States Department of Commerce. These laws and regulations among
other things, prohibit or require a license for the export of certain types of
technical data to certain specified countries. Licensee hereby agrees and gives
written assurance that it will comply with all United States laws and
regulations controlling the export of commodities and technical data, that it
will be solely responsible for any violation of such by Licensee or its
AFFILIATES or sublicensees, and that it will defend and hold UIRF harmless in
the event of any legal action of any nature occasioned by such violation.
ARTICLE 14.
INTEGRATION
     14.1 This Agreement constitutes the final and entire agreement between the
parties, and supersedes all prior written agreement with respect to the subject
matter hereof, including without limitation the Option Agreement between QIAGEN
and UIRF dated August 22, 1995, as extended on March 18, 1996, and the Option
Agreement between UIRF and QIAGEN dated May 28, 1996, as extended on
September 18, 1996 and January 28, 1997, and any prior or contemporaneous oral
understanding regarding the subject matter hereof. Any representation, promise
or condition in connection with such subject matter which is not incorporated in
this agreement shall not be binding on either party. No modification, renewal,
extension or termination of this agreement or any of its provisions shall be
binding upon the party against whom enforcement of such modification, renewal,
extension or termination is sought, unless made in writing and signed an behalf
of such party by a duly authored officer.
IN WITNESS WHEREOF, each of the parties have caused this agreement to be
executed by its duly authorized representative.

                      Signed this 26 day of March, 1997       Signed this 3 day
of April,1997     LICENSOR       LICENSEE     The University of Iowa Research
Foundation       CpG ImmunoPharmaceuticals, Inc.    
By:
Name:
  /s/ W. Bruce Wheaton
 
W. Bruce Wheaton       By:
Name:   /s/ Metin Colpan
 
   
Title:
  Executive Director       Title:        

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

47

--------------------------------------------------------------------------------

 

License Agreement
Appendix A
Patent Rights are indicated on the following page.
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

48

--------------------------------------------------------------------------------

 

License Agreement

                  L&C   Serial No./             Docket No.   Patent No.   Title
and Inventors   Filing Date   Status
[***********]
  [*************
*************]   [************************
**************************]   [********]   [********************
**************************
****************]
[***********]
  [*************
*************]   [************************
**************************]   [********]   [********************
**************************
****************]
[***********]
  [*************]   [************************
**************************]   [********]   [********************
**************************
****************]
[***********]
  [*************
*************]   [************************
**************************]   [********]   [********************
**************************
****************]
[***********]
  [*************
*************]   [************************
**************************]   [********]   [********************
**************************
****************]
[***********]
  [*********]   [************************
**************************]   [********]   [********************
**************************
****************]
[***********]
  [*********]   [************************
**************************]   [********]   [********************
**************************
****************]
[*****]
  [*********]   [************************
**************************]   [*************]   [********************
**************************
****************]
[*********]
  [*********]   [************************
**************************]   [********]   [********************
**************************
****************]
[*********]
  [*********]   [************************
**************************]   [********]   [********************
**************************
****************]

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[* ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

49

--------------------------------------------------------------------------------

 

License Agreement
Appendix B
Form of Confidentiality Agreement
[T3/647063.1]
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

50

--------------------------------------------------------------------------------

 

License Agreement
CONFIDENTIALITY AGREEMENT
     This Agreement is made as of                     , 1997, by and among the
University of Iowa with its principal place of business at                    
(the “Institution”), and                     , having an office at
                    (the “Recipient”).
1. Background. The Recipient is interested in receiving certain Proprietary
Information (as defined below) from the Institution for the purpose of
establishing and/or maintaining a business and/or research relationship between
the Institution and the Recipient. The Proprietary Information shall relate to
the following subjects:                     .
2. Proprietary Information. As used in this Agreement, the term “Proprietary
Information” shall mean all confidential or proprietary information or materials
of the Institution, whether disclosed in writing, orally, or visually, and which
is identified by the Institution as confidential, including, without limitation,
compounds, business plans, financial statements or technical information.
3. Disclosure of Proprietary Information. The Recipient shall hold in
confidence, and shall not disclose to any person other than its employees,
agents and consultants, any Proprietary Information. The Recipient shall use
such Proprietary Information only for the purpose for which it was disclosed and
shall not use or exploit such Proprietary Information for its own benefit or the
benefit of another without the prior written consent of the Institution. The
Recipient shall disclose Proprietary Information received by it under this
Agreement only to those of its employees, agents and consultants who have a need
to know such Proprietary Information in the course of the performance of their
duties and who are bound by written agreement to protect the confidentiality of
such Proprietary Information.
4. Limitation on Obligations. The obligations of the Recipient specified in
Section 3 above shall not apply, and the Recipient shall have no further
obligations hereunder, with respect to any Proprietary Information to the extent
that such Proprietary Information;

  (a)   is generally known to the public at the time of disclosure or becomes
generally known through no wrongful act on the part of the Recipient;     (b)  
is in the Recipient’s possession at the time of disclosure other than as a
result of prior disclosure by the Institution or a breach of any legal
obligation by Recipient or third party;     (c)   becomes known to the Recipient
through disclosure by sources other than the Institution having no duty of
confidentiality to the Institution, whether direct or indirect, with respect to
such Proprietary Information and having the legal right to disclose such
Proprietary Information;     (d)   is independently developed by the Recipient
without reference to or reliance upon the Proprietary Information as can be
documented by written records; or     (e)   is required to be disclosed by the
Recipient to comply with applicable laws or

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

51

--------------------------------------------------------------------------------

 

License Agreement
governmental regulations, provided that the Recipient provides prior written
notice of such disclosure to the Institution and takes reasonable and lawful
actions to avoid and/or minimize the extent of such disclosure.
5. Ownership of Proprietary Information. The Recipient agrees that the
Institution is and shall remain the exclusive owner of the Proprietary
Information and all patent, copyright, trade secret, trademark and other
intellectual property rights therein. No license or conveyance of any such
rights to the Recipient is granted or implied under this Agreement.
6. Return of Documents. The Recipient shall, upon the request of the
Institution, return to the Institution all drawings, documents, materials and
other tangible manifestations of the Proprietary Information received by the
Recipient pursuant to this Agreement (and all copies and reproductions thereof)
except that one copy of each may be retained by the Recipient’s legal department
for archival purposes only.
7. Term. The Recipient’s obligations under Paragraphs 3 and 4 with respect to
each item of Proprietary Information shall extend for a period of five (5) years
from the date of initial disclosure to Recipient of such item of Proprietary
Information.
8. Miscellaneous.

  (a)   This Agreement supersedes all prior agreements, written or oral, between
the Institution and the Recipient relating to the subject matter of this
Agreement. This Agreement may not be modified, changed or discharged, in whole
or in part, except by an agreement in writing signed by the Institution and the
Recipient.     (b)   This Agreement will be binding upon and inure to the
benefit of the parties hereto and their respective heirs, successors an assigns.
    (c)   This Agreement shall be construed and interpreted in accordance with
the laws of the State of Iowa, without giving effect to the conflict of laws
provisions thereof.     (d)   The provisions of this Agreement are necessary for
the protection of the business and goodwill of the parties and are considered by
the parties to be reasonable for such purpose. The Recipient agrees that any
breach of this Agreement will cause the Institution substantial and irreparable
harm and, therefore, in the event of any such breach, in addition to other
remedies which may be available, the Institution shall have the right to seek
specific performance and other injunctive and equitable relief.

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

52

--------------------------------------------------------------------------------

 

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

          The University of Iowa    
 
       
By:
       
 
 
 
   
Title:
       
 
 
 
   
 
        RECIPIENT    
 
       
By:
       
 
 
 
   
Title:
       
 
 
 
   

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

53

--------------------------------------------------------------------------------

 

License Agreement
Appendix C
Form of Material Transfer Agreement
[T3/648340.8]
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

54

--------------------------------------------------------------------------------

 

License Agreement
PROPRIETARY REAGENT TRANSFER AGREEMENT FOR
REAGENTS SUPPLIED FOR RESEARCH USE ONLY
     This Agreement is made as of                     , 1997 by and among
INSTITUTION, having its principal offices at                      (the
“Institution”), RECIPIENT having an address of                      (the
“Recipient”), and INVESTIGATOR having an address of                      (the
“Investigator”).
     WITNESSETH:
     WHEREAS, Institution possesses certain reagents in the form of
                     [describe]                      and which are further
described in U.S. Patent Application No.                     (all such
biological materials including all Derivatives thereof are hereinafter referred
to as “Reagent”). “Derivatives” as used herein shall mean any material derived
from Reagent, or any material resulting from the physical, chemical, or
biological manipulation of Reagent; and
     WHEREAS, Investigator and Recipient are interested in receiving access to
limited quantities of Reagent for the sole purpose of conducting non-commercial
research; and
     WHEREAS, Institution is willing to make such Reagent available to
Investigator on the terms and conditions set forth herein.
     NOW THEREFORE, intending to be legally bound, the parties hereto mutually
agree as follows:
     The Reagent is owned by Institution and will continue to be owned by
Institution even after it has been transmitted to Investigator and Recipient;
     Investigator and Recipient shall not use the Reagent in any commercial use
or for any purpose except for research to be conducted by Investigator at the
premises of Recipient.
     The Reagent shall be used only in the form provided to you. You shall not
[delete or alter or in any way modify any of the DNA sequences in the vectors
supplied to you, modify the vectors supplied to you for the expression of other
DNA sequences, or remove any DNA sequences from the vectors for use as DNA
probes or for expression in other systems whether prokaryotic or eukaryotic
without the prior written consent of Institution;—modify as appropriate.]
     The Reagent shall not be distributed to any third party, except as provided
in Paragraph 5 below, and all rights and interests in such Reagent shall vest
and reside in Institution;
     Investigator shall keep strict possession of the Reagent and shall only
allow access to the Reagent by people who: (1) are doing research at
Investigator’s direction; and (2) have previously accepted the terms of this
Agreement by signing a copy of this Agreement;
     Investigator and Recipient agree not to publish or make public disclosures
or file patent applications on data, products or improvements derived from or
including the Reagent furnished
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

55

--------------------------------------------------------------------------------

 

License Agreement
herein, except with Institution’s prior written approval. Institution will use
its best efforts to expeditiously allow Investigator to publish research results
in peer review journals.
No license to the Reagent, or any uses therefore other than for the stated
research purposes as described and limited herein are granted by this Agreement;
Investigator and Recipient agree not to grant any rights in or to any research
conducted utilizing Reagent to any commercial institution without prior written
consent of Institution. Institution shall have sole right of first refusal to
exclusively license any inventions made in the course of research conducted
utilizing Reagent.
Institution disclaims any liability for damages arising from any use, storage,
handling or disposal by Investigator or Recipient of the Reagent and Recipient
agrees to indemnify and hold Institution harmless against any and all such
liability. THE REAGENT IS PROVIDED WITHOUT WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE OR USE OR ANY OTHER WARRANTY, EXPRESS OR
IMPLIED.
This Agreement does not create an agency relationship between Recipient or
Investigator and Institution;
Investigator agrees to update Institution on the results of research with this
Reagent on a semi-annual basis and to provide yearly research summaries to
Institution;
This Agreement is the sole agreement between the parties in respect to the
Reagent. This Agreement is personal and non-assignable and terminable at will by
Institution upon 10 days notice, at which time all remaining quantities of
Reagent shall be delivered to Institution;
Reagent is a valuable proprietary asset of Institution and premature release or
disclosure concerning this Reagent could severely injure Institution.
Furthermore, damages are not an adequate remedy for breach of this Agreement;
rather an injunctive remedy may also be required to preserve Institution’s
rights;
This Agreement shall be governed and interpreted in accordance with the laws of
the State of Iowa and the United States of America.
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

56

--------------------------------------------------------------------------------

 

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

                  INSTITUTION    
 
           
 
  By:        
 
     
 
   
 
  Name:        
 
     
 
   
 
  Title:        
 
     
 
   
 
  Date:        
 
     
 
   

                      AGREED TO AND ACCEPTED:                 INVESTIGATOR      
RECIPIENT    
 
                   
By:
          By:        
Name:
 
 
      Name:  
 
   
Title:
 
 
      Title:  
 
   
Date:
 
 
      Date:  
 
   
 
 
 
         
 
   

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

57

--------------------------------------------------------------------------------

 

License Agreement
APPENDIX D
PROPRIETARY REAGENT TRANSFER AGREEMENT FOR
REAGENTS SUPPLIED FOR RESEARCH USE ONLY
     This Agreement is made as of                     , 1996 by and among
INSTITUTION, having its principal offices at                      (the
“Institution”), RECIPIENT having an address of                      (the
“Recipient”), and INVESTIGATOR having an address of                      (the
“Investigator”).
     WITNESSETH:
     WHEREAS, Institution possesses certain reagents in the form
of                     [describe]                     and which are further
described in U.S. Patent Application No.                     (all such
biological materials including all Derivatives thereof are hereinafter referred
to as “Reagent”). “Derivatives” as used herein shall mean any material derived
from Reagent, or any material resulting from the physical, chemical, or
biological manipulation of Reagent; and
     WHEREAS, Investigator and Recipient are interested in receiving access to
limited quantities of Reagent for the sole purpose of conducting non-commercial
research; and
     WHEREAS, Institution is willing to make such Reagent available to
Investigator on the terms and conditions set forth herein.
     NOW THEREFORE, intending to be legally bound, the parties hereto mutually
agree as follows:
     (1) The Reagent is owned by Institution and will continue to be owned by
Institution even after it has been transmitted to Investigator and Recipient;
Investigator and Recipient shall not use the Reagent in any commercial use or
for any purpose except for research to be conducted by Investigator at the
premises of Recipient.
The Reagent shall be used only in the form provided to you. You shall not
[delete or alter or in any way modify any of the DNA sequences in the vectors
supplied to you, modify the vectors supplied to you for the expression of other
DNA sequences, or remove any DNA sequences from the vectors for use as DNA
probes or for expression in other systems whether prokaryotic or eukaryotic
without the prior written consent of Institution;—modify as appropriate.]
The Reagent shall not be distributed to any third party, except as provided in
Paragraph 5 below, and all rights and interests in such Reagent shall vest and
reside in Institution;
Investigator shall keep strict possession of the Reagent and shall only allow
access to the Reagent by people who: (1) are doing research at Investigator’s
direction; and (2) have previously accepted the terms of this Agreement by
signing a copy of this Agreement;
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

58

--------------------------------------------------------------------------------

 

License Agreement
Investigator and Recipient agree not to publish or make public disclosures or
file patent applications on data, products or improvements derived from or
including the Reagent furnished herein, except with Institution’s prior written
approval. Institution will use its best efforts to expeditiously allow
Investigator to publish research results in peer review journals.
No license to the Reagent, or any uses therefore other than for the stated
research purposes as described and limited herein are granted by this Agreement;
Investigator and Recipient agree not to grant any rights in or to any research
conducted utilizing Reagent to any commercial institution without prior written
consent of Institution. Institution shall have sole right of first refusal to
exclusively license any inventions made in the course of research conducted
utilizing Reagent.
Institution disclaims any liability for damages arising from any use, storage,
handling or disposal by Investigator or Recipient of the Reagent and Recipient
agrees to indemnify and hold Institution harmless against any and all such
liability. THE REAGENT IS PROVIDED WITHOUT WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE OR USE OR ANY OTHER WARRANTY, EXPRESS OR
IMPLIED.
This Agreement does not create an agency relationship between Recipient or
Investigator and Institution;
Investigator agrees to update Institution on the results of research with this
Reagent on a semi-annual basis and to provide yearly research summaries to
Institution;
This Agreement is the sole agreement between the parties in respect to the
Reagent. This Agreement is personal and non-assignable and terminable at will by
Institution upon 10 days notice, at which time all remaining quantities of
Reagent shall be delivered to Institution;
Reagent is a valuable proprietary asset of Institution and premature release or
disclosure concerning this Reagent could severely injure Institution.
Furthermore, damages are not an adequate remedy for breach of this Agreement;
rather an injunctive remedy may also be required to preserve Institution’s
rights;
This Agreement shall be governed and interpreted in accordance with the laws of
the State of Iowa and the United States of America.
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

59

--------------------------------------------------------------------------------

 

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

                  INSTITUTION    
 
           
 
  By:        
 
     
 
   
 
  Name:        
 
     
 
   
 
  Title:        
 
     
 
   
 
  Date:        
 
     
 
   

                      AGREED TO AND ACCEPTED:                 INVESTIGATOR      
RECIPIENT    
 
                   
By:
          By:        
Name:
 
 
      Name:  
 
   
Title:
 
 
      Title:  
 
   
Date:
 
 
      Date:  
 
   
 
 
 
         
 
   

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

60

--------------------------------------------------------------------------------

 

License Agreement
Appendix A
PATENT RIGHTS

                                      FILING             WG&S ID   UIRF ID   SN
  DATE   INVENTORS   TITLE   STATUS
[**********]
  [***********]   [*************]   [********]   [*****]
[*******]
[**********]   [**********
**********]   [**********
**********]
 
              [************]        
[**********]
  [*****]   [*************]   [********]   [*******]
[**********]   [**********
**********]   [**********
**********]
[**********]
  [***********]   [*************]   [********]   [*****]
[*******]
[**********]   [**********
**********]   [**********
**********]
[**********]
  [*****]   [**********]   [********]   [*************
********]   [**********
**********
**********]   [*******]
[**********]
  [*****]   [*************]   [********]   [******]
[********]   [*************
**************
*************
*************
*************
******** *****
*************
****]   [************
**********]
[**********]
  [***********]   [**********
***]   [******
**]   [******]
[********]   [**************
**************
***************
***************
*******]   [*******]
[**********]
  [*****]
[********]   [**********]   [********]   [***********]   [***************
*****************
**************
****************
****************
*******]   [*******]
[**********]
  [*****]
[********]   [**********]   [********]   [*****]
[********]   [***************
************
****************
***************]   [*******]
[**********]
  [*****]
[********]   [**********]   [********]   [*****]   [****************
***************
***************
**************
**************]   [*******]
[**********]
  [*****]
[********]   [**********]   [********]   [*****]   [***********
*************
************]   [*******]

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

61

--------------------------------------------------------------------------------

 

License Agreement

                                      FILING             WG&S ID   UIRF ID   SN
  DATE   INVENTORS   TITLE   STATUS
[**********]
  [***********]   [*************]   [********]   [*****]
[*******]
[**********]   [**********
**********]   [**********
**********]
[**********]
  [*****]   [*************]   [********]   [************]
[*******]
[**********]   [**********
**********]   [**********
**********]
[**********]
  [***********]   [*************]   [********]   [*****]
[*******]
[**********]   [**********
**********]   [**********
**********]
[**********]
  [*****]   [**********]   [********]   [*************
********]   [**********
**********
**********]   [*******]
[**********]
  [*****]   [*************]   [********]   [******]
[********]   [*************
**************
*************
*************
*************
******** *****
*************
****]   [************
**********]
[**********]
  [***********]   [**********
***]   [******
**]   [******]
[********]   [**************
**************
***************
***************
*******]   [*******]
[**********]
  [*****]
[********]   [**********]   [********]   [***********]   [***************
*****************
**************
****************
****************
*******]   [*******]
[**********]
  [*****]
[********]   [**********]   [********]   [*****]
[********]   [***************
************
****************
***************]   [*******]
[**********]
  [*****]
[********]   [**********]   [********]   [*****]   [****************
***************
***************
**************
**************]   [*******]
[**********]
  [*****]
[********]   [**********]   [********]   [*****]   [***********
*************
************]   [*******]

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

62

--------------------------------------------------------------------------------

 

License Agreement

                                      FILING             WG&S ID   UIRF ID   SN
  DATE   INVENTORS   TITLE   STATUS
[**********]
  [**********]
[****]   [**********]   [********]   [*****]
[*******]
[********]   [*********************
**********************
***********]   [*******]
[****************
*****]
[**********]
  [********]
[****]   [**********]   [********]   [*****]
[*******]
[********]   [*********************
**********************
******]   [*******]
[****************
*****]
[**********]
  [****]   [**********]   [********]   [*******]
[********]
[*****]   [*********************
**********************
**************]   [*******]
[**********]
  [*******]   [**********]   [********]   [*******]
[********]
[*****]   [*********************
**********************
***************]   [*******]
[**********]
  [*****]           [*****]
[********]
[********]   [********]   [***********]
[**********]
              [*****]
[*********]
[*******]   [*********************
****************]   [***********]
[**********]
  [*****]           [*****]   [*********************
********************** **]   [***********]
[**********]
  [*****]           [*****]   [*********************
**********************
*********]   [***********]

[**************************************************************************************]
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

63

--------------------------------------------------------------------------------

 

License Agreement
Exhibit 10.17 to Coley Pharmaceutical Group, Inc. Form S-1 filed April 20, 2005
CONFIDENTIAL
and
Confidential Treatment Requested under: 5 U.S.C. §552(b)(4)
Coley Pharmaceutical Group, Inc.
20 William Street, Suite 115
Wellesley, Massachusetts 02481
March 7th, 2001
University of Iowa Research Foundation
100 Oakdale Campus
214 Technology Innovation Center
Iowa City, Iowa 52242-5000
Attn: Executive Director
Re: Amendment to License Agreement
Ladies and Gentlemen:
This letter will serve as an amendment (the “Amendment”) to the License
Agreement (the “Agreement”) dated as of March 31, 1997 between Coley
Pharmaceutical Group, Inc., formerly known as CpG ImmunoPharmaceuticals, Inc. (“
Coley “), and the University of Iowa Research Foundation (“ UIRF “). All
capitalized terms that are used in this letter and not defined herein shall have
the meanings ascribed to them in the Agreement. Except as specifically modified
by this Amendment, the parties hereto agree that all of the terms and conditions
set forth in the Agreement remain in full force and effect.
1. Amendment to the Definition of PATENT RIGHTS and Update to Appendix A.
     The Parties hereby agree that Section 1.1 of the Agreement shall hereby be
amended and restated in its entirety to read as follows:
     “1.1 PATENT RIGHTS shall mean
(a) each of the patents and patent applications listed on Appendix A attached to
this Agreement, as amended, and
(b) each patent and patent application of UIRF that relates to immune modulation
in which Arthur M. Krieg (“Dr. Krieg”) is a named inventor, and
(c) Intellectual property of the University of Iowa or UIRF arising under any
University of Iowa research agreement sponsored by Coley, unless Coley elects
not to exercise its option to such intellectual property,
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

64

--------------------------------------------------------------------------------

 

License Agreement
(d) together with (i) the inventions described and claimed therein, and any
divisions, continuations, continuations-in-part to the extent the claims are
directed to the subject matter specifically described in the foregoing patents
and patent applications, (ii) any and all patents issuing thereon or reissues
thereof, and (iii) any and all foreign patents and patent applications
corresponding thereto.
All of the foregoing patents and patent applications will be automatically
incorporated in and added to this Agreement and shall periodically be added to
Appendix A and made a part thereof.”
     The Parties also hereby agree that Appendix A to the Agreement shall be
updated as of the date hereof to the form of Appendix A attached to this
Amendment.
     Subject to the following sentence, the Parties further agree that ownership
of all rights in and to any inventions, discoveries, information or materials
which are discovered, invented, made, conceived, or first reduced to practice by
Dr. Krieg while on a leave of absence from The University of Iowa (the “ Leave
of Absence Inventions “) shall be governed by separate written agreements by and
between Coley and Dr. Krieg, and by and among UIRF, the University of Iowa and
Dr, Krieg, and not by the Agreement, as amended hereby. If, however, UIRF or the
University of Iowa are determined to be an owner of any such Leave of Absence
Inventions, then the Parties agree that the University of Iowa’s or UIRF’s
interest in such Leave of Absence Inventions shall be subject to the terms of
the Agreement, as amended hereby.
2. Addition of Definitions “Sublicensee” and “Sublicense Revenues.”
     The Parties hereby agree that ARTICLE 1 of the Agreement shall hereby be
amended by inserting the following two additional definitions:
     “1.8 SUBLICENSEE shall mean any third party that is not an AFFILIATE of
LICENSEE to whom LICENSEE, or an AFFILIATE of LICENSEE, grants a sublicense or
an option to sublicense under the PATENT RIGHTS pursuant to Section 2.1 hereof
to make and have made, to use and haveused, to import and have imported, to
offer for sale and have offered for sale, and/or to sell and have sold the
LICENSED PRODUCTS, and/or to practice the LICENSED PROCESSES.
     1.9 SUBLICENSE REVENUES shall mean all revenues received by LICENSEE or an
AFFILIATE from a SUBLICENSEE pursuant to a sublicense under the PATENT RIGHTS,
an option for a sublicense under the PATENT RIGHTS, or a similar agreement
providing for the exploitation of the PATENT RIGHTS, in each case granted
pursuant to Section 2.1 hereof, including license issue fees, license
maintenance fees, milestone fees and royalties, but excluding equity investments
in LICENSEE, any funds received by LICENSEE for the conduct of research and
development, payments received for manufacturing, and the reimbursement of costs
and expenses.”
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

65

--------------------------------------------------------------------------------

 

License Agreement
3. Amendment to Clarify that Term of Agreement is on a Country-by Country Basis.
          The Parties hereby agree that Sections 2.2 and 2.4 of the Agreement
shall hereby be amended and restated in their entirety to read as follows:
          “2.2 The term of this Agreement and the exclusive license set forth in
Paragraph 2.1 shall be from the Effective date of this Agreement until the
expiration of the last to expire of the PATENT RIGHTS, on a country-by country
basis, or for a period of fifteen years, whichever is longer.
          2.4 Upon expiration of the period of exclusivity of this license in a
particular country under the terms of 2.2 above, LICENSEE shall receive in such
country a fully paid up perpetual license to make and have made, to use and have
used, to import and have imported, to offer for sale and have offered for sale,
and to sell and have sold the LICENSED PRODUCTS, and to practice the LICENSED
PROCESSES.”
4. Amendment to Royalty Payment Obligations of Coley.
          The Parties hereby agree that Section 3.2 of the Agreement shall
hereby be amended and restated in its entirety to read as follows:

  “3.2   (a) Licensee shall pay UIRF within forty-five (45) days after the end
of each calendar quarter, during the team of the license of Paragraph 2.1,
royalties on NET SALES of all LICENSED PRODUCTS sold by Licensee and its
AFFILIATES (but not by its sublicensees) as follows:

          In the human field:
[***]%, if total royalties being paid on the LICENSED PRODUCT to all parties,
other than by LICENSEE to [******] and its AFFILIATES for anything other than
licenses under issued patents, is less than or equal to [***]%.
[****]%, if total royalties being paid on the LICENSED PRODUCT to all parties,
other than by LICENSEE to [******] and its AFFILIATES for anything other than
licenses under issued patents, is greater than [***]%, but less than equal to
[***]%.
[***]%, if total royalties being paid on the LICENSED PRODUCT to all parties,
other than by LICENSEE to [******] and its AFFILIATES for anything other than
licenses under issued patents, is greater than [***]% but less than or equal to
[****]%.
[*]%, if total royalties being paid on the LICENSED PRODUCT to all parties,
other than by LICENSEE to [******] and its Affiliates for anything other than
licenses under issued patents, is greater than [****]%.
          In the animal field:
          [***]% of LICENSED PRODUCTS.
(b) Royalties shall not apply to sales among LICENSEE, its AFFILIATES and their
respective SUBLICENSEES for resale. On sales between LICENSEE and its AFFILIATES
for resale, the royalty shall be paid only on the resale.”
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

66

--------------------------------------------------------------------------------

 

License Agreement
5. Amendment to Annual License Maintenance Fee Obligations of Coley.
               The Parties hereby agree that Section 3.3 of the Agreement shall
hereby be amended and restated in its entirety to read as follows:
               “3.3 Commencing in the fifth AGREEMENT YEAR, an annual license
maintenance fee payment of $[*******] shall be payable to the UIRF within
forty-five (45) days of the end of each AGREEMENT YEAR. This payment shall be
reduced by the amount of any milestones, royalties, and SUBLICENSE REVENUES
accrued to the UIRF solely during that AGREEMENT YEAR but shall not be reduced
by (a) any royalties accruing in any other AGREEMENT YEAR or (b) contract
research funding payable to the University of Iowa pursuant to the terms of any
Sponsored Research Agreement.”
6. Amendment to Milestone Payment Obligations of Coley.
               The Parties hereby agree that Section 3.4 of the Agreement shall
hereby be amended and restated in its entirety to read as follows:
               “3.4 Licensee shall pay to UIRF the following sums within thirty
(30) days of the achievement of the indicated milestones:
$[******] payable upon the
[*****************************************************************] LICENSED
PRODUCTS in the animal field in the [*************]; and
$[*******] payable upon
[********************************************************************] LICENSED
PRODUCTS in the human field in [***********************************]
               UIRF acknowledges that the milestone payment obligations set
forth under Section 3.4 of the Agreement, as amended hereby, will be credited
against the amount of any Sublicense Revenues due to UIRF under Section 3.5 of
the Agreement, as amended hereby, to the extent such Sublicense Revenues are
attributable to milestone payments from a Sublicensee to Coley. For purpose of
clarification, the parties specifically agree that in the event Coley receives
payment from a Sublicensee for achievement of these milestones in an amount
which would require a payment to UIRF under Section 3.5, as amended below,
greater than set forth in Section 3.4, Coley shall pay UIRF only the amount due
under Section 3.5.
7. Amendment to Sublicense Payment Obligations of Coley.
               The Parties hereby agree that Section 3.5 of the Agreement shall
hereby be amended and restated in its entirety to read as follows:

  “3.5   In the case of sublicenses, options to sublicense, and similar
agreements to exploit the PATENT RIGHTS, LICENSEE shall also pay to UIRF the
following

     Portions of this Exhibit were omitted and have been filed separately with
the Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

67

--------------------------------------------------------------------------------

 

License Agreement
               percentages of SUBLICENSE REVENUES received in the manner set
forth below:
(i) [**************] ([**]%) of SUBLICENSE REVENUES (the “Interim Payments”)
received by LICENSEE during the first twelve (12) month period immediately
following the execution of this Amendment (the “ Interim Period “), [********]
([***]) of which shall be paid in a deferred manner in accordance with
Paragraph 11 of the Amendment (the “ Deferred Interim Payments “); and
(ii) [********] percent ([**]%) of SUBLICENSE REVENUES received by LICENSEE
thereafter.”
8. Amendment to Clarify Survival of Confidentiality Obligations upon
Termination.
          The Parties hereby agree that Section 9.1 of the Agreement shall
hereby be amended by inserting a new paragraph (d) as follows:
          “(d) UIRF’s obligations of confidentiality under Section 4.4 hereof.”
9. SmithKline Beecham PLC and Qiagen GmbH
          Coley hereby agrees to pay UIRF $[*******] in a deferred manner in
accordance with Paragraph 11 of this Amendment (the “Deferred SB/Qiagen Payment
“).
          As consideration for Coley’s obligation to pay UIRF the Deferred
SB/Qiagen Payment, UIRF hereby irrevocably waives any claim that it might
otherwise have for a percentage of the payments received by Coley on or before
February 1, 2001 under:
          (i) Sections 3.04, 4, 8.01a, 8.01b, and 8.03.1 of the Strategic
Alliance Agreement Infectious Diseases dated as of December 18, 1998 between
Coley and SmithKline Beecham PLC (“SB”), and Sections 3.1, 3.2 and 4.2 of
Amendment No. 1 thereto dated as of December 18, 1999 (collectively, the “ SB
Amendment “),
          (ii) Sections 3.1 and 3.2(a) of the Strategic Alliance Option
Agreement Cancer dated as of December 8, 1998, as amended, between Coley and SB
(the “ SB Option “) and
          (iii) Sections 3.1 and 3.5 of the Sublicense Agreement dated as of
January 5, 1998, as amended, between Coley and Qiagen GmbH (the “Qiagen
Agreement”).
          The SB Agreement, SB Option and the Qiagen Agreement are referred to
collectively as the “SB/Qiagen Agreements.” Any Sublicense Revenues that have
accrued or may accrue under the entire SB/Qiagen Agreements after February 1,
2001 shall be subject to Section 3.5 of the Agreement as amended hereby.
10. Amendment Payments
          As consideration for the execution of this Amendment, Coley hereby
agrees to pay to UIRF $[*******] in cash immediately upon the execution of this
Amendment. UIRF
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

68

--------------------------------------------------------------------------------

 

License Agreement
acknowledges that such $[*******] payment will be credited against the amount of
any Sublicense Revenues due to UIRF under Section 3.5 of the Agreement, as
amended hereby, to the extent such Sublicense Revenues are attributable to the
successful completion of Phase I clinical trials for the first three independent
LICENSED PRODUCTS in the human field.
          As further consideration for the execution of this Amendment, Coley
hereby agrees to pay UIRF $[*******] in a deferred manner in accordance with
Paragraph 11 of this Amendment (the “ Deferred Amendment Payment ,” and together
with the Deferred Interim Payments and the Deferred SB/Qiagen Payment, the “
Deferred Payments “).
11. Deferred Payments; UIRF’s Option to Convert into Common Stock
          11.1 Payment Terms. Coley shall pay to UIRF the Deferred Payments,
together with interest at the rate of [****] percent ([*]%) per year, compounded
annually on the aggregate outstanding principal amounts of such Deferred
Payments plus interest previously accrued on such Deferred Payments from the
date such Deferred Payments are incurred, within thirty (30) days after receipt
by Coley of a written request for payment from UIRF, in such amounts as UIRF may
specify from time to time; provided, however, that, subject to Paragraph 11.2 of
this Amendment, Coley shall have no obligation to make any payments to UIRF on a
Deferred Payment prior to the second anniversary of the date that such Deferred
Payment is incurred. Theparties agree that for purposes of this Paragraph 11 of
the Amendment, the Deferred SB/Qiagen Payment and the Deferred Amendment Payment
shall be incurred by Coley on the date of this Amendment and the Deferred
Interim Payments, if any, shall be incurred by Coley on the date Coley makes the
relevant cash Interim Payment to UIRF. On or after the fifth anniversary of the
date of this Amendment, Coley shall have the right, at any time following ten
business days advance written notice to UIRF, to prepay (i.e. prior to receipt
of a written request by UIRF) all or any part of the outstanding principal
amount of the Deferred Payments, plus accrued but unpaid interest thereon,
provided that Coley shall concurrently pay a premium equal to [****] percent
([*]%) of the amount that is so prepaid, and provided further that UIRF may,
before the expiration of such ten business day notice period, exercise its
conversion rights in accordance with Paragraph 11.2.1, or Paragraph 11.2.2, as
applicable.
          11.2 Option to Convert.
          11.2.1 Following an Initial Public Offering. Coley shall promptly
inform UIRF of the consummation of an initial public offering of the Common
Stock of Coley pursuant to a registration statement filed with the Securities
and Exchange Commission under the Securities Act of 1933, as amended (an “ IPO
“). At any time after the consummation of an IPO (the “Option Trigger Date “),
UIRF may, during the Conversion Period as defined below, elect to convert all or
part of each outstanding Deferred Payment (including interest thereon) into
shares of the Common Stock of Coley by executing and delivering to Coley the
form of subscription agreement (the “Subscription Agreement” ) attached to this
Amendment as Exhibit A, specifying therein the Deferred Payment(s), and the
aggregate amount(s) thereof, to be converted. For purposes of this
Paragraph 11.1.2, the Conversion Period shall commence on the Option Trigger
Date and terminate on the later of (i) six months following such Option Trigger
Date or (ii) six months following the expiration of any applicable Lock-Up to
which UIRF may be bound pursuant to Section 2(f) of the Subscription Agreement.
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

69

--------------------------------------------------------------------------------

 

License Agreement
          11.2.2 Upon a Sale Transaction. Coley shall promptly inform UIRF if
Coley enters into a binding written commitment to consummate a Sale Transaction
(as defined below), provided that UIRF shall maintain such information as
confidential pursuant to Section 4.4 of the Agreement. Upon receipt of such
notice, UIRF may, at any time prior to the consummation of the Sales
Transaction, elect to convert all or part of each outstanding Deferred Payment
(including interest thereon) into shares of the Common Stock of Coley by
executing and delivering to Coley a Subscription Agreement, specifying therein
the Deferred Payment(s), and the aggregate amount(s) thereof, to be converted.
As used herein, the term “ Sale Transaction “ shall mean any consolidation or
merger of Coley into or with any other entity or entities which results in the
exchange of outstanding shares of capital stock of Coley for securities or other
consideration issued or paid or caused to be issued or paid by any such entity
or affiliate thereof (other than a merger to reincorporate Coley in a different
jurisdiction or a merger or consolidation in which the holders of outstanding
shares of the capital stock of Coley become, solely by means of such merger or
consolidation, the holders of a majority of the voting securities of such other
entity), and any sale, lease, abandonment, transfer or other disposition by
Coley of all or substantially all its assets.
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

70

--------------------------------------------------------------------------------

 

License Agreement
          11.2.3 Calculation of Number of Conversion Shares. The number of
shares to be issued upon a conversion pursuant to Paragraphs 11.2.1 or 11.2.2 of
this Amendment shall be equal to the cash amount of the Deferred Payment(s)
(including interest) to be so converted (as specified by UIRF in the
Subscription Agreement) divided by the Conversion Price. The “ Conversion Price
“ shall initially be $[*****] (which is equal to the per share price of the
Series E Preferred Stock issued by Coley in its most recent private financing
prior to the date hereof), subject to adjustment as follows:
               (i) If Coley shall at any time or from time to time after the
date of this Amendment effect a subdivision of the outstanding Common Stock, the
Conversion Price then in effect immediately before that subdivision shall be
proportionately decreased. If Coley shall at any time or from time to time after
the date of this Amendment combine the outstanding shares of Common Stock into a
smaller number, the Conversion Price then in effect immediately before the
combination shall be proportionately increased. Any adjustment under this
paragraph (i) shall become effective at the close of business on the date the
subdivision or combination becomes effective; and
               (ii) If Coley shall at any time or from time to time after the
date of this amendment make or issue, or fix a record date for the determination
of holders of Common Stock entitled to receive, a dividend or other distribution
payable in additional shares of Common Stock, then and in each such event the
Conversion Price then in effect shall be decreased as of the time of such
issuance or, in the event such a record date shall have been fixed, as of the
close of business on such record date, by multiplying the Conversion Price then
in effect by a fraction:
               (1) the numerator of which shall be the total number of shares of
Common Stock issued and outstanding immediately prior to the time of such
issuance or the close of business on such record date, and
               (2) the denominator of which shall be the total number of shares
of Common Stock issued and outstanding immediately prior to the time of such
issuance or the close of business on such record date plus the number of shares
of Common Stock issuable in payment of such dividend or distribution;
provided, however, if such record date shall have been fixed and such dividend
is not fully paid or if such distribution is not fully made on the date fixed
therefor, the Conversion Price shall be recomputed accordingly as of the close
of business on such record date and thereafter the Conversion Price shall be
adjusted pursuant to this paragraph as of the time of actual payment of such
dividends or distributions.
          11.2.4 Option Non-Transferable; Compliance with Securities Act. UIRF
acknowledges and agrees that the option provided for in this Section 11 (the “
Option “) may not be sold, assigned, transferred or conveyed to any third party
whatsoever, without the prior written consent of Coley in Coley’s sole
discretion, other than to the National Institutes of Health (the “NIH”) pursuant
to the terms of the Inter-Institutional Agreement (the “NIH Agreement”) dated as
of November 24, 1999 between UIRF and the NIH (provided that the NIH agrees in
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

71

--------------------------------------------------------------------------------

 

License Agreement
writing not to further assign the Option without the prior written consent of
Coley in Coley’s sole discretion). UIRF agrees that the Option, and, if
exercised, the shares of Common Stock to be issued upon conversion thereof, are
being acquired for investment for UIRF’s own account and not with a view toward
distribution thereof, and that it will not offer, sell or otherwise dispose of
any shares of Common Stock to be issued upon conversion of the Option other than
pursuant to the terms and conditions of the Subscription Agreement.
12. No Admission of Liability.
          This Amendment has been entered into solely to revise certain terms
set forth in the Agreement, and in certain cases to amicably resolve certain
disagreements over the interpretation of such terms, and it shall not constitute
an admission of liability by either party as to any claim, defense or allegation
of the other party.
13. Survival, Acknowledgement and Release.
          Each of the parties hereto acknowledges that the Agreement remains in
full force and effect in accordance with its terms, as amended hereby, and that
the other party hereto is not in breach of any of the terms and conditions of
the Agreement, as amended hereby, as of the date of this Amendment. Each of the
parties to this Amendment hereby releases and forever discharges the other
party, each parent, subsidiary and affiliate of the other party, and their
respective representatives, agents, shareholders, officers, directors,
employees, successors, and assigns from any and all claims, demands, actions
causes of action, debts, dues, liabilities, and controversies of every kind and
nature, whether presently known or unknown, vested or contingent, arising or
accruing at any time on or before the date hereof, which relate to or arise out
of the Agreement or the subject matter thereof.
14. Entire Agreement.
          The Agreement and this Amendment and the attachments hereto and
thereto constitute the entire agreement and understanding between Coley and UIRF
relating to the subject thereof and hereof. No verbal agreement, conversation or
representation between any officers, agents, or employees of the parties hereto
either before or after the execution of the Agreement or this Amendment shall
affect or modify any of the terms or obligations therein or herein contained.
Any further amendment to the terms of the Agreement or this Amendment shall be
made in writing and signed on behalf of each party by a duly authorized officer.
15. Terms Confidential.
          Each party hereby acknowledges and agrees that it will not disclose
the terms of the Agreement or this Amendment or any other information relating
to the subject matter hereof or thereof to any third party without the express
written consent of the other party, except that (i) either party may use the
text of a written statement approved
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

72

--------------------------------------------------------------------------------

 

License Agreement
in advance by both parties without further approval, (ii) Coley may disclose the
terms of the Agreement and this Agreement to a Sublicensee, and (iii) either
party shall have the right to identify the other party and to disclose the terms
of this Agreement as required by applicable securities laws or other applicable
laws or regulations. Without limiting the generality of the foregoing, either
party may disclose the Agreement and this Amendment to the NIH pursuant to a
request that the terms thereof be withheld from public disclosure pursuant to
Exemption 4 of the Freedom of Information Act, 5 U. S.C. § 552(b)(4).
          Please sign below where indicated to acknowledge your agreement to the
foregoing Amendment.

                  Sincerely,         COLEY PHARMACEUTICAL GROUP, INC.    
 
           
 
  By:
Name:   /s/ Robert Bratzler
 
Bratzler    
 
  Title:   President & CEO    

          ACKNOWLEDGED AND AGREED TO     This 7th day of March, 2001     THE
UNIVERSITY OF IOWA RESEARCH FOUNDATION    
 
       
By:
Name:
  /s/ W. Bruce Wheaton
 
W. Bruce Wheaton    
Title:
  Executive Director and Secretary    

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

73

--------------------------------------------------------------------------------

 

License Agreement
Exhibit A
FORM OF SUBSCRIPTION AGREEMENT
     Portions of this Exhibit were omitted and have been filed separately with
the Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

74

--------------------------------------------------------------------------------

 

License Agreement
EXHIBIT C
OHRI Agreement
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

1

--------------------------------------------------------------------------------

 

License Agreement
Exhibit 10.18 to Coley Pharmaceutical Group, Inc. Form S-1 filed April 20, 2005
LICENSE AGREEMENT
THIS AGREEMENT comes into force as of the first day of September, 1998,
(“Effective Date”), by and between The Loeb Health Research Institute at the
Ottawa Hospital (hereinafter referred to as “LOEB”) located at 725 Parkdale
Avenue, Ottawa, Ontario K1 Y 4E9, CANADA and CpG ImmunoPharmaceuticals, Inc.
having an address of 55 William Street, Suite 120, Wellesley, MA 02481, USA
(hereinafter referred to as “CpG”).
WITNESSETH:
WHEREAS QIAGEN GmbH and LOEB have entered into a Research Agreement effective as
of September 1, 1996 (the “Research Agreement”) pursuant to which QIAGEN has
sponsored a research and development program (the “R&D Program”) at LOEB under
the direction of Dr. Heather L. Davis (the “Investigator”);
WHEREAS, pursuant to Section 6.01 of the Research Agreement, QIAGEN has assigned
all of its rights, obligations, terms and conditions under the Research
Agreement to CpG;
WHEREAS, LOEB has acquired valuable rights to Inventions derived from the R&D
Program and has filed the patent applications listed on Exhibit A attached
hereto with respect to such Inventions; and
WHEREAS, pursuant to Section 4.02 of the Research Agreement, LOEB has agreed to
promptly notify CpG of any Inventions derived from the R&D Program;
WHEREAS pursuant to Section 4.03 of the Research Agreement, CpG has elected to
exercise its option to acquire an exclusive license in the Field to Inventions
developed under the Research Agreement for which the patent applications listed
on Exhibit A attached hereto have been filed;
NOW, THEREFORE, in consideration of the sum of ten dollars (US$10.00), the
mutual covenants herein contained, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged by the parties, and
intending to be legally bound, LOEB and CpG agree as follows:
ARTICLE 1
DEFINITIONS
As used herein, capitalized terms shall have the following meanings:

1.1   Affiliate shall mean a corporate or other entity which directly or
indirectly controls, is controlled by, or is under common control with a Party,
and “control” shall mean the ownership of not less than 50% of the voting shares
of a corporation, or decision-making

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

2

--------------------------------------------------------------------------------

 

License Agreement

    authority as to any unincorporated entity. With respect to CpG, Affiliate
shall also include any partnership of which CpG is the general partner.   1.2  
Commercial Sale shall mean any transaction between CpG, or an Affiliate of CpG,
and a third party which transfers physical possession and title to any Licensed
Product to a third party.   1.3   Field shall mean applications of CpG
immunomodulatory nucleic acid sequences for human and veterinary prophylactic
and therapeutic purposes independently or in combination with protein(s), other
adjuvants, other immunostimulatory agents and/or other nucleic acid sequences.  
1.4   Institute Personnel means any person working at the LOEB, including but
not limited to any Investigator, professor, technician, associate, medical
professional, or student (including a pre- or post-doctoral student), any
independent contractor (including any consultant under an obligation of
confidentiality), or any research collaborator, student or consultant who
participates in the R&D Program in any manner or who acquires knowledge of any
test data, clinical information or any other information resulting from any R&D
Program which is deemed a trade secret or confidential or proprietary to CpG or
LOEB.   1.5   Invention shall mean any discovery, new or useful process, method,
manufacture, compound, biological material, composition of matter, or software,
or any improvement thereof, with application in the Field, whether patentable or
unpatentable, which is developed, conceived or first reduced to practice, or
demonstrated to have utility during the term of the R&D Program and covered by
the Patent Rights. Notwithstanding the foregoing, if any such Invention is not
reduced to practice within twelve months following the expiration or termination
of the R&D Program, it shall not be deemed an Invention hereunder.   1.6  
Investigator(s) shall mean initially Dr. Heather L. Davis, so long as she is
associated with LOEB, and any other Institute Personnel who became or becomes
involved in the R&D Program, as agreed by CpG pursuant to Section 2.01 of the
Research Agreement between the Parties hereto.   1.7   Joint Invention shall
mean any Invention for which it is determined, in accordance with U.S. patent
law, that both: (i) employees, consultants or agents of CpG or any other persons
obligated to assign or exclusively license such Invention to CpG or to an
institution other than CpG or LOEB for use in the Field, and (ii) employees or
agents of LOEB or any other persons obliged to assign such Invention to LOEB,
are joint inventors of such Invention.   1.8   Licensed Product shall mean any
product or process which is covered by a Pending or issued claim under Patent
Rights or, if not covered by Patent Rights, shall mean any product or process
which, to a material degree as determined by mutual agreement of the

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

3

--------------------------------------------------------------------------------

 

License Agreement

    Parties, contains, is based on, or is derived from, identified through or
utilizes any Licensed Technology which is not in the public domain. Any product
or process which is a Licensed Product at the time of first Commercial Sale
shall, for the purposes of Sec. 4.1, 4.3 and 9.1, be treated as a Licensed
Product for at least 15 years from the date of first Commercial Sale.   1.9  
Licensed Technology shall mean any and all information, and all patentable and
non-patentable inventions (including, without limitation, the Inventions, Joint
Inventions and Patent Rights), improvements, discoveries, claims, formulae,
materials, processes, methods, trade secrets, technologies, data and know-how,
whether existing in the Investigator’s laboratory at LOEB as of the Effective
Date or developed by Investigator(s) in the performance of the R&D Program,
relating to the Field or the development and/or commercialization of products in
the Field, whenever such inventions, improvements, discoveries, claims,
formulae, materials, processes, methods, trade secrets, technologies, data and
know-how are derived from or directly related to the Inventions. Notwithstanding
the foregoing, the patent application PCT/FR94/00483, CON of USSN 08/633,821
entitled “Nucleotide Vector Composition Containing Such Vector and Vaccine for
Immunization Against Hepatitis” assigned to the Pasteur Institute INSERM and the
University of Ottawa shall not be included in Licensed Technology.   1.10   Net
Sales shall mean the gross invoice price of Licensed Products sold by CpG and/or
its Affiliates in arm’s length sales to third parties, less the sum of the
following deductions where applicable:

  (a)   cash, trade and quantity discounts;     (b)   sales, use, tariff,
import/export duties or other excise taxes imposed upon particular sales;    
(c)   transportation charges;     (d)   allowances or credits to customers
because of rejections or returns; and     (e)   commission and other fees paid
to non-affiliated brokers or non-affiliated sales agents.

In the event that CpG sells Licensed Products to a non-affiliated third party in
an arm’s length transaction solely for the purpose of having such third party
act as a distributor for Licensed Products, “Net Sales” shall be the amount owed
CpG by such distributor less the returns as defined above.
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

4

--------------------------------------------------------------------------------

 

License Agreement
In the event that Licensed Products are sold or used in combination with
products or processes having independent therapeutic or prophylactic effect,
then Net Sales, for purposes of determining royalty payments on the combination,
shall be calculated using one of the following methods:
(i) By multiplying the Net Sales of the combination product or process by the
fraction A/A+B, where A is the gross selling price, during the royalty period in
question, of Licensed Products when sold separately for the same application,
and B is the gross selling price of the other product for the same application,
during the royalty period in question, when sold separately; or
(ii) In the event that no such separate sales are made of such Licensed
Product(s) or other products or processes in such combination during the royalty
period in question, Net Sales, for the purposes of determining royalty payments,
shall be calculated using the above formula where A is the reasonably estimated
commercial value of the Licensed Products when sold separately, and B is the
reasonably estimated commercial value of the other product or processes, when
sold separately. Any such estimates shall be mutually agreed upon by the
Parties. Such estimates shall be reported to LOEB with the reports to be
provided to LOEB pursuant to Section 5.1 hereof.

1.11   Party shall mean LOEB or CpG and, when used in the plural, shall mean
LOEB and CpG.   1.12   Patent Rights shall mean all rights derived from the
patent applications listed on Exhibit A attached hereto (including without
limitation provisional applications and invention disclosures), and as such
Exhibit A may be amended from time to time by mutual agreement of the Parties,
and which are owned or controlled, in whole or in part, by LOEB by way of
transfer of rights from any Investigator, claiming, describing, embodying or
relating to the Licensed Technology throughout the Territory, including any
substitutions, extensions, renewals, continuations, continuations-in-part,
divisions, patents of addition, and/or reissues thereof, and any current and
future patent or patent application, or portion thereof, which is a foreign
counterpart in any country in the Territory to any of the foregoing, including
any substitutions, extensions, renewals, continuations, continuations-in-part,
divisions, patents of addition and/or reissues thereof.   1.13   Pending shall
mean a claim in a patent application under Patent Rights that has not been
completely and finally rejected.   1.14   Publication means any non-confidential
written or oral publication or disclosure resulting from or involving the
Licensed Technology, and includes but is not limited to a publication or
disclosure in articles, books, journals, theses, the media, trade publications,
scientific meetings, seminars, poster sessions, and symposia.   1.15   R&D
Program shall mean research conducted by LOEB, acting through the laboratories
of any Investigator(s) pursuant to the terms of the Research Agreement.   1.16  
Sublicensee shall mean any third party to whom CpG, or an Affiliate of CpG,
grants a sublicense pursuant to Section 3.2 of this Agreement to develop, make,
have made, use, have used, sell, offer for sale, have sold, import or have
imported Licensed Products.

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

5

--------------------------------------------------------------------------------

 

License Agreement

1.17   Sublicense Income shall mean all sublicensing fees and revenues received
by CpG or its Affiliates from Sublicensees in consideration for a sublicense to
develop, make, have made, use, have used, sell, offer for sale or have sold,
import and have imported Licensed Products, including, but not limited to,
milestone payments and license initiation fees. Notwithstanding the foregoing,
Sublicense Income shall not include revenue specifically allocated by CpG to,
and demonstrably used for, research and development of the Licensed Technology,
nor shall it include funds received by CpG for equity investments in CpG which
are not in excess of a [**]% premium of the then current fair market value of
CpG equity (i.e., that portion of any funds received for equity which is greater
than a [**]% premium shall be deemed Sublicense Income).   1.18   Territory
shall mean the entire world.

ARTICLE 2
REPRESENTATIONS AND WARRANTIES

2.1   Representations and Warranties of Both Parties. Each Party represents and
warrants to the other Party that: (i) it is free to enter into this Agreement;
(ii) in so doing, it will not violate any other agreement to which it is a
party; and (iii) it has taken all corporate action necessary to authorize the
execution and delivery of this Agreement and the performance of its obligations
under this Agreement.   2.2   Representations and Warranties of LOEB. LOEB
hereby represents and warrants that:

  (a)   They are the owners, either solely or, jointly with others, of the
patent applications listed on Exhibit A, and have the exclusive right to grant
licenses in their interests therein;     (b)   They are the owners of, either
solely or jointly with others, or are the licensees of, all of the Licensed
Technology in existence on the date of this Agreement, and have the right to
grant licenses or sublicenses of their interest therein;     (c)   They have
used their best efforts to inform CpG of and preserve all patent rights to the
Inventions and all patent applications listed on Exhibit A are in full force and
effect to the best of their knowledge as of the Effective Date of this License
Agreement;     (d)   They are not aware of any asserted or unasserted claim or
demand against the patent applications listed on Exhibit A; and     (e)   They
have not entered into any agreement with any third party which is in conflict
with the rights granted to CpG pursuant to this Agreement.

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

6

--------------------------------------------------------------------------------

 

License Agreement

2.3   Disclaimer of Other Warranties.

  (a)   EXCEPT AS EXPRESSLY PROVIDED IN SECTION 2.2, NOTHING IN THIS AGREEMENT
SHALL BE CONSTRUED AS A REPRESENTATION MADE, OR WARRANTY GIVEN, BY LOEB THAT ANY
PATENT WILL ISSUE BASED UPON ANY PENDING PATENT APPLICATION, THAT ANY PATENT
WHICH ISSUES WILL BE VALID, OR THAT THE LICENSED TECHNOLOGY OR LICENSED PRODUCTS
WILL NOT INFRINGE THE PATENT OR PROPRIETARY RIGHTS OF ANY THIRD PARTY.
FURTHERMORE, LOEB MAKES NO OTHER REPRESENTATIONS OR WARRANTIES, EXPRESS OR
IMPLIED, WITH RESPECT TO THE LICENSED TECHNOLOGY OR LICENSED PRODUCTS,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE.     (b)   NEITHER PARTY SHALL BE LIABLE WITH RESPECT TO THE
SUBJECT MATTER OF THIS AGREEMENT UNDER ANY CONTRACT, NEGLIGENCE, STRICT
LIABILITY OR OTHER LEGAL OR EQUITABLE THEORY FOR (I) ANY INDIRECT,
CONSEQUENTIAL, PUNITIVE OR OTHER DAMAGES OR (II) COST OF PROCUREMENT OF
SUBSTITUTE GOODS, TECHNOLOGY OR SERVICES.

ARTICLE 3
LICENSE GRANT

3.1   Grant of License. LOEB hereby grants to CpG a royalty-bearing exclusive
license in the Field and in the Territory to utilize the Licensed Technology and
to develop, have developed, make, have made, perform, use, have used, sell,
offer for sale, have sold, import or have imported Licensed Products (the"
License" ).   3.2   Right to Sublicense. Such License shall also include the
right to grant sublicenses. CpG shall have the right to screen and select
Sublicensees, and to agree on the terms of any sublicense. LOEB shall have the
right to inspect and comment upon any sublicense agreement prior to execution of
any sublicense agreement. Copies of all executed sublicense agreements shall be
provided to LOEB.   3.3   Reservation of Rights. Notwithstanding any rights
granted to CpG hereunder, the LOEB shall retain the right to use Inventions
solely for research and educational purposes on a non-commercial basis, subject
to confidentiality requirements and LOEB’s obligations to preserve patent rights
as set forth in Article 7 hereof. For purposes hereof, “research and educational
purposes” shall not include the conduct of research sponsored by a commercial
entity or the development of products or processes to be licensed to a
commercial entity during the term of the Research Agreement or extension thereof
other than the work performed under the R&D Program. During the term of this
Agreement,

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

7

--------------------------------------------------------------------------------

 

License Agreement

    LOEB can suggest how CpG and third party technology could be used together
and may seek CpG’s permission to do so under the Research Agreement between the
Parties hereto, but shall not use any such third party technology in combination
with CpG technology without the prior written consent of CpG.   3.4   CpG’s
Development Efforts. CpG shall use all reasonable efforts to develop and
commercialize Licensed Products. A Development Plan will be prepared by CpG and
submitted to LOEB which shall outline CpG’s plans to develop the Licensed
Technology on or before December 31, 1999. A written progress report by CpG will
be submitted to the LOEB on or prior to each anniversary of the Effective Date
summarizing the development work on Licensed Technology for commercial purposes.
  3.5   Failure to Use Due Diligence. In the event that CpG shall fail to use
all reasonable efforts to develop and commercialize Licensed Products, LOEB may,
upon written notice to CpG to be given pursuant to the mechanism set forth in
Section 9.2, with the opportunity to cure or remedy such default as set forth
therein convert CpG’s License for such Licensed Products and Licensed Technology
into a non-exclusive license.   3.6   Notwithstanding any other provision of the
Research Agreement or this Agreement to the contrary, the parties hereby agree
that, if so requested by CpG, the terms for the exclusive license to CpG of any
future Joint Invention which is developed pursuant to the R&D Program and owned
in part by a party other than CpG or LOEB, but which is not included on
Exhibit A as of the Effective Date hereof, will be governed by an
interinstitutional agreement to be negotiated between LOEB and any third party
owner(s) of any such Joint Invention, provided the third party owner(s) are
agreeable to enter into such negotiations with LOEB.

ARTICLE 4
CONSIDERATION

4.1   Royalties. In consideration of the exclusive licenses and other rights
granted to CpG under this Agreement, CpG agrees to pay to LOEB a royalty,
commencing upon the first Commercial Sale of a Licensed Product by CpG, its
Affiliates or its Sublicensees, as follows:

  (a)   For Commercial Sales made by CpG or its Affiliates, CpG shall pay the
highest applicable royalty as set forth below:

  (i)   For sales of Licensed Products covered by issued or Pending Patent
Rights, CpG shall pay to LOEB a royalty equal to [****] percent ([*]%) of Net
Sales;

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

8

--------------------------------------------------------------------------------

 

License Agreement

  (ii)   For sales of Licensed Products not covered by issued or Pending Patent
Rights, CpG shall pay to LOEB a royalty equal to [*****] percent ([*]%) of Net
Sales.

  (b)   Notwithstanding the foregoing, in the event that the total royalties due
to LOEB and all third parties on a Licensed Product exceed [**]% of Net Sales
prior to any applicable royalty reduction(s), CpG shall be entitled to a royalty
reduction of [*****] percent ([**]%) of the royalties owed to third parties on
the Licensed Products in excess of [**]%, up to a maximum reduction of [**]% of
the royalties due the LOEB according to Section 4.1(a) above. For example, if
the total royalty due on a Licensed Product is [**]%, CpG shall pay to LOEB a
royalty of [***]% (i.e., [*]% — [***]%) of Net Sales of the Licensed Product.  
  (c)   In the event that CpG and/or its Affiliates receive Sublicense Income
from any Sublicensee, CpG shall pay to LOEB [***] percent ([**]%) of such
Sublicense Income from each such Sublicensee.     (d)   In the event that:
(i) payments by CpG to LOEB under Section 4.1(c) plus (ii) payments by CpG to
one or more third parties of a percentage of such Sublicense Income exceed
[*****] percent ([**]%) of any such Sublicense Income received by CpG, then
payments to LOEB pursuant to Section 4.1(c) will be reduced on a prorata basis
with payments owed to such third parties on such Sublicense Income so that the
total percentage paid out by CpG to all non-affiliated third parties with
respect to Sublicense Income shall not exceed [******] percent ([**]%) of any
such amounts received by CpG. For example, if CpG receives Sublicense Income and
owes Party X [***] percent ([**]%) thereof and Party Y [******] percent ([**]%)
thereof, bringing the total owed to [**]%, then LOEB’s share of such Sublicense
Income will be reduced to [****]% (i.e., by [****]%, which is [****]% of the
excess of [****] percent since [**]% is [****]% of [**]%). Notwithstanding the
foregoing, this provision shall only be effective with respect to payments to
third parties which are governed by a similar provision and shall not be used to
reduced the percentage owed to LOEB pursuant to Sec. 4.1(c) to less than [****]
percent ([*]%).     (e)   Sublicense Income from all Licensed Products which
incorporate CpG DNA as an adjuvant in antigen- or DNA-based vaccines against
infectious diseases shall be exempted from the conditions for reductions in
payment to the LOEB as stated in Sec. 4.1(d).

4.2   Obligation to Pay Royalties. The obligation to pay royalties to LOEB under
this Article 4 is imposed only once with respect to the same unit of Licensed
Product regardless of the number of Patent Rights or the amount of Licensed
Technology pertaining thereto.   4.3   Duration of Royalties. CpG shall not be
obligated to make any further royalty payments in any country for any Licensed
Product after the end of the period commencing on the date of the first
Commercial Sale of the Licensed Product in that country by CpG, its

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

9

--------------------------------------------------------------------------------

 

License Agreement

    Affiliates or Sublicensees and ending either on the date of expiration of a
valid, enforceable claim of a Patent Right covering the Licensed Product in that
country or fifteen (15) years after the date of the first Commercial Sale,
whichever is later.

ARTICLE 5
PAYMENTS AND REPORTS

5.1   Payment. All royalty payments due pursuant to Article 4 shall be paid
quarterly on March 1, June 1, September 1 and December 1 of each year after the
date of first Commercial Sale, for the periods ending December 31, March 31,
June 30 and September 30, respectively. Each such payment shall be accompanied
by a statement of the amount of Net Sales of Licensed Products sold by CpG and
Sublicense Income received by CpG during the relevant period, and the amount of
royalties due thereon.   5.2   Mode of Payment, Blocked Currency. CpG shall make
all payments required under this Agreement by check in United States Dollars
payable to the Loeb Health Research Institute at the Ottawa Hospital. All
royalty payments in any currency other than United States Dollars shall be
translated quarterly into United States Dollars at the average of the rates of
exchange listed in The Wall Street Journal at which United States Dollars are
exchangeable for the cur r ency of the country in which the royalty is accrued
for the last day of each month of the quarter in which such sales were made.

If, at any time, a product is sold in a country in which conditions or legal
restrictions exist which prohibit remittance of royalty payments (“Blocked
Country”), CpG or its Affiliates shall accrue the amount of royalties due in
such Blocked Country on paper on behalf of the LOEB. For so long as such
restrictions or conditions apply, CpG shall be relieved of any further
obligation to LOEB with respect to such royalties except for the furnishing to
LOEB of the statement required by Section 5.1 and a report on the amount accrued
until such times as the legal restrictions is resolved. CpG shall use its best
efforts to pay the LOEB such accrued amounts within thirty days of such
resolution in the Blocked Country.

5.3   Records Retention. CpG and its Affiliates shall keep complete and accurate
records pertaining to the sale of Licensed Products in the Territory and
covering all transactions from which Net Sales and Sublicense Income are derived
for a period of five (5) calendar years after the year in which such Net Sales
and Sublicense Income occurred, and in sufficient detail to permit LOEB to
confirm the accuracy of royalty calculations hereunder.   5.4   Audit Request.
At LOEB’s request, CpG and its Affiliates shall pen lit an independent,
certified public accountant, appointed by LOEB and acceptable to CpG or its
Affiliates, at reasonable times and upon reasonable notice, to examine those
records and all other material documents relating to or relevant to the
calculation of amounts due to LOEB pursuant to Article 4 in the possession or
control of CpG or its Affiliates for a period of

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

10

--------------------------------------------------------------------------------

 

License Agreement

    five (5) years after such royalties have accrued, as may be necessary to
(i) determine the correctness of any report or payment made under this Agreement
or (ii) obtain information as to the royalties payable for any semi-annual
payment period in the case of CpG’s or its Affiliate’s failure to report or pay
pursuant to this Agreement. Said accountant shall treat all such information as
confidential information of CpG and shall not disclose to LOEB any information
other than information relating to said reports, royalties, and payments.
Results of any such examination shall be made available to both Parties. LOEB
shall bear the full cost of the performance of any such audit, unless such audit
demonstrates underpayment of royalties by CpG of more than [***] percent ([**]%)
from the amount of the original royalty payment made by CpG. In such event, CpG
shall bear the full cost of the performance of such audit.   5.5   Taxes. In the
event that CpG or its Affiliates are required to withhold any tax to the revenue
authorities in any country in the Territory regarding any payment to LOEB due to
the laws of such country, LOEB’s pro rata portion of such amount shall be
deducted by CpG or its Affiliates, and it shall notify LOEB and promptly furnish
LOEB with copies of any tax certificate or other documentation evidencing such
withholding. Such taxes deducted from payments to the LOEB shall exclude those
taxes included under Net Sales under Sec. 1.10. In addition, CpG shall use its
best efforts to obtain relief in such tax payments in such countries on behalf
of LOEB.

ARTICLE 6
PATENT PROSECUTION; ENFORCEMENT; INFRINGEMENT

6.1   Patent Prosecution and Maintenance.

  (a)   CpG shall diligently prepare, file and prosecute all patent applications
under Patent Rights in the name of the LOEB using patent counsel engaged by LOEB
as set forth below. LOEB shall cooperate in the preparation, filing and
prosecution of all Patent Rights licensed hereunder to the extent requested by
CpG. Patent Rights shall be filed, prosecuted and maintained in countries
specified by CpG, as agreed to by LOEB. LOEB shall retain a patent law film
selected and agreed upon jointly by LOEB and CpG, and shall pay all invoices
received from such patent law firm in a timely manner. CpG shall have full
rights of consultation with LOEB’s patent counsel with respect to the Patent
Rights to which CpG has exclusive rights hereunder and shall have the right to
control the filing, prosecution and maintenance of Patent Rights and shall keep
LOEB informed and advised and seek input from LOEB except as otherwise provided
herein. Each Party shall provide to the other Party copies of all such
applications, official actions, amendments and all papers filed or received
relating to the Patent Rights. Notwithstanding the foregoing, CpG shall have the
right and obligation, alone or in conjunction with other owners of such rights,
to diligently prepare, file and prosecute all Patent Rights which are Joint
Inventions and shall keep LOEB

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

11

--------------------------------------------------------------------------------

 

License Agreement

      informed and advised and seek input from LOEB with respect thereto to the
same extent set forth above.     (b)   Both Parties agree to cooperate with the
other Party to execute all lawful papers and instruments, to make all rightful
oaths and declarations and to provide consultation and assistance as may be
necessary in the preparation, prosecution, maintenance, and reinforcement of all
such patent applications and patents.

6.2   Patent Cost Reimbursement. For Patent Rights licensed hereunder, CpG shall
reimburse LOEB for all reasonable and customary costs and expenses of filing,
prosecuting and maintaining such Patent Rights, including legal expenses of the
patent counsel, within thirty (30) days after CpG receives an itemized invoice
from LOEB for such costs and expenses. CpG may elect to cease paying for further
patent expenses on a country-by-country basis for any particular patent or
patent application licensed hereunder upon giving sixty (60) days prior written
notice to LOEB, whereupon CpG’s rights under such patent or patent application
in such country pursuant to this Agreement shall terminate. LOEB may thereafter
elect to dispose of any such terminated rights at its sole discretion without
any further obligations to CpG hereunder.   6.3   Notification of Infringement.
If either Party learns of an infringement or threatened infringement by a third
party of any Patent Right licensed hereunder within the Territory, such Party
shall promptly notify the other Party and shall provide such other Party with
available evidence of such infringement. Section 6.4 shall then be applicable.  
6.4   Patent Enforcement.

  (a)   CpG and/or Sublicensee(s) shall have the first right, but not the
obligation, to institute patent infringement actions against third parties based
on any Patent Right licensed under this Agreement. If CpG and/or any Sublicensee
does not institute an infringement proceeding against an offending third party,
or enter into good faith negotiations regarding a sublicense under such Patent
Right with such third party, within one hundred eighty (180) days after receipt
of notice from LOEB, (i) with respect to inventions owned solely by LOEB, LOEB
shall have the right, but not the obligation, to institute an infringement
proceeding, and (ii) with respect to Joint Invention, shall have such rights as
are mutually agreed by the other owners of such Joint Invention as appropriate.
The costs and expenses of any such action (including fees of attorneys and other
professionals) shall be borne by the Party and/or parties instituting the
action. Each Party shall execute all necessary and proper documents and take
such actions as shall be appropriate to allow the other Party (or, for certain
Joint Inventions, other co-owners) to institute and prosecute such infringement
actions and such expenses will be borne by the instituting party. Any award paid
by third parties as a result of such an infringement action (whether by way of
settlement or otherwise) shall be first applied to reimburse the costs and
expenses (including attorney’s fees) of the Party bringing suit, or to reimburse
the costs and expenses (including attorney’s

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

12

--------------------------------------------------------------------------------

 

License Agreement

      fees) incurred by the Parties if the suit is brought jointly and to
reimburse any additional costs and expenses including attorney’s fees incurred
by LOEB in cooperating with CpG in such suits. Any remaining amount of the award
shall be regarded as Sublicense Income and an amount shall be paid to the LOEB
pursuant to Section 4.1(c). Notwithstanding the foregoing, for suits involving
Joint Inventions with co-owners who are not Parties, awards shall be shared as
mutually agreed, provided that CpG’s share of any such recovery shall be treated
as set forth above.     (b)   Notwithstanding the foregoing, neither Party shall
be entitled to settle or otherwise dispose of any suit brought pursuant to
provisions of Section 6.4(a) without the approval of the other Party, which
approval shall not be unreasonably withheld.

6.5   Infringement Action by Third Parties. In the event of the institution of
any claim or suit by a third party against CpG for patent infringement arising
from the development, manufacture, use or sale of any Licensed Product in the
Territory, CpG shall notify LOEB in writing of such suit within ten
(10) business days of receiving notice of such suit. CpG shall have the right to
defend such claim or suit at its own expense, and LOEB hereby agrees to assist
and cooperate with CpG, at CpG’s expense, to the extent necessary in the defense
of such suit. During the pendency of such claim or action, CpG shall continue to
make payments due under this Agreement, but shall be entitled to claim a credit
against royalties otherwise payable hereunder of an amount equal to the
out-of-pocket unreimbursed costs and expenses incurred by CpG in defending
against such claim or suit, provided that such credit shall be no greater than
fifty percent (50%) of the amount of such royalties otherwise payable hereunder.

ARTICLE 7
PUBLICATION; CONFIDENTIALITY

7.1   Notification. The Parties recognize that it is part of LOEB’s function to
disseminate knowledge and information and to make it available for the purpose
of scholarship. The Parties further recognize that the publication of certain
technical information may destroy its commercial value and patentability.
Consequently, any proposed Publication by Institute Personnel shall comply with
this Article 7. Investigator and LOEB shall furnish a copy to CpG of any
proposed Publication or disclosure of data related to the Licensed Technology at
least ninety (90) days in advance of presentation or submission for Publication.
If CpG does not object in writing to such disclosure within thirty (30) days of
receipt, LOEB shall he free to proceed with such disclosure. In the event
written objection is made, the Parties shall negotiate in good faith an
acceptable version of the proposed Publication, including the release date,
within the original ninety (90) day notice period or shall agree to withhold
Publication until a mutually agreeable time, all as further described in
Section 7.2.

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

13

--------------------------------------------------------------------------------

 

License Agreement

7.2   Review of Proposed Publications. CpG will review the proposed Publication,
manuscript, abstract, text or any other material provided under Section 7.1 to
determine if patentable subject matter which has not been adequately protected
by the Patent Rights or Confidential Information of CpG as defined in Sec. 7.4
is disclosed. CpG will notify Institute Personnel within the period prescribed
in Section 7.1 if CpG, in its sole discretion, determines that patentable
subject matter is or may be disclosed, or if CpG, in its sole discretion,
believes confidential or proprietary information of CpG is or may be disclosed.
If it is determined by CpG that additional patent applications should be filed,
and in the event that the delay needed to complete the filing of any necessary
patent application will exceed the period specified in Section 7.1, LOEB and
Institute Personnel shall agree to any reasonable extension of the Publication
delay. The Publication delay shall not continue beyond thirty (30) days past the
date that the proposed Publication or other material was to be presented,
submitted or otherwise disclosed. If it is determined by CpG and LOEB that
confidential or proprietary information of CpG is being disclosed, CpG, LOEB and
Institute Personnel will consult among themselves in good faith to arrive at an
agreement on mutually acceptable modifications to the proposed Publication to
avoid such disclosure within the time period set forth in Section 7.1.   7.3  
Use of Name. Neither Party will use the name of the other in any advertising or
other form of publicity without the prior written permission of the other.
Notwithstanding the foregoing, either Party may include an accurate description
of the terms of this Agreement to the extent required by the laws of any
government or other disclosure laws and in internal communications.   7.4  
Confidentiality; Exceptions. Confidential Information shall mean all Patent
Rights patent applications, research proposals and results, business plans,
development reports. Except to the extent expressly authorized by this Agreement
or otherwise agreed in writing, the Parties agree that, for the term of this
Agreement and for five (5) years thereafter, the receiving Party of Confidential
Information shall keep completely confidential and shall not publish or
otherwise disclose and shall not use for any purpose other than proper
performance hereunder any information furnished to it by the other Party
pursuant to this Agreement, except to the extent that it can be established by
the receiving Party by reasonable proof that such information:

  (a)   was already known to the receiving party at the time of disclosure as
can be reasonably proved by such party;     (b)   became part of the public
domain without breach of this Agreement; or     (c)   was obtained from third
parties with the lawful right to disclose such information.

Each party may disclose the other’s Confidential Information to the extent such
disclosure is reasonably necessary in filing or prosecuting patent applications,
prosecuting or
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

14

--------------------------------------------------------------------------------

 

License Agreement
defending litigation, complying with applicable governmental regulations,
undertaking basic research with outside collaborators, or conducting preclinical
or clinical trials provided that if a Party makes any such disclosure of the
other Party’s secret or confidential information it will, except where
impracticable for necessary disclosures, for example to physicians conducting
studies or to health authorities, give reasonable advance notice to the other
Party of such disclosure requirement and, except to the extent inappropriate in
the case of patent applications, will use its best efforts to secure
confidential treatment of such information required to he disclosed. LOEB may
publish results of the work performed under the Research Agreement upon approval
by CpG pursuant to Article 7 of this Agreement.
ARTICLE 8
INDEMNIFICATION AND INSURANCE

8.1   Indemnification. CpG shall indemnify, defend and hold harmless the LOEB,
its officers, directors, employees, agents and students from any claims, loss,
expense, costs, suits, including attorney’s fees and expenses arising out of or
connected with any activities of CpG and their Affiliates, licensees or
Sublicensees under this Agreement, including without limitation, product
liability claims relating to products based on the Licensed Technology or
Licensed Products, except to the extent that such claim is due to the gross
negligence of the LOEB. The LOEB shall promptly notify CpG of any such claim(s),
shall permit CpG to defend such claim(s) and shall cooperate with CpG and its
insurance carrier in the defense of the claim(s) at CpG’s expense.   8.2  
Insurance. In connection with human clinical trials and/or commercial sales of a
Licensed Product, CpG, at its sole cost and expense, shall insure its
activities, obtain, keep in force and maintain comprehensive or commercial form
of general liability insurance. Such insurance shall name LOEB as an additional
insured and shall provide at least US$[*********] per incident and adequate
annual aggregate in amounts as required by the various hospitals and clinics for
such human clinical trials of Licensed Products. Upon commercial sales of
Licensed Products, CpG and/or its Sublicensees shall obtain, keep in force and
maintain comprehensive general product liability insurance of at least
US$[*********] per incident and adequate annual aggregate amounts and shall name
LOEB as an additional insured.

ARTICLE 9
TERM; TERMINATION

9.1   Term. This Agreement shall commence as of the Effective Date and, unless
sooner terminated as provided in Sec. 9.3 hereunder, shall terminate as to the
Licensed Technology and as to each country in the Territory, upon the expiration
of the last to

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

15

--------------------------------------------------------------------------------

 

License Agreement

    expire of the Patent Rights covering the manufacture, use or sale of such
Licensed Technology and/or the manufacture, use or sale of such Licensed Product
in such country or a minimum of fifteen (15) years from the date of first
Commercial Sale, whichever is later. Upon any such expiration of Patent Rights
or end of such fifteen year period in such country whichever is later, CpG shall
have a fully paid-up license of perpetual duration in such country, subject to
the survival provisions in Section 9.7, including the right of CpG, its
Affiliates and/or its Sublicensees to continue developing, making, using or
selling such Licensed Technology and Licensed Products without any further
obligation to LOEB hereunder.   9.2   Breach. Failure by either Party to comply
with any of the material obligations contained in this Agreement shall entitle
the other Party to give to the Party in default notice specifying the nature of
the default and requiring it to cure such default. If such default is not cured
within sixty (60) days after the receipt of such notice (or, if such default
cannot be cured or remedied within such sixty (60) day period, the Party in
default does not commence and diligently continue actions to cure or remedy such
default), the notifying Party shall be entitled, without prejudice to any of its
other rights conferred on it by this Agreement, and in addition to any other
remedies available to it by law or in equity, to terminate this Agreement by
giving written notice to take effect within sixty (60) days after such notice
unless the defaulting Party shall cure such default within said sixty (60) days.
The right of either Party to terminate this Agreement, as hereinafter provided,
shall not be affected in any way by its waiver or failure to take action with
respect to any previous default.   9.3   Termination by CpG. CpG shall have the
right to terminate the licenses to Licensed Technology granted hereunder, in
whole or as to any Patent Right in any country in the Territory, at any time,
and from time to time, by giving notice in writing to LOEB. Such termination
shall be effective thirty (30) days from the date such notice is given, and all
CpG’s rights associated therewith shall cease as of that date, subject to
Section 9.4.   9.4   Rights to Sell Stock on Hand. Upon the termination of any
license to Licensed Technology granted herein, other than under Section 9.1, in
part or in whole or as to any Patent Right and corresponding Licensed
Technology, CpG shall have the right for one (1) year or such longer period as
the Parties may reasonably agree to dispose of all Licensed Product or
substantially completed Licensed Product then on hand to which such termination
applies, and royalties shall be paid to LOEB with respect to such Licensed
Products as though this Agreement had not terminated.   9.5   Termination of
Sublicenses. Upon any termination of this Agreement, except under Section 9.1,
all sublicenses granted by CpG under this Agreement shall terminate, subject,
nevertheless, to Section 9.4, unless any Sublicensee shall agree in writing
prior to any such termination to be bound directly to LOEB by the provisions of
the relevant sublicense agreement.   9.6   Effect of Termination. Upon the
termination of any license granted hereunder as to any Patent Right and
corresponding Licensed Technology in any country in the Territory other

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

16

--------------------------------------------------------------------------------

 

License Agreement

    than pursuant to Section 9.1, CpG and its Affiliates and Sublicensees shall
promptly return to LOEB all relevant records, materials and Confidential
Information of LOEB concerning such Patent Rights and corresponding Licensed
Technology in such country in the possession or control of CpG or any of its
Affiliates or Sublicensees.   9.7   Surviving Rights. Termination of this
Agreement shall not terminate CpG’s obligation to pay all royalties which shall
have accrued hereunder prior to such termination. The Parties’ obligations under
ARTICLES 7 and 8 and Sections 6.1(b), 10.1, 10.8 and 10.12 shall survive
termination or expiration of this Agreement in addition to those articles
surviving by matter of law.   9.8   Accrued Rights, Surviving Obligations.
Termination, relinquishment or expiration of this Agreement for any reason shall
be without prejudice to any rights which shall have accrued to the benefit of
either Party under this Agreement prior to such termination, relinquishment or
expiration. Such termination, relinquishment or expiration shall not relieve
either Party from obligations which are expressly indicated to survive
termination or expiration of this Agreement.

ARTICLE 10
MISCELLANEOUS PROVISIONS

10.1   Dispute Resolution.

  (a)   Except for the right of either Party to apply to a court of competent
jurisdiction for a temporary restraining order, a preliminary injunction, or
other equitable relief to preserve the status quo or prevent irreparable harm,
any and all claims, disputes or controversies arising under, out of, or in
connection with this Agreement, including any dispute relating to patent
validity or infringement, or to the reasonableness of CpG’s commercialization
efforts, which the Parties shall be unable to resolve within sixty (60) days
shall be mediated in good faith. The Party raising such dispute shall promptly
advise the other party of such claim, dispute or controversy in a writing which
describes in reasonable detail the nature of such dispute. By not later than
five (5) business days after the recipient has received such notice of dispute,
each Party shall have selected for itself a representative who shall have the
authority to bind such Party, and shall additionally have advised the other
Party in writing of the name and title of such representative.     (b)   By not
later than ten (10) business days after the date of such notice of dispute, the
Party against whom the dispute shall be raised shall select a mediation firm
reasonably acceptable to both Parties and such representatives shall schedule a
date with such firm for a mediation hearing in the Ottawa area. The Parties
shall enter into good faith mediation and shall share the costs equally. If the
representatives of the Parties have not been able to resolve the dispute within

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

17

--------------------------------------------------------------------------------

 

License Agreement

      fifteen (15) business days after such mediation hearing, the Parties shall
have the right to pursue any other remedies legally available to resolve such
dispute.

10.2   Relationship of Parties. Nothing in this Agreement is or shall be deemed
to constitute a partnership, agency, employee, franchise or joint venture
relationship between the Parties. No Party shall incur any debts or make any
commitments for the other, except to the extent, if at all, specifically
provided herein.   10.3   Assignment. Except as otherwise provided herein,
neither this Agreement nor any interest hereunder shall be assignable by any
Party without the prior written consent of the other; provided, however, that
either Party may assign this Agreement to any wholly-owned subsidiary or to any
successor by merger or sale of substantially all of its assets to which this
Agreement relates in a manner such that the assignee shall remain liable and
responsible for the performance and observance of all of the assigning Party’s
duties and obligations hereunder. This Agreement shall be binding upon the
successors and permitted assigns of the parties and the name of a Party
appearing herein shall be deemed to include the names of such Party’s successors
and permitted assigns to the extent necessary to carry out the intent of this
Agreement. Any assignment not in accordance with this Section 10.3 shall be
void.   10.4   Further Actions. Each Party agrees to execute, acknowledge and
deliver such further instructions, and to do all such other acts, as may be
necessary or appropriate in order to carry out the purposes and intent of this
Agreement.   10.5   Force Majeure. Neither Party shall be liable to the other
for loss or damages nor shall have any right to terminate this Agreement for any
default or delay attributable to any act of God, flood, fire, explosion,
lightning, windstorm, earthquake, failure of supply of materials or failure or
destruction of machinery or equipment, strike, labor difficulties or
governmental action, lockout, casualty, accident, war, revolution, civil
commotion, act of public enemies, blockage or embargo, injunction, law, order,
proclamation, regulation, ordinance, demand or requirement of any government or
subdivision, authority or representative of any such government, or any other
cause beyond the reasonable control of such Party, if the Party affected shall
give prompt notice of any such cause to the other Party. The Party giving such
notice shall thereupon be excused from such of its obligations hereunder as it
is thereby disabled from performing for so long as it is so disabled and for
thirty (30) days thereafter. Notwithstanding the foregoing, nothing in this
Section 10.5 shall excuse or suspend the obligation to make any payment due
hereunder in the manner and at the time provided.   10.6   No Trademark Rights.
Except as otherwise provided herein, no right, express or implied, is granted by
this Agreement to use in any manner the name “CpG” or “LOEB” or any other trade
name or trademark of the other Party in connection with the performance of this
Agreement.

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

18

--------------------------------------------------------------------------------

 

License Agreement

10.7   Headings. Section and subsection headings are inserted for convenience of
reference only and do not form a part of this Agreement.   10.8   No Third
Parties Benefited. Except as set forth in Article 8 hereof, no third party,
including any employee of any party to this Agreement, shall have or acquire any
rights by reason of this Agreement.   10.9   Public Announcements. Except as
required by law, neither Party shall make any public announcement concerning
this Agreement or the subject matter hereof without the prior consent of the
other. In the event of a required public announcement, the Party making such
announcement shall provide the other with a copy of the proposed text prior to
such announcement. Once any written statement is approved for disclosure by both
Parties, either Party may make subsequent public disclosures limited to all or a
portion of the specific contents of such prior statement without the further
approval of the other Party.   10.10   Notices. All notices and other
communications hereunder shall be in writing and shall be deemed given if sent
by registered mail, return receipt requested or delivered by hand or commercial
express courier to the following address of either Party unless changed by
written notice (provided that notice of a change of address shall be effective
only upon receipt thereof:

  (a)   If to CpG, addressed to:

CpG ImmunoPharmaceuticals, Inc.
55 William Street, Suite 120
Wellesley, MA 02481
USA
Attn: President
With a copy to:
Mintz, Levin, Cohn, Ferris,
Glovsky and Popeo, P.C.
One Financial Center
Boston, MA 02111
Attn: Jeffrey M. Wiesen, Esq.

  (b)   If to LOEB, addressed to:

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

19

--------------------------------------------------------------------------------

 

License Agreement
The Loeb Health Research Institute at the Ottawa Hospital
725 Parkdale Avenue
Ottawa, Ontario
Canada. K1Y 4E9
           Attn: Robert Hanlon, M.H.A.; C.H.E.
      Chief Administrative Officer

10.11   Amendment. No amendment, modification or supplement of any provision of
this Agreement shall be valid or effective unless made in writing and signed by
a duly authorized officer of each Party. This Agreement may be executed in a
series of counterparts, all of which, when taken together, shall constitute one
and the same instrument.   10.11   Waiver. Subject to applicable statutes of
limitation, no provision of this Agreement shall be waived by any act, omission
or knowledge of a Party or its agents or employees, except by an instrument in
writing expressly waiving such provision and signed by the waiving Party.  
10.12   Governing Law. This Agreement shall be construed, governed, interpreted
and applied in accordance with the laws of the province of Ontario, Canada
without application of principles of conflict of law except that questions
affecting the construction and effect of any patent shall be determined by the
law of the country in which the patent was granted.   10.13   Severability.
Whenever possible, each provision of this Agreement will be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be prohibited by or invalid under applicable law,
such provision will be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of this Agreement and the Parties
shall promptly negotiate in good faith a replacement provision to carry out the
intention of the invalid, illegal or unenforceable provision to the fullest
extent permitted by law.   10.14   Entire Agreement of the Parties. This
Agreement constitutes and contains the entire understanding and agreement of the
Parties and cancels and supersedes any and all prior negotiations,
correspondence, understandings and agreements, whether oral or written, between
the Parties respecting the subject matter hereof. In the event of any conflict
between the terms of the Research Agreement and this Agreement, the terms of
this Agreement shall govern.

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

20

--------------------------------------------------------------------------------

 

License Agreement
     IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
executed by its duly authorized officer as of the day and year first above
written:

              For LOEB:        
By:
  /s/ Robert Hanlon   By:   /s/ Michel Chretian, M.D.
 
           
Name:
  Robert Hanlon, M.H.A.; C.H.E.   Name:   Michel Christian, M.D.
Title:
  Chief Administrative Officer   Title:   Chief Executive Officer and Scientific
Director
 
  The Loeb Health Research Institute       The Loeb Health Research Institute

  at the Ottawa Hospital       at the Ottawa Hospital
 
           
Date:
  January 6, 1999   Date:   January 7, 1999
 
            For CpG:        
By:
  /s/ Robert L. Bratzler, Ph.D.        
 
           
Name:
  Robert L. Bratzler, Ph.D.        
Title:
  President, CpG ImmunoPharmaceuticals, Inc.        
Date:
  Dec. 23, 1998        

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

21

--------------------------------------------------------------------------------

 

License Agreement
EXHIBIT A
LICENSED PATENTS
(As of May 31, 1998)

          Patents   Status  
1. [****************************************************]
       
a) US Provisional #[**********] filed [*******]
    [*******]  
2. [*****************************************************]
       
a) US Provisional # [*********] filed [*******] and [********] filed [*******]
    [*******]  
3. [*****************************************************
       
*******************************************************************] a) US
Provisional [*********] filed [*******]
    [*******]  
4.
[**********************************************************************************************
       
****************************]
       
a) US Provisional [**********] filed [*******]
    [*******]  

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

22

--------------------------------------------------------------------------------

 

License Agreement
Exhibit 10.19 to Coley Pharmaceutical Group, Inc. Form S-1 filed April 20, 2005
CONFIDENTIAL
Coley Pharmaceutical Group, Inc.
Wellesley Gateway
93 Worcester Street, Suite 101
Wellesley, Massachusetts 02481
September 25, 2001
Ottawa Health Research Institute
725 Parkdale Avenue
Ottawa, Ontario KIY 4E9
CANADA
Attn: Robert Hanlon, M.H.A., C.H.E.
                     Chief Administrative Officer
          Re: Amendment to License Agreement
Ladies and Gentlemen:
          This letter will serve as an amendment (the “Amendment”) to the
License Agreement (the “Agreement”) dated as of September 1, 1998 between Coley
Pharmaceutical Group, Inc., formerly known as CpG ImmunoPharmaceuticals, Inc.
(“Coley”), and the Loeb Health Research Institute at the Ottawa Hospital (the
“LOEB”). The Ottawa Health Research Institute (the “OHRI”) is the successor in
interest to, and assignee of, all the rights and obligations of the LOEB under
the Agreement. All capitalized terms that are used in this letter and not
defined herein shall have the meanings ascribed to them in the Agreement. Except
as specifically modified by this Amendment, the parties hereto agree that all of
the terms and conditions set forth in the Agreement remain in full force and
effect.
1. OHRI as a Party
          The OHRI, as the assignee of all of the assets and liabilities of the
LOEB, has replaced the LOEB as a Party to the Agreement. Consequently, all
references in the Agreement to the LOEB are hereby replaced with references to
the OHRI.
2. Amendment to the Definition of Commercial Sale.
          The Parties hereby agree that Section 1.2 of the Agreement shall
hereby be amended and restated in its entirety to read as follows:

  “1.3   Commercial Sale shall mean any transaction for value between Coley, an
affiliate of Coley, or a Sublicensee of Coley, as applicable, and a third party,
which transaction involves the transfer or other disposition of a Licensed
Product to such third party.”

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

23

--------------------------------------------------------------------------------

 

License Agreement
3. Amendment to the Definition of Field.
     The Parties hereby agree that Section 1.3 of the Agreement shall hereby be
amended and restated in its entirety to read as follows:

  “1.3   Field shall mean any and all uses of CpG, T- rich or G- rich molecules
and any derivatives, modifications, improvements, fragments, analogs, or
homologs thereof and any other materials which could not have been discovered or
made but for the use of the above described molecules or Coley’s confidential
information (that is not in the public domain), whether used alone or in
combination with other agents, including but not limited to, formulations or
delivery systems.”

4. Amendment to the Definition of Licensed Product.
     The Parties hereby agree that Section 1.8 of the Agreement shall hereby be
amended and restated in its entirety to read as follows:

  “1.8   Licensed Product shall mean any product or process which is covered, on
a country-by-country and product-by-product basis, by a Pending or issued claim
under Patent Rights in such country. In addition, Licensed Product shall also
mean, on a product-by-product basis, any product or process not covered by
Patent Rights which to a material degree, as determined by mutual agreement of
the Parties, contains, is based on, or is derived from, identified through or
utilizes any Licensed Technology which is not in the public domain. Any product
or process which is a Licensed Product at the time of first Commercial Sale
shall, for the purposes of Sections 4.1, 4.3 and 9.1, be treated as a Licensed
Product for at least 10 years from the date of first Commercial Sale,”

5. Amendment to the Definition of Patent Rights and Update to Exhibit A.
      The Parties hereby agree that Section 1.12 of the Agreement shall hereby
be amended and restated in its entirety to read as follows:

  “1.12   Patent Rights shall mean all rights derived from any and all patents
and patent applications (including without limitation provisional applications
and invention disclosures) that

     (a) are listed on Exhibit A attached hereto; or
     (b) are owned or controlled, in whole or in part (with the ability to grant
licenses or sublicenses), by the OHRI by way of transfer of rights from any
Investigator, and that claim, describe, embody or relate to the Licensed
Technology throughout the Territory; or
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

24

--------------------------------------------------------------------------------

 

License Agreement
(c) result from or arise under any OHRI research agreement that is sponsored
solely by Coley; or
(d) fall within the Field, name [******************] as an inventor, and are
owned or controlled, in whole or in part (with the ability to grant licenses or
sublicenses), by the OHRI (any patent rights outside of the Field in which is
[******************] is an inventor will be subject to prevailing OHRI policy
governing intellectual property rights of its students);
together with any substitutions, extensions, renewals, continuations,
continuations-in-part, divisions, patents of addition, and/or reissues thereof,
and any current and future patent or patent application, or portion thereof,
which is a foreign counterpart in any country in the Territory to any of the
foregoing, including any substitutions, extensions, renewals, continuations,
continuations-in-part, divisions, patents of addition and/or reissues thereof.
All of the foregoing patents and patent applications will be automatically
incorporated in and added to this Agreement and shall periodically be added to
Exhibit A and made a part thereof.”
      The Parties also hereby agree that Exhibit A to the Agreement shall be
updated as of the date hereof to the form of Exhibit A attached to this
Amendment.
6. Amendment to Royalty Payment Obligations of Coley.
      The Parties hereby agree that Section 4.1 of the Agreement shall hereby be
amended and restated in its entirety to read as follows:

  “4.1   Royalties. In consideration of the exclusive licenses and other rights
granted to Coley under this Agreement, Coley agrees to pay to the OHRI a
royalty, commencing upon the first Commercial Sale of a Licensed Product by
Coley, its Affiliates or its Sublicensees, as follows:

  (a)   For Commercial Sales made by Coley or its Affiliates (but not its
Sublicensees) of all Licensed Products covered by issued or Pending Patent
Rights in a particular country, Coley shall pay the following royalty rates on
Net Sales in such country:

  (i)   [****]%, if the aggregate royalty rate being paid by Coley or its
Affiliates on the Licensed Product to all Licensed Product Licensors is less
than or equal to [****]%. For purposes of this Section 4.1(a), the term Licensed
Product Licensors shall mean, as to a particular Licensed Product, all third
parties (excluding OHRI) to whom Coley or its Affiliates owe(s) a royalty on
Commercial Sales of such Licensed Product.

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

25

--------------------------------------------------------------------------------

 

License Agreement

  (ii)   [****]%, if the aggregate royalty rate being paid by Coley or its
Affiliates on the Licensed Product to all Licensed Product Licensors is greater
than [****]% but less than or equal to [****]%.     (iii)   [****]%, if the
aggregate royalty rate being paid by Coley or its Affiliates on the Licensed
Product to all Licensed Product Licensors is greater than [****]% but less than
or equal to [****]%.     (iv)   [****]%, if the aggregate royalty rate being
paid by Coley or its Affiliates on the Licensed Product to all Licensed Product
Licensors is greater than [****]%.     (v)   [****]% if the Licensed Product is
sold for the treatment or prophylaxis treatment of veterinary diseases.

  (b)   For Commercial Sales made by Coley or its Affiliates (but not its
Sublicensees) of all Licensed Products that are not covered by issued or Pending
Patent Rights in a particular country, Coley shall pay [*****] ([*]%) of the
foregoing royalty rates, as applicable, on Net Sales in such country.     (c)  
In the event that Coley and/or its Affiliates receive Sublicense Income from any
Sublicensee, Coley shall pay to the OHRI [*****] ([*]%) of such Sublicense
Income from each such Sublicensee.”

7. Amendment to Duration of Royalty Payment Obligations of Coley.
     The Parties hereby agree that Section 4.3 of the Agreement shall hereby be
amended and restated in its entirety to read as follows:

  “4.3   Duration of Royalties. Coley shall not be obligated to make any further
royalty payments in any country for any Licensed Product after the end of the
period commencing on the date of the first Commercial Sale of the Licensed
Product in that country by Coley, its Affiliates or Sublicensees and ending
either on the expiration of a valid, enforceable claim of a Patent Right
covering the Licensed Product in that country or ten (10) years after the date
of the first Commercial Sale, whichever is later.”

8. Amendment to Term of Agreement.
     The Parties hereby agree that Section 9.1 of the Agreement shall hereby be
amended and restated in its entirety to read as follows:

  “9.1   Term. This Agreement shall commence as of the Effective Date and,
unless sooner terminated as provided in Section 9.3 hereunder, shall terminate
as to each country in the Territory, upon the expiration of the last to expire
valid, enforceable claim of a Patent Right covering such Licensed Product in
such country or a minimum of ten (10) years from the date of the first
Commercial Sale, whichever is later. Upon any such expiration of Patent Rights
or end of such ten year period in such country whichever is later, Coley shall
have a fully paid-up license of

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

26

--------------------------------------------------------------------------------

 

License Agreement

      perpetual duration in such country, subject to the survival provisions in
Section 9.7, including the right of Coley, its Affiliates and/or its
Sublicensees to continue using the Licensed Technology and to develop, have
developed, make, have made, perform, use, have used, sell, offer for sale, have
sold, import or have imported Licensed Products without any further obligation
to the OHRI hereunder.”

9. Amendment to Restriction on Assignment of Agreement.
      The Parties hereby agree that the first sentence of Section 10.3 of the
Agreement shall hereby be amended and restated in its entirety to read as
follows:

  “10.3   Assignment. Except as otherwise provided herein, neither this
Agreement nor any interest hereunder shall be assignable by any Party without
the prior written consent of the other, whose consent shall not be unreasonably
denied; provided, however, that either Party may assign this Agreement to any
wholly-owned subsidiary, affiliate or to any successor by merger or sale of
substantially all of its assets to which this Agreement relates in a manner such
that the assignee shall remain liable and responsible for the performance and
observance of all of the assigning Party’s duties and obligations hereunder.”

10. Issuance of Common Stock to OHRI and Co-Inventors.
     OHRI hereby requests of Coley, as consideration for the execution of this
Amendment by ORHI, and Coley hereby agrees, subject to the terms and conditions
set forth below, to issue Forty Thousand (40,000) shares of its Common Stock
(the “Amendment Shares”) as follows: (1) 20,000 shares to OHRI, (2) 14,000
shares to Heather Davis, (3) 4,000 shares to Michael McCluskie, and (4) 2,000
shares to Tong Wu . The issuance of Amendment Shares to OHRI shall be made
pursuant to, and subject to the terms and conditions of, the Subscription
Agreement attached hereto as Exhibit B, and the issuance of Amendment Shares to
the Co-Inventors (as defined below) shall be made pursuant to, and subject to
the terms and conditions of, separate written agreements mutually acceptable to
Coley and each of the Co-Inventors.
      OHRI hereby represents and warrants to Coley that (1) Heather Davis,
Michael McCluskie and Tong Wu (collectively, the “Co-Inventors”) are inventors
of the Patent Rights, and the only LOEB or OHRI inventors named therein, (2) the
allocation of the Amendment Shares as set forth in the preceding paragraph is
pursuant to and in compliance with any and all policies or agreements to which
OHRI is a party or otherwise bound that relate to the sharing of revenues among
inventors of intellectual property rights of OHRI constituting the Patent
Rights, and (3) no person has any claim to any portion of the Amendment Shares
except as set forth in the preceding paragraph. OHRI hereby agrees to indemnify
and hold harmless Coley, its successors and assigns, and their respective
officers, directors, employees and agents (collectively, the “Obligees”), from
and against any and all losses, damages, costs, expenses and liabilities
(including reasonable attorneys’ fees) that the Obligees may incur by reason of
(1) a breach of OHRI’s representations and warranties in the preceding sentence
or (2) any obligation with respect to the payment or withholding of taxes that
may arise as a result of the issuance of the Amendment Shares to the
Co-Inventors.
11. Survival.
      Each of the Parties hereto acknowledges that the Agreement remains in full
force and effect in accordance with its terms, as amended hereby.
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

27

--------------------------------------------------------------------------------

 

License Agreement
12. Entire Agreement.
     The Agreement and this Amendment and the attachments hereto and thereto
constitute the entire agreement and understanding between Coley and the OHRI
relating to the subject thereof and hereof. No verbal agreement, conversation or
representation between any officers, agents, or employees of the parties hereto
either before or after the execution of the Agreement or this Amendment shall
affect or modify any of the terms or obligations therein or herein contained.
Any further amendment to the terms of the Agreement or this Amendment shall be
made in writing and signed on behalf of each Party by a duly authorized officer.
13. Terms Confidential.
      Each Party hereby acknowledges and agrees that it will not disclose the
terms of the Agreement or this Amendment or any other information relating to
the subject matter hereof or thereof to any third party without the express
written consent of the other Party, except that (i) either Party may use the
text of a written statement approved in advance by both Parties without further
approval, (ii) Coley may disclose the terms of the Agreement and this Agreement
to a potential or current Sublicensee, and (iii) either Party shall have the
right, following written notice to the other Party, to identify the other Party
and to disclose the terms of this Agreement as required by applicable securities
laws or other applicable laws or regulations.
      Please sign below where indicated to acknowledge your agreement to the
foregoing Amendment.

              Sincerely,
COLEY PHARMACEUTICAL GROUP, INC.
 
  By:   /s/ Robert L. Bratzler
 
       
 
  Name:   Robert L. Bratzler, Ph.D.
 
  Title:   CEO and President

          ACKNOWLEDGED AND AGREED TO This 25 day of September, 2001
THE OTTAWA HEALTH RESEARCH INSTITUTE    
By:
  /s/ Robert Hanlon    
 
       
Name:
  Robert Hanlon    
Title:
  Chief Operating Officer    

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

28

--------------------------------------------------------------------------------

 

License Agreement
Exhibit A
PATENT RIGHTS

                              FILING             WG&S ID   SN   DATE   INVENTORS
  TITLE   STATUS
[*************]
  [*************]   [********]   [*********]   [**********************  
[*******]       [*****]   ********************]  
[*************]
  [*******]   [********]           [*******]
[*************]
  [***********]   [********]           [*******]
[*************]
  [******]   [********]           [*******]
[*************]
  [*********]   [********]           [*******]
[*************]
  [******]   [********]           [*******]
[*************]
  [************]   [********]           [*******]
[*************]
  [******]   [********]           [*******]
[*************]
  [********]   [********]           [*******]
[*************]
  [************]   [********]   [*****]   [**********************   [*******]
 
          [*********]   **********************  
 
            ************]    
[*************]
  [*************]   [********]      
[*************]
          [*********]   [***********************   [*****************          
[*****]   ***********************   *****************]
 
              **********************]    
[**************]
          [*********]   [***********************   [*****************          
[*****]   ************************   *****************] ************************
********]

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

29

--------------------------------------------------------------------------------

 

License Agreement

                     
 
          [*****]        
[************]
  [********]   [********]   [******]   [********************   [*******]
[************]
  [********]   [********]   [*****]   ********************   [*******]
[************]
  [********]   [********]   [********]   ********************   [*******]
[************]
  [********]   [********]   [*********]   ***********]   [*******]
 
              [********************    
[************]
  [*************]   [********]   [*****]   ********************   [*******]
 
          [*****]   ****************]    
[************]
  [********]   [********]   [******]       [*******]
[************]
  [**********]   [********]   [**]       [*******]
[************]
  [**********]   [********]           [*******]
[************]
  [**********]   [********]       [********************   [*******]
[************]
  [**********]   [********]   [******]   ********************   [*******]
 
          [******]   ********************           [*****]   *********]        
[**********]   [********************  
 
          [*****]   ********************    
 
          [*****]   ********************    
 
            ********************    
[************]
  [********]   [********]     ****************]   [*******]
[************]
  [********]   [********]           [*******]
[************]
  [**********]   [********]   [*******]       [*******]
[************]
  [***********]   [********]           [*******]

[*****************************************************************************************]
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

30

--------------------------------------------------------------------------------

 

License Agreement
SUBSCRIPTION AGREEMENT
          This Agreement is made as of the 25 day of September 2001, by and
between Coley Pharmaceutical Group, Inc., a Delaware corporation (the “ Company
”), and the Ottawa Health Research Institute (“Purchaser”).
          WHEREAS, the Company has requested. and the Purchaser has agreed, to
amend certain terms and conditions of the License Agreement dated as of
September l, 1998 between the Company and Purchaser (the “Agreement”) pursuant
to an Amendment dated as of the date hereof (the “Amendment”); and
          WHEREAS, as partial consideration for the Purchaser’s agreement to
enter into the Amendment, the Company has agreed to issue to the Purchaser
shares of the Company’s Common Stock on the terms and conditions set forth
below;
          NOW THEREFORE, the parties hereto, for good and valuable
consideration, the sufficiency of which is hereby acknowledged, agrees as
follows:
          I. Purchase and Sale. Purchaser hereby purchases from the Company, and
the Company agrees to sell to Purchaser, Twenty Thousand (20,000) shares of the
Company’s Common Stock (the “Shares”) as consideration for the Purchaser’s
agreement to enter into the Amendment, and for no additional consideration. The
closing hereunder shall occur at the offices of the Company on the date hereof,
or at such other time and place as the parties may mutually agree.
          2. Purchaser Representations. Purchaser acknowledges that the Shares
to be issued pursuant to this Agreement have not been registered under the
Securities Act of 1933, as amended (the “ Securities Act”), and Purchaser
warrants and represents to the Company as follows:
          (a) Enforceability. This Agreement has been duly executed and
delivered by Purchaser and constitutes a legal, valid and binding obligation of
Purchaser, enforceable against Purchaser in accordance with its terms, subject
to laws of general application relating to bankruptcy, insolvency and the relief
of debtors and rules of law governing specific performance, injunctive relief or
other equitable remedies, and to limitations of public policy.
          (b) Purchase for Own Account. Purchaser is purchasing the Shares
solely for Purchaser’s own account for investment and not with a view to or for
sale or distribution of the Shares or any portion thereof and not with any
present intention of selling, offering to sell or otherwise disposing of or
distributing the Shares or any portion thereto. Purchaser also represents that
the entire legal and beneficial interest of the Shares that Purchaser is
purchasing is being purchased for, and will be held for the account of,
Purchaser only and neither in whole nor in part for any other person.
          (c) Availability of Information. Purchaser has heretofore discussed
the Company and its plans, operations and financial condition with Company’s
officers and Purchaser has heretofore received all such information as Purchaser
deems necessary and appropriate to enable Purchaser to evaluate the financial
risk inherent in making an investment in the Shares and
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

31

--------------------------------------------------------------------------------

 

License Agreement
Purchaser further represents and warrants that Purchaser has received
satisfactory and complete information concerning the business and financial
condition of the Company in response to all inquiries in respect thereof.
          (d) Rule 144. Purchaser understands that the Shares are restricted
securities within the meaning of Rule 144 promulgated under the Securities Act,
and that any sale of the Shares may be made by Purchaser only in accordance with
the terms and conditions of Rule 144 (of which it is familiar), as amended from
time to time.
          (e) Accredited Investor. The Purchaser represents that he, she or it
is an “accredited investor” as such term is defined in Rule 501 of Regulation D
promulgated under the Securities Act.
          (f) Lock-Up. If requested by the Company and the managing underwriter
of an offering by the Company of Common Stock or other securities of the Company
pursuant to a registration statement under the Securities Act, the Purchaser
shall agree not to sell publicly or otherwise transfer or dispose of the Shares
for a specified period of time (not to exceed 180 days) following the effective
date of such registration statement (the “Lock-up”), provided that:
          (i) all holders of more than two percent (2%) of the Common Stock then
outstanding (including holders of securities convertible into or exchangeable or
exercisable for shares of Common Stock) and all officers and directors of the
Company enter into similar agreements; and
          (ii) in the event of any discretionary waiver or termination of the
Lock-up by the Company or representatives of the underwriter, the Company shall
use its best efforts to obtain the waiver or termination of the Lock-up with
respect to all persons subject to such Lock- up on a pro-rata basis.
          The Company may impose stop-transfer instructions with respect to the
Shares or such other securities subject to the Lock-up until the end of such
180-day period.
          (g) Legend. Each certificate representing the Shares shall bear a
legend substantially in the following form:
“The shares represented by this certificate have not been registered under the
Securities Act of 1933, as amended, and may not be offered, sold or otherwise
transferred, pledged or hypothecated unless and until such shares are registered
under such Act or an opinion of counsel satisfactory to the Company is obtained
to the effect that such registration is not required.”
          (h) Dispositions. Without in any way limiting the representations set
forth above, Purchaser further agrees that Purchaser shall in no event make any
disposition of all or any portion of the Shares unless and until:
          (i) There is then in effect a registration statement under the
Securities Act covering such proposed disposition and such disposition is made
in accordance with said registration statement; or
Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

32

--------------------------------------------------------------------------------

 

License Agreement
          (ii) (A) Purchaser shall have notified the Company of the proposed
disposition and shall have furnished the Company with a detailed statement of
circumstances surrounding the proposed disposition, (B) Purchaser shall have
furnished the Company with an opinion of Purchaser’s counsel (or, at Purchaser’s
expense, an opinion of the Company’s counsel) to the effect that such
disposition will not require registration of such Shares under the Act, and
(C) any opinion of counsel to Purchaser shall have been concurred in by counsel
for the. Company and the Company shall have advised Purchaser of such
concurrence.
          3. Miscellaneous.
          (a) Successors and Assigns. This Agreement shall inure to the benefit
of the successors and assigns of the Company and be binding upon Purchaser and
Purchaser’s successors and assigns.
          (b) Governing Law. This Agreement shall be governed by and interpreted
under the laws of the Commonwealth of Massachusetts.
          (c) Headings. Headings are for convenience only and are not deemed to
be part of this Agreement.
          (d) Counterparts. This Agreement may be executed simultaneously in any
number of counterparts, each of which shall be deemed to be an original, but all
of which together shall constitute one and the same instrument.
          IN WITNESS WHEREOF, the parties hereto have executed this Agreement
under seal as of the day and year first above written.

              COLEY PHARMACEUTICAL GROUP, INC.
 
       
 
  By:   /s/ Robert L. Bratzler
 
       
 
  Name:   Robert L. Bratzler, Ph.D.
 
  Title:   CEO and President
 
            THE OTTAWA HEALTH RESEARCH INSTITUTE
 
  By:   /s/ Robert Hanlon
 
       
 
  Name:   Robert Hanlon
 
  Title:   Chief Operating Officer

Portions of this Exhibit were omitted and have been filed separately with the
Secretary of the Commission pursuant to the Company’s application requesting
confidential treatment under Rule 406 of the Securities Act.
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

33

--------------------------------------------------------------------------------

 

License Agreement
EXHIBIT D
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

34

--------------------------------------------------------------------------------

 

License Agreement

     
(COLEY LOGO) [f32364f3236401.gif]
  (DYNAVAX LOGO) [f32364f3236400.gif]

News Release

     
Coley Contact:
  Dynavax Contact:
Susan Hager
  Shari Annes
Senior Director, Investor Relations and
  Investor Relations
Corporate Communications
  Public Relations
+1.781.431.9079
  +1-650-888-0902
shager@coleypharma.com
  sannes@dynavax.com

Media Contact:
Karen L. Bergman or
Michelle Corral
BCC Partners
+1.650.575.1509 or +1.415.794.8662
kbergman@bccpartners.com
mcorral@bccpartners.com
For Immediate Release
Coley Pharmaceutical Group Grants Dynavax
License for Commercialization of HEPLISAV™
Wellesley, MA and Berkeley, CA, June 28, 2007 – Coley Pharmaceutical Group, Inc.
(Nasdaq: COLY) and Dynavax Technologies Corporation (Nasdaq: DVAX) today
announced they have entered into a license agreement relating to certain TLR
Therapeutics™ patents from Coley.
Under the terms of the agreement, Dynavax receives a non-exclusive license under
Coley’s immunostimulatory oligonucleotide patent estate for the
commercialization of HEPLISAV™, a hepatitis B prophylactic vaccine, currently in
Phase 3 clinical trials. Coley will receive a $5 million up-front payment. Coley
is also eligible to receive up to an additional $5.0 million upon regulatory
approvals of HEPLISAV, as well as royalty payments for any future sales of
HEPLISAV.
—more—
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

35

--------------------------------------------------------------------------------

 

License Agreement
About HEPLISAV and Hepatitis B

HEPLISAV is currently being evaluated in a Phase 3 clinical trial in Canada and
in Europe. The multi-center trial, known as PHAST (Phase 3 HeplisAv
Short-regimen Trial), is comparing a two-dose regimen of HEPLISAV administered
at 0 and 1 month to the conventional three-dose regimen of Engerix-B®. The
enrollment target of the study is approximately 2,000 subjects, ages 11 to
55 years. Dynavax expects to submit a BLA in 2008 for approval of the product
with a database of approximately 4,000 patients
In several previous clinical studies, HEPLISAV has been shown to provide
seroprotection against hepatitis B faster and with fewer doses than conventional
hepatitis B vaccines. Additionally, HEPLISAV has provided 100% seroprotection in
all subjects who have received the full regimen, including those who are
difficult-to-immunize.
About Coley’s TLR Therapeutics™

Coley’s TLR Therapeutics are a new class of investigational drug candidates that
target certain immune cells through Toll-like receptors. The patents licensed
today to Dynavax relate to Coley’s Toll-like receptor 9 (TLR9) agonist
technology that induce enhanced antigen-specific antibody and T-cell immune
responses when used in combination with vaccines. Coley’s TLR9 agonist drug
candidate has been included in approximately 35 clinical trials of vaccines in
development for use in various cancer indications, infectious diseases and
biowarfare defense. The most advanced clinical program with Coley’s TLR9 agonist
vaccine adjuvant candidate is a forthcoming Phase III clinical trial under the
direction of GlaxoSmithKline (GSK) as part of a treatment for resectable, early
stage lung cancer.
About Coley Pharmaceutical Group

Coley Pharmaceutical Group, Inc. is an international biopharmaceutical company,
headquartered in Wellesley, Massachusetts, USA, that discovers and develops TLR
Therapeutics™, a new class of investigational drug candidates that direct the
human immune system to fight cancers, asthma and allergic diseases and to
enhance the effectiveness of vaccines. Coley has established a pipeline of TLR
Therapeutic product candidates currently advancing through clinical development
with partners and has additional product candidates in preclinical development.
Coley has product development, research and license agreements with Pfizer,
sanofi-aventis, GSK, Novartis Vaccines, Merck and the United States government.
For further information on Coley Pharmaceutical Group please visit
www.coleypharma.com.
About Dynavax

Dynavax Technologies Corporation discovers, develops, and intends to
commercialize innovative TLR9 agonist-based products to treat and prevent
infectious diseases, allergies, cancer, and chronic inflammatory diseases using
versatile, proprietary approaches that alter immune system responses in highly
specific ways. The company’s TLR9 agonists are based on immunostimulatory
sequences, or ISS, which are short DNA sequences that enhance the ability of the
immune system to fight disease and control chronic inflammation. Dynavax’s
pipeline includes: HEPLISAV, a hepatitis B vaccine in Phase 3; TOLAMBA™, a
ragweed allergy immunotherapeutic; a therapy for non-Hodgkin’s lymphoma (NHL) in
Phase 2 and for metastatic colorectal cancer in Phase 1; and a therapy for
hepatitis B also in Phase 1. A preclinical asthma and COPD program is partnered
with AstraZeneca. The National Institutes of Health (NIH) partially funds
preclinical work on a vaccine for influenza; Symphony Dynamo, Inc., funds the
company’s colorectal cancer trials and a preclinical hepatitis C therapeutic
program. While the
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

iii

--------------------------------------------------------------------------------

 

License Agreement
NIH and Symphony provide program support, Dynavax has retained rights to seek
strategic partners for future development and commercialization. For more
information, please visit http://www.dynavax.com.
—more—
Safe Harbor Statements

Certain statements in this news release concerning Coley’s business are
considered “forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements include, but are not
limited to, those relating to royalty payments for any future product sales
involving HEPLISAV. Any or all of the forward-looking statements in this press
release may turn out to be wrong. They can be affected by inaccurate assumptions
Coley might make or by known or unknown risks and uncertainties, including, but
not limited to: the early stage of product development; uncertainties as to the
future success of ongoing and planned clinical trials; the risk that results
from early stage clinical trials may not be indicative of results in later stage
trials; the unproven safety and efficacy of products under development;
intellectual property rights and litigation; competitive products; and other
risks identified in Coley’s filings with the Securities and Exchange Commission
including, but not limited to, Coley’s Annual Report on Form 10-K for the fiscal
year ended December 31, 2006. Consequently, no forward-looking statement can be
guaranteed, and actual results may vary materially. Coley undertakes no
obligation to publicly update forward-looking statements, whether because of new
information, future events or otherwise, except as required by applicable law.
This press release contains forward-looking statements concerning Dynavax that
are subject to a number of risks and uncertainties, including statements about
Dynavax’s HEPLISAV hepatitis B vaccine and financial terms of its agreement with
Coley. Actual results may differ materially from those set forth in this press
release due to the risks and uncertainties inherent in Dynavax’s business,
including difficulties or delays in development; achieving the objectives of
collaborative and licensing efforts; and obtaining regulatory approval for
HEPLISAV; the scope and validity of patent protection; possible claims based on
the patent rights of others; the ability to obtain additional financing to
support operations; and other risks detailed in the “Risk Factors” section of
Dynavax’s Quarterly Report on Form 10-Q. Dynavax undertakes no obligation to
revise or update information herein to reflect events or circumstances in the
future, even if new information becomes available.
TLR Therapeutics is a trademark of Coley Pharmaceutical Group. HEPLISAV is a
trademark of Dynavax Technologies Corporation. All other trademarks are the
property of their respective holders.
# # #
 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

iv