TO FIRST HAVE BEEN USED BY
SUCH THIRD PARTY LICENSOR, (D) THE STAGE OF DEVELOPMENT OF SUCH COMPOUND, (E)
THE SCOPE THE LICENSE TO BE GRANTED TO LICENSEE (INCLUDING DEGREE OF EXCLUSIVITY
AND TERRITORIES INCLUDED), AND (F) THE IDENTITY OF SUCH THIRD PARTY LICENSOR.
CHIRON MAY, IN ITS SOLE DISCRETION, APPROVE OR REJECT SOME OR ALL OF THE
IN-LICENSES SET FORTH IN THE THIRD PARTY NOTICE, AND SHALL MAKE SUCH APPROVAL OR
REJECTION IN WRITING WITHIN THIRTY (30) DAYS OF RECEIPT OF THE THIRD PARTY
NOTICE. UPON CHIRON'S WRITTEN APPROVAL OF AN IN-LICENSE, EACH COMPOUND THAT IS
THE SUBJECT OF THE IN-LICENSE (AN "ACQUIRED COMPOUNDS") SHALL BECOME AN
IDENTIFIED PRODUCT UNDER THIS AGREEMENT FOR ALL PURPOSES, INCLUDING THE
OBLIGATIONS TO MAKE MILESTONE AND ROYALTY PAYMENT. WITHIN TEN (10) DAYS OF
REACHING A BINDING AGREEMENT WITH THE THIRD PARTY LICENSOR FOR SUCH IN-LICENSE
("IN-LICENSE DATE"), LICENSEE SHALL PAY TO CHIRON FOR SUCH IDENTIFIED PRODUCT
ANY MILESTONE PAYMENTS IN ACCORDANCE WITH SECTION 3.1.1 FOR MILESTONE EVENTS
THAT OCCURRED PRIOR TO THE IN-LICENSE DATE, AND ANY ROYALTY PAYMENTS IN
ACCORDANCE WITH SECTION 3.1.2 AND 3.1.3 FOR PERIODS PRIOR TO THE IN-LICENSE
DATE.
2.4.
NO RIGHTS BY IMPLICATION.
LICENSEE'S RIGHTS UNDER THE CHIRON
PATENT RIGHTS SHALL BE LIMITED TO THOSE RIGHTS SPECIFIED IN SECTIONS 2.1 AND
2.2, AND CHIRON RETAINS ALL OTHER RIGHTS RELATED THERETO.
3.
PAYMENTS
3.1.
PAYMENTS.
IN CONSIDERATION OF CHIRON'S GRANT OF THE LICENSE TO
LICENSEE, LICENSEE SHALL, IN ADDITION TO THE OTHER LICENSEE OBLIGATIONS
REFERENCED HEREIN, MAKE TO CHIRON THE PAYMENTS REFERENCED IN THIS SECTION 3.1.
3.1.1.
MILESTONE PAYMENTS.
WITH RESPECT TO EACH AND EVERY IDENTIFIED
PRODUCT DEVELOPED BY LICENSEE OR ANY THIRD PARTY BENEFICIARY THAT REACHES THE
MILESTONE EVENTS REFERENCED IN THIS SECTION 3.1.1, LICENSEE SHALL PAY TO CHIRON
THE FOLLOWING MILESTONE PAYMENTS WITHIN THIRTY (30) DAYS FOLLOWING THE
OCCURRENCE OF EACH SUCH MILESTONE EVENT:
(A)
UPON FILING OF AN IND OR COMMENCEMENT OF PHASE I CLINICAL TRIALS,
WHICHEVER OCCURS FIRST:
*** ("FIRST MILESTONE PAYMENT"); AND
(B)
UPON COMMENCEMENT OF PHASE II CLINICAL TRIALS: ***; AND
(C)
UPON COMMENCEMENT OF PHASE III CLINICAL TRIALS: ***; AND
(D)
UPON FILING OF AN NDA: ***; AND
(E)
UPON APPROVAL OF AN NDA: ***.
For the avoidance of doubt, each payment pursuant to clause (a), (b), (c), (d)
or (e) above shall be non-refundable, non-creditable, non-cancelable and payable
once (and only once) with respect to each Identified Product regardless of the
number of countries in which clinical trials are conducted or the number of NDA
registrations filed or
7
approved with respect to such Identified Product.
If a milestone event occurs
and Licensee has not made any milestone payments due for previous milestone
events (regardless of whether such milestone events have occurred), Licensee
shall pay to Chiron the amounts due for such previous milestone events in
conjunction with the payments for the current milestone events.
For purposes of
this Section 3.1.1, "commencement" of particular Clinical Trial shall mean the
earlier of (i) the date of first such dosing of Identified Product