exv10w5






Exhibit 10.5




PATENT AND TECHNOLOGY ASSIGNMENT AGREEMENT




     This Patent and Technology Assignment Agreement (“AGREEMENT”), is by and between ADVIRNA, LLC,
a Colorado limited liability company having its principal place of business at 10 Rocklawn Road,
Westborough, MA 01581 (“ADVIRNA”) and RXi Pharmaceuticals Corporation (formerly RNCS, Inc.), a
Delaware corporation, having its principal place of business at 60 Prescott Street, Worcester, MA
01605 (“RXi”). ADVIRNA and RXi may each be referred to as a “PARTY” and collectively as the
“PARTIES”. For good and valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the PARTIES agree as follows:



1.0 Background of Agreement




     1.1 ADVIRNA owns certain PATENT RIGHTS and TECHNOLOGY RIGHTS.



     1.2 ADVIRNA desires to assign, transfer and convey to RXi, all right, title and interest in
and to selected PATENT RIGHTS and TECHNOLOGY RIGHTS of ADVIRNA and RXI desires to develop, sell and
distribute products derived therefrom.



     1.3 The parties agree to simultaneously execute and deliver a Patent and Technology License
Agreement relating to the “Grant-Back Field,” a copy of which is annexed hereto as Exhibit C and
made a part hereof as if set out verbatim herein.



     1.4 ADVIRNA represents that Anastasia Khvorova, Ph.D., the inventor of PATENT RIGHTS and
TECHNOLOGY RIGHTS, developed such rights.



2.0 Definitions




     As used herein, the following terms shall have the meanings set forth below:



     2.1 “EFFECTIVE DATE” means September 24, 2011.



     2.2 “GRANT-BACK FIELD” means all fields of use for the Technology Rights and Patent Rights
outside of human therapeutic and diagnostic fields.



     2.3 [Intentionally Omitted]



     2.4 [Intentionally Omitted]



     2.5 “PATENT RIGHTS” mean any ADVIRNA rights to pending or issued patent claims supported by
U.S. Patent Application No. 61/192,954 (the “ ‘954 application”), entitled “Chemically modified
polynucleotides and methods of using the same,” and any patent application related or claiming
priority to the ‘954 application, and any divisional, continuation, or continuation-in-part of the
foregoing, to the extent the claims are directed to subject matter specifically described and
supported in the ‘954 application, as well as in any patents issued on any of the foregoing and any
reissues or reexaminations or extensions of the patents, and any foreign counterparts to any of the
foregoing including, without limitation, those patents and patent applications set forth in Exhibit
A attached hereto.



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     2.6 “ROYALTY-BEARING PRODUCT” means any product that is developed, manufactured, used, or sold
in a manner that is covered by one or more VALID CLAIM.



     2.7 “TECHNOLOGY RIGHTS” mean ADVIRNA’s rights in any technical information, know-how, process,
procedure, composition, method, formula, protocol, trade secrets, technique or data developed by
Anastasia Khvorova, Ph.D. (“INVENTOR”) at ADVIRNA. Such rights relate to TECHNOLOGY RIGHTS which
are not covered by PATENT RIGHTS, but which are necessary for practicing the invention covered by
PATENT RIGHTS. Subsequent to the commencement of INVENTOR’s employment relationship with
Galena BioPharma (formerly “RXi Pharmaceuticals Corporation”) (“Galena”) and through the date
hereof, all inventions, patents and technology rights developed by INVENTOR were owned by Galena
under an assignment of invention and disclosure agreement executed by INVENTOR on October 18, 2009,
which rights have, as of the date hereof, been assigned to RXi.



     2.8 “TERRITORY” means worldwide.



     2.9 “VALID CLAIM” means (a) a claim of an issued and unexpired patent within the PATENT RIGHTS
which has not been permanently revoked or held unenforceable or invalid by an unappealable or
unappealed decision of a court or government agency of competent jurisdiction or (b) a claim of a
pending patent application within the PATENT RIGHTS that has not been abandoned or finally
disallowed without the possibility of appeal or refilling.



3.0 Assignment; Exclusive License in Favor of ADVIRNA




     3.1 ADVIRNA hereby assigns, transfers and conveys to RXi all of ADVIRNA’s rights, titles, and
interests throughout the TERRITORY in and to the PATENT RIGHTS and TECHNOLOGY RIGHTS, and further,
all rights and privileges pertaining to the PATENT RIGHTS and TECHNOLOGY RIGHTS, including, without
limitation, the right, if any, to sue or bring and recover for, and the right to profits or damages
due or accrued, arising out of or in connection with, any and all actions for past, present and
future infringement thereof.



     3.2 ADVIRNA agrees to: take such further action and to execute such documents as
RXI may reasonably request to effect or confirm the conveyance to RXi of the PATENT RIGHTS and
TECHNOLOGY RIGHTS, including without limitation executing and delivering to RXi the Assignment of
Patents attached hereto as Exhibit A.



     3.3 ADVIRNA further agrees that this assignment shall he deemed a full legal and formal
equivalent of any assignment, consent to file or like document which may be required in any country
for any purpose regarding the subject matter hereof, as well as constituting proof of the right of
RXi or its successors, assigns or nominees to apply for patent or other proper protection described
in the PATENT RIGHTS and TECHNOLOGY RIGHTS, and to claim the aforesaid benefits of the right of
priority provided by the International Convention for the Protection of Industrial Property, as
amended, or by any convention which may henceforth be substituted for it.



     3.4 In partial consideration of the parties entering into this Agreement, the parties agree to
simultaneously execute and deliver a Patent and Technology License Agreement



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relating to the “Grant-Back-Field”, a copy of which is annexed hereto as Exhibit C and made a
part hereof as if set out verbatim.




     3.5 Advirna, for itself and its Affiliates, hereby covenants and agrees that for a period of
five (5) years following Effective Date, Advirna and its Affiliates will not, directly or
indirectly, within the Territory (as defined in the License Agreement) engage in activities
relating to the development or commercialization of human therapeutic or diagnostic products or
technologies. For the avoidance of doubt, Advirna shall be permitted to provide non-therapeutic
and non-diagnostic: (i) products (such as reagents); and (ii) related services, in either case for
the modulation of gene function by unaffiliated third parties, who may use such tools as part of
their development of therapeutic or diagnostic products or technologies.



4.0 Stock Payment




     4.1 Issuance. In consideration for this Agreement, RXi hereby agrees that it will, on
the Payment Date (defined below), issue to Advirna shares of common stock of RXi (the “Stock
Payment”) equaling either: (a) the “Advirna Shares,” as determined in accordance with Annex II
to the that certain Securities Purchase Agreement by and among RXi, Galena, Tang Capital Partners,
LP and RTW Investments, LLC (the “Purchase Agreement”), but only if the Payment Date is triggered
due to the occurrence of the Closing, or (b) that number of shares of common stock of RXi
representing five percent (5%) of RXi’s fully diluted outstanding Common Stock after such issuance
(and after accounting for the shares of common stock to be issued upon the Note Conversion (defined
below)), but only if the Payment Date is triggered due to the occurrence of a Note Conversion. The
shares underlying the Stock Payment (the “Shares”) will, when issued as contemplated
herein, be validly issued, duly authorized, fully-paid and non-assessable. For purposes of this
Section 4.1, the “Payment Date” shall mean the earlier of: (x) the Closing (as defined in
the Purchase Agreement) or (y) the conversion of the Bridge Notes pursuant to Section 4.2 of the
Bridge Notes (such event being referred to above as a “Note Conversion”).



     4.2 Investment Representations. Advirna understands and agrees that the offering and
sale of the Shares has not been registered under the Securities Act, or any applicable state
securities laws and is being made in reliance upon federal and state exemptions for transactions
not involving a public offering which depend upon, among other things, the bona fide nature of the
investment intent and the accuracy of Advirna’s representations and warranties as expressed below.




(a) Advirna is acquiring the Shares for its own account for investment and not with
a view toward distribution in a manner which would violate the Securities Act or any
applicable state securities laws.




(b) Advirna, by reason of the business and financial experience of its management,
has the capacity to protect its own interests in connection with the transactions
contemplated by this Amendment Agreement and is capable of evaluating the merits and
risks of the investment in the Shares. Advirna understands that an investment in the
Shares bears significant risk and Advirna



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represents that it is able to bear the economic risk of an investment in the Shares
and is able to sustain a loss of all of its investment in the Shares without
economic hardship, if such a loss should occur.




(c) Advirna is an “accredited investor” as that term is defined in Regulation D
promulgated under the Securities Act.




(d) Advirna understands that the Shares will be characterized as “restricted
securities” under the federal securities laws inasmuch as they are being acquired
from RXi in a private placement under Section 4(2) of the Securities Act and that
under such laws and applicable regulations the Shares may be resold without
registration under the Securities Act only in certain limited circumstances. Advirna
acknowledges that the Shares must be held indefinitely unless subsequently
registered under the Securities Act and under applicable state securities laws or an
exemption from such registration is available. Further, it is understood that the
certificates evidencing the Shares may bear substantially the following legends (in
addition to any other legends as legal counsel for RXi deems necessary or advisable
under the applicable state and federal securities laws):




THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
OR ANY APPLICABLE STATE SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN
EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR APPLICABLE STATE
SECURITIES LAWS OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT
SUCH REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OR
RULE 144A OF SUCH ACT.



5.0 Fees and Other Consideration




     5.1 RXi agrees to pay a one-time payment to Advirna of $350,000.00 (Three Hundred Fifty
Thousand Dollars) (“Patent Issuance Fee”), within ten (10) days following the issue date of the
first patent from the Patent Rights with Valid Claims, which would otherwise be infringed by a
Royalty-Bearing Product. If a patent within the Patent Rights is issued for which RXI concludes it
does not include any such Valid Claims, then RXi shall notify Advirna of that fact within thirty
(30) days following RXi’s receipt of a Notice of Allowance for that patent. Such notice to Advirna
shall recite a specific reason for concluding that the patent within the Patent Rights does not
include a Valid Claim. If Advirna disputes RXi’s conclusions regarding the existence of a Valid
Claim and if the parties are unable to resolve the matter within twenty (20) days thereafter, then
Advirna may refer the matter to final and binding arbitration in Boston, Massachusetts, in
accordance with the then commercial rules of the American Arbitration Association (“A.A.A.”). RXi
and Advirna will be equally responsible for the payment of arbitrator’s fee and the filing fee with
the A.A.A. and otherwise, each party shall be responsible



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for its own attorneys’ fees and costs, witness fees, travel, transcripts, expert testimony and
the like, provided, however, that the arbitrator shall have the right, but not the obligation, to
award the prevailing party its fees and expenses (including reasonable attorneys’ fees).




     5.2 RXi agrees to pay an annual maintenance fee of $100,000.00 (One Hundred Thousand)
beginning January 1, 2012, to maintain its rights hereunder, which maintenance fee is non
refundable and due on the last day of January each year. In the event that RXi fails to pay such
annual maintenance fee, RXi agrees to assign all right, title and interest in and to the PATENT
RIGHTS and TECHNOLOGY RIGHTS to ADVIRNA, provided that at RXi’s option, such assignment shall be
subject to a nonexclusive license to be negotiated by the PARTIES in good faith at such time, which
shall be reasonably consistent with the other terms and conditions of this AGREEMENT. Following
any such assignment, RXi shall have no further payment obligations to ADVIRNA hereunder, other than
payments which accrued prior to the date of such assignment.



     5.3 RXi shall control the prosecution and pay directly for all patent and maintenance costs
during the term of this AGREEMENT. RXi agrees to provide ADVIRNA reasonable opportunity to review
and comment on prosecution matters, including by providing ADVIRNA with a copy of material
communications from any patent authority regarding such PATENT RIGHTS, and by providing drafts of
any material filings or responses to be made to such patent authorities at least thirty (30) days
in advance of submitting such filings or responses. RXi shall reasonably consider and incorporate
ADVIRNA’s comments in good faith and ensure that inventorship conforms to the rules of the laws of
the country in which such patent application is filed. Notwithstanding the foregoing, for so long
as Anastasia Khvorova serves as an officer of RXi, RXi need not comply with the notice and review
provisions of this Section 5.3.



     5.4 If, at any time, RXi decides at its sole discretion to abandon the prosecution and
maintenance of PATENT RIGHTS, RXi agrees to assign all right, title and interest in and to the
PATENT RIGHTS and TECHNOLOGY RIGHTS to ADVIRNA and ADVIRNA will be solely responsible for
prosecution and maintenance costs of the PATENT RIGHTS. Following any such assignment, RXi shall
have no further payment obligations to ADVIRNA hereunder, other than payments which accrued prior
to the date of such assignment



     5.5 RXi hereby grants ADVIRNA, as security for performance of its payment obligations pursuant
to this AGREEMENT a first priority security interest in the PATENT RIGHTS and TECHNOLOGY RIGHTS, as
described in the Security Agreement attached hereto as Exhibit B (“SECURITY AGREEMENT”). As set
forth in the SECURITY AGREEMENT, ADVIRNA will have all the rights and remedies afforded secured
parties. RXi will execute, deliver, file and record any statement, instrument, agreement or other
document and take any other action (including, without limitation, any filings with the United
States Patent and Trademark Office and any filings of financing or continuation statements under
the Uniform Commercial Code) in order to create, preserve, upgrade in rank, perfect, confirm or
validate the security interest or enable ADVIRNA to obtain the full benefits of such security
interest.



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6.0 Licensing




     6.1 The granting of licenses under the PATENTS RIGHTS and TECHNOLOGY RIGHTS by RXi will be in
the discretion of RXi, and RXi will have the sole power to determine whether or not, to grant
licenses, and the royalty rates and terms and conditions of such licenses. All license agreements
shall be shared with ADVIRNA promptly after execution of the documents, all of which shall be
deemed to be RXi CONFIDENTIAL INFORMATION.



     6.2 RXi will pay to ADVIRNA one percent (1%) of any and all income received by RXi from
licensing (other than from (i) any equity investments in RXi, or (ii) payments to RXi for research
and development (such as FTE reimbursement)). Payment of ADVIRNA’s share of licensing income will
be made to ADVIRNA semiannually as provided in Section 7.0.



7.0 Payments




     Not later than the last day of each January and July, RXi must furnish to ADVIRNA a written
statement of all amounts due pursuant to Section 6.2 for the semiannual periods ended the last days
of the preceding December and June, respectively, and must pay to ADVIRNA all amounts due to
ADVIRNA in US Dollars. If no amount is accrued during any semiannual period, a written statement
to that effect will be furnished.



8.0 Representations and Disclaimer of Warranties




     8.1 MUTUAL REPRESENTATIONS. Each of the PARTIES hereby represents and warrants to the other
PARTY that, as of the EFFECTIVE DATE:




	 	(a)	 	Such PARTY has full corporate right, power and authority to
enter into this AGREEMENT and to perform its respective obligations under this
AGREEMENT and that it has the right to grant the assignments, licenses and
sublicenses granted pursuant to this AGREEMENT;






	 	(b)	 	This AGREEMENT is a legal and valid obligation binding upon
such PARTY and enforceable in accordance with its terms. The execution,
delivery and performance of this AGREEMENT by such PARTY does not conflict with
any agreement, instrument or understanding; oral or written, to which it is a
party or by which it is bound, nor, to its knowledge; violate any
law or regulation having jurisdiction over it;






	 	(c)	 	Such PARTY has not granted any right to any third party that
would conflict with the rights granted to the other PARTY hereunder;






	 	(d)	 	Except for regulatory approvals, pricing and/or reimbursement
approvals, manufacturing approvals and/or similar approvals necessary for the
development, manufacture or commercialization of a ROYALTY-BEARING PRODUCT (and
the components thereof), such PARTY has Obtained all necessary consents,
approvals and authorizations of all government authorities and other persons
required to be obtained by it as of the EFFECTIVE DATE in connection with the
execution, delivery and




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	 	 	 	performance of this AGREEMENT; and






	 	(e)	 	There is no action or proceeding pending or, to such PARTY’s
knowledge, threatened, that questions the validity of this AGREEMENT or any
action taken by such PARTY in connection with the execution of this AGREEMENT.





     8.2 ADDITIONAL REPRESENTATIONS OF ADVIRNA. ADVIRNA hereby represents and Warrants to RXi
that, as of the EFFECTIVE DATE:




	 	(a)	 	ADVIRNA owns all right, title and interest in and to the PATENT
RIGHTS and TECHNOLOGY RIGHTS and has full power and authority to assign,
transfer and convey all right, title and interest in and to the PATENT RIGHTS
and TECHNOLOGY RIGHTS as set forth in this AGREEMENT;






	 	(b)	 	All the patents and patent applications that are part of the
PATENT RIGHTS and TECHNOLOGY RIGHTS existing as of the EFFECTIVE DATE are
identified under Section 2.3, and there are no other patents, patent
applications or inventions owned by ADVIRNA or to which the INVENTOR is a named
inventor that cover or relate to inventions or claims disclosed in the PATENT
RIGHTS or TECHNOLOGY RIGHTS (except for any patents or patent applications
assigned to RXi pursuant to INVENTOR’s employment relationship with RXi). To
ADVIRNA’s knowledge, all patent applications within the PATENT RIGHTS are still
pending and all issued patents within the PATENT RIGHTS are in good standing
and have not been abandoned; and






	 	(c)	 	To ADVIRNA’s knowledge, ADVIRNA is not a party to an
interference relating to the subject matter of the PATENT RIGHTS.





     8.3 LIMITATION ON REPRESENTATIONS OR WARRANTIES. Notwithstanding anything to the contrary
herein, neither PARTY will be in breach of any representation or warranty made pursuant to this
Section 8 to the extent that the PARTY alleged to have so breached can demonstrate that the PARTY
alleging such breach had, on or prior to the EFFECTIVE DATE, actual knowledge of such breach of
such representation or warranty.



     8.4 DISCLAIMER OF WARRANTY. EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH HEREIN, NEITHER PARTY
MAKES ANY REPRESENTATIONS AND GRANTS NO WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY
OPERATION OF LAW, BY STATUTE OR OTHERWISE, AND ADVIRNA AND RXi EACH SPECIFICALLY DISCLAIMS ANY
OTHER REPRESENTATIONS AND WARRANTIES, WHETHER WRITTEN OR ORAL, EXPRESS, STATUTORY OR IMPLIED,
INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR
ANY WARRANTY AS TO THE VALIDITY OF ANY PATENT RIGHTS OR THE NON-INFRINGEMENT OF ANY INTELLECTUAL
PROPERTY RIGHTS OF THIRD PARTIES.



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EACH PARTY HEREBY DISCLAIMS ANY REPRESENTATION OR WARRANTY THAT THE DEVELOPMENT, MANUFACTURE
AND COMMERCIALIZATION OF A ROYALTY-BEARING PRODUCT PURSUANT TO THIS AGREEMENT WILL BE SUCCESSFUL OR
THAT ANY PARTICULAR SALES LEVEL WITH RESPECT TO THE ROYALTY-BEARING PRODUCT WILL BE ACHIEVED.




     8.5 LIMITATION OF LIABILITY. IN NO EVENT WILL EITHER PARTY BE LIABLE FOR LOST PROFITS OR FOR
ANY SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, HOWEVER CAUSED, ON ANY THEORY
OF LIABILITY AND WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES,
ARISING UNDER ANY CAUSE OF ACTION AND ARISING IN ANY WAY OUT OF THIS AGREEMENT, EXCEPT AS A RESULT
OF A PARTY’S WILLFUL MISCONDUCT, GROSS NEGLIGENCE, RECKLESS CONDUCT OR A BREACH OF THE
CONFIDENTIALITY IN SECTION 9.



     8.6 Nothing in this AGREEMENT precludes RXi from contesting the validity of any PATENT RIGHTS.
In the event evidentiary material comes to the attention of RXi subsequent to RXi’s execution of
this AGREEMENT that, in the judgment of RXi, bears on the validity or scope of any PATENT RIGHTS,
ADVIRNA will in good faith discuss with RXi whether such evidentiary material so affects the
validity or scope of the PATENT RIGHTS to which it is asserted to apply that the terms of this
AGREEMENT in respect to such PATENT RIGHTS should be modified.



     8.7 In the event RXi intends to assert in any forum that any PATENT RIGHTS are invalid,
unenforceable, or unpatentable, RXi will, not less than ninety (90) days prior to making any such
assertion, provide to ADVIRNA a complete written disclosure of each and every basis then known to
RXi for such assertion and with such disclosure, will provide ADVIRNA with a copy of any document
or publication upon which RXi intends to rely in support of such assertion. RXi’s failure to
comply with this provision will constitute a material breach of this AGREEMENT.



9.0 Confidential Information




     9.1 ADVIRNA, through INVENTOR, has disclosed all relevant CONFIDENTIAL INFORMATION as defined
in Section 9.2 below, other information, and data relating to PATENT RIGHTS and TECHNOLOGY RIGHTS
that enabled RXi to evaluate the potential commercial significance of the PATENT RIGHTS and
TECHNOLOGY RIGHTS.



     9.2 In addition to the initial disclosure described in Section 9.1, the disclosure of further
confidential information as of the date that INVENTOR became an employee of RXi is no longer
subject to this Section 9, but to confidentiality provisions of employment agreements entered into
by INVENTOR. All information (a) disclosed by ADVIRNA, whether disclosed initially or at any time
prior to the date of INVENTOR’s employment with RXi and (b) disclosed by RXi to ADVIRNA whether
disclosed prior to or during the term of this AGREEMENT will be referred to as “CONFIDENTIAL
INFORMATION.” Each PARTY will only use the other PARTY’s CONFIDENTIAL INFORMATION as required for
the performance of this AGREEMENT. Each PARTY will continue to use reasonable efforts to prevent
the disclosure



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of any of the other PARTY’S CONFIDENTIAL INFORMATION to third parties for a period of three
(3) years after the termination of this AGREEMENT, provided that the recipient PARTY’s obligation
will not apply to information that:





	 	(a)	 	was known to the receiving PARTY prior to its disclosure to the
receiving PARTY by the disclosing PARTY as evidenced by written documents
predating the receiving PARTY’s receipt of such CONFIDENTIAL 
INFORMATION; or






	 	(b)	 	is public knowledge at the time of its disclosure to the
receiving PARTY or became public knowledge after its disclosure to the
receiving PARTY through no act or omission or on its behalf; or






	 	(c)	 	is or later becomes published through no fault of the receiving
PARTY;






	 	(d)	 	is disclosed or made available to the receiving PARTY by a
third party which, to the receiving PARTY’s knowledge, had no direct or
indirect obligation to the disclosing PARTY to maintain the confidentiality of
such CONFIDENTIAL INFORMATION at the time of such disclosure to the receiving
PARTY; or






	 	(e)	 	is independently developed by the receiving PARTY without the
aid or benefit of CONFIDENTIAL INFORMATION disclosed to the receiving PARTY by
the disclosing PARTY.





     9.3 In the event that information is required to be disclosed by court order, law or
regulation, the PARTY required to make disclosure will notify the other to allow that PARTY to
assert whatever exclusions or exemptions may be available to it under such law or regulation.



10.0 Termination




     10.1 This AGREEMENT will expire upon the expiration of the last to expire of the PATENT RIGHTS
included herein, or upon the abandonment of the last to be abandoned of any patents included
herein, whichever is later, unless this AGREEMENT is sooner terminated.



     10.2 RXi may terminate this AGREEMENT at any time upon ninety (90) days written notice in
advance to ADVIRNA.



     10.3 ADVIRNA may terminate this AGREEMENT upon ninety (90) days’ prior written notice in the
event that RXi ceases using commercially reasonable efforts to research, develop, license or
otherwise commercialize the PATENT RIGHTS or ROYALTY-BEARING PRODUCTS, provided that RXi may refute
such claim within such ninety (90) day period by showing budgeted expenditures for the research,
development, licensing or other commercialization consistent with other technologies of similar
stage of development and commercial potential as the PATENT RIGHTS and ROYALTY-BEARING PRODUCTS.



     10.4 Either PARTY at any time may provide written notice to the other PARTY of a material
breach of this AGREEMENT. If the oilier PARTY fails to cure the identified breach



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within ninety (90) days after the date of the notice, the aggrieved PARTY may terminate this
AGREEMENT by written notice to the PARTY in breach. This will not be an exclusive remedy, and
either PARTY will be entitled, if the circumstances warrant, alternatively or cumulatively, to
damages for breach of this AGREEMENT, to an order requiring performance of obligations of this
AGREEMENT, or to any other remedy available at law or equity:




     10.5 The word “termination” and cognate, words, such as “term” and “terminate,” used in this
Section 10 and elsewhere in this AGREEMENT are to be read, except where the contrary is
specifically indicated, as omitting from their effect the following rights and obligations, all of
which will survive any termination to the degree necessary to permit their complete fulfillment or
discharge:




	 	(a)	 	RXi’s obligation to supply a terminal report as specified in
Section 7.0 of this AGREEMENT.






	 	(b)	 	ADVIRNA’s right to receive or recover and RXi’s obligation to
pay any payments accrued or accruable for payment at the time of any
termination.






	 	(c)	 	Licenses, releases, and agreements of non-assertion running in
favor of customers or transferees of RXi in respect to products sold or
transferred by RXi prior to any termination.






	 	(d)	 	Any cause of action or claim of ADVIRNA accrued, or to accrue,
because of any breach or default by RXi.






	 	(e)	 	The representation and disclaimer of warranties of Section 8.0.






	 	(f)	 	The confidentiality provisions of Section 9.0.






	 	(g)	 	The re-assignment of the PATENT RIGHTS and TECHNOLOGY RIGHTS to
ADVIRNA as set forth in Sections 5.2, 5.4 and 10.6.





     10.6 Following any expiration or termination of this AGREEMENT, no further payment shall be
payable to ADVIRNA pursuant to this Agreement, except for payments that accrued prior to such
termination or expiration. Upon termination under Sections 10.2 and 10.3, or for cause for failure
of payment of fees to ADVIRNA under Sections. 05.0 and 6.0, or expiration of this AGREEMENT in
accordance with its terms, RXi agrees to assign, transfer and convey to ADVIRNA all right, title
and interest in and to the PATENT RIGHTS and TECHNOLOGY RIGHTS.



11.0 Litigation




     11.1 Each PARTY will notify the other PARTY in writing of any suspected infringement(s) of the
PATENT RIGHTS, TECHNOLOGY RIGHTS in the TERRITORY and will provide to the other PARTY any evidence
of such infringement(s).



     11.2 RXi has the right to institute suit for infringement(s) in the TERRITORY so long as this
AGREEMENT is in full force and effect. ADVIRNA agrees to join as a party plaintiff in



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any such lawsuit initiated by RXi, if requested by RXi, with all costs, attorneys’ fees, and
expenses to be paid by RXi.




     11.3 RXi will be entitled to any recovery of damages resulting from a lawsuit brought by it
pursuant to Section 11.2.



     11.4 RXi may not settle with an infringer without the prior approval of ADVIRNA if such
settlement would affect the rights of ADVIRNA under the PATENT RIGHTS and TECHNOLOGY RIGHTS, which
approval will not be unreasonably withheld or delayed.



12.0 Indemnification




     12.1 RXi will hold ADVIRNA harmless against all liabilities, demands, damages, expenses, or
losses arising (1) out of use by RXi or its transferees (other than ADVIRNA) of inventions licensed
or information furnished under this AGREEMENT, or (2) out of any use, sale, or other disposition by
RXi or its transferees (other than ADVIRNA) of products made by use of such inventions or
information.



13.0 General Provisions




     13.1 This AGREEMENT may not be assigned by RXi without the prior written consent of ADVIRNA,
which consent may not unreasonably be withheld or delayed. However, RXi may assign any and all of
the rights granted to it pursuant to this AGREEMENT to a successor of all or substantially all of
its business to which this AGREEMENT relates without the approval from or prior notice to ADVIRNA.
This AGREEMENT shall be binding upon and inure to the benefit of the PARTIES and their respective
successors and permitted assigns.



     13.2 This AGREEMENT constitutes the entire and only agreement between the PARTIES, and all
prior negotiations, representations, agreements, options and understandings are superseded hereby.
No agreements altering or supplementing the terms hereof may be made except by written mutual
agreement by the PARTIES.



     13.3 The relationship between ADVIRNA and RXi is that of independent contractors. ADVIRNA and
RXi are not joint venturers, partners, principal and agent, master and servant, employer or
employee, and have no other relationship other than independent contracting parties. ADVIRNA will
have no power to bind or obligate RXi in any manner, other than as is expressly set forth in this
AGREEMENT. Likewise RXi will have no power to bind or obligate ADVIRNA in any manner, other than
as is expressly set forth in this AGREEMENT.



     13.4 If any provision of this AGREEMENT is ultimately held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions will not in
any way be affected or impaired thereby.



     13.5 Any delay in enforcing a PARTY’s right under this AGREEMENT or any waiver as to a
particular default or other matter will not constitute a waiver of such PARTY’s rights to the
future enforcement of its rights under this AGREEMENT, except only as to an express written and
signed waiver to a specific matter for a specific period of time.



11









 





     13.6 Any notice required by this AGREEMENT will be given by personal delivery (including
delivery by reputable messenger services such as Federal Express) or by prepaid, first class,
certified mail, return receipt requested, addressed to:


ATTENTION:




ADVIRNA, LLC

10 Rocklawn Road

Westborough, MA 01581




or in the case of RXi to:



President and CEO




RXi Pharmaceuticals Corporation

60 Prescott St.

Worcester, MA 01605



or at such other addresses as may be given from time to time in accordance with the terms of this
notice provision.




     13.7 This AGREEMENT will be governed by, construed, and enforced in accordance with the
internal laws of the Commonwealth of Massachusetts, without regard to conflict of law principles
that would result in the application of the domestic substantive law of any other jurisdiction
other than U.S. federal law, in regard to any question affecting the construction or effect of any
patent.



     13.8 If RXi elects arbitration, the arbitration shall be conducted in Massachusetts, by one
(1) independent arbitrator who is experienced in licensing biotechnology intellectual property.
The arbitrator shall be chosen by mutual consent of the PARTIES within thirty (30) days after RXi
elects arbitration and pays the fees of the arbitrator.



     13.9 In publicizing anything made, used, offered for sale, sold, or imported under this
AGREEMENT, RXi may use the name of ADVIRNA or otherwise refer to any organization related to
ADVIRNA, after obtaining written approval of ADVIRNA, which will not be unreasonably withheld or
delayed.



     13.10 RXi must place in a conspicuous location on ROYALTY-BEARING PRODUCT a patent notice in
accordance with 35 U.S.C. §287. RXi agrees to mark any products made using a process covered by
any PATENT RIGHTS or TECHNOLOGY RIGHTS with the number of each such patent and, with respect to
such PATENT RIGHTS and, to respond to any request for disclosure under 35 U.S.C. §287(b)(4)(B).



     13.11 Capitalized terms not otherwise defined herein shall have the respective meanings
ascribed to them in the Purchase Agreement.



12









 




IN WITNESS WHEREOF, the PARTIES have caused this AGREEMENT to be executed by their duly authorized
representatives.




	 	 	 	 	 
	 	ADVIRNA, LLC

 	 
	 	By:  	/s/ Alexey Wolfson
 	 
	 	 	Name:  	Alexey Wolfson, Ph.D., MBA 	 
	 	 	Its: President
 	 
	 	 	Date: September 28, 2011
 	 
	 



	 	 	 	 	 
	 	RXi PHARMACEUTICALS CORPORATION

 	 
	 	By:  	/s/  Mark J. Ahn
 	 
	 	 	Name:  	Mark J. Ahn, Ph.D. 	 
	 	 	Its: President
 	 
	 	 	Date: September 28, 2011
 	 



13









 






	 	 	 	 	 



EXHIBIT A




ASSIGNMENT OF PATENT APPLICATIONS




     WHEREAS, ADVIRNA, LLC, a Colorado limited liability company, with its principal place of
business at 10 Rocklawn Road, Westborough, MA 01581 (“Assignor”) is the owner of the following
United States patent application, including but not limited to all international, provisional and
other types of applications related or claiming thereto (collectively, the “Patent Applications”):



	 	 	 	 	 
	Title	 	Number	 	Filing Date
	Chemically modified
polynucleotides and
methods of using the
same

	 	61/192,954


(Atty. Dock. No. 


007330-01 USPRV) 


PCT/US2009/005247


PCT/US2009/005246


13/069,780


PCT/US2009/005251
	 	September 22, 2008






     WHEREAS, Assignor is desirous of transferring the entire and exclusive right, title and
interest in and to the inventions disclosed in said Patent Applications (the “Inventions”) in the
United States and throughout, the world, and in and to any Letters Patent which may be granted and
issued therefor to RXi Pharmaceuticals Corporation (formerly RNCS, Inc.), a Delaware corporation
with its principal place of business at 60 Prescott St., Worcester, MA 01605 (“Assignee”);



     NOW, THEREFORE, in consideration of the foregoing recitals and other good and valuable
consideration the receipt and adequacy of which are hereby acknowledged, the parties hereby agree
as follows:



     1. Assignment. Assignor hereby assigns, transfers and conveys to Assignee all of
Assignor’s rights, titles, and interests throughout the world in and to said Patent Applications,
the Inventions, and any and all Letters Patent whether U.S. or foreign that are or may be granted
therefrom, including, without limitation, any extensions, continuations, continuations-in-part,
divisions, reissues, reregistrations, reexaminations and renewals thereof, or other equivalents
thereof (collectively, the “Assigned Patent Applications”), and further, all rights and privileges
pertaining to the Assigned Patent Applications, including, without limitation, the right, if any,
to sue or bring and recover for, and the right to profits or damages due or accrued, arising out of
or in connection with, any and all actions for past, present and future infringement thereof.



     2. Further Assignment. Assignor further assigns to and empowers Assignee, their
successors, assigns or nominees, all rights to make applications for patents or other forms of
protection for said Inventions and to prosecute such applications and the Assigned Patent
Applications, as well as to claim and receive the benefit of the right of priority provided by the
International Convention for the Protection of Industrial Property, as amended, or by any
convention which may henceforth be substituted for it, and the right to invoke and claim such



14









 




right of priority without further written or oral authorization.




     3. Authorization of Patent and Trademark Office to Record. Assignor further agrees
that this assignment shall be deemed a full legal and formal equivalent of any assignment, consent
to file or like document which may be required in any country for any purpose regarding the subject
matter hereof, as well as constituting proof of the right of Assignee or its successors, assigns or
nominees to apply for patent or other proper protection for said Inventions, and to claim the
aforesaid benefits of the right of priority provided by the International Convention for the
Protection of Industrial Property, as amended, or by any convention which may henceforth be
substituted for it.



     4. Further Assurances. Assignor agrees to take such further action and to execute
such documents as Assignee may reasonably request to effect or confirm the conveyance to Assignee
of the Patent Applications and any improvements thereunder.



     IN WITNESS WHEREOF, the parties hereto have executed this Assignment of Patent Application as
of the last day indicated below.



	 	 	 	 	 
	 	ADVIRNA, LLC

 	 
	 	By:  	 	 
	 	 	Printed Name:  	 	 
	 	 	Date: 	 	 
	 




     The foregoing Assignment of Patent Application thereof by the Assignor to the Assignee is
hereby accepted as of the ____ day of _____________, 2011.



	 	 	 	 	 
	 	RXI PHARMACEUTICALS CORPORATION

 	 
	 	By:  	 	 
	 	 	Printed Name:  	 	 
	 	 	Date: 	 	 



15









 






	 	 	 	 	 



EXHIBIT B




SECURITY AGREEMENT




     This Security Agreement (“Agreement”) dated the 24th day of September, 2011, is by and between
ADVIRNA, LLC, a Colorado limited liability company having its principal place of business at 10
Rocklawn Road, Westborough, MA 01581 (“ADVIRNA”), and RXi Pharmaceuticals Corporation (formerly
RCNS, Inc.), a Delaware corporation, having its principal place of business at 60 Prescott Street,
Worcester, MA 01605 (“RXi”).



RECITALS




     A. ADVIRNA and RXi are parties to a Patent and Technology Assignment Agreement dated the 24th
day of September, 2011, as it may be amended from time to time (hereinafter referred to
collectively as the “Assignment Agreement”);



     B. Pursuant to the Assignment Agreement, ADVIRNA has assigned to RXi certain Patent Rights and
Technology Rights as defined in the Assignment Agreement (herein called the “Collateral”);



     C. Pursuant to the terms of the Assignment Agreement, RXi has granted to ADVIRNA a security
interest in the Patent Rights and Technology Rights, subject to no other security interests except
those created in accordance with any subordination to which ADVIRNA agrees in writing; and



     D. All capitalized terms not defined herein shall have the meanings set forth in the
Assignment Agreement.



     NOW, THEREFORE, in consideration of the premises contained herein, RXi and ADVIRNA agree as
follows:



     1. To secure the complete and timely satisfaction of the obligations of RXi pursuant to the
Assignment Agreement solely as to (i) payment of any licensing-based payments as the same become
due and payable in accordance with Section 6.2 of the Assignment Agreement and applicable law (and
subject to any exceptions specified therein or elsewhere in the Assignment Agreement) and (iii)
payment of any payments as the same become due and payable in accordance with Section 4.1, 5.1 and
5.2 of the Assignment Agreement and applicable law (and subject to any exceptions specified therein
or elsewhere in the Assignment Agreement) (the “Secured Obligations”), RXi hereby grants, assigns
and conveys to ADVIRNA a continuing security interest in and lien on all of RXi’s right, title and
interest in the Collateral. Nothing herein shall be deemed to create any other security interest
in any other asset of RXi, and without limiting the generality of the foregoing, ADVIRNA shall have
no security interest in any other intellectual property rights of RXi.



     2. ADVIRNA is authorized to file at any time financing statements, continuation statements,
and amendments thereto, including, but not limited to, filings with the United States Patent and
Trademark Office or any other governmental agency, it deems necessary or desirable in order to
secure and perfect its rights under this Agreement or the Assignment Agreement,



16









 




provided that any such filings shall make it clear in a manner reasonably satisfactory to RXi
that the scope of the Collateral is limited to such particular numbered patent(s), patent
application(s) and related technology rights so assigned to it by ADVIRNA pursuant to the
Assignment Agreement. RXi authorizes and requests that Commissioner of Patents and Trademarks
record this Agreement, or a copy thereof.




     3. If a breach of RXi’s Secured Obligations shall have occurred and be continuing beyond the
time period (if any) provided to cure such breach in the Assignment Agreement, or, if none or a
shorter period is stated in the Assignment Agreement, then sixty (60) days after written notice of
such breach is received from ADVIRNA, during which RXi shall be entitled to cure such breach, or if
any proceeding is commenced by or against RXi under any provision of the United States Bankruptcy
Code, as amended, or any other bankruptcy or insolvency law (collectively, an “Event of Default”),
ADVIRNA shall have in addition to all other rights’ and remedies given it by this Agreement or the
Assignment Agreement, those allowed by law and the rights and remedies of a secured party under the
Uniform Commercial Code (“UCC”) as enacted in any jurisdiction in which either the Collateral may
be located or is otherwise applicable.



     4. Without the prior written consent of ADVIRNA, which will not be unreasonably withheld,
conditioned or delayed, RXi covenants after any Event of Default not to surrender or lose
possession of sell, encumber, rent, license, transfer or otherwise dispose of the Patent Rights,
Technology Rights or an interest therein, except as expressly permitted in herein or in the
Assignment Agreement. Prior to any Event of Default, RXi may license or otherwise deal with the
Collateral in any manner that it wishes, as long as any transfer or disposition is subject to
ADVERNA’s security interest. In addition, the security interest granted herein by RXi in favor of
ADVIRNA shall be at all times subject and subordinate to any bona fide license, sublicense or other
contract not creating any lien or security interest made by RXi in favor of any affiliated or
nonaffiliated party at any time prior to any uncured Event of Default notice issued by ADVIRNA in
accordance with this Agreement. ADVIRNA shall promptly execute any subordination agreement as may
be reasonably ‘requested by any such third party beneficiary of this provision in order to confirm
or further evidence such subordination hereunder.



     5. RXi hereby authorizes and empowers ADVIRNA to make, constitute and appoint any officer or
agent of ADVIRNA, as ADVIRNA may select in its exclusive discretion, as RXi’s true and lawful
attorney-in-fact, with the power solely exercised in accordance with the requirements of the UCC
and other applicable law, after an Event of Default, to endorse RXi’s name on all applications,
documents, papers and instruments necessary or desirable for ADVIRNA to use the Patent Rights and
Technology Rights, or to grant or issue any exclusive or nonexclusive license under the Collateral
to any third person, or necessary or desirable for ADVIRNA to assign, pledge, convey or otherwise
transfer title in or dispose of the Collateral to any third person. RXi hereby ratifies all that
such attorney shall lawfully do or cause to be done by virtue hereof in compliance with this
Agreement and the Assignment Agreement and applicable law. This power of attorney being coupled
with an interest shall be irrevocable for the life of this Agreement



     6. RXi shall have the right, with the consent of ADVIRNA, which shall not be unreasonably
withheld, conditioned or delayed, to bring suit in its own name, and to join ADVIRNA, if necessary,
as a party to such suit so long as ADVIRNA is satisfied that such



17









 




joinder will not subject it to any risk of liability, to enforce the rights related to the
Patent Rights and Technology Rights.




     7. At such time as RXi shall completely satisfy all of the Secured Obligations, ADVIRNA shall
execute and deliver to RXi all releases, terminations, and other instruments as may be necessary or
proper to release the security interest hereunder.



     8. No course of dealing between RXi and ADVIRNA, nor any failure to exercise, nor any delay in
exercising, on the part of ADVIRNA, any right, power or privilege hereunder or under the Assignment
Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any right,
power or privilege hereunder or thereunder preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.



     9. All of ADVIRNA’s rights and remedies with respect to the Collateral, whether established
hereby, the Assignment Agreement, any other agreements or by law shall be cumulative and May be
exercised singularly or concurrently.



     10. The provisions of this Agreement are severable,: and if any clause or provision
shall be held invalid and unenforceable in whole or in part in any jurisdiction, then such
provision shall be ineffective only to the extent and duration of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining provisions of this Agreement.



     11. This Agreement is subject to modification only by a writing signed by both parties.



     12. The validity and interpretation of this Agreement and the rights and obligations of the
parties shall be governed by the laws of the Commonwealth of Massachusetts, excluding conflict: of
laws principles that would cause the application of laws of any other jurisdiction. To the extent
the provisions of the Uniform Commercial Code govern any aspect of this Agreement, the Uniform
Commercial Code as the same is, from time to time, in effect in the Commonwealth of Massachusetts
shall govern; provided, that in the event that, by reason of mandatory provisions of law, any or
all of the attachment, perfection or priority of or remedies with respect to the security interest
granted on the Patent Rights and Technology Rights is required to be governed, by the Uniform
Commercial Code as the same is from time to time, in effect in a jurisdiction other than the
Commonwealth of Massachusetts, then such jurisdiction’s Uniform Commercial Code, as in effect, from
time to time, shall govern only to the extent required by applicable law.



     13. All judicial proceedings arising in or under or related to this Agreement may be brought
in any state or federal court of competent jurisdiction located in the Commonwealth of
Massachusetts.



[remainder of page intentionally left blank]



18









 





     WITNESS the execution hereof under seal as of the day and year first above written.



	 	 	 	 	 
	 	RXI PHARMACEUTICALS CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	ADVIRNA, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



19









 






	 	 	 	 	 



EXHIBIT C




PATENT AND TECHNOLOGY

LICENSE AGREEMENT




     THIS PATENT AND TECHNOLOGY LICENSE AGREEMENT (“Agreement”), is entered into this 24th day of
September, 2011 (the “Effective Date”) by and between ADVIRNA, LLC, a Colorado limited liability
company having its principal place of business at 10 Rocklawn Road, Westborough, MA 01581
(“ADVIRNA”) and RXi Pharmaceuticals Corporation (formerly RNCS, Inc.), a Delaware corporation,
having its principal place of business at 60 Prescott Street, Worcester, MA 01605 (“RXi”). ADVIRNA
and RXi may each be referred to as a “Party” and collectively as the “Parties”. For good and
valuable consideration, the receipt and adequacy of which is hereby acknowledged, the Parties agree
as follows:



1. Background of Agreement.





	 	1.1	 	ADVIRNA assigned to RXi certain Patent Rights and Technology Rights pursuant to
the Patent Assignment.
	 
	 	1.2	 	As part of the consideration for the Patent Assignment, RXi agreed to grant to
ADVIRNA an exclusive license (with the right to grant sublicenses) to the Patent Rights
and Technology Rights to develop, manufacture, sell and distribute Licensed Products in
the Grant-Back Field.
	 
	 	1.3	 	Such exclusive license in and to the Grant-Back Field is at no cost to ADVIRNA
and is given in consideration of ADVIRNA’s assignment of the Patent Rights and
Technology Rights to RXi.
	 
	 	1.4	 	On September 24, 2011 ADVIRNA agreed to enter a Patent Assignment with RXi.
	 
	 	1.5	 	As part of the consideration for such Patent Assignment, RXi agreed to grant to
ADVIRNA an exclusive license to the Technology Rights and improvements to the Patent
Rights, and rights to use the RXi Data within the Grant-Back Field.





2. Definitions. As used herein, the following terms shall have the meanings set forth below:





	 	2.1	 	“Grant-Back Field” means all fields of use for the Technology Rights and Patent
Rights outside of human therapeutic and diagnostic fields.
	 
	 	2.2	 	“Licensed Product” means any product for use in the Grant-Back Field that is
either (i) researched, developed, manufactured, used, marketed or sold in a manner that
is covered by one or more Valid Claims; or (ii) developed, manufactured, used, or sold
in a manner that utilizes any aspect of the Technology Rights.
	 
	 	2.3	 	“Patent Assignment” means that certain Patent and Technology Assignment
Agreement entered into by and between ADVIRNA and RXi, dated as of September 24, 2011.




20











 












	 	2.4	 	“Patent Rights” mean any patent rights related to RNAi and self delivering
technology set forth on Appendix 1 as well as all further improvements of such sd-rxRNA
technology, to the extent the claims are directly related to subject matter
specifically described and supported in the patents and patent applications set forth
on Appendix 1, as well as in any patents issued on any of the foregoing and any
reissues or reexaminations or extensions of the patents, and any foreign counterparts
to any of the foregoing.
	 
	 	2.5	 	“Technology Rights” mean any technical information, know-how, process,
procedure, composition, method, formula, protocol, technique or data developed by RXi
or Galena BioPharma (formerly, “RXI Pharmaceuticals Corporation”), which are necessary
for practicing the invention covered by Patent Rights.
	 
	 	2.6	 	“RXi Data” is defined as all data related to Patent Rights and Technology
Rights which has been publically disclosed.
	 
	 	2.7	 	“Territory” means worldwide.
	 
	 	2.8	 	“Valid Claim” means: (a) a claim of an issued and unexpired patent within the
Patent Rights which has not been permanently revoked or held unenforceable or invalid
by an unappealable or unappealed decision of a court or government agency of competent
jurisdiction or (b) a claim of a pending patent application within the Patent Rights
that has not been abandoned or finally disallowed without the possibility of appeal or
refilling.





3. License to ADVIRNA.






	 	3.1	 	Subject to the terms and conditions of this Agreement, RXi hereby grants to
ADVIRNA an exclusive (subject to Section 3.2 below), sublicensable (subject to Section
4.1 below), royalty-free, fully paid-up, no-cost, right and license throughout the
Territory in and to the Patent Rights and Technology Rights to make, have made, use,
offer to sell, sell, have sold, import and have imported Licensed Products in the
Grant-Back Field (the “License”). For clarity, the License to ADVIRNA in the
Grant-Back Field is free of charge, milestones and royalties and is given in
consideration of ADVIRNA assigning to RXi the Patent Rights and Technology Rights.

	 
	 	3.2	 	RXi reserves rights to the Patent Rights and Technology Rights to make, have
made, use, import and have imported products in the Grant-Back Field for its own
non-commercial, internal research and development purposes only.

	 
	 	3.3	 	Unless this Agreement is terminated or expires as set forth in Section 11
below, RXi shall not grant to any third party any rights or licenses to the Patent
Rights or Technology Rights in the Grant-Back Field.

	 
	 	3.4	 	Each Party agrees to take such further action and to execute such documents as
the other Party may reasonably request to effect or confirm the rights and licenses set
forth herein.







21









 








4. Sublicensing.





	 	4.1	 	ADVIRNA may, in its discretion, grant to third parties sublicenses and
sub-sublicenses under the Patent Rights and Technology Rights solely in the Grant-Back
Field. ADVIRNA will have the sole power to determine whether or not to grant such
sublicenses and sub-sublicenses, and the royalty rates and terms and conditions of such
sublicenses, provided that such sublicenses shall be consistent with the terms and
conditions of this Agreement. All sublicense agreements shall be shared with RXi
promptly after execution of the documents, all of which shall be deemed to be
Confidential Information of ADVIRNA.





5. [Intentionally Omitted].




6. Patent Prosecution.





	 	6.1	 	The Parties acknowledge and agree that pursuant to the Patent Assignment, RXi
shall control the prosecution and pay directly for all patent and maintenance costs in
respect of the Patent Rights during the term of the Patent Assignment. RXi agrees to
provide ADVIRNA reasonable opportunity to review and comment on prosecution matters,
including by providing ADVIRNA with a copy of material communications from any patent
authority regarding such Patent Rights, and by providing drafts of any material filings
or responses to be made to such patent authorities at least thirty (30) days in advance
of submitting such filings or responses. RXi shall reasonably consider and incorporate
ADVIRNA’s comments in good faith and ensure that inventorship conforms to the rules of
the laws of the country in which such patent application is filed. Notwithstanding the
foregoing, for so long as Anastasia Khvorova serves as an officer of RXi, RXi need not
comply with the notice and review provision of this Section 6.1.
	 
	 	6.2	 	If, as set forth in the Patent Assignment, RXi decides in its sole discretion
to abandon the prosecution and maintenance of the Patent Rights, RXi agrees to assign
all right, title and interest in and to the Patent Rights and Technology Rights to
ADVIRNA and ADVIRNA will be solely responsible for prosecution and maintenance costs of
the Patent Rights, provided, however, that Advirna shall grant, and hereby grants, a
worldwide, non-exclusive, fully-paid and royalty-free license to RXi or its assigns to
make, have made, use, sell and import products and services that would otherwise
infringe on any Valid Claims contained in such forfeited patents.
	 
	 	6.3	 	Nothing in this Agreement precludes ADVIRNA from contesting the validity of any
Patent Rights. In the event evidentiary material comes to the attention of ADVIRNA
subsequent to the Effective Date that, in the judgment of ADVIRNA, bears on the
validity or scope of any Patent Rights, ADVIRNA will in good faith discuss with RXi
whether such evidentiary material so affects the validity or scope of the Patent Rights
to which it is asserted to apply that the terms of this Agreement in respect to such
Patent Rights should be modified.






	 	6.4	 	In the event ADVIRNA intends to assert in any forum that any Patent Rights are
invalid, unenforceable, or unpatentable, ADVIRNA will, not less than ninety (90)





22









 






	 	 	 	days prior to making any such assertion, provide to RXi a complete written disclosure
of each and every basis then known to ADVIRNA for such assertion and, with such
disclosure, will provide RXi with a copy of any document or publication upon which
ADVIRNA intends to rely in support of such assertion. ADVIRNA’s failure to comply
with this provision will constitute a material breach of this Agreement. If Advirna
so asserts in any forum that any Patent Rights are invalid, unenforceable, or
unpatentable, then this license shall automatically terminate.





7. Litigation.





	 	7.1	 	Each Party will notify the other Party in writing of any suspected
infringement(s) of the Patent Rights and/or Technology Rights in the Territory and will
provide to the other Party any evidence of such infringement(s).
	 
	 	7.2	 	RXi has the right to institute suit for infringement(s) in the Territory so
long as the Patent Assignment is in full force and effect. ADVIRNA agrees to join as a
party plaintiff in any such lawsuit initiated by RXi, if requested by RXi, with all
costs, attorneys’ fees, and expenses to be paid by RXi.
	 
	 	7.3	 	RXi will be entitled to any recovery of damages resulting from a lawsuit
brought by it pursuant to Section 7.2.
	 
	 	7.4	 	RXi may not settle with an infringer without the prior approval of ADVIRNA if
such settlement would affect the rights of ADVIRNA under the Patent Rights and
Technology Rights, which approval will not be unreasonably withheld or delayed.
	 
	 	7.5	 	In the event that RXi does not take reasonable actions in respect of any such
infringement in the Grant-Back Field within one hundred eighty (180) days after receipt
of written notice of such infringement, then ADVIRNA may, at its sole cost and expense,
pursue such infringement as it relates to the Grant-Back Field and recover any damages
resulting from a lawsuit brought by ADVIRNA in pursuant to this Section 7.5. RXi
agrees to join as a party plaintiff in any such lawsuit initiated by ADVIRNA, if
requested by ADVIRNA, with all costs, attorneys’ fees, and expenses to be paid by
ADVIRNA. ADVIRNA may not settle with an infringer without the prior approval of RXi if
such settlement would affect the rights of the RXi under the Patent Rights and
Technology Rights, which approval will not be unreasonably withheld or delayed.





8. Representations and Disclaimer of Warranties.





	 	8.1	 	Each of the Parties hereby represents and warrants to the other Party that, as
of the Effective Date:






	 	8.1.1	 	Such Party has full corporate right, power and authority to
enter into this Agreement and to perform its respective obligations under this
Agreement and that it has the right to grant the licenses granted pursuant to
this Agreement;




23









 












	 	8.1.2	 	This Agreement is a legal and valid obligation binding upon
such Party and enforceable in accordance with its terms. The execution,
delivery and performance of this Agreement by such Party does not conflict with
any agreement, instrument or understanding, oral or written, to which it is a
party or by which it is bound, nor, to its knowledge, violate any law or
regulation having jurisdiction over it;
	 
	 	8.1.3	 	Such Party has not granted any right to any third party that
would conflict with the rights granted to the other Party hereunder;
	 
	 	8.1.4	 	Except for regulatory approvals, pricing and/or reimbursement
approvals, manufacturing approvals and/or similar approvals necessary for the
development, manufacture or commercialization of a Licensed Product (and the
components thereof), such Party has obtained all necessary consents, approvals
and authorizations of all government authorities and other persons required to
be obtained by it as of the Effective Date in connection with the execution,
delivery and performance of this Agreement; and
	 
	 	8.1.5	 	There is no action or proceeding pending or, to such Party’s
knowledge, threatened, that questions the validity of this Agreement or any
action taken by such Party in connection with the execution of this Agreement.






	 	8.2	 	Notwithstanding anything to the contrary herein, neither Party will be in
breach of any representation or warranty made pursuant to this Section 8 to the extent
that the Party alleged to have so breached can demonstrate that the Party alleging such
breach had, on or prior to the Effective Date, actual knowledge of such breach of such
representation or warranty.
	 
	 	8.3	 	EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN SECTION 8.1 NEITHER PARTY MAKES
ANY REPRESENTATIONS AND GRANTS NO WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY
OPERATION OF LAW, BY STATUTE OR OTHERWISE, AND ADVIRNA AND RXI EACH SPECIFICALLY
DISCLAIMS ANY OTHER REPRESENTATIONS AND WARRANTIES, WHETHER WRITTEN OR ORAL, EXPRESS,
STATUTORY OR IMPLIED, INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY OR FITNESS FOR
A PARTICULAR USE OR PURPOSE OR ANY WARRANTY AS TO THE VALIDITY OF ANY PATENT RIGHTS OR
THE NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES. EACH PARTY
HEREBY DISCLAIMS ANY REPRESENTATION OR WARRANTY THAT THE DEVELOPMENT, MANUFACTURE AND
COMMERCIALIZATION OF A LICENSE PRODUCT PURSUANT TO THIS AGREEMENT WILL BE SUCCESSFUL OR
THAT ANY PARTICULAR SALES LEVEL WITH RESPECT TO THE LICENSED PRODUCT WILL BE ACHIEVED.




24









 











9. Limitation of Liability.





	 	 	IN NO EVENT WILL EITHER PARTY BE LIABLE FOR LOST PROFITS OR FOR ANY SPECIAL, INDIRECT,
INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, HOWEVER CAUSED, ON ANY THEORY OF LIABILITY
AND WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, ARISING
UNDER ANY CAUSE OF ACTION AND ARISING IN ANY WAY OUT OF THIS AGREEMENT, EXCEPT AS A RESULT
OF A PARTY’S INDEMNIFICATION OBLIGATIONS HEREUNDER, WILLFUL MISCONDUCT, GROSS NEGLIGENCE,
RECKLESS CONDUCT OR A BREACH OF THE CONFIDENTIALITY IN SECTION 10.





10. Confidential Information.





	 	10.1	 	All information: (a) disclosed by ADVIRNA to RXi; (b) disclosed by RXi to
ADVIRNA; or (c) related to or arising out of the Technology Rights owned by RXi, will
be referred to as “Confidential Information.” Each Party will only use the other
Party’s Confidential Information as required for the performance of this Agreement.
Each Party will continue to use reasonable efforts to prevent the disclosure of any of
the other Party’s Confidential Information to third parties for a period of five (5)
years after the termination of this Agreement, provided that the recipient Party’s
obligation will not apply to information that:






	 	10.1.1	 	was known to the receiving Party prior to its disclosure to the receiving
Party by the disclosing Party as evidenced by written documents predating the
receiving Party’s receipt of such Confidential Information;
	 
	 	10.1.2	 	is public knowledge at the time of its disclosure to the receiving Party or
became public knowledge after its disclosure to the receiving Party through no
act or omission or on its behalf;
	 
	 	10.1.3	 	is or later becomes published through no fault of the receiving Party;
	 
	 	10.1.4	 	is disclosed or made available to the receiving Party by a third party which,
to the receiving Party’s knowledge, had no direct or indirect obligation to the
disclosing Party to maintain the confidentiality of such Confidential
Information at the time of such disclosure to the receiving Party; or
	 
	 	10.1.5	 	is independently developed by the receiving Party without the aid or benefit
of Confidential Information disclosed to the receiving Party by the disclosing
Party.






	 	10.2	 	In the event that information is required to be disclosed by court order, law
or regulation, the Party required to make disclosure will notify the other to allow
that Party to assert whatever exclusions or exemptions may be available to it under
such law or regulation.




25









 











11. Termination.





	 	11.1	 	This Agreement will expire upon the expiration of the last to expire of the
Patent Rights included herein, or upon the abandonment of the last to be abandoned of
any patents included herein, whichever is later, unless this Agreement is sooner
terminated.
	 
	 	11.2	 	ADVIRNA may terminate this Agreement at any time upon ninety (90) days written
notice in advance to RXi and all of ADVIRNA rights granted herewith will revert to RXi.
	 
	 	11.3	 	The word “termination” and cognate words, such as “term” and “terminate,” used
in this Section 11 and elsewhere in this Agreement are to be read, except where the
contrary is specifically indicated, as omitting from their effect the following rights
and obligations, all of which will survive any termination to the degree necessary to
permit their complete fulfillment or discharge:






	 	11.3.1	 	The representations and disclaimer of warranties of Section 8;
	 
	 	11.3.2	 	The limitation of liability of Section 9;
	 
	 	11.3.3	 	The confidentiality provisions of Section 10; and
	 
	 	11.3.4	 	The indemnification provisions of Section 12.





12. Indemnification.



ADVIRNA will hold RXi harmless against all liabilities, demands, damages, expenses, or losses
arising: (1) out of use by ADVIRNA, or its sublicensees of inventions licensed or information
furnished under this Agreement or (2) out of any use, sale, or other disposition by ADVIRNA or its
sublicensees of products made by use of such inventions or information.




13. General Provisions.





	 	13.1	 	This Agreement may not be assigned or transferred by ADVIRNA, including without
limitation through merger, acquisition, sale of assets, or operation of law, without
the prior written consent of RXi, which consent may not unreasonably be withheld,
delayed or conditioned. This Agreement shall be binding upon and inure to the benefit
of the Parties and their respective successors and permitted assigns.






	 	13.2	 	This Agreement constitutes the entire and only agreement between the Parties
with respect to the subject matter hereof, and all prior negotiations, representations,
agreements, options and understandings are superseded hereby, including without
limitation any terms or conditions relating to the license back to ADVIRNA as set forth
in the Patent Assignment. No agreements altering or supplementing the terms hereof may
be made except by written mutual agreement by the Parties.






	 	13.3	 	The relationship between ADVIRNA and RXi is that of independent contractors. ADVIRNA and RXi are not joint venturers, partners, principal and agent, master






26











 






	 	 	 	and servant, employer or employee, and have no other relationship other than
independent contracting parties. ADVIRNA will have no power to bind or obligate RXi
in any manner, other than as is expressly set forth in this Agreement. Likewise RXi
will have no power to bind or obligate ADVIRNA in any manner, other than as is
expressly set forth in this Agreement.






	 	13.4	 	If any provision of this Agreement is ultimately held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions
will not in any way be affected or impaired thereby.
	 
	 	13.5	 	Any delay in enforcing a Party’s right under this Agreement or any waiver as to
a particular default or other matter will not constitute a waiver of such Party’s
rights to the future enforcement of its rights under this Agreement, except only as to
an express written and signed waiver to a specific matter for a specific period of
time.
	 
	 	13.6	 	Any notice required by this Agreement will be given by personal delivery
(including delivery by reputable messenger services such as FedEx) or by prepaid, first
class, certified mail, return receipt requested, addressed to:




ATTENTION:

ADVIRNA, LLC

10 RockLawn, Westborough, MA 01581



with a copy, which shall not constitute notice to:



Rubin and Rudman LLP

50 Rowes Wharf

Boston, MA 02110

Attn: Peter B. Finn, Esq.



or in the case of RXi to:



President and CEO

RXi Pharmaceuticals Corporation

60 Prescott St.

Worcester, MA 01605





	 	 	or at such other addresses as may be given from time to time in accordance with the terms of
this notice provision.






	 	13.7	 	This Agreement will be governed by, construed, and enforced in accordance with
the internal laws of the Commonwealth of Massachusetts, without regard to conflict of
law principles that would result in the application of the domestic substantive law of
any other jurisdiction other than U.S. federal law, in regard to any question affecting
the construction or effect of any patent.






	 	13.8	 	If either party elects arbitration, the arbitration shall be conducted in
Massachusetts, by one (1) independent arbitrator who is experienced in licensing
biotechnology




27









 






	 	 	 	intellectual property. The arbitrator shall be chosen by mutual consent of the
Parties within thirty (30) days after a party elects arbitration and pays the fees of
the arbitrator. Each party shall have its own costs and expenses, including
attorneys’ fees and costs, witness fees, travel and the like.






	 	13.9	 	In publicizing anything made, used, offered for sale, sold, or imported under
this Agreement, ADVIRNA agrees to properly acknowledge RXi as a source of all data
used.
	 
	 	13.10	 	ADVIRNA must place in a conspicuous location on Licensed Products, a patent
notice in accordance with 35 U.S.C. §287. ADVIRNA agrees to mark any products made
using a process covered by any Patent Rights or Technology Rights with the number of
each such patent and, with respect to such Patent Rights and, to respond to any request
for disclosure under 35 U.S.C. §287(b)(4)(B).
	 
	 	13.11	 	Each Party shall duly execute and deliver, or cause to be duly executed and
delivered, such further instruments and do and cause to be done such further acts and
things, including the filing of such assignments, agreements, documents and
instruments, as may be necessary or as the other Party may reasonably request in
connection with this Agreement or to carry out more effectively the provisions and
purposes hereof or to better assure and confirm unto such other Party its rights and
remedies under this Agreement.





[remainder of this page left intentionally blank]



28









 




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




	 	 	 	 	 
	 	ADVIRNA, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	Alexey Wolfson, Ph.D 	 
	 	 	Its: President and Chief Executive Officer

Date: September  , 2011
 	 
	 



	 	 	 	 	 
	 	RXI PHARMACEUTICALS CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	Mark J. Ahn, Ph.D. 	 
	 	 	Its: President and Chief Financial Officer

Date: September  , 2011
 	 





[Signature Page to Advirna License-Back Amendment]






 









 






	 	 	 	 	 


APPENDIX 1



List of RNAi related patent applications covered by Patent Rights:





	 	•	 	PCT/US2009/005247
	 
	 	•	 	PCT/US2009/005246
	 
	 	•	 	PCT/US2011/029867
	 
	 	•	 	PCT/US2011/029824
	 
	 	•	 	PCT/US2011/029849
	 
	 	•	 	13/069,780
	 
	 	•	 	PCT/US2009/005251
	 
	 	•	 	PCT/US2010/000019
	 
	 	•	 	PCT/US2010/000348
	 
	 	•	 	12/867181
	 
	 	•	 	PCT/US2011/027165
	 
	 	•	 	PCT/US2010/000348
	 
	 	•	 	13/054696