Document:

ex_235841.htm

EXHIBIT 10.23

AMENDED AND RESTATED SUBLICENSE AGREEMENT

 

This AMENDED AND RESTATED SUBLICENSE AGREEMENT (the “Agreement”) as originally entered into February 19, 2019 (the “Effective Date”) and amended on August 2, 2019, and as further amended on _March 22_, 2021, (the “2nd Amendment Date”), is entered into by and between Moleculin Biotech Inc., (“MBI”) having a business address of 5300 Memorial Drive, Suite 950 Houston, TX 77007 and WPD Pharmaceuticals, (“WPD”), a Polish corporation, having a business address of ul. Żwirki i Wigury 101, 02-089 Warszawa. MBI and WPD are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

 

RECITALS

 

WHEREAS, subject to the MD Anderson License Agreements (defined below), MBI has obtained licenses to research, develop, make, have made, use, offer to sell, sell, export and/or import and commercialize Licensed Products within the Licensed Territory for use within the Licensed Field under Patent Rights;

 

WHEREAS, WPD wishes to obtain a sublicense from MBI to research and develop, manufacture, have manufactured, use, export/import, offer to sell and/or sell Sublicensed Products under the Sublicensed Subject Matter for use in the Sublicensed Field within the Sublicensed Territories;

 

WHEREAS, MBI and WPD wish to share Development Data; and

 

WHEREAS, MBI AND WPD wish to continue the Agreement by amending certain provisions on the 2nd Amendment Date.

 

 

 

NOW, THEREFORE, in consideration of the mutual covenants and promises herein contained, the Parties agree as follows:

 

	 	
			 

				
			       ARTICLE I.

			

DEFINITIONS

 

1.1    "Additional Patents” has the meaning set forth in Section 7.2 of this Agreement.

 

1.2    "Agreement” means this Sublicense Agreement.

 

1.3    "Annual Development Plan” has the meaning set forth in section 4.2 of this Agreement.

 

1.4    "April 2012 Agreement” means the Patent and Technology License Agreement dated April 2, 2012, entered into by and between Intertech Bio Corporation on the one hand and Board on behalf of UTMDACC on the other hand, and any amendments thereto.

 

1.5    "Board” means the Board of Regents of the System.

 

 

 

 

1.6.   “Buyback Consideration” has the meaning set forth in Section 15.3(b) of this Agreement.

 

1.7.   “Buyback Event” has the meaning set forth in Section 15.3(a) of this Agreement.

 

1.8.   “Buyback Percentage” has the meaning set forth in Section 15.3(c) of this Agreement.

 

1.9.   “Calendar Quarter” means a period of three (3) consecutive calendar months commencing on January 1, April 1, July 1 or October 1; provided, however, that the first Calendar Quarter under this Agreement shall commence upon the Effective Date of this Agreement, and the last Calendar Quarter shall extend from the first day of such Calendar Quarter until the effective date of the termination or expiration of this Agreement.

 

1.10.   “Calendar Year” means any twelve (12) month period commencing on January 1st and expiring on December 31st of the same year; provided, however, that the first Calendar Year under this Agreement shall commence on the Effective Date of this Agreement, and the last day of the last Calendar Year shall be the effective date of the termination or expiration of this Agreement.

 

1.11.   “Claims” has the meaning set forth in Section 12.1 of this Agreement.

 

1.12.   “Commercially Reasonable Development Efforts” has the meaning set forth in Section 4.1 of this Agreement.

 

1.13.   “Confidential Information” includes: (1) all information contained in documents marked "confidential" and disclosed by one Party (the “disclosing party”) to the other Party (the “recipient party”) pursuant to this Agreement; (2) orally disclosed information which is disclosed by the disclosing party to the recipient party pursuant to this Agreement, summarized in writing, identified as "confidential" and delivered to the recipient party; and (3) all proprietary technical information, business and financial information, and all other information which a reasonable person would treat confidentially that relates to the Sublicensed Subject Matter and disclosed from the disclosing party to the recipient party, whether or not the information is marked as “confidential”. Notwithstanding anything to the contrary, MBI shall be permitted to make sure disclosures as MBI determines, in its sole discretion, is required pursuant to the Securities Exchange Act of 1934, as amended, and the rules and regulations thereof.

 

1.14.   “Dermin 2010 Agreement” means the Patent and Technology Development and License Agreement dated October 27, 2010 entered into by and between Dermin LLC and MBI.

 

1.15.   “Dermin 2011 Agreement” means the Patent and Technology Development and License Agreement dated April 15, 2011 entered into by and between Dermin LLC and Intertech Bio Corporation.

 

1.16.   “Dermin 2012 Agreement” means the Patent and Technology Development and License Agreement dated June 28, 2012 entered into by and between Dermin LLC and Annamed Inc.

 

 

 

 

1.17.   “Dermin License Agreements” means the Dermin 2010 Agreement, Dermin 2011 Agreement, and Dermin 2012 Agreement, collectively.

 

1.18.   “Development Data” means any data, information or know-how resulting from or relating to the research and development of the Sublicensed Subject Matter or Sublicensed Products. For the purposes of Section 5.1 of this Agreement, Development Data of WPD includes any data, information or know-how resulting from or relating to the research and development of the Sublicensed Subject Matter or Sublicensed Products in the possession or control of MBI or any of its employees, agents, representatives, or affiliates.

 

 

1.19    Reserved.

 

1.20.   “Disagreement” has the meaning set forth in Section 3.6 of this Agreement.

 

1.21.   “Effective Date” is as defined in the Header of this Agreement.

 

1.22.   “Executive(s)” shall have the meaning set forth in Section 3.6 of this Agreement.

 

1.23    “February 2018 Agreement” means the Patent and Technology License Agreement dated February 12, 2018 entered into by and between MBI on the one hand and the Board on behalf of UTMDACC on the other hand, and any amendments thereto.

 

1.24.   “Force Majeure Event” has the meaning set forth in Section 16.9 of this Agreement.

 

1.25.   “Government” has the meaning set forth in Section 10.2 of this Agreement.

 

1.26.   “Improvements” has the meaning set forth in Section 7.3 of this Agreement.

 

1.27.   “Indemnified Party” has the meaning set forth in Section 12.1 of this Agreement.

 

1.28    “Indemnifying Party” has the meaning set forth in Section 12.1 of this Agreement.

 

1.29    “Licensed Field” has the meaning set forth in the MD Anderson License Agreements.

 

1.30     “Licensed Product(s)” has the meaning set forth in each of the MD Anderson License Agreements, collectively.

 

1.31.   “Licensed Subject Matter” has the meaning set forth in each of the MD Anderson License Agreement, collectively.

 

1.32.   “Licensed Territory” has the meaning set forth in the MD Anderson License Agreements.

 

1.33.   “MBI” has the meaning set forth in the Header of this Agreement.

 

 

 

 

1.34.   “MD Anderson License Agreements” means the June 2010 Agreement, April 2012 Agreement, June 2017 Agreement, and February 2018 Agreement, collectively.

 

1.35.   “Marketing Approval” means the regulatory approval necessary to market and sell a Sublicensed Product in a country.

 

 

1.36    Reserved.

 

1.37.   “Minimum Annual Royalty” has the meaning set forth in Section 6.3 of this Agreement.

 

1.38.   “Minimum Buyback Consideration” has the meaning set forth in Section 15.3(d) of this Agreement.

 

1.39.   “Net Sales” has the meaning set forth in the June 2010 Agreement, April 2012 Agreement, June 2017 Agreement, or February 2018 Agreement, as applicable, to calculate payments for pass-through royalties and override royalty percentage pursuant to Sections 6.1 and 6.2 of this Agreement, respectively.

 

1.40.   “November 2015 Assignment” means the Assignment and Assumption Agreement dated November 17, 2015, entered into by and between MBI and Intertech Bio Corporation, pursuant to which Intertech Bio Corporation assigned all of its rights, title and interest under the April 2012 Agreement to MBI.

 

1.41.   “JDC” has the meaning set forth in Section 3.1 of this Agreement.

 

1.42.   “JDC Chair” has the meaning set forth in Section 3.3 of this Agreement.

 

1.43.   “June 2010 Agreement” means the Patent and Technology License Agreement dated June 21, 2010 entered into by and between Moleculin, LLC (which merged into MBI in 2016) on the one hand and the Board on behalf of UTMDACC on the other hand, and any amendments thereto.

 

1.44.   “June 2017 Agreement” means the Patent and Technology License Agreement dated June 29, 2017 entered into by and between MBI on the one hand and the Board on behalf of UTMDACC on the other hand, and any amendments thereto.

 

1.45.   “Party” and “Parties” has the meaning set forth in the Header of this Agreement.

 

1.46    “Patent Rights” has the meaning set forth in each of the MD Anderson License Agreements, collectively.

 

1.47.   “Phase II Study” means, in respect of a Sublicensed Product, (a) that portion of the FDA submission and approval process which provides for early controlled clinical studies conducted to obtain preliminary data on the effectiveness of a product for a particular indication, as more specifically defined by the rules and regulations of the FDA, including 21 C.F.R. § 312.21(b) or any future revisions or substitutes thereof; or (b) similar clinical study in any national jurisdiction other than the United States.

 

 

 

 

1.48.   “Phase III Study” means, in respect of a Sublicensed Product, (a) that portion of the FDA submission and approval process in which expanded clinical studies are conducted to gather the additional information about effectiveness and safety that is need to evaluate the overall benefit-risk relationship of a product as more specifically defined by the rules and regulations of the FDA, including 21 C.F.R. § 312.21(c) or any future revisions or substitutes thereof; or (b) a similar clinical study in any natural jurisdiction other than the United States.

 

1.49.   “Regulatory Approval” has the meaning set forth in the June 2017 Agreement.

 

1.50.   “Sale” or “Sold” means the transfer or disposition of a Sublicensed Product for value to a party other than WPD for purposes other than research and development.

 

1.51.   “Sublicensed Field” means the field of pharmaceutical drug products for the treatment of any illness, disease, or symptom in h umans.

 

1.52.   “Sublicensed Patent Rights” means MBI’s rights, as of the Effective Date of this Agreement, in the information and discoveries described in invention disclosures, or claimed in any patents and/or patent applications in the Sublicensed Territory pursuant to the collective MD Anderson License Agreements.

 

1.53.   “Sublicensed Product(s)” means any product or service sold by WPD or its affiliates comprising, using or made through the use of the Sublicensed Subject Matter pursuant to this Agreement.

 

1.54.   “Sublicensed Subject Matter” means Sublicensed Patent Rights and Sublicensed Technology Rights within the Sublicensed Field.

 

1.55.   “Sublicensed Technology Rights” means MBI’s rights and interests, as of the Effective Date of this Agreement, to Technology Rights granted pursuant to the MD Anderson License Agreements, collectively.

 

1.56.   “Sublicensed Territory” means those countries listed in Exhibit “A” to this Agreement.

 

1.57.   “System” means the University of Texas system.

 

1.58.   “Technology Rights” has the meaning set forth in the MD Anderson License Agreements, collectively.

 

1.59.   “Term” has the meaning set forth in Section 15.1 of this Agreement.

 

1.60.   “Third Party Indemnity Claim” has the meaning set forth in Section 12.2 of this Agreement.

 

1.61.   “UTMDACC” means the University of Texas M.D. Anderson Cancer Center, a component of System.

 

 

 

 

1.62.   “WPD” has the meaning set forth in the Header of this Agreement.

 

1.63.   “WPD Improvements” has the meaning set forth in Section 7.3 of this Agreement.

 

1.64.   “WPD Intellectual Property” has the meaning set forth in Section 7.3 of this Agreement.

 

1.65.   “Grant Guarantees” shall mean any guarantee, promise, contingent liability, assumed debt or the like of existing and possible commitments derived from third party grants related to Commercially Reasonable Development Efforts and approved by MBI.

 

1.66.   “Required Extension Fee” shall mean for the extensions described in Section 4.4, $20,000 for the first extension, $40,000 for the second extension, and $60,000 for the third extension.

 

1.67.   “Initial Hurdle Date” shall be as defined in Section 4.1.

 

ARTICLE II.

SUBLICENSE

 

2.1    Subject to the terms and conditions of this Agreement, including without limitation, Sections 2.2 and 2.3 below, MBI hereby grants to WPD an exclusive sublicense even as to MBI under the Sublicensed Subject Matter to research, develop, manufacture, have manufactured, use, import, offer to sell and/or sell Sublicensed Products within the Sublicensed Territories for use within the Sublicensed Field.

 

2.2    The Parties agree that the scope of the license rights granted pursuant to this Agreement do not exceed the scope of rights conferred to MBI pursuant to the MD Anderson License Agreements and such sublicensed rights are subject to any and all restrictions and limitations set out therein.

 

2.3    The sublicense granted herein is subject to (i) the timely payment by WPD to MBI of all consideration as provided herein (subject to any cure period, if applicable); (ii) MBI’s use of Development Data for any purpose pursuant to Section 5.2 of this Agreement; and (iii) is further subject to the following rights retained by the Board and UTMDACC as per the MD Anderson License Agreements including the right to (A) publish the general scientific findings from research and development related to the Sublicensed Subject Matter, subject to the terms of Article XI of each of the MD Anderson License Agreements and section 13.4 of this Agreement; (B) use Sublicensed Subject Matter solely for research, teaching, patient care and other academic purposes; and (C) transfer Sublicensed Subject Matter to academic or research institutions for non-commercial purposes.

 

 

 

 

ARTICLE III.

JOINT DEVELOPMENT COMMITTEE

 

3.1    The Parties agree to establish, for the purposes specified herein, a joint development committee (the “JDC”). The Parties acknowledge and agree that neither the JDC, nor any other committee formed or to be formed under this Agreement has the power to amend any term or condition of this Agreement; and the JDC does not have the power to require WPD to accecelerate its expenditure deadlines as set out in section 4.1..

 

3.2    The JDC shall be established by the Parties within forty-five (45) days of the Effective Date of this Agreement and shall oversee the activities of WPD with respect to the research and development of Sublicensed Products and in furtherance of this Agreement for the purposes of exploiting and optimizing the development and ultimate Marketing Approval of Sublicensed Products in the Sublicensed Territory.

 

3.3    Each Party shall appoint one (1) senior level representative having expertise in research and development within thirty (30) days of the Effective Date to sit on the JDC. A Party may change any of its representatives appointed to the JDC at any time with a new person (with appropriate expertise) by giving written notice of such change to the other Party; provided, however, that, without limiting the foregoing, a key objective with respect to membership in the JDC shall be preserving continuity. The total number of JDC members may be changed by unanimous vote of the JDC from time to time as appropriate; provided, that the JDC shall in all cases be comprised of an equal number of members for each of MBI and WPD. Either Party may invite additional agents or representatives of that Party, which must be under a non-disclosure agreement satisfactory to MBI, to attend any JDC meeting in order to provide the expertise such Party deems reasonably necessary for such meeting, subject to the prior consent of the other Party, such consent not to be unreasonably withheld, delayed or conditioned. A representative appointed by WPD shall serve as Chair of the JDC (“JDC Chair”). The JDC Chair shall: (i) set meeting agendas, provided that the agenda shall include any matter requested by either Party; (ii) call emergency meetings of the JDC upon the request of a JDC member; and (iii) at the request of either Party, present JDC Disagreements (as defined below) that have been unresolved for thirty (30) days to the Executive (as defined below). The JDC Chair shall be responsible for recording, preparing and issuing minutes of the JDC meetings, which meeting minutes shall be prepared and submitted to the other JDC members for approval within thirty (30) days of the JDC meeting.

 

3.4    The responsibilities of the JDC shall be exercised consistent with this Agreement and shall include:

 

	 	
			a.

				
			Review and approval of the Annual Development Plan, and any material changes and updates thereto, prepared and submitted to the JDC by WPD in accordance with Section 4.3, provided that WPD shall incorporate into the applicable Annual Development Plan any comments provided by MBI;

			

 

	 	
			b.

				
			Reviewing updates from WPD regarding the status of the research and development of the Sublicensed Products in each of the Sublicensed Territories and WPD’s progress in the implementation of the Annual Development Plan;

			

 

	 	
			c.

				
			Reviewing and approving activities and expenditures in satisfaction of WPD’s obligation to use Commercially Reasonable Development Efforts in accordance with Section 4.1 of this Agreement, including Grant Guarantees;

			

 

 

 

 

	 	
			d.

				
			Reviewing written reports summarizing the Commercially Reasonable Development Efforts and progress of the research and development and all efforts to develop and/or commercialize a Sublicensed Product in each of the Sublicensed Territories within the Sublicensed Field during the preceding Calendar Year. Such reports shall include, without limitation, a full financial report of the expenditures actually made by WPD relative to its claimed Commercially Reasonable Development Efforts.

			

 

	 	
			e.

				
			No more than once (1) per Calendar Year, the JDC or MBI may inspect the books and records of WPD that support Commercially Reasonable Development Efforts claimed by WPD, unless otherwise necessary for MBI to comply with its reporting obligations pursuant to any of the MD Anderson License Agreements.

			

 

	 	
			f.

				
			Reviewing Development Data that may have been generated as a result of research and development efforts.

			

 

3.5    Meetings of the JDC shall be held at least once each Calendar Quarter unless the Parties agree otherwise. Meetings shall be face-to-face, unless otherwise agreed to by the Parties. Each Party shall provide to the other Party copies of all materials, reports or data that are to be considered or reviewed at any meeting at least five (5) business days prior to the date of such meeting.

 

3.6    The JDC shall operate by unanimous vote. Each of MBI and WPD will have one vote on the JDC, which vote shall be cast by such Party’s designee. If a unanimous vote on any matter within the jurisdiction of the JDC cannot be obtained within thirty (30) days of the date the matter was first presented to the JDC for a vote (a “Disagreement”), then the matter will be determined by the CEO of MBI, or its designate (the “Executive”).

 

ARTICLE IV.

DEVELOPMENT EFFORTS

 

4.1    WPD hereby agrees that it must use Commercially Reasonable Development Efforts to develop and commercialize Sublicensed Products in the Sublicensed Territory within the Sublicensed Field. For purposes of this Agreement, the term “Commercially Reasonable Development Efforts” or “CRDE” shall mean, subject to Section 5.1 below, the expenditure, including Grant Guarantees, by or on behalf of WPD or any of its affiliates of at least: (i) U.S. $2,500,000 during the first four (4) years (the “Initial Hurdle Date”) immediately following the Effective Date of this Agreement on the research, development and commercialization of Sublicensed Products in the Sublicensed Territories; and (ii) U.S. $1,000,000 annually for each of the four (4) years after the Initial Hurdle Date on the research and development of Sublicensed Products in the Sublicensed Territories. The minimum required total CRDE or “CRDE Min” is $6.5 million. WPD receives financial support and in-kind contributions from third parties including grants from governmental and non-governmental agencies, in connection with WPD’s research and development efforts. MBI acknowledges and agrees that the value of any grants or other financial support or in-kind contributions expended by WPD or any of its affiliates on the research and development of Sublicensed Products as approved by the JDC shall be considered expenses by or on behalf of WPD or its affiliate as applicable, in calculating the Commercially Reasonable Development Efforts, provided such financial support and in-kind contributions are approved by the JDC as constituting Commercially Reasonable Development Efforts. In the event that WPD fails to use Commercially Reasonable Development Efforts to develop Sublicensed Product, MBI shall have the right to terminate this Agreement pursuant to the terms specified in Section 15.2(c) below.

 

 

 

 

4.2    WPD shall provide an initial Annual Development Plan for the upcoming Calendar Year within ninety (90) days of the Effective Date of this Agreement. Thereafter, the JDC shall meet to discuss and vote on the proposed Annual Development Plan. The term “Annual Development Plan” means a plan which includes: (a) list of research and development activities in furtherance of the research and development and Marketing Approval of Sublicensed Products for the Sublicensed Field in each Sublicensed Territory; (b) the budget allocated towards each research and development activity; and (c) such other items as the JDC may reasonably determine.

 

 

4.3    Reserved.

 

4.4    WPD may extend by up to three years the Initial Hurdle Date by paying the Required Extension Fee.

 

	 	
			ARTICLE V.

			

INFORMATION

 

 

5.1    Reserved.

 

5.2    WPD hereby grants MBI the right to use Development Data provided by WPD for any purpose in any territory. Development Data shall be also shared with UTMDACC and the Board as may be required pursuant to each of the MD Anderson License Agreements. MBI shall have no obligation to provide support or assistance to WPD in connection with development of Sublicensed Products, except as may be set forth in a separate written agreement executed by the Parties. Notwithstanding the foregoing, upon WPD’s written request, MBI may reasonably assist WPD, at WPD’s expense, in its efforts to obtain funding required for research, development, and Marketing Approval of Sublicensed Products in the Sublicensed Territories. Such assistance, or lack thereof, cannot be used as a defense by WPD in adhering to this Agreement.

 

ARTICLE VI.

CONSIDERATION, REIMBURSEMENTS AND PAYMENT

 

6.1    In consideration for rights granted by MBI to WPD under this Agreement, WPD agrees to pay MBI a running royalty, pursuant to the MD Anderson License Agreements (“pass-through royalties”) calculated as the sum of the following:

 

 

 

 

	 	
			a.

				
			percentage of Net Sales, as set forth in Section 4.1(d)(i) of the June 2010 Agreement, for any Sublicensed Product approved for dermatological use, covered by the Patent Rights and/or Technology Rights licensed to MBI pursuant to the June 2010 Agreement;

			

 

	 	
			b.

				
			percentage of Net Sales, as set forth in Section 4.1(d)(ii) of the June 2010 Agreement, for any Sublicensed Product approved for non-dermatological use, covered by the Patent Rights and/or Technology Rights licensed to MBI pursuant to the June 2010 Agreement;

			

 

	 	
			c.

				
			percentage of Net Sales, as set forth in Section 4.1(d) of the April 2012 Agreement, for any Sublicensed Product covered by the Patent Rights and/or Technology Rights licensed to Intertech Bio Corporation (thereafter, assigned from Intertech Bio Corporation to MBI pursuant to the November 2015 Assignment) pursuant to the April 2012 Agreement;

			

 

	 	
			d.

				
			percentage of Net Sales, as set forth in Section 4.1(d) of the June 2017 Agreement, for any Sublicensed Product covered by the Patent and/or Technology Rights licensed to MBI pursuant to the June 2017 Agreement;

			

 

	 	
			e.

				
			percentage of Net Sales, as set forth in Section 4.1(d)(i) of the February 2018 Agreement, for any Sublicensed Product approved for dermatological use, covered by the Patent Rights and/or Technology Rights licensed to MBI pursuant to the February 2018 Agreement; and

			

 

	 	
			f.

				
			percentage of Net Sales, as set forth in Section 4.1(d)(ii) of the February 2018 Agreement, for any Sublicensed Product approved for non-dermatological use, covered by the Patent Rights and/or Technology Rights licensed to MBI pursuant to the February 2018 Agreement.

			

 

Each of the above royalty amounts shall be due and payable pursuant to Section 4.1(d) of the applicable MD Anderson License Agreement. Additionally, the pass-thru royalties payable shall be reduced to the extent such reduction is taken by or provided to MBI pursuant to the applicable MD Anderson License Agreement, and shall be further subject to any sections of the applicable MD Anderson License Agreement that modify or change the terms or payment of the pass-thru royalties to be made by MBI. MBI shall notify WPD of any reduction taken by or provided to MBI pursuant to any of the applicable MD Anderson License Agreements.

 

6.2    In further consideration for the rights granted by MBI to WPD under this Agreement, as long as this Agreement has not been terminated, WPD agrees to pay MBI a royalty percentage in addition to the pass-through royalty (“override royalty percentage”) equal to 1.0% of Net Sales of any Sublicensed Product, provided, however, if WPD spends: (i) more than one million dollars (U.S. $1,000,000) in excess of the CRDE Min, the override royalty percentage will decrease to 0.75% of Net Sales; or (ii) more than three million dollars (U.S. $3,000,000) in excess of the CRDE Min, the override royalty percentage will decrease to 0.5% of Net Sales.

 

 

 

 

6.3    Minimum annual royalties (“Minimum Annual Royalties”) will be due and payable (without invoice) by WPD to MBI as follows:

 

	 	
			a.

				
			With respect to a Sublicensed Product covered by Patent Rights and/or Technology Rights licensed to MBI pursuant to the June 2010 Agreement: the amount payable and due as set forth in Section 4.1(e) of the June 2010 Agreement;

			

 

	 	
			b.

				
			With respect to a Sublicensed Product covered by Patent Rights and/or Technology Rights licensed to Intertech Bio Corporation (assigned to MBI pursuant to the November 2015 Assignment) pursuant to the April 2012 Agreement: the amount payable and due as set forth in Section 4.1(e) of the April 2012 Agreement;

			

 

	 	
			c.

				
			With respect to a Sublicensed Product covered by Patent Rights and/or Technology Rights licensed to MBI pursuant to the February 2018 Agreement: the amount, payable and due as set forth in Section 4.1(e) of the February 2018 Agreement.

			

 

Each of the Minimum Annual Royalties shall be due and payable pursuant to Section 4.1(e) of the applicable MD Anderson License Agreement, under the same terms and conditions set forth in the applicable MD Anderson License Agreement. Running royalties accrued under Section 6.1 actually paid to MBI for Net Sales made during the twelve-month period preceding an anniversary of the applicable effective date may be credited against the Minimum Annual Royalties due on that anniversary date. Notwithstanding the foregoing, to the extent MBI’s obligation to pay a Minimum Annual Royalty pursuant to the applicable MD Anderson License Agreement ceases, WPD’s obligation hereunder shall cease.

 

6.4    WPD shall pay milestone payments to MBI as follows:

 

	 	
			a.

				
			With respect to a Sublicensed Product covered by Patent Rights and/or Technology Rights licensed to MBI pursuant to the June 2010 Agreement: the amount(s), payable and due as set forth in Section 4.1(f)(1) of the June 2010 Agreement, upon commencement of the first Phase III Study in respect of a Sublicensed Product;

			

 

	 	
			b.

				
			With respect to a Sublicensed Product covered by Patent Rights and/or Technology Rights licensed to Intertech Bio Corporation (assigned to MBI pursuant to the November 2015 Assignment) pursuant to the April 2012 Agreement: the amount(s), payable and due as set forth in Sections 4.1(f)(1), 4.1(f)(2), 4.1(f)(3) and 4.1(f)(4) of the April 2012 Agreement, upon commencement of the first Phase II and Phase III Study in respect of a Sublicensed Product; and upon receiving Market Approval for the first time in respect of a Sublicensed Product;

			

 

	 	
			c.

				
			With respect to a Sublicensed Product covered by Patent Rights and/or Technology Rights licensed to MBI pursuant to the June 2017 Agreement: the amount(s), payable and due as set forth in Sections 4.1(e)(1), 4.1(e)(2) and 4.1(e)(3) of the June 2017 Agreement upon commencement of the first Phase III Study in respect of a Sublicensed Product; and upon receiving Regulatory Approval for the first time in respect of a Sublicensed Product; and

			

 

 

 

 

	 	
			d.

				
			With respect to a Sublicensed Product covered by Patent Rights and/or Technology Rights licensed to MBI pursuant to the February 2018 Agreement: the amount(s), payable and due as set forth in Section 4.1(f)(1) of the February 2018 Agreement, upon commencement of the first Phase III Study in respect of a Sublicensed Product.

			

 

Each of the milestone payments shall be due and payable pursuant to Section 4.1(e) or 4.1(f) of the applicable MD Anderson License Agreement, under the same terms and conditions set forth in the applicable MD Anderson License Agreement.

 

6.5    During the Term, to the extent MBI is required to make any payments to UTMDACC or the Board pursuant to Sections 4.1(d), (e), or (g) of the June 2010 Agreement, April 2012 Agreement, and February 2018 Agreement, or Section 4.1(f) of the June 2017 Agreement, or any other consideration, whether a milestone payment or royalty, as a result of the research and development or Sale of a Sublicensed Product, and not contemplated by the terms of this Agreement, WPD shall be required to advance or reimburse MBI such payments upon demand by MBI and an accounting showing the calculations for such payments. Such requirement to advance or reimburse MBI for payments made to the UTMDACC or the Board pursuant to Sections 4.1(g) of the June 2010 Agreement, April 2012 Agreement, and February 2018 Agreement, or Section 4.1(f) of the June 2017 Agreement shall not apply to any obligation on MBI to pay the UTMDACC or the Board relating to the override royalty paid to MBI pursuant to Section 6.2 of this Agreement.

 

ARTICLE VII.

MAINTENANCE AND ADDITIONAL PATENTS

 

7.1    MBI shall be responsible for the prosecution and maintenance of the Sublicensed Patent Rights, subject to Section 7.2 of this Agreement.

 

7.2    WPD shall consult with MBI in the event that WPD determines that any additional patent applications (“Additional Patents”) for the Sublicensed Subject Matter in the Sublicensed Territory should be filed. Should MBI and WPD agree that an Additional Patent covering an invention in the Sublicensed Territory shall be filed, then MBI, at all times subject to the terms of the applicable MD Anderson License Agreements, will prepare and file appropriate patent applications covering the invention so identified. In such instance, WPD shall be responsible for all costs of searching, preparing, filing, prosecuting and maintaining the Additional Patents in the Sublicensed Territories. For purposes of clarity only, (i) WPD shall not be responsible for any part of the Annual Maintenance Fee, as that term may be defined in any applicable MD Anderson License Agreement, or any other maintenance fees for the Sublicensed Patent Rights except for maintenance fees for any Additional Patents, and (ii) WPD shall not be responsible for any other costs specified under Article VI of any of the MD Anderson License Agreement unless such costs are specifically assigned to WPD under the terms of this Agreement.

 

 

 

 

7.3    MBI shall own any and all rights, titles, and interests, including all intellectual property rights, in any and all variations, modifications, improvements, or enhancements of or relating to the Sublicensed Subject Matter (whether patentable or not) (collectively “Improvements”) whether conceived, developed, created or reduced to practice by MBI or WPD (regardless of whether WPD-Incorporated IP is utilized) during the term of this Agreement. As between WPD and MBI, WPD shall own all rights and title and interests including all intellectual property rights in all intellectual property or other subject matter developed or acquired independent of the Sublicensed Subject Matter and owned by WPD or licensed from third parties by WPD (“WPD Intellectual Property”). MBI acknowledges that in the course of developing the Sublicensed Product, WPD may incorporate in the Sublicensed Product certain WPD Intellectual Property that is developed and owned by WPD prior to the Effective Date (“WPD-Incorporated IP”).

 

	 	
			a.

				
			MBI hereby grants WPD an exclusive license under the Improvements to research, develop, manufacture, have manufactured, use, import, offer to sell and sell Sublicensed Products in the Sublicensed Territory.

			

 

	 	
			b.

				
			WPD hereby grants MBI an exclusive license under WPD-Incorporated IP to research, develop, manufacture, have manufactured, use, import, offer to sell and sell Licensed Products in any territory outside of the Sublicensed Territories. WPD hereby grants MBI a non-exclusive license under the WPD-Incorporated IP to research develop, manufacture, have manufactured, use, import, offer to sell Licensed Products in the Sublicensed Territories upon expiration or earlier termination of this Agreement.

			

 

7.4    To the extent that MBI and not UTMDACC or any other third party, has control over the preparation, filing prosecution and maintenance of a patent application or patent:

 

	 	
			a.

				
			MBI shall keep WPD reasonably informed of the status of any patent application or patent directed to the Sublicensed Patent Rights in the Sublicensed Territories, and will provide WPD with a copy of any patent applications included within the Sublicensed Patent Rights in the Sublicensed Territories, as well as copies of any material documents received or filed during the prosecution of Additional Patents in the Sublicensed Territories included within the Sublicensed Patent Rights;

			

 

	 	
			b.

				
			MBI shall not knowingly abandon any such patent application or patent included within the Additional Patents without reasonable advanced notice to WPD; If WPD is not in default on any of its obligations under this Agreement, MBI shall consider in good faith any requests made by WPD to continue prosecution, but the final decision to continue or abandon shall be in MBI’s sole discretion. The parties agree that they share a common legal interest to get valid enforceable patents and that each party will maintain as privileged all information received pursuant to this section 7.4. In addition such information shall be considered to fall within the definition of “Confidential Information” as set forth in Article XIII.

			

 

 

 

 

ARTICLE VIII.

INFRINGEMENT BY THIRD PARTIES

 

8.1    Subject to any limitations as may be set forth in the MD Anderson License Agreements and Dermin License Agreements WPD, at its expense, shall have the first right to (but shall not be obligated to) enforce any patent included within the Sublicensed Patent Rights against infringement by third parties in the Sublicensed Territories. After reimbursement of reasonable legal costs and expenses related to such recovery incurred by WPD, WPD agrees to pay MBI (a) the applicable royalty detailed in Section 6.1 and 6.2 above for any monetary recovery that is for sales of Sublicensed Product lost due to the infringement, and fifty percent (50%) of related punitive damages received by WPD or its affiliates; or (b) fifty percent (50%) of reasonable royalties awarded and received by WPD or its affiliates, and fifty percent (50%) of related punitive damages received by WPD or its affiliates in any monetary recovery in which the award is for reasonable royalties. 

 

8.2    If either WPD or MBI becomes aware of any infringement or potential infringement of the Sublicensed Patent Rights, each shall promptly notify the other of such in writing. If WPD does not file suit against a potential infringer or take alternative action reasonably acceptable to MBI to end such infringement or potential infringement, within three (3) months of knowledge thereof, then, provided that such infringement is still on going, MBI may, at its sole discretion, enforce any patent licensed hereunder on behalf of itself and WPD, with MBI retaining all recoveries from such enforcement. In addition, in resolution of such infringement, MBI may grant non-exclusive license rights to the alleged infringer notwithstanding WPD’s exclusive license rights granted herein.

 

8.3    In any suit or dispute involving an infringer, the Parties agree to cooperate fully with each other. Each Party shall cooperate with the other including provision of documents and witnesses in the conduct of litigation against any third party infringement, whether they have commenced it or not. At the request and expense of the Party bringing suit, the other Party will permit access during regular business hours, to all relevant personnel, records, papers, information, samples, specimens and the like in its possession.

 

ARTICLE IX.

PATENT MARKINGS

 

9.1    WPD agrees that all packaging containing individual Sublicensed Products, documentation therefor, and, when possible, actual Sublicensed Products sold by WPD will be permanently and legibly marked with the number of any applicable patents licensed hereunder in accordance with each country’s patent laws to the extent such marking is necessary or required to fully preserve Sublicensed Patent Rights in such country.

 

ARTICLE X.

REPRESENTATIONS, WARRANTIES AND COVENANTS

 

10.1    Each Party represents and warrants that:

 

	 	
			a.

				
			it is duly organized and validly existing under the laws of its state or country of incorporation, and has full corporate power and authority to enter into this Agreement and to carry out the provisions hereof;

			

 

	 	
			b.

				
			it is duly authorized to execute and deliver this Agreement and to perform its obligations hereunder, and the person executing this Agreement on its behalf has been duly authorized to do so by all requisite corporate action;

			

 

 

 

 

	 	
			c.

				
			this Agreement is legally binding upon it and enforceable in accordance with its terms; that the execution, delivery and performance of this Agreement by it does not conflict with any Agreement, instrument or understanding, oral or written, to which it is a party or by which it may be bound, nor violate any material law or regulation of any governmental entity having jurisdiction over it; and

			

 

	 	
			d.

				
			it has not granted, and will not grant during the term of the Agreement, any right to any third party that would conflict with the rights granted to the other Party hereunder; that it has (or will have at the time performance is due) maintained, and will maintain, and keep in full force and effect, all agreements, permits and licenses necessary to perform its obligations hereunder; and in complying with the terms and conditions of this Agreement and carrying out any obligations hereunder, it will comply (and it will ensure that its subcontractor’s comply) with all applicable laws, regulations, ordinances, statutes, and decrees or proclamations of all governmental entities having jurisdiction over such Party.

			

 

10.2    Except for the rights of any party to the MD Anderson License Agreements, Dermin License Agreements, and the Government of the United States of America ("Government") as set forth below and except as may otherwise be set forth in this Agreement, MBI represents and warrants that:

 

	 	
			a.

				
			MBI is the exclusive licensee of the Sublicensed Patent Rights and is entitled to grant the rights and licenses specified herein, subject to the terms and conditions of the MD Anderson License Agreements, Dermin License Agreements and/or any rights of the Government;

			

 

	 	
			b.

				
			as of the Effective Date, all right, title, and interest of Moleculin, LLC under the June 2010 Agreement is owned by MBI;

			

 

	 	
			c.

				
			as of the Effective Date, all right, title and interest of Intertech Bio Corporation under the April 2012 Agreement has been sold, assigned and transferred to MBI and is owned by MBI;

			

 

	 	
			d.

				
			as of the Effective Date, MBI is entitled to the benefit of each of the Dermin License Agreements as licensor, and is entitled to exercise the rights of the licensor in each of the Dermin License Agreements;

			

 

	 	
			e.

				
			MBI has not entered into any agreement granting any rights, interest or claim in or to any Sublicensed Patent Rights, if any, to any third party that conflicts with or is inconsistent with the rights granted to WPD pursuant to this Agreement;

			

 

	 	
			f.

				
			to MBI’s knowledge, as of the Effective Date of this Agreement, the patents encompassed by the Sublicensed Patent Rights are, or upon issuance will be, valid, and enforceable patents, no third party is infringing or threatened to infringe any such Sublicensed Patent Rights, and no third party has challenged or threatened to challenge the scope, validity, or enforceability of such patents or Sublicensed Patent Rights, nor is MBI aware of any valid basis for any such challenge;

			

 

 

 

 

	 	
			g.

				
			MBI will consult with and keep WPD reasonably informed of the status of any patent application or patent related to the Sublicensed Patent Rights, subject to Section 7.4 of this Agreement;

			

 

	 	
			h.

				
			to MBI’s knowledge, as of the Effective Date of this Agreement, there are no third party patents or intellectual property rights which would be infringed by WPD’s exercise of the rights granted to WPD under this Agreement; and

			

 

	 	
			i.

				
			to MBI’s knowledge, as of the Effective Date of this Agreement, there are no other patents, patent applications or intellectual property rights created or owned by MBI which would be infringed by WPD’s exercise of the rights granted to WPD under this Agreement.

			

 

10.3    WPD understands that the Sublicensed Patent Rights may have been developed under a funding agreement with the Government and, if so, that the Government may have certain rights relative thereto. This Agreement is explicitly made subject to the Government's rights under any such agreement and any applicable law or regulation. To the extent that there is a conflict between any such agreement, applicable law or regulation and this Agreement, the terms of such Government agreement, applicable law or regulation shall prevail. To MBI’s knowledge, as of the Effective Date of this Agreement there are no funding agreements with the Government under which any of the Sublicensed Patent Rights were developed.

 

10.4    WPD understands and acknowledges that certain rights and interests to substantial portions of the Sublicensed Subject Matter have been licensed to Dermin pursuant to the Dermin License Agreements and Dermin has certain rights relative thereto that conflict with rights granted herein. This Agreement is explicitly made subject to the rights granted to Dermin pursuant to the Dermin License Agreements, and the rights granted to WPD shall be junior to such rights granted to Dermin. WPD hereby acknowledges that it has received and reviewed the Dermin License Agreements.

 

10.5    WPD hereby acknowledges that it has received and reviewed the MD Anderson License Agreements.

 

10.6    WPD understand and agrees that, except as set out in section 10.2 of this Agreement, MBI, by this Agreement, makes no representation as to the operability or fitness for any use, safety, efficacy, approvability by regulatory authorities, time and costs of development, patentability, and/or breadth of the Sublicensed Subject Matter. Except as set out in section 10.2 of this Agreement, MBI, by this Agreement, also makes no representation as to whether any patent covered by the Sublicensed Patent Rights is valid or as to whether there are any patents now held, or which will be held by others or by MBI in the Sublicensed Field. Except as set out in section 10.2 of this Agreement, MBI does not make any representation that the inventions contained in Sublicensed Patent Rights do not infringe any other patents now held or that will be held by others.

 

 

 

 

10.7    WPD, by execution hereof, acknowledges, covenants and agrees that WPD has not been induced in any way by MBI or employees of MBI to enter into this Agreement, and further represents that WPD is entering into this Agreement voluntarily.

 

10.8    Upon execution of this Agreement, WPD will provide MBI with a complete schedule of the equity ownership of WPD, and further agrees to update such equity ownership schedule within 30 days after the completion of each calendar quarter after the date hereof.

 

10.9    U.S. FCPA Compliance. WPD hereby agrees to at all times comply with the U.S. Foreign Corrupt Practices Act of 1977, as amended (the “FCPA”), and WPD shall establish, institute and maintain policies and procedures designed to ensure that:

 

	 	
			a.

				
			no agent, employee or affiliate of WPD, or any of its affiliates, takes any action, directly or indirectly, that would result in a violation by such person of the FCPA or any other anti-bribery or anti-corruption law, rule or regulation of similar purpose and scope, including, without limitation, making use of the U.S. mails or any means or instrumentality of interstate commerce in furtherance of an unlawful offer, payment, promise to pay or authorization of the unlawful payment of any money, or other property, gift, promise to give, or authorization of the giving of anything of value to any “foreign official” or any foreign political party or official thereof, of any candidate for any foreign office or any candidate for foreign political office, in contravention of the FCPA;

			

 

	 	
			b.

				
			WPD, and its affiliates, shall at all times keep books, records and accounts which, in reasonable detail, accurately and fairly reflect the transactions and dispositions of their assets and maintain a system of internal accounting controls sufficient to provide reasonable assurances that transactions are properly authorized and recorded;

			

 

	 	
			c.

				
			WPD shall, and shall cause its respective affiliates, to permit MBI and its respective designated representatives, at reasonable times and upon reasonable prior notice to such parties, to review the books and records of WPD and any of its affiliates and to discuss the affairs, finances and condition of such party and any of its affiliates with the officers of such entities and any of their affiliates in relation to their compliance with this section, as applicable.

			

 

	 	
			d.

				
			WPD understands and agrees that MBI may terminate this Agreement immediately and without any early termination penalty in the event that WPD, or any of its affiliates, materially violates the FCPA or any other anti-bribery or anti-corruption law. WPD understands and agrees that, if WPD, or any of its affiliates, intends to use foreign subcontractors to provide any services pursuant to this Agreement, such party and each of its affiliates is prohibited from engaging or using subcontractors for performance of services under this Agreement without prior and express authorization, in writing, by MBI. If WPD, or any of its affiliates, is authorized to engage or use subcontractors for such work, such party and each of its affiliates so involved agrees to obtain a commitment from the subcontractor to comply with the FCPA and any other anti-bribery or anti-corruption law.

			

 

 

 

 

ARTICLE XI.

USE OF NAME

 

11.1    WPD will not use the name of (or the name of any employee of) UTMDACC, System or the Board in any advertising, promotional or sale literature on its website or for the purposes of raising capital without the advanced express written consent of Board.

 

11.2    WPD, on behalf of itself and its parent corporation, agrees that, without the advanced express written consent of MBI, WPD (or any employees, directors or agents of such parties, or its parent corporation) may not (i) use the name of MBI; (ii) use the name of any employee, board member, science advisory board member, or contractor of MBI (except in the case of contractors that WPD has a direct relationship with); or (iii) refer to any of the technologies, drug candidates, or intellectual property subject to this Agreement or refer to this Agreement, on its website or in any press releases, marketing or promotional materials.

 

	 	
			ARTICLE XII.

			

INDEMNIFICATION

 

12.1    Each Party (the “Indemnifying Party”) hereby agrees to indemnify and hold harmless the other Party and its officers, directors, employees, consultants, contractors, sublicensees and agents (collectively, the “Indemnified Party”) from and against any and all losses, damages and other amounts payable to a claimant, as well as reasonable attorneys’ fees and costs (collectively, “Losses”), to the extent resulting from claims, suits, proceedings or causes of action (“Claims”) brought by a third party against the Indemnified Party based on or arising from: (a) breach of any representation or warranty or covenant or other agreement by the Indemnifying Party contained in this Agreement, or (b) negligence, recklessness or willful misconduct by such Indemnifying Party.

 

12.2    In the event that any third party asserts a Claim with respect to any matter for which the Indemnified Party is entitled to indemnification hereunder (a “Third-Party Indemnity Claim”), then the Indemnified Party shall promptly notify the Indemnifying Party thereof; provided, however, that no delay on the part of the Indemnified Party in notifying the Indemnifying Party shall relieve the Indemnifying Party from any obligation hereunder unless (and then, only to the extent that) the Indemnifying Party is prejudiced thereby. The Indemnifying Party shall have the right, exercisable by notice to the Indemnified Party within ten (10) days of receipt of notice by the Indemnifying Party from the Indemnified Party of the commencement of or assertion of any Third-Party Indemnity Claim, to control the defense, settlement, appeal or other disposition of the Third-Party Indemnity Claim with counsel reasonably acceptable to the Indemnified Party; provided that, the Indemnified Party will have the right to participate jointly therein and provided, further, that if the Indemnifying Party fails to take reasonable steps necessary to defend such Third-Party Indemnity Claim, the Indemnified Party may assume its own defense and the Indemnifying Party will be liable for the reasonable costs and expenses of the Indemnified Party in connection therewith. The Indemnifying Party will not settle any Third-Party Indemnity Claim except: (i) with the approval of the Indemnified Party, which approval shall not be unreasonably withheld or delayed; and (ii) with respect to any Third-Party Indemnity Claim relating solely to the payment of money damages and which could not result in the Indemnified Party’s becoming subject to injunctive or other equitable relief or otherwise adversely affect the business of the Indemnified Party in any manner, and as to which the Indemnifying Party shall have acknowledged in writing the obligation to Indemnify the Indemnified Party hereunder; provided, that the Indemnifying Party shall provide reasonable evidence of its ability to pay any damages claimed and with respect to any such settlement shall obtain the written release of the Indemnified Party from the Third-Party Indemnity Claim. The Indemnifying Party shall obtain the written consent of the Indemnified Party prior to ceasing to defend, settling or otherwise disposing of any Third-Party Indemnity Claim if as a result thereof the Indemnified Party would become subject to injunctive or other equitable relief or the business of the Indemnified Party would be adversely affected in any manner.

 

 

 

 

12.3    IN NO EVENT SHALL EITHER PARTY OR ITS AFFILIATES BE LIABLE TO THE OTHER PARTY FOR ANY INDIRECT, INCIDENTAL, SPECIAL, PUNITIVE, EXEMPLARY MULTIPLIED OR CONSEQUENTIAL DAMAGES, WHETHER BASED UPON A CLAIM OR ACTION OF CONTRACT, WARRANTY, NEGLIGENCE, STRICT LIABILITY OR OTHER TORT, OR OTHERWISE, ARISING OUT OF THIS AGREEMENT, PROVIDED, HOWEVER, THAT THIS LIMITATION WILL NOT REDUCE OR AFFECT EITHER PARTY’S OBLIGATIONS TO INDEMNIFY THE OTHER AGAINST THIRD-PARTY INDEMNITY CLAIMS.

 

ARTICLE XIII.

CONFIDENTIALITY 

 

13.1    During the term of this Agreement and for a period of five (5) years thereafter, the Parties each agree that Confidential Information of the other party, which is disclosed to it by the other party pursuant to this Agreement: (i) shall be received and held in strict confidence, (ii) shall be used only for the purposes of this Agreement, and (iii) will not be disclosed by the recipient party (except as required by law, court order or regulation), its agents or employees without the prior written consent of the disclosing party, except to the extent that the recipient party can establish by competent written proof that particular Confidential Information:

 

	 	
			a.

				
			Was in the public domain at the time of disclosure to the recipient party; or

			

 

	 	
			b.

				
			Later became part of the public domain through no act or omission of the recipient party, its employees, agents, successors or assigns; or

			

 

	 	
			c.

				
			was lawfully disclosed to the recipient party by a third party having the right to disclose it to the recipient party; or

			

 

	 	
			d.

				
			was already known by the recipient party at the time of disclosure; or

			

 

	 	
			e.

				
			was independently developed by the recipient party without use of the disclosing party's Confidential Information; or

			

 

 

 

 

	 	
			f.

				
			is required by law, court order or regulation to be disclosed, provided that the recipient party so obligated to disclose the Confidential Information shall promptly notify the disclosing party of such requirement and provide the disclosing party an opportunity to challenge or limit the disclosure requirement and to seek confidential treatment or protection order, and that the Confidential Information so disclosed shall remain otherwise subject to the confidentiality and non-use obligations set forth above in this Section 13.1.

			

 

Particular Confidential Information shall not be deemed to come under any of the above exceptions merely because it is embraced by more general information that is or becomes subject to any of the above exceptions.

 

13.2    Subject to full compliance with Section 13.3 below, WPD may disclose MBI’s Confidential Information to its employees, consultants and affiliates who have a need to know such information in order to satisfy WPD’s obligations under this Agreement. Such employees, consultants and affiliates of WPD shall be required to agree to maintain the confidentiality of such information pursuant to terms no less restrictive that the ones set forth herein. MBI shall restrict the disclosure of WPD’s Confidential Information to MD Anderson, those of MBI’s employees, consultants and affiliates who have a need to know such information in order to satisfy MBI’s obligations under this Agreement and any applicable MD Anderson License Agreement, are obliged under a written agreement with MBI to restrict the disclosure, possession, knowledge, development and use of such Confidential Information wherein such obligations are no less restrictive than those of MBI contained herein.

 

13.3    Each Party shall protect the other party’s Confidential Information with at least the same degree of care as it uses to protect its own confidential information, but at no time less than a reasonable degree of care. This obligation will exist while this Agreement is in force and for a period of five (5) years thereafter.

 

13.4    WPD acknowledges that subject to the MD Anderson License Agreement, UTMDACC and MBI reserve the right to publish the general scientific findings from research related to Licensed Subject Matter, with due regard to the protection of WPD’s Confidential Information. MBI will submit manuscripts of any proposed publication to WPD at least twenty (20) calendar days before publication, and WPD shall have the right to review and comment upon the publication in order to protect WPD’s Confidential Information. Upon WPD’s request, publication may be delayed up to sixty (60) additional calendar days to enable WPD to file adequate intellectual property protection desired by WPD of WPD’s Confidential Information that would otherwise be affected by the publication.

 

13.5    Data Privacy and Security Laws. WPD and its subsidiaries (if any) will at all times during the Term be in material compliance with all applicable data privacy and security laws and regulations, and the Company and its subsidiaries (if any) have taken or will take commercially reasonable actions to comply with the European Union General Data Protection Regulation (“GDPR”) (EU 2016/679) and all other applicable laws and regulations with respect to Personal Data (defined below) that have been announced as of the date hereof as becoming effective within 12 months after the date hereof, and for which any non-compliance with same would be reasonably likely to create a material liability (collectively, the “Privacy Laws”). To the Company’s knowledge, the Company and its subsidiaries (if any) have been and currently are in material compliance with the GDPR. To ensure material compliance with the Privacy Laws, the Company and its subsidiaries (if any) have taken, and currently take, commercially reasonable steps reasonably designed to ensure compliance in all material respects with Privacy Laws relating to data privacy and security and the collection, storage, use, disclosure, handling, and analysis of Personal Data that the Company has collected, and collects, or is in the Company’s possession or will be in the Company’s possession during the Term. “Personal Data” means “personal data” as defined by GDPR.

 

 

 

 

ARTICLE XIV.

ASSIGNMENT

 

14.1    Neither Party shall assign any of its rights or obligations under this Agreement not specifically transferable by its terms without the prior written consent of the other Party, such consent not to be unreasonably withheld, conditioned or delayed; except in connection with the merger or acquisition of a Party by a third party, or the sale of all or substantially all of such Party's assets to which this Agreement relates to a third party. For any assignment to be effective the assignee must assume in writing (a copy of which writing will be provided to the other Party) all of the assigning Party's interests, rights, duties, liabilities and obligations under the Agreement and agree to comply with all terms and conditions of the Agreement as if the assignee were the original party to the Agreement. Notwithstanding the foregoing, WPD may not assign this Agreement without the approval of MBI if such assignment would require the approval of MD Anderson or the payment to MD Anderson of any consideration.

 

ARTICLE XV.

TERM AND TERMINATION

 

15.1    The term of this Agreement will commence on the Effective Date and remain in full force and effect until the expiration of the last patent within the Sublicensed Patents, unless earlier termination by either (i) termination of all of the MD Anderson License Agreements, or (ii) pursuant to the terms of this Agreement (“Term”).

 

15.2    Subject to any rights herein which survive termination, this Agreement will earlier terminate in its entirety:

 

	 	
			a.

				
			Automatically, if WPD becomes bankrupt or insolvent and/or if the business of WPD shall be placed in the hands of a receiver or trustee, whether by voluntary act of WPD or otherwise; or

			

 

	 	
			b.

				
			Upon thirty (30) calendar days written notice from MBI, if WPD materially breaches or defaults on the payment or report obligations of Article VI, or use of name obligations of Article XI, or any obligation set forth in Article IV, unless before the end of such thirty (30) calendar day notice period, WPD has cured the material default or breach to MBI’s reasonable satisfaction, and so notifies MBI, stating the manner of the cure; or

			

 

	 	
			c.

				
			Upon ninety (90) calendar days written notice from MBI if WPD materially breaches or defaults on any other obligation under this Agreement, unless, before the end of such ninety (90) calendar day period, WPD has cured the material default or breach to MBI’s reasonable satisfaction, and so notifies MBI, stating the manner of the cure; or

			

 

 

 

 

	 	
			d.

				
			At any time by mutual written agreement between WPD and MBI upon one hundred eighty (180) calendar days written notice to all Parties and subject to any terms herein which survive termination; or

			

 

	 	
			e.

				
			Immediately, upon written notice from MBI, if WPD brings any action before any court, agency or tribunal seeking to invalidate or otherwise challenge the enforceability of MBI’s, UTMDACC’s or the Board's ownership of any patent included in the Sublicensed Patent Rights. Any dispute regarding the validity, enforceability or ownership of any patent included in the Patent Rights shall be litigated in the courts located in Houston, Texas, and WPD agrees not to challenge personal jurisdiction in that forum. To the extent that WPD unsuccessfully challenges the validity or enforceability of any patent included in the Patent Rights, WPD agrees to reimburse MBI, UTMDACC and Board for all costs and fees (including attorney's fees) paid by MBI, UTMDACC and Board in defending against such challenge. WPD understands and agrees that, in the event WPD successfully challenges the validity or enforceability of any patent included in the Patent Rights, all payments or other consideration made or otherwise provided by WPD to MBI, UTMDACC or the Board prior to a final, non-appealable adjudication of invalidity and/or unenforceability shall be non-refundable.

			

 

	 	
			f.

				
			Notwithstanding any terms to the contrary, if WPD has defaulted or been late on its payment obligations pursuant to this Agreement for a period of five (5) calendar days after notice from MBI of such default or failure to pay on any two (2) occasions in a twelve (12)-month period. Notwithstanding the foregoing, WPD may avoid termination under this Section, if WPD pays all past due amounts and a default waiver fee of $50,000.00 within thirty (30) calendar days following the receipt of written notice from MBI identifying the second payment default in the twelve (12) month period. WPD may avoid termination as provided in the foregoing sentence (by payment of all past due amounts and default waiver fee) a maximum of three (3) times during the Term of this Agreement. For purposes of clarification, a separate default waiver fee of $50,000.00 shall be due each time WPD seeks to avoid termination under this provision. It is understood that time is of the essence with respect to the default waiver fees, and these fees are not subject to the thirty (30) day cure period specified in Section 15.2(b); or

			

 

15.3    Early Termination or Amendment Rights. MBI shall have the right, in its sole discretion, to terminate this Agreement in whole, or to materially amend the Agreement by removing a portion of the Sublicensed Subject Matter or Sublicensed Territory related to a Buyback Event (defined below), at any time in connection with the completion of any Buyback Event by paying to WPD the Buyback Consideration (defined below), provided however that MBI’s right to terminate this Agreement shall only be exercised if the Buyback Consideration payable to WPD is reasonably expected to exceed the Minimum Buyback Consideration (defined below).

 

 

 

 

	 	
			a.

				
			“Buyback Event” means the occurrence of any of the following:

			

 

	 	
			i.

				
			MBI entering into a license or sublicense agreement with an unaffiliated third party pursuant to which such MBI grants such third party a license or sublicense to all or to a material portion of the Sublicensed Subject Matter within all or substantially all of the Sublicensed Territories;

			

 

	 	
			ii.

				
			MBI, directly or indirectly, in one or more related transactions, effecting any merger or consolidation of MBI with or into another entity;

			

 

	 	
			iii.

				
			MBI, directly or indirectly, effecting any sale, license, assignment, transfer, conveyance or other disposition of all or to a material portion of its assets in one or a series of related transactions; or

			

 

	 	
			iv.

				
			MBI, directly or indirectly, in one or more related transactions, consummating a stock or share purchase agreement or other business combination with another entity or group of entities whereby such other entity or group acquires more than 50% of the outstanding shares of MBI common stock.

			

 

	 	
			b.

				
			“Buyback Consideration” means:

			

 

	 	
			i.

				
			With respect to a Buyback Event set forth in 15.3(a)(i) above, the Buyback Consideration shall consists of the Buyback Percentage (as defined below) multiplied by the cash and non-cash consideration paid to MBI by the third party licensee pursuant to the license or sublicense agreement, less any transaction costs. To the extent the Buyback Consideration consists of non-cash consideration, the value of such Buyback Consideration shall be determined in good faith by MBI.

			

 

	 	
			ii.

				
			With respect to a Buyback Event set forth in 15.3(a)(ii)-(iv) above, the Buyback Consideration shall consists of the Buyback Percentage multiplied by b) the cash or non-cash consideration paid to MBI or to MBI’s shareholders as part of the Buyback Event, less any transaction costs. To the extent the Buyback Consideration consists of non-cash consideration, the value of such Buyback Consideration, less any transaction costs, shall be determined in good faith by MBI.

			

 

	 	
			iii.

				
			To the extent any Buyback Consideration is payable to MBI over time, MBI shall be permitted to pay WPD such Buyback Consideration, less any transaction costs, as and when received by MBI. To the extent any Buyback Consideration is payable to WPD over time, MBI shall provide WPD with a written statement showing the expected value of such Buyback Consideration.

			

 

 

 

 

	 	
			c.

				
			“Buyback Percentage” means the lesser of:

			

 

	 	
			i.

				
			the greater of:

			

 

 

	 	
			1.

				
			Two percent (2%) upon execution of this Agreement; or

			

 

 

	 	
			2.

				
			10% multiplied by a fraction (A) the numerator of which is the total dollar amount of expenditures made by or on behalf of WPD or any of its affiliates that qualify as Commercially Reasonable Development Efforts under this Agreement, up to a maximum of $6.5 million; and (B) the denominator of which is $6.5 million.

			

			or

			

 

	 	
			ii.

				
			A percentage equal to a) the percentage of of the world heathcare spend (as defined by the most recent World Heathcare Organization report) represented by the countries being removed from the Sublicensed Territory versus the countries involved in the Buyback Event world healthcare spend multiplied by b) a fraction (1) the numerator of which is the total dollar amount of expenditures made by or on behalf of WPD or any of its affiliates that qualify as Commercially Reasonable Development Efforts under this Agreement, up to a maximum of $6.5 million; and (2) the denominator of which is $6.5 million.

			

 

	 	
			d.

				
			“Minimum Buyback Consideration” means as of the date of the Buyback Event the sum of:

			

 

	 	
			i.

				
			the total amount expended by or on behalf of WPD or any of its affiliates on Commercially Reasonable Development Efforts;

			

 

	 	
			ii.

				
			the total amount of grants from governmental agencies, in connection with WPD’s Commercially Reasonable Development Efforts (not otherwise included in 15.3(d)(i) above; and

			

 

	 	
			iii.

				
			any fees or penalties incurred by or on behalf of WPD in connection with the return or reimbursement of any financial support and in-kind contributions from third parties, including grants from governmental and non-governmental agencies.

			

 

15.4    Upon termination of this Agreement:

 

	 	
			a.

				
			Nothing herein will be construed to release either Party of any obligation maturing prior to the effective date of termination; and

			

 

 

 

 

	 	
			b.

				
			The Parties agree that the provisions of Article XI (Use of Name), Article XII (Indemnification), Article XIII (Confidentiality) and Section 7.3(b) of this Agreement shall survive termination of this Agreement; and

			

 

	 	
			c.

				
			WPD may for a period of one (1) year after the effective date of termination, sell all Sublicensed Product(s) and parts thereof that it has on hand at the date of termination, if WPD pays the earned royalty thereon and any other amounts due pursuant to the terms of this Agreement; and

			

 

	 	
			d.

				
			Subject to Section 15.3(c) above, WPD agrees to cease and desist any use and all sale of the Sublicensed Subject Matter and Sublicensed Products; and

			

 

	 	
			e.

				
			all rights granted by MBI to WPD hereunder shall revert to MBI or otherwise cease; provided, however, if this Agreement is not earlier terminated during the Term pursuant to termination of the MD Anderson License Agreement or pursuant to Section 15.2 of this Agreement, then all rights granted by MBI to WPD shall be granted in perpetuity.

			

 

ARTICLE XVI.

MISCELLANEOUS

 

16.1    The Parties shall execute and deliver any and all additional papers, documents, and other instruments and shall do any and all further acts and things reasonably necessary, if any, in connection with the performance of its obligation hereunder to carry out the intent of this Agreement.

 

16.2    This Agreement, including exhibits and schedules (if any) contains the entire understanding of the Parties, and supersedes all prior agreements and understandings between the Parties. This Agreement may be amended only by a written instrument signed by the Parties.

 

16.3    The waiver by any Party of any term or condition of this Agreement, or any part hereof, shall not be deemed a waiver of any other term or condition of this Agreement, or of any later breach of this Agreement.

 

16.4     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:

 

If to WPD:                                                                              If to MBI:

 

WPD Pharmaceuticals sp. z o.o                                          Moleculin Biotech Inc.      

Attention: CEO                                                                   Attention: CEO    

                 ul. Żwirki i Wigury 101,                                                     5300 Memorial Drive, Suite 950

                 02-089 Warszawa, Poland                                                   Houston, TX 77007

 

16.5    This Agreement may be executed in counterparts, all of which together shall constitute a single agreement.

 

16.6    This Agreement will be governed by, construed and enforced in accordance with the laws of the State of Texas. Any dispute between the Parties regarding or related to this Agreement shall be litigated in the courts located in Houston, Texas, and WPD agrees not to challenge personal jurisdiction in that forum.

 

 

 

 

16.7    If any provision of this Agreement or application thereof to anyone is adjudicated to be invalid or unenforceable, such invalidity or unenforceability shall not affect any provision or application of this Agreement which can be given effect without the invalid or unenforceable provision or application, and shall not invalidate or render unenforceable such provision or application. Further, the judicial or other competent authority making such determination shall have the power to limit, construe or reduce the duration, scope, activity and/or area of such provision, and/or delete specific words or phrases as necessary to render, such provision enforceable.

 

16.8    The headings used in this Agreement have been inserted for convenience of reference only and do not define or limit the provisions hereof. The Exhibits (if any) to this Agreement are incorporated herein by reference and will be deemed a part of this Agreement. Unless otherwise expressly provided herein or the context of this Agreement otherwise requires, (a) words of any gender include each other gender, (b) words such as “herein”, “hereof”, and “hereunder” refer to this Agreement as a whole and not merely to the particular provision in which such words appear, (c) words using the singular will include the plural, and vice versa, (d) the words “include,” “includes” and “including” will be deemed to be followed by the phrase “but not limited to”, “without limitation”, “inter alia” or words of similar import, (e) the word “or” will be deemed to include the word “and” (e.g., “and/or”) and (f) references to “ARTICLE,” “Section,” “subsection”, “clause” or other subdivision, or to a Schedule or Exhibit, without reference to a document are to the specified provision, Schedule or Exhibit of this Agreement. This Agreement will be construed as if it were drafted jointly by the Parties and shall not be strictly construed against either Party.

 

16.9    Except for the payment of any amount due hereunder (other than any amount disputed in good faith), neither Party shall be liable to the other for any failure or delay in the fulfillment of its obligations under this Agreement, when any such failure or delay is caused by fire, flood, earthquakes, locusts, explosions, sabotage, terrorism, lack of adequate raw materials (caused by matters beyond the reasonable control of the performing Party), civil commotions, riots, invasions, wars, peril of the sea, acts, restraints, requisitions, regulations, or directions of government authorities (caused by matters beyond the reasonable control of the performing Party), acts of God, or any similar cause beyond the reasonable control of the performing Party (each, a “Force Majeure Event”). In the event that either Party is prevented from discharging its obligations under this Agreement on account of a Force Majeure Event, the performing Party will notify the other Party forthwith, and will nevertheless make every endeavor, in the utmost good faith, to discharge its obligations, even if in a partial or compromised manner. For clarity, a Force Majeure Event shall not excuse a Party from its obligation to pay any money due hereunder.

 

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement by their duly authorized representatives with full right, power and authority to enter into and perform under this Agreement.

 

 

Moleculin Biotech Inc.                                    WPD Pharmaceuticals SP. z o.o.

 

By: _/s/ Walter Klemp                                    By:          /s/ Mariusz Olejniczak         

           Walter Klemp, CEO                                                   Mariusz Olejniczak

Date: 3/22/2021                                              Date:          3/22/2021                  

 

 

 

 

 

 

Exhibit A

 

The Sublicensed Territory

 

Poland, Estonia, Latvia, Lithuania, Belarus, Ukraine, Romania, Armenia, Azerbaijan, Georgia, Slovakia, Czech Republic, Hungary, Uzbekistan, Kazakhstan, Greece, Austria, Russia, Netherlands, Turkey, Belgium, Switzerland, Sweden, Portugal, Norway, Denmark, Ireland, Finland, Luxembourg, IcelandDocument

Exhibit 10.1

FIFTEENTH AMENDMENT

FIFTEENTH AMENDMENT, dated as of March 19, 2021 (this “Amendment”) to the Amended and Restated Master Purchase and Sale Agreement, dated as of March 6, 2017, as amended by the First Amendment, dated as of September 14, 2017, by the Second Amendment, dated as of November 3, 2017, by Omnibus Amendment No. 2 to Basic Documents (Ally-Carvana Flow), dated as of January 4, 2018, by the Third Amendment, dated as of November 2, 2018, by the Fourth Amendment, effective as of January 4, 2019, by the Fifth Amendment, effective as of March 6, 2019, by the Sixth Amendment, effective as of April 19, 2019, by the Seventh Amendment, effective as of March 19, 2020, by the Eighth Amendment, effective as of March 24, 2020, by the Ninth Amendment, effective as of April 29, 2020, by the Tenth Amendment, effective as of May 19, 2020, by the Eleventh Amendment, effective as of June 30, 2020, by the Twelfth Amendment, dated as of September 29, 2020, by the Thirteenth Amendment, dated as of December 30, 2020 and by the Fourteenth Amendment, dated as of January 29, 2021 (the “Master Purchase and Sale Agreement”), among CARVANA AUTO RECEIVABLES 2016-1 LLC, a Delaware limited liability company, as Transferor (the “Transferor”), ALLY BANK, a Utah chartered bank, as a Purchaser (in such capacity, a “Purchaser”), and ALLY FINANCIAL INC., a Delaware corporation, as a Purchaser (in such capacity, a “Purchaser” and, together with Ally Bank, the “Purchasers”).

WITNESSETH:

WHEREAS, the Transferors and the Purchasers are parties to the Master Purchase and Sale Agreement pursuant to which the Purchasers have agreed to purchase specified portfolios of receivables and related property from the Transferor; and

WHEREAS, the parties wish to amend the Master Purchase and Sale Agreement in certain respects;

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

SECTION I
DEFINITIONS

Section 1.01 Defined Terms.  Unless otherwise defined herein, capitalized terms used in the above recitals and in this Amendment are defined in and shall have the respective meanings assigned to them in (or by reference in) Appendix A to the Master Purchase and Sale Agreement.

SECTION II
AMENDMENTS

Section 2.01 Amendments to Appendix A (Definitions). Appendix A to the Master Purchase and Sale Agreement is hereby amended by: 

Certain information has been excluded because it both (i) is not material and (ii) would be competitively harmful if publicly disclosed.

(a) inserting each of the following terms which are double underlined in the place where such term appears below to, and deleting the stricken terms from, the “Closing Date” definition:

““Closing Date” means, with respect to a First Tier Receivables Pool and subject to Section 3.1(e) of the Master Sale Agreement or a Receivables Pool and subject to Section 4.1(a) of the Master Purchase and Sale Agreement, the date on which the related First Step Pool Supplement or Pool Supplement is executed and delivered and the Purchase Price is paid, which generally will be the third (3rd) Business Day of the last calendar week that follows receipt by the Purchasers of notification from the Transferor of its intent to complete such a sale of each calendar quarter; provided that, if there is a corresponding Funding Date under the Master Transfer Agreement (Warehouse) in the same calendar week, the Closing Date shall occur on the same day as such Funding Date.”

(b) inserting each of the following terms which are double underlined in the place where such term appears below to, and deleting the stricken terms from, the “Commitment Amount” definition:

““Commitment Amount” means the sum of (i) $4,000,000,000 3,000,000,000 plus (ii) the Outstanding Principal Balance of a Receivable that had been previously included in a Receivables Pool and was repurchased, remediated and resold to the Purchasers in a subsequent Receivables Pool.”

(c) inserting each of the following terms which are double underlined in the place where such term appears below to, and deleting the stricken terms from, the “Commitment Period” definition:

““Commitment Period” means the period from the Fifth Fourth Extension Amendment Effective Date to the earliest of (i) the Scheduled Commitment Termination Date, (ii) the occurrence of a Commitment Termination Event and (iii) the purchase by the Purchasers of Receivables Pools with a total Cutoff Date Aggregate Outstanding Principal Balance in an amount equal to the Commitment Amount.”

(d) inserting each of the following terms which are double underlined in the place where such term appears below to, and deleting the stricken terms from, the “Delinquent Receivable” definition:

““Delinquent Receivable” means any Receivable (other than a Defaulted Receivable) for which all or any part of a scheduled payment (the “Delinquency Threshold”) is one thirty-one (1 31) or more days past due, taking into account the application by the Servicer of payments received in any Collection Period to previously unpaid scheduled payments or portions thereof in accordance with the Collection Policy. For purposes of determining delinquency, in accordance with the Collection Policy, the Servicer applies payments from Obligors in order of delinquency of outstanding scheduled payments, with payments first applied to the longest overdue and outstanding scheduled payment or portion thereof.”

(e) inserting each of the following terms which are double underlined in the place where such term appears below to, and deleting the stricken terms from, the “Origination Period” definition:

““Origination Period” means, each calendar week quarter during the period beginning with the week first quarter of December 12, 2016 2021 and ending with the week quarter containing the last day of the Commitment Period; provided, that, with respect to (i) the initial First Tier Receivables Pool and Receivables Pool, (ii) any First Tier Receivables Pool and Receivables Pool sold from and including March 7, 2019 to and including April 4, 2019, respectively, (iii) any First Tier Receivables Pool and Receivables Pool sold on March 20, 2020, and (iv) any other date consented to by the Purchasers in their sole discretion, “Origination Period” shall be the period consented to by the Purchasers.”

(f) inserting each of the following terms which are double underlined in the place where such term appears below to, and deleting the stricken terms from, the “Purchase Percentage” definition:

"“Purchase Percentage” for an Origination Period, means, the percentage equal or greater than to (i) the aggregate Outstanding Principal Balance of all Receivables originated or acquired by the Seller to be sold to the Transferor on the related Closing Date pursuant to the Master Sale Agreement divided by (ii) the aggregate principal balance of all receivables originated or acquired by the Seller that meet the criteria described in the definition of “Eligible Receivable” and such other documented administrative criteria as the Purchasers may agree to from time to time during such Origination Period (which, for purposes of clause (ii) shall be reduced by the aggregate principal balance of receivables with respect to which the applicable obligor has exercised its right to return the related financed vehicle and terminate the related receivable). In no event shall the Purchase Percentage be less than 100% the value, expressed as a percentage, equal to the minimum sales amount of $300,000,000 for each Closing Date divided by the amount determined in clause (ii) of the preceding sentence, other than during the period from October 1, 2020 through January 28, 2021 when the Purchase Percentage will be 0%, and, in the event the Seller or the Transferor shall fail to notify the Purchasers of the Purchase Percentage for any Origination Period, the Purchase Percentage from the prior Origination Period shall apply."

(g) inserting each of the following terms which are double underlined in the place where such term appears below to, and deleting the stricken terms from, the “Scheduled Commitment Termination Date” definition: 

““Scheduled Commitment Termination Date” means March 19, 2022 2021March 23, 2021.”

(h) inserting each of the following terms which are double underlined in the place where such term appears below to the “Settlement Date” definition:

““Settlement Date” means with respect to each Origination Period in which Transferor has submitted notification of its intent to complete a sale, the third 

(3rd) Business Day of the second last calendar week that follows of such Origination Period; provided that on any date consented to by the Purchasers in their sole discretion, the “Settlement Date” will be the date consented to by the Purchasers.”

(i) adding a new definition of “Fifth Extension Amendment Effective Date” in proper alphabetical order to read as follows:

““Fifth Extension Amendment Effective Date” means March 19, 2021.”

(j) adding a new definition of “Nonconforming Receivables Pool” in proper alphabetical order to read as follows:

““Nonconforming Receivables Pool” means a Receivables Pool that the Purchasers have agreed to purchase on a Closing Date after waiving (i) one or more of the characteristics contained in the definition of “Eligible Receivables Pool” or (ii) one or more of the characteristics contained in the definition of “Eligible Receivable”.

(k) deleting the “Fourth Extension Amendment Effective Date” definition.

Section 2.02 Amendments to Section 2.1(a) (Transferor Obligation). Section 2.1(a) of the Master Purchase and Sale Agreement is hereby amended as set forth below by inserting each term thereof which is double underlined in the place where such term appears below and deleting the stricken text:

"(a)      Transferor Obligation.  Upon the terms and subject to the conditions set forth in this Agreement, and in reliance on the covenants, representations, warranties and agreements set forth herein, the Transferor commits to sell to the Purchasers one Receivables Pool each calendar week quarter during the Commitment Period, except for the calendar weeks within the periods from January 4, 2019 to February 9, 2019 and October 1, 2020 through January 28, 2021 (provided, however, that the Transferor may elect to sell a Receivables Pool during any calendar week from October 1, 2020 through January 28, 2021), with a total Cutoff Date Aggregate Outstanding Principal Balance for all such Receivables Pools sold during the Commitment Period, taken together, equal to the Commitment Amount and each Receivables Pool sold to the Purchaser shall have a Cutoff Date Aggregate Outstanding Principal Balance equal to at least 100% $300,000,000, other than during the period from October 1, 2020 through January 28, 2021 when the Purchase Percentage will be 0%, (adjusted downward for a nonmaterial amount resulting from application of the Selection Procedures, including the Freestyle Selection, at a by the Purchase Percentage of 100%, other than during the period from October 1, 2020 through January 28, 2021 when the Purchase Percentage will be 0%,) of the aggregate principal balance of weekly quarterly pools of receivables originated by the Seller that meet the criteria described in the definition of “Eligible Receivable” and such other documented administrative criteria as the Purchasers may agree to from time to time during the second calendar week preceding the calendar week in which the related Closing Date shall occur related to such Receivables Pool during the Commitment Period; provided, that the Transferor shall not be obligated to sell any Receivables Pool if the related Second Step Receivables Purchase Price for such Receivables Pool is less than or equal to the Cutoff Date Aggregate Outstanding Principal Balance (collectively, the “Transferor Obligation”); provided, further, notwithstanding the maximum FICO score 

described in clause (xxxiv) in the definition of “Eligible Receivable,” if the Seller elects to consummate a Limited Sale Option under the Master Sale Agreement, then the Transferor shall include in any related Receivables Pool that has a related Cutoff Date on and including February 24, 2019 through and including March 24, 2019, all Receivables (without regard to the Purchase Percentage or application of the Freestyle Selection Criteria) where the related Obligors have a FICO score of more than the Upper Bound FICO Score and that otherwise meet the definition of “Eligible Receivable” (other than the Upper Bound FICO Score described in clause (xxxiv) thereof) originated during the related Origination Period; provided further that, in connection with a Limited Sale Option, if the Transferor sells such Receivables with FICO scores of more than the Upper Bound FICO Score, the Transferor shall also be required to include in such Receivables Pool all Eligible Receivables originated during the related Origination Period with FICO scores of not less than 590 and not more than the Upper Bound FICO Score that otherwise meet the definition of “Eligible Receivable” with randomization codes of the related contract numbers that are greater than the Purchase Percentage; provided, further, that the sum of the Cutoff Date Aggregate Outstanding Principal Balance for all Flex Receivables sold during the period beginning April 30, 2020 through and including July 2, 2020, taken together, shall not exceed $[***] (or such other later dates or higher amount as agreed to by the Purchasers in their sole discretion).  Notwithstanding the foregoing or anything to the contrary herein, solely for the purposes of this Section 2.1(a), any Receivable sold on June 30, 2020, September 29, 2020, or December 30, 2020 shall not be deemed to be a Flex Receivable."

Section 2.03 Amendments to Section 2.1(b) (Purchaser Obligation). Section 2.1(b) of the Master Purchase and Sale Agreement is hereby amended as set forth below by inserting each term thereof which is double underlined in the place where such term appears below and deleting the stricken text:

"(b)      Purchaser Obligation.  Upon the terms and subject to the conditions set forth in this Agreement, including Section 2.1(c) below, and in reliance on the covenants, representations, warranties and agreements herein set forth, the Purchasers commit to purchase one Receivables Pool each calendar week quarter during the Commitment Period, except for the calendar weeks within the period from January 4, 2019 to February 9, 2019 and October 1, 2020 through January 28, 2021 (provided, however, that the Purchasers may elect, in their sole discretion to purchase a Receivables Pool during any calendar week from October 1, 2020 through January 28, 2021), on each Closing Date designated by the Transferor pursuant to Section 4.1(a); provided that the sum of the Cutoff Date Aggregate Outstanding Principal Balance for all Receivables Pools purchased during the Commitment Period shall not exceed the Commitment Amount and the sum of the Cutoff Date Aggregate Outstanding Principal Balance for all Flex Receivables purchased during the period beginning April 30, 2020 through and including July 2, 2020, taken together, shall not exceed $[***], or such other later dates or higher amount with respect to Flex Receivables as agreed to by the Purchasers in their sole discretion (collectively, the “Purchaser Obligation”).  Notwithstanding the foregoing or anything to the contrary herein, solely for the purposes of this Section 2.1(b), any Receivable sold on June 30, 2020, September 29, 2020, or December 30, 2020 shall not be deemed to be a Flex Receivable."  

[***] Redacted for confidentiality purposes.

Section 2.04 Amendments to Section 4.2(a) (Effecting Purchases). Section 4.1(a) of the Master Purchase and Sale Agreement is hereby amended as set forth below by inserting each term thereof which is double underlined in the place where such term appears below and deleting the stricken text:

"(a)      General Procedures.  During the Commitment Period, the purchase and sale of a Receivables Pool pursuant to the Transferor Obligation will occur on the Closing Date for the calendar week quarter that follows receipt of notification from the Transferor of its intent to complete such a sale at such time (which Closing Date, for the avoidance of doubt, will fall in the second last calendar week that follows of the related Origination Period).  For the avoidance of doubt, subject to the terms and conditions of this Agreement, the Transferor is obligated to sell a Receivables Pool to the Purchasers hereunder during each calendar week quarter during the Commitment Period; provided, that the Transferor, by written notice to be delivered to the Purchasers no later than the second (2nd) Business Day following an Origination Period, may elect to defer the related sale if it reasonably determines in good faith that consummating such sale would be administratively burdensome (e.g., due to shortened holiday weeks or other similar events not in its control) and the Receivables Pool that would have been sold to the Purchasers on such Closing Date will be combined with the Receivables Pool to be sold to the Purchasers on the next succeeding Closing Date; provided, further, that the Transferor may not make such an election more than six (6) times per twelve month period and such election may not be made to skip closings in consecutive calendar weeks."

Section 2.05 Amendments to Section 6.2(b) (Minimum Sales Amount). Section 6.2(b) of the Master Purchase and Sale Agreement is hereby amended as set forth below by inserting each term thereof which is double underlined in the place where such term appears below and deleting the stricken text:

"(b)    Minimum Sales Amount.  The Aggregate Outstanding Principal Balance as of the related Cutoff Date shall not be less than 100% $300,000,000, other than during the period from October 1, 2020 through January 28, 2021 when the Purchase Percentage will be 0%, (adjusted downward for a nonmaterial amount resulting from application of the Freestyle Selection at a by the Purchase Percentage of 100%, other than during the period from October 1, 2020 through January 28, 2021 when the Purchase Percentage will be 0%,) of the aggregate principal balance of weekly quarterly pools of receivables meeting the criteria described in the definition of “Eligible Receivable” and such other documented administrative criteria as the Purchasers may agree to from time to time originated by the Seller during the second calendar week preceding the related Closing Date unless otherwise agreed by the Purchasers."

SECTION III
MISCELLANEOUS

Section 3.01 Conditions to Effectiveness. This Amendment shall become effective as of the date first written above upon the receipt of the following:

(a) a signed counterpart to this Amendment duly executed and delivered by each of the parties hereto;

(b) a signed counterpart to the Seventeenth Amended and Restated Letter Agreement re Master Purchase and Sale Agreement, dated as of the date hereof, shall have been duly 

executed and delivered by Carvana, LLC, Bridgecrest Credit Company, LLC, the Transferor, Ally Financial, and Ally Bank; and

(c) a signed copy of the Thirteenth Amendment to Master Sale Agreement, dated as of the date hereof, shall have been duly executed and delivered by Carvana, LLC the Transferor, Ally Financial, and Ally Bank.

Section 3.02 Continuing Effect of the Master Purchase and Sale Agreement. Except as specifically amended and modified above, the Master Purchase and Sale Agreement is and shall continue to be in full force and effect and is hereby in all respects ratified and confirmed. The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of the Purchasers under the Master Purchase and Sale Agreement, nor constitute a waiver of any provision of the Master Purchase and Sale Agreement.

Section 3.03 Representations and Warranties. The representations and warranties of the Seller and the Transferor contained in the Basic Documents shall be true and correct in all material respects as of the effective date of this Amendment.

Section 3.04 Binding Effect. This Amendment shall be binding upon and inure to the benefit of the Purchasers, the Servicer and their respective successors and permitted assigns.

Section 3.05 Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same agreement. The parties intend that faxed signatures and electronically imaged signatures including as .pdf files shall constitute original signatures and are binding on all parties. In case any provision in or obligation under this Amendment shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby. This Amendment contains the final and complete integration of all prior expressions by the parties hereto with respect to the subject matter hereof
and shall constitute the entire agreement among the parties hereto with respect to the subject matter hereof, superseding all prior oral or written understandings other than any fee letter contemplated hereby. 

Section 3.06 GOVERNING LAW. SUBMISSION TO JURISDICTION, ETC.

(a) THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF OR OF ANY OTHER JURISDICTION OTHER THAN SECTION 5-1401 AND SECTION 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES UNDER THIS AMENDMENT SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

(b) THE TRANSFEROR AND THE PURCHASERS HEREBY MUTUALLY AGREE TO SUBMIT TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND OF ANY NEW YORK STATE COURT SITTING IN THE CITY OF NEW YORK FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AMENDMENT, ANY OTHER BASIC DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH OF THE 

TRANSFEROR AND THE PURCHASERS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

(c) THE TRANSFEROR AND THE PURCHASERS EACH HEREBY WAIVES (TO EXTENT THAT IT MAY LAWFULLY DO SO) ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE ARISING OUT OF, CONNECTED WITH, RELATED TO, OR IN CONNECTION WITH THIS AMENDMENT. INSTEAD, ANY DISPUTE RESOLVED IN COURT WILL BE RESOLVED IN A BENCH TRIAL WITHOUT A JURY.

Section 3.07 Effect of Headings. The section headings herein are for convenience only and shall not affect the construction hereof.

[remainder of the page intentionally left blank] 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.

												
	CARVANA AUTO RECEIVABLES 2016-1 LLC,	
		as Transferor	
				
	By:	/s/ Paul Breaux	
		Name:	Paul Breaux	
		Title:	Vice President	
				
				
	ALLY BANK,	
		as Purchaser	
				
	By:	/s/ Aaron Dawkins	
		Name:	Aaron Dawkins	
		Title:	Authorized Representative	
				
				
	ALLY FINANCIAL INC.,	
		as Purchaser	
				
	By:	/s/ Thomas Elkins	
		Name:	Thomas Elkins	
		Title:	Authorized Representative	

 

						
	Agreed to and Accepted by:
		
	CARVANA, LLC,
		as Seller
		
	By:	/s/ Paul Breaux
	Name:	Paul Breaux
	Title:	Vice President

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00324-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00324-of-00352.parquet"}]]