Document:

Exhibit 10.8

 

CONFIDENTIAL TREATMENT REQUESTED

 

LICENSE AGREEMENT

 

This LICENSE AGREEMENT (“Agreement”) is entered into as of March 21, 2014 (“Effective Date”) by and between ReGenX Biosciences, LLC, a limited liability company organized under the laws of the State of Delaware, with offices at 750 17th Street, NW, Suite 1100, Washington, DC 20006 (“Licensor”), and AveXis, Inc. (formerly known as BioLife Cell Bank, Inc.), a corporation organized under the laws of the State of Delaware, with offices at 4925 Greenville Avenue, Suite 604, Dallas, TX 75206 (“Licensee”).  Licensor and Licensee are hereinafter referred to individually as a “Party” and collectively as the “Parties.”

 

WHEREAS, Licensor has rights under certain Licensed Patents (as defined herein) pertaining to adeno-associated virus serotype 9; and

 

WHEREAS, Licensee desires to obtain an exclusive license under the Licensed Patents under the terms set forth herein;

 

NOW, THEREFORE, in consideration of the promises and covenants contained in this Agreement, and intending to be legally bound, the Parties hereby agree as follows:

 

ARTICLE 1:  DEFINITIONS

 

1.1                               “AAV9” means (a) the recombinant adeno-associated virus serotype 9 vector with the specified sequence set forth in GenBank **** and (b) any recombinant adeno-associated virus derivatives of such serotype 9 vector that are covered by the claims of the Licensed Patents.

 

1.2                               “Affiliate” means any legal entity directly or indirectly, during the term of this Agreement, controlling, controlled by, or under common control with another entity.  For purposes of this Agreement, “control” means the direct or indirect ownership of more than 50% of the outstanding voting securities of a legal entity, or the right to receive more than 50% of the profits or earnings of a legal entity, or the right to control the policy decisions of a legal entity.  An entity may be or become an Affiliate of an entity and may cease to be an Affiliate of an entity, in each case, during the term of this Agreement.

 

1.3                               “Calendar Quarter” means each three-month period or any portion thereof, beginning on January 1, April 1, July 1, and October 1.

 

1.4                               “Confidential Information” means and includes all technical information, inventions, developments, discoveries, software, know-how, methods, techniques, formulae, animate and inanimate materials, data, processes, finances, business operations or affairs, and other proprietary ideas, whether or not patentable or copyrightable, of either Party that are (a) marked or otherwise identified as confidential or proprietary at the time of disclosure in writing; or (b) if disclosed orally, visually, or in another non-written form, identified as confidential at the time of disclosure and summarized in reasonable detail in writing as to its general content within 30 days after original disclosure.  The Parties acknowledge that (i) the terms and conditions of this Agreement and (ii) the records and reports referred to in Section 3.6 will be deemed the Confidential Information of both Parties, regardless of whether such information is marked or identified as confidential.  In addition, information provided to Licensee pursuant to the

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

 

provisions of Section 7.1 will be deemed the Confidential Information of Licensor, regardless of whether such information is marked or identified as confidential.  Notwithstanding the foregoing, Confidential Information will not include the following, in each case, to the extent evidenced by competent written proof of the Receiving Party:

 

1.4.1                     information that was already known to the Receiving Party, other than under an obligation of confidentiality, at the time of disclosure by the Disclosing Party;

 

1.4.2                     information that was generally available to the public or otherwise part of the public domain at the time of its disclosure to the Receiving Party;

 

1.4.3                     information that became generally available to the public or otherwise part of the public domain after its disclosure, other than through any act or omission of the Receiving Party in breach of this Agreement;

 

1.4.4                     information that is independently discovered or developed by the Receiving Party without the use of Confidential Information of the Disclosing Party; or

 

1.4.5                     information that was disclosed to the Receiving Party, other than under an obligation of confidentiality, by a Third Party who had no obligation to the Disclosing Party not to disclose such information to others.

 

1.5                               “Disclosing Party” has the meaning set forth in Section 5.1.

 

1.6                               “Domain Antibody” ****.

 

1.7                               “FDA” means the United States Food and Drug Administration, or a successor agency in the United States with responsibilities comparable to those of the United States Food and Drug Administration.

 

1.8                               “Field” means the treatment of spinal muscular atrophy in humans by in vivo gene therapy using AAV9.

 

1.9                               “GSK Agreement” means that certain License Agreement entered into between Licensor and SmithKline Beecham Corporation, effective on March 6, 2009, as amended by that certain Amendment to License Agreement dated April 15, 2009, and as amended from time to time.

 

1.10                        “Licensed Patents” means, to the extent they cover AAV9, (a) all United States patents and patent applications listed in Exhibit A, and (b) any re-examination certificates thereof, and their foreign counterparts and extensions, continuations, divisionals, and re-issue applications.

 

1.11                        “Licensed Product” means (a) any AAV9 product that is made, made for, used, sold, offered for sale, or imported by Licensee, its Affiliates, and any of its or their Sublicensees, the manufacture, use, sale, offer for sale, or import of which product, in the absence of the license granted pursuant to this Agreement, would infringe or is covered by at least one Valid Claim in the country of manufacture, use, sale, offer for sale, or import, including products manufactured by a process that would infringe or is covered by at least one Valid Claim in the country of manufacture, use, sale, offer for sale, or import; or (b) any service sold by Licensee, its

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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Affiliates, and any of its or their Sublicensees with respect to the administration of any AAV9 product to patients that, in the absence of the licenses granted pursuant to this Agreement, would infringe or is covered by at least one Valid Claim in the country of sale.

 

1.12                        “NDA” means a New Drug Application filed with the FDA as described in 21 C.F.R. § 314, a Biological License Application (BLA) pursuant to 21 C.F.R. § 601.2, or any equivalent or any corresponding application for regulatory approval in any country or regulatory jurisdiction other than the United States.

 

1.13                        “Net Sales” means the gross receipts from sales or other disposition of a Licensed Product (including fees for services within the definition of “Licensed Product”) by Licensee and/or its Affiliates and/or any Sublicensees to Third Parties less the following deductions that are directly attributable to a sale, specifically and separately identified on an invoice or other documentation and actually borne by Licensee, its Affiliates, or any Sublicensees:  ****.  In the event consideration other than cash is paid to Licensee, its Affiliates, or any Sublicensees, for purposes of determining Net Sales, the Parties shall use the cash consideration that Licensee, its Affiliates, or any Sublicensees would realize from an unrelated buyer in an arm’s length sale of an identical item sold in the same quantity and at the time and place of the transaction, as determined jointly by Licensor and Licensee based on transactions of a similar type and standard industry practice, if any.

 

1.14                        “Penn Agreement” means that certain License Agreement entered into between Licensor and The Trustees of the University of Pennsylvania, effective on February 24, 2009, as amended by that letter agreement dated March 6, 2009, and as amended from time to time.

 

1.15                        “Phase 3 Clinical Trial” means a pivotal clinical trial in humans performed to gain evidence with statistical significance of the efficacy of a product in a target population, and to obtain expanded evidence of safety for such product that is needed to evaluate the overall benefit-risk relationship of such product, to form the basis for approval of an NDA and to provide an adequate basis for physician labeling, as described in 21 C.F.R. § 312.21(c) or the corresponding regulation in jurisdictions other than the United States.

 

1.16                        “Prosecute” means preparation, filing, and prosecuting patent applications and maintaining patents, including any reexaminations, reissues, oppositions, inter partes review, and interferences.

 

1.17                        “Receiving Party” has the meaning set forth in Section 5.1.

 

1.18                        “ReGenX Licensors” means SmithKline Beecham Corporation (or any successor thereto under the GSK Agreement) and The Trustees of the University of Pennsylvania (or any successor thereto under the Penn Agreement).

 

1.19                        “Retained Rights” has the meaning set forth in Section 2.2.

 

1.20                        “Sublicensee” means (i) any Third Party or Affiliate to whom Licensee grants a sublicense of some or all of the rights granted to Licensee under this Agreement as permitted by this Agreement; and (ii) any other Third Party or Affiliate to whom a sublicensee described in clause (i) has granted a further sublicense as permitted by this Agreement.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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1.21                        “Third Party” means any person or entity other than a Party to this Agreement or Affiliates of a Party to this Agreement.

 

1.22                        “Valid Claim” means a claim of an issued and unexpired patent (including any patent claim the term of which is extended by any extension, supplementary protection certificate, patent term restoration, or the like) included within the Licensed Patents or a claim of a pending patent application included within the Licensed Patents, which has not lapsed, been abandoned, been held revoked, or been deemed unenforceable or invalid by a non-appealable decision or an appealable decision from which no appeal was taken within the time allowed for such appeal of a court or other governmental agency of competent jurisdiction.

 

ARTICLE 2:  LICENSE GRANT

 

2.1                               License Grant.  Subject to the terms and conditions of this Agreement, including the Retained Rights, Licensor hereby grants to Licensee an exclusive, sublicensable (as provided in Section 2.4 only), non-transferable (except as provided in Section 10.2), royalty-bearing, worldwide license, under the Licensed Patents to make, have made, use, import, sell, and offer for sale Licensed Products solely in the Field, including, for the avoidance of doubt, the right to conduct research and development.

 

2.2                               Retained Rights.  Except for the rights and licenses specified in Section 2.1, no license or other rights are granted to Licensee under any intellectual property of Licensor, whether by implication, estoppel, or otherwise and whether such intellectual property is subordinate, dominant, or otherwise useful for the practice of the Licensed Patents.  Notwithstanding anything to the contrary in this Agreement, Licensor may use and permit others to use the Licensed Patents for any research, development, commercial, or other purposes outside of the Field.  Without limiting the foregoing, and notwithstanding anything in this Agreement to the contrary, Licensee acknowledges and agrees that the following rights are retained by Licensor and the ReGenX Licensors (individually and collectively, the “Retained Rights”), whether inside or outside the Field:

 

2.2.1                     The rights and licenses granted in Section 2.1 shall not include any right (and Licensor and the ReGenX Licensors retain the exclusive (even as to Licensee), fully sublicensable right) under the Licensed Patents to make, have made, use, sell, offer to sell, and import Domain Antibodies that are expressed by an adeno-associated vector, including AAV9.

 

2.2.2                     Licensor and the ReGenX Licensors retain the following rights with respect to the Licensed Patents:

 

(a)                                 A non-exclusive, sublicensable right under the Licensed Patents to make, have made, use, sell, offer to sell, and import products that deliver RNA interference and antisense drugs using an adeno-associated vector, including AAV9; and

 

(b)                                 A non-exclusive right for the ReGenX Licensors (which right is sublicensable by the ReGenX Licensors) to use the Licensed Patents for non-commercial research purposes and to use the Licensed Patents for

 

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such ReGenX Licensors’ discovery research efforts with non-profit organizations and collaborators.

 

2.2.3                     The rights and licenses granted in Section 2.1 shall not include any right (and Licensor retains the exclusive (even as to Licensee), fully sublicensable right) under the Licensed Patents:

 

(a)                                 to conduct commercial reagent and services businesses, which includes the right to make, have made, use, sell, offer to sell, and import research reagents, including any viral vector construct; provided that, for clarity, such rights retained by Licensor shall not include the right to conduct clinical trials in humans in the Field; or

 

(b)                                 to use the Licensed Patents to provide services to any Third Parties; provided that Licensee’s license under Section 2.1 does include the right to provide the service of the administration of Licensed Products to patients.

 

2.2.4                     Licensor retains the fully sublicensable right under the Licensed Patents to grant non-exclusive research and development licenses to Affiliates and Third Parties; provided that such development rights granted by Licensor shall not include the right to conduct clinical trials in humans in the Field or any rights to sell products in the Field.

 

2.2.5                     The Trustees of the University of Pennsylvania may use and permit other non-profit organizations or other non-commercial entities to use the Licensed Patents for educational and research purposes.

 

2.3                               Government Rights.  Licensee acknowledges that the United States government retains certain rights in intellectual property funded in whole or part under any contract, grant, or similar agreement with a federal agency.  The license grant hereunder is expressly subject to all applicable United States government rights, including any applicable requirement that products resulting from such intellectual property sold in the United States must be substantially manufactured in the United States.

 

2.4                               Sublicensing.

 

2.4.1                     The license granted pursuant to Section 2.1 is sublicensable by Licensee to any Affiliates or Third Parties; provided that any such sublicense must comply with the provisions of this Section 2.4 (including Section 2.4.2).

 

2.4.2                     The right to sublicense granted to Licensee under this Agreement is subject to the following conditions:

 

(a)                                 Licensee may only grant sublicenses pursuant to a written sublicense agreement with the Sublicensee; ****.  Licensor must receive written notice as soon as practicable following execution of any such sublicenses.  Any further sublicenses granted by any Sublicensees (to the extent permitted hereunder) must comply with the provisions of this Section 2.4

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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(including Section 2.4.2) to the same extent as if Licensee granted such sublicense directly.

 

(b)                                 In each sublicense agreement, the Sublicensee must be required to comply with the terms and conditions of this Agreement to the same extent as Licensee has agreed and must acknowledge that Licensor is an express third party beneficiary of such terms and conditions under such sublicense agreement.

 

(c)                                  The official language of any sublicense agreement shall be English.

 

(d)                                 Within **** after entering into a sublicense, Licensor must receive a copy of the sublicense written in the English language for Licensor’s records and to share with the ReGenX Licensors.  The copy of the sublicense may be redacted to exclude confidential information of the applicable Sublicensee, but such copy shall not be redacted to the extent that it impairs Licensor’s (or the ReGenX Licensors’) ability to ensure compliance with this Agreement; provided that, if either of the ReGenX Licensors requires a complete, unredacted copy of the sublicense, Licensee shall provide such complete, unredacted copy.

 

(e)                                  Licensee’s execution of a sublicense agreement will not relieve Licensee of any of its obligations under this Agreement.  Licensee is and shall remain **** to Licensor for all of Licensee’s duties and obligations contained in this Agreement and for any act or omission of an Affiliate or Sublicensee that would be a breach of this Agreement if performed or omitted by Licensee, and Licensee will be deemed to be in breach of this Agreement as a result of such act or omission.

 

2.5                               Improvements.

 

2.5.1                     Licensee hereby grants to Licensor a non-exclusive, worldwide, royalty-free, transferable, sublicensable, irrevocable, perpetual license:

 

(a)                                 to use any Licensed Back Improvements (and any intellectual property rights with respect thereto) consummate in scope to the Retained Rights, and

 

(b)                                 to practice the Licensed Back Improvements (and any intellectual property rights with respect thereto) in connection with AAV9, including the right to research, develop, make, have made, use, offer for sale, and sell products and services; provided that Licensor shall have no right, under the license in this Section 2.5.1(b), to practice the Licensed Back Improvements in the Field.

 

2.5.2                     For purposes of this Agreement, “Licensed Back Improvements” means any patentable modifications or improvements developed by Licensee, any Affiliates, or any Sublicensees to any vector that is the subject of a claim within the Licensed Patents.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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2.5.3                     Licensee agrees to provide prompt notice to Licensor upon the filing of any patent application covering any Licensed Back Improvement, together with a reasonably detailed description of or access to such Licensed Back Improvement to permit the practice of any such invention or improvement.

 

ARTICLE 3:  CONSIDERATION

 

3.1                               Initial Fee.  In consideration of the license granted to Licensee under Section 2.1, Licensee shall pay Licensor an initial fee of $2,000,000, which shall be payable as follows:  (i) **** upon the Effective Date, (ii) **** within **** after the Effective Date, and (iii) **** within **** after the Effective Date; provided that any unpaid portion of the initial fee will be immediately payable upon any termination of this Agreement.

 

3.2                               Annual Maintenance Fee.  In consideration of the license granted to Licensee under Section 2.1, Licensee shall pay Licensor on-going annual maintenance fees of **** on each anniversary of the Effective Date.

 

3.3                               Milestone Fees.  In consideration of the license granted to Licensee under Section 2.1, Licensee shall pay Licensor the following milestone payments:

 

	
Milestone
    	
 
    	
Milestone Payment
    	
 
    
	
1. First treatment of the ****   human subject in a clinical trial (i.e., ****   patient, first dose)
    	
 
    	
****
    	
 
    
	
2. First treatment in Phase 3   Clinical Trial (i.e., first patient, first   dose)
    	
 
    	
****
    	
 
    
	
3. First NDA submission for a   Licensed Product in the United States
    	
 
    	
****
    	
 
    
	
4. First NDA submission for a   Licensed Product in the European Union
    	
 
    	
****
    	
 
    
	
5. First NDA approval for a   Licensed Product in the United States
    	
 
    	
****
    	
 
    
	
6. First NDA approval for a   Licensed Product in the European Union
    	
 
    	
****
    	
 
    
	
Total:
    	
 
    	
$
    	
12,250,000.00
    	
 
    
					

 

For clarity, the milestone payments set forth in this Section 3.3 are payable **** with respect to each milestone event, ****.

 

3.4                               Royalties.  In further consideration of the license granted to Licensee under Section 2.1, Licensee shall pay to Licensor the following royalties based upon Net Sales of Licensed Products, subject to the reductions in royalty rates set forth in Section 3.4.1:

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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Cumulative Annual Net Sales of all Licensed
   Products Worldwide
    	
 
    	
Royalty Percentage
    	
 
    
	
Portion of Net Sales in a   calendar year less than $****
    	
 
    	
****
    	
 
    
	
Portion of Net Sales in a   calendar year between (and including) $**** through (and including) $****
    	
 
    	
****
    	
 
    
	
Portion of Net Sales in a   calendar year greater than $****
    	
 
    	
****
    	
 
    

 

By way of example only, if Licensee receives $700,000,000 in cumulative Net Sales of all Licensed Products in a calendar year, then the royalties payable by Licensee to Licensor under this Section 3.4 during such calendar year would be calculated as follows:

 

= (****)(****) + (****)(****) + (****)(****)

 

= (****) + (****) + (****)

 

= ****

 

3.4.1                     Third Party Royalties Stacking Provision.  If Licensee must obtain a license from a Third Party to avoid infringement of such Third Party’s rights in order to manufacture, use, or commercialize a given Licensed Product and if the royalties required to be paid to such Third Party for such license, together with those royalties payable to Licensor, in the aggregate, exceed **** of Net Sales for any Licensed Product, then the royalty owed to Licensor for that Licensed Product will be reduced by an amount calculated as follows:

 

STACKING ROYALTY CALCULATIONS

 

R = (C * (A / (A+B)))

 

Where
 R = reduction of Licensor royalty,
 A = unreduced Licensor royalty,
 B = sum of all Third Party royalties,
 C = increment of projected total royalty above ****.

 

Example Calculation:

 

Assume                                                     i)  all Third Party royalties = ****

ii)  unreduced Licensor royalty = ****

iii):  projected total royalty = ****

 

R = (**** - ****) * (**** / (**** + ****))
 R = (**** * ****)
 R = ****
 Licensor Stacked Royalty = **** - **** = **** (but subject to the cap described below)

 

Notwithstanding the foregoing, Licensee will pay to Licensor no less than **** of the royalties that Licensee would otherwise pay to Licensor with respect to Net Sales of Licensee if there were no royalties due to Third Parties.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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3.4.2                     Royalty Payment Period.  Licensee’s obligation hereunder for payment of a royalty under this Section 3.4 on the Net Sales of Licensed Products in a given country will end on a country-by-country basis when the Licensed Product ceases to infringe or be covered by a Valid Claim in that country.

 

3.5                               Sublicense Fees.

 

3.5.1                     In further consideration of the license granted to Licensee under Section 2.1, Licensee will pay Licensor **** of any sublicense fees (****) received by Licensee or its Affiliates from a Third Party for the Licensed Patents from any Sublicensee or from any Third Party granted any option to obtain a sublicense.

 

3.5.2                     With respect to the obligations under this Section 3.5, Licensee shall not be required to submit any amounts received from a Third Party for the following:

 

(a)                                 Reimbursement for research, development, and/or manufacturing activities performed by Licensee or its Affiliates corresponding directly to the development of Licensed Products pursuant to a specific agreement;

 

(b)                                 Any and all amounts paid to Licensee or its Affiliates by a Sublicensee as royalties on sales of Licensed Product sold by the Sublicensee under a sublicense agreement; and

 

(c)                                  Consideration received for the purchase of an equity interest in Licensee or its Affiliates at fair market value.

 

3.5.3                     If Licensee or its Affiliates receives sublicense fees from Third Party Sublicensees or from any Third Party granted any option to obtain a sublicense under this Agreement in the form of non-cash consideration, then, at Licensor’s option, Licensee shall pay Licensor payments as required by this Section 3.5 (a) in the form of the non-cash consideration received by Licensee or its Affiliates or (b) a cash payment determined based on the fair market value of such non-cash consideration.  If Licensee or its Affiliate enters into any sublicense that is not an arm’s length transaction, fees due under this Section 3.5 will be calculated based on the fair market value of such transaction, at the time of the transaction, assuming an arm’s length transaction made in the ordinary course of business, as determined jointly by Licensor and Licensee based on transactions of a similar type and standard industry practice, if any.

 

3.5.4                     To the extent Licensee receives payment from a Third Party relating to one or more of the milestone events set forth in the table in Section 3.3, then the amount of the payment made to Licensor under such Section 3.3 with respect to such milestone event shall not be deemed sublicense fees under this Section 3.5; instead, the amounts due under this Section 3.5 shall be calculated by applying the applicable sublicense fee rate set forth in Section 3.5.1 above to the sublicense fees received by Licensee from such Third Party after deducting the amount of the payment under Section 3.3.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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3.6                               Reports and Records.

 

3.6.1                     Licensee must deliver to Licensor within **** after the end of each Calendar Quarter after the first commercial sale of a Licensed Product a report setting forth the calculation of the royalties due to Licensor for such Calendar Quarter, including:

 

(a)                                 Number of Licensed Products included within Net Sales, listed by country;

 

(b)                                 Gross consideration for Net Sales of Licensed Product, including all amounts invoiced, billed, or received;

 

(c)                                  Qualifying costs to be excluded from the gross consideration, as described in Section 1.13, listed by category of cost;

 

(d)                                 Net Sales of Licensed Products listed by country;

 

(e)                                  A detailed accounting of any royalty reductions applied pursuant to Section 3.4.1;

 

(f)                                   Royalties owed to Licensor; and

 

(g)                                  The computations for any applicable currency conversions.

 

3.6.2                     Licensee shall pay the royalties due under Section 3.4 within **** following the last day of the Calendar Quarter in which the royalties accrue.  Licensee shall send the royalty payments along with the report described in Section 3.6.1.

 

3.6.3                     Within **** after the occurrence of a milestone event described in Section 3.3, Licensee must deliver to Licensor a report describing the milestone event that occurred, together with a payment of the applicable amount due to Licensor pursuant to Section 3.3.

 

3.6.4                     All financial reports under this Section 3.6 will be certified by the chief financial officer of Licensee or Licensee’s qualified financial representative.

 

3.6.5                     Licensee shall maintain and require its Affiliates and all Sublicensees to maintain, complete and accurate books and records which enable the royalties, fees, and payments payable under this Agreement to be verified.  The records must be maintained for **** after the submission of each report under Article 3.  Upon reasonable prior written notice to Licensee, Licensee and its Affiliates and all Sublicensees will provide Licensor and/or the ReGenX Licensors (and their respective accountants) with access to all of the relevant books, records, and related background information required to conduct a review or audit of the royalties, fees, and payments payable to Licensor under this Agreement to be verified.  Access will be made available:  (a) during normal business hours; (b) in a manner reasonably designed to facilitate the auditing party’s review or audit without unreasonable disruption to Licensee’s business; and (c) no more than once each calendar year during the term of this Agreement and for a period of five years thereafter.  Licensee will promptly pay to Licensor the amount of any underpayment determined by the review or audit, plus accrued interest.  If the review or audit determines that

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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Licensee has underpaid any payment by **** or more, then Licensee will also promptly pay the costs and expenses of Licensor and the ReGenX Licensors and their respective accountants in connection with the review or audit.  If the review or audit determines that Licensee has overpaid any payment, then Licensor shall refund the overpayment to Licensee.

 

3.7                               Currency, Interest.

 

3.7.1                     All dollar amounts referred to in this Agreement are expressed in United States dollars.  All payments to Licensor under this Agreement must be made in United States dollars.

 

3.7.2                     If Licensee receives payment in a currency other than United States dollars for which a royalty or fee or other payment is owed under this Agreement, then (a) the payment will be converted into United States dollars at the conversion rate for the foreign currency as published in the eastern edition of the Wall Street Journal, N.Y. edition, as of the last business day of the Calendar Quarter in which the payment was received by Licensee; and (b) the conversion computation will be documented by Licensee in the applicable report delivered to Licensor under Section 3.6.

 

3.7.3                     All amounts that are not paid by Licensee when due will accrue interest from the date due until paid at a rate equal to 1.5% per month (or the maximum allowed by law, if less).

 

3.8                               Taxes and Withholding.

 

3.8.1                     All payments hereunder will be made free and clear of, and without deduction or deferment in respect of, and Licensee shall pay and be responsible for, and shall hold Licensor harmless from and against, any taxes, duties, levies, fees, or charges, including sales, use, transfer, excise, import, and value added taxes (including any interest, penalties, or additional amounts imposed with respect thereto) but excluding withholding taxes to the extent provided in Section 3.8.2.  At the request of Licensee, Licensor will give Licensee such reasonable assistance, which will include the provision of documentation as may be required by the relevant tax authority, to enable Licensee to pay and report and, as applicable, claim exemption from or reduction of, such tax, duty, levy, fee, or charge.

 

3.8.2                     If any payment made by Licensee hereunder becomes subject to withholding taxes with respect to Licensor’s gross or net income under the laws of any jurisdiction, Licensee will deduct and withhold the amount of such taxes for the account of Licensor to the extent required by law and will pay the amounts of such taxes to the proper governmental authority in a timely manner and promptly transmit to Licensor appropriate proof of payment of such withholding taxes.  At the request of Licensor, Licensee will give Licensor such reasonable assistance, which will include the provision of appropriate certificates of such deductions made together with other supporting documentation as may be required by the relevant tax authority, to enable Licensor to claim exemption from or reduction of, or otherwise obtain repayment of, such withholding taxes, and will upon request provide such additional documentation from time to time as is reasonably required to confirm the payment of withholding tax.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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ARTICLE 4:  DILIGENCE

 

4.1                               Diligence Obligations.  Licensee will use commercially reasonable efforts to develop, commercialize, market, promote, and sell Licensed Products in the Field.  Commercially reasonable efforts means efforts equivalent to those utilized by ****.

 

4.2                               Reporting.  Within **** after the Effective Date and within **** of each December 1 thereafter, Licensee shall provide Licensor with written progress reports, setting forth in such detail as Licensor may reasonably request, the progress of the development, evaluation, testing, and commercialization of each Licensed Product.  Licensee will also notify Licensor within **** of the first commercial sale by Licensee, its Affiliates, or any Sublicensees of each Licensed Product.  Such a report (“Development Progress Report”), setting forth the current stage of development of Licensed Products, shall include:

 

4.2.1                     Date of Development Progress Report and time covered by such report;

 

4.2.2                     Major activities and accomplishments completed by Licensee, its Affiliates, and any Sublicensees relating directly to the Licensed Product since the last Development Progress Report;

 

4.2.3                     Significant research and development projects relating directly to the Licensed Product currently being performed by Licensee, its Affiliates, and any Sublicensees and projected dates of completion;

 

4.2.4                     A development plan covering the next two years at least, which will include future development activities to be undertaken by Licensee, its Affiliates, or any Sublicensees during the next reporting period relating directly to the Licensed Product, Licensee’s strategy to bring the Licensed Product to commercialization, and projected timeline for completing the necessary tasks to accomplish the goals of the strategy;

 

4.2.5                     Projected total development remaining before product launch of each Licensed Product; and

 

4.2.6                     Summary of significant development efforts using the Licensed Patents being performed by Third Parties, including the nature of the relationship between Licensee and such Third Parties.

 

4.3                               Confidential Information.  The Parties agree that Development Progress Reports shall be deemed Licensee’s Confidential Information; provided that Licensor may share a copy of such reports with the ReGenX Licensors.

 

4.4                               Improvements.  Simultaneously with the Development Progress Report, Licensee shall deliver a detailed description of any Licensed Back Improvements, if not previously provided pursuant to Section 2.5.3.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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ARTICLE 5:  CONFIDENTIALITY

 

5.1                               Treatment of Confidential Information.  Each Party, as a receiving party (a “Receiving Party”), agrees that it will (a) treat Confidential Information of the other Party (the “Disclosing Party”) as strictly confidential; (b) protect the Confidential Information of the Disclosing Party with at least the same degree of care as it protects its own confidential and proprietary information, and in any event with not less than a reasonable degree of care; (c) not disclose such Confidential Information to Third Parties without the prior written consent of the Disclosing Party, except as may be permitted in this Agreement; provided that any disclosure permitted hereunder be under confidentiality agreements with provisions at least as stringent as those contained in this Agreement; and (d) not use such Confidential Information for purposes other than those authorized expressly in this Agreement.  The Receiving Party agrees to ensure that its employees who have access to Confidential Information are obligated in writing to abide by confidentiality obligations at least as stringent as those contained under this Agreement.

 

5.2                               Public Announcements.

 

5.2.1                     The Parties agree they will release a joint press release in the form attached hereto as Exhibit B.  Except as provided in Section 5.2.2, any other press releases by either Party with respect to the other Party or any other public disclosures concerning the existence of or terms of this Agreement shall be subject to review and approval by the other Party.  Once the joint press release or any other written statement is approved for disclosure by both Parties, either Party may make subsequent public disclosure of the contents of such statement without the further approval of the other Party.

 

5.2.2                     Notwithstanding Section 5.2.1, Licensor has the right to publish (through press releases, scientific journals, or otherwise) and refer to any clinical, regulatory, or research results related to Licensee’s Licensed Product or AAV9 program that have been publicly disclosed by Licensee, including referring to Licensee by name as a licensee of Licensor, which publication or referral by Licensor shall not require the prior consent of Licensee.

 

5.3                               Authorized Disclosure.  Notwithstanding the provisions of Section 5.1 or 5.2, either Party may disclose Confidential Information or make such a disclosure of the existence of and/or terms of this Agreement to any ****; provided that, in each case, such recipient of Confidential Information is obligated to keep such information confidential on terms no less stringent than those set forth in this Agreement.  Furthermore, Licensee agrees that Licensor may share a copy of this Agreement, reports and notices provided by Licensee to Licensor pursuant to the terms of this Agreement, and copies of sublicense agreements provided to Licensor hereunder with the ReGenX Licensors.  In the event that the Receiving Party receives service of legal process that purports to compel disclosure of the Disclosing Party’s Confidential Information or becomes obligated by law to disclose the Confidential Information of the Disclosing Party or the existence of or terms of this Agreement to any governmental authority, the Receiving Party shall promptly notify the Disclosing Party, so that the Disclosing Party may seek an appropriate protective order or other remedy with respect to narrowing the scope of such requirement and/or waive compliance by the Receiving Party with the provisions of this Agreement.  The Receiving Party will provide the Disclosing Party with reasonable assistance in obtaining such protective order or other remedy.  If, in the absence of such protective order or other remedy, the Receiving Party is

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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nonetheless required by law to disclose the existence of or terms of this Agreement or other Confidential Information of the Disclosing Party, the Receiving Party may disclose such Confidential Information without liability hereunder; provided that the Receiving Party shall furnish only such portion of the Confidential Information that is legally required to be disclosed and only to the extent required by law.

 

5.4                               Term of Confidentiality.  The obligations of this Article 5 shall continue for a period of **** following the expiration or termination of this Agreement.

 

ARTICLE 6:  TERM AND TERMINATION

 

6.1                               Term of Agreement.  This Agreement, unless sooner terminated as provided in this Agreement, expires upon the expiration, lapse, abandonment, or invalidation of the last Valid Claim to expire, lapse, or become abandoned or unenforceable in all countries of the world.

 

6.2                               Licensee’s Right to Terminate.  Licensee may, upon six months’ prior written notice to Licensor, terminate this Agreement for any reason, with or without cause; provided that, if such termination notice is sent prior to payment in full of the initial fee under Section 3.1, such termination notice shall be accompanied by Licensee’s payment of all unpaid amounts in satisfaction of the remainder of the initial fee under Section 3.1.

 

6.3                               Termination for Breach.

 

6.3.1                     Licensor may terminate this Agreement, if Licensee is late in paying to Licensor royalties, fees, or any other monies due under this Agreement, and Licensee does not pay Licensor in full within 15 days upon written demand from Licensor, which termination shall be effective immediately upon the expiration of such 15-day cure period.

 

6.3.2                     Either Party may terminate this Agreement, if the other Party materially breaches this Agreement and does not cure such material breach within 30 days after written notice of the breach, which termination shall be effective immediately upon the expiration of such 30-day cure period.

 

6.4                               Termination for Insolvency.

 

6.4.1                     Licensor may terminate this Agreement, effective immediately upon written notice to Licensee, if Licensee or any of its Affiliates experiences any Trigger Event.

 

6.4.2                     Licensee shall include in each sublicense agreement entered into with a Sublicensee a right of Licensee to terminate such sublicense agreement if such Sublicensee experiences any Trigger Event; and Licensee shall terminate the sublicense agreement, effective immediately upon written notice to the Sublicensee, if the Sublicensee experiences any Trigger Event.  In addition, if the Sublicensee’s experiencing of a Trigger Event gives a ReGenX Licensor a right of termination under the Penn Agreement or GSK Agreement, Licensor may terminate this Agreement, effective immediately upon written notice to Licensee, if any Sublicensee experiences any Trigger Event.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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6.4.3                     For purposes of this Section 6.4, “Trigger Event” means any of the following:  (a) if Licensee, any Affiliate, or any Sublicensee, as applicable, (i) becomes insolvent, becomes bankrupt, or generally fails to pay its debts as such debts become due, (ii) is adjudicated insolvent or bankrupt, (iii) admits in writing its inability to pay its debts, (iv) suffers the appointment of a custodian, receiver, or trustee for it or its property and, if appointed without its consent, is not discharged within 30 days, (v) makes an assignment for the benefit of creditors, or (vi) suffers proceedings being instituted against it under any law related to bankruptcy, insolvency, liquidation, or the reorganization, readjustment, or release of debtors and, if contested by it, not dismissed or stayed within ten days; (b) the institution or commencement by Licensee, any Affiliate, or any Sublicensee, as applicable, of any proceeding under any law related to bankruptcy, insolvency, liquidation, or the reorganization, readjustment, or release of debtors; (c) the entering of any order for relief relating to any of the proceedings described in Section 6.4.3(a) or (b) above; (d) the calling by Licensee, any Affiliate, or any Sublicensee, as applicable, of a meeting of its creditors with a view to arranging a composition or adjustment of its debts; or (e) the act or failure to act by Licensee, any Affiliate, or any Sublicensee, as applicable, indicating its consent to, approval of, or acquiescence in any of the proceedings described in Section 6.4.3(b) through (d) above.

 

6.5                               Patent Challenge.

 

6.5.1                     Licensor may terminate this Agreement, effective immediately upon written notice to Licensee, upon the commencement by Licensee, any of its Affiliates, or any Sublicensee of a Patent Challenge.

 

6.5.2                     For purposes of this Section 6.5, “Patent Challenge” means any action against Licensor or the ReGenX Licensors, including an action for declaratory judgment, to declare or render invalid or unenforceable the Licensed Patents, or any claim thereof.

 

6.6                               Effects of Termination.  The effect of termination by Licensee pursuant to Section 6.2, by either Party, as applicable, under Section 6.3, or by Licensor pursuant to Section 6.4 or 6.5 shall be as follows:

 

6.6.1                     The licenses granted by Licensor hereunder shall terminate, and Licensee, its Affiliates, and (unless the sublicense agreement is assigned pursuant to Section 6.6.2) all Sublicensees shall cease to make, have made, use, import, sell, and offer for sale all Licensed Products and shall cease to otherwise practice the Licensed Patents; provided that Licensee shall have the right to continue to sell its existing inventories of Licensed Products for a period not to exceed **** after the effective date of such termination;

 

6.6.2                     If termination is by Licensor pursuant to Section 6.3, 6.4, or 6.5, then, at Licensor’s request, Licensee shall assign to Licensor any or all sublicenses granted to Third Parties to the extent of the rights licensed to Licensee hereunder and sublicensed to the Sublicensee; provided that (i) prior to such assignment, Licensee shall advise Licensor whether such Sublicensee is then in full compliance with all terms and conditions of its sublicense and continues to perform thereunder, and, if such Sublicensee is not in full compliance or is not continuing to perform, Licensor may elect not to have such sublicense assigned; and (ii) following such assignment, Licensor shall not be liable to such Sublicensee with respect to any

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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obligations of Licensee to the Sublicensee that are not consistent with, or not required by, Licensor’s obligations to Licensee under this Agreement; and all sublicenses not requested to be assigned to Licensor shall terminate.  If termination is for any other reason, then all sublicenses shall terminate;

 

6.6.3                     If termination is by Licensee pursuant to Section 6.2 or by Licensor pursuant to Section 6.3, 6.4, or 6.5, Licensee shall grant, and hereby grants, to Licensor a non-exclusive, perpetual, irrevocable, worldwide, royalty-free, transferable, sublicensable license under any patentable modifications or improvements (and any intellectual property rights with respect thereto) developed by Licensee, any Affiliates, or any Sublicensees to any vector that is the subject of a claim within any of the Licensed Patents, for use by Licensor for the research, development, and commercialization of products in any therapeutic indication;

 

6.6.4                     Licensee shall pay all monies then-owed to Licensor under this Agreement; and

 

6.6.5                     Each Receiving Party shall, at the Disclosing Party’s request, return all Confidential Information of the Disclosing Party.  Notwithstanding the foregoing, one copy may be kept by either Party for a record of that Party’s obligations.

 

6.7                               Survival.  Licensee’s obligation to pay all monies due and owed to Licensor under this Agreement which have matured as of the effective date of termination or expiration shall survive the termination or expiration of this Agreement.  In addition, the provisions of Section 2.2, (Retained Rights), 2.3 (Government Rights), 2.5 (Improvements), Article 3 (Consideration) (with respect to any final reports or to the extent any amounts are due but unpaid), Section 3.6 (Reports and Records), Article 5 (Confidentiality), Article 6 (Term and Termination), Section 8.3 (Disclaimer of Warranties, Damages), Section 8.4 (Indemnification), Section 8.5 (Insurance), Article 9 (Use of Name), and Article 10 (Additional Provisions) shall survive such termination or expiration of this Agreement in accordance with their respective terms.

 

ARTICLE 7:  PATENT MAINTENANCE; PATENT INFRINGEMENT

 

7.1                               Prosecution of Licensed Patents.  As between Licensor and Licensee, the Parties agree as follows:

 

7.1.1                     Licensor shall have the sole right, but not the obligation, to Prosecute patent applications and issued patents within Licensed Patents, in Licensor’s sole discretion.  Subject to Section 7.1.3, Licensor shall provide Licensee with a reasonable opportunity to review and provide comments in connection with the Prosecution of the Licensed Patents; and Licensor shall keep Licensee reasonably informed as to all material developments with respect to such Licensed Patents and shall supply to Licensee copies of material communications received and filed in connection with the Prosecution of such Licensed Patents.

 

7.1.2                     Nothing in this Agreement obligates Licensor to continue to Prosecute any patent applications or issued patents, and Licensee acknowledges that Licensor shall have no obligation to undertake any inter-party proceedings, such as oppositions or interferences, or to undertake any re-examination or re-issue proceedings, in either case, with respect to the Licensed Patents.

 

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7.1.3                     Licensee acknowledges that The Trustees of the University of Pennsylvania control Prosecution of the Licensed Patents, with Licensor having certain rights to review.  Licensee acknowledges and agrees that (a) the rights and obligations under this Section 7.1 are subject to the rights of the ReGenX Licensors set forth in the GSK Agreement and Penn Agreement with respect to the Licensed Patents, and (b) Licensor’s obligations under this Agreement only apply to the extent of Licensor’s rights with respect to participation in Prosecuting the Licensed Patents under the GSK Agreement and the Penn Agreement.

 

7.2                               Infringement Actions Against Third Parties.

 

7.2.1                     Licensee is responsible for notifying Licensor promptly of any infringement of Licensed Patents (other than Retained Rights) that may come to Licensee’s attention.  However, Licensee is under no obligation to search for potential infringers.  Licensee and Licensor shall consult one another in a timely manner concerning any appropriate response to the infringement.

 

7.2.2                     As between Licensor and Licensee, Licensor shall have the first right, but not the obligation, to prosecute any such infringement ****.  In any action to enforce any of the Licensed Patents, Licensee, at the request and expense of Licensor, shall cooperate to the fullest extent reasonably possible, including in the event that, if Licensor is unable to initiate or prosecute such action solely in its own name, Licensee shall join such action voluntarily and shall execute all documents necessary to initiate litigation to prosecute, maintain, and settle such action.

 

7.2.3                     If Licensor elects not to pursue any infringement of a Licensed Patent, then, to the extent that a Licensed Product is covered by any such Licensed Patent and such Licensed Patent is being infringed by another product in the Field (such infringement, the “Competitive Infringement”), Licensee shall have the second right, but not the obligation, to prosecute such Competitive Infringement with respect to such other product in the Field, at Licensee’s own expense.  In any such action to enforce any of the Licensed Patents, Licensor, at the request and expense of Licensee, shall cooperate to the fullest extent reasonably possible, including in the event that, if Licensee is unable to initiate or prosecute such action solely in its own name, Licensor shall join such action voluntarily and shall execute all documents necessary to initiate litigation to prosecute and maintain such action.  In prosecuting any such Competitive Infringement, Licensee (a) shall not take any actions that would be detrimental to the Licensed Patents and Licensor’s rights with respect thereto outside the Field and (b) shall not settle any such Competitive Infringement without the prior consent of Licensor.

 

7.2.4                     The Party not controlling the action under this Section 7.2 shall be entitled to independent counsel in such proceedings but at its own expense, not subject to reimbursement by the other Party and not subject to any offset against any damages received by the Party bringing suit under Section 7.2.5.  The controlling Party shall keep the cooperating party reasonably informed of the progress of the action proceedings.

 

7.2.5                     Any recovery of damages by Licensor for any infringement other than a Competitive Infringement shall be ****.  Any recovery of damages by the Party undertaking enforcement or defense of a suit for Competitive Infringement shall be applied, as between Licensor and Licensee but subject to the obligations to the ReGenX Licensors set forth in the

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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GSK Agreement and the Penn Agreement, as follows:  (a) first to reimburse each such Party for costs and expenses (including reasonable attorneys’ fees and costs) incurred by such Party in connection with such suit, and (b) the balance remaining, if any, from any such recovery shall be ****.

 

7.2.6                     Licensee acknowledges and agrees that (a) the rights and obligations under this Section 7.2 are subject to the rights of the ReGenX Licensors under the GSK Agreement and Penn Agreement (including any consent or approval rights or rights to control or participate in any enforcement actions); and (b) Licensor’s obligations under this Agreement only apply to the extent that Licensor has any rights with respect to enforcing the Licensed Patents under the GSK Agreement and the Penn Agreement.  Furthermore, Licensee acknowledges the following:

 

7.2.6.1                                   All monies recovered upon the final judgment or settlement of any action with respect to Competitive Infringement will also need to be allocated to the ReGenX Licensors (a) to reimburse the costs and expenses (including reasonable attorneys’ fees and costs) of such licensors, (b) to take into account the royalties payable to such licensors; and (c) to take into account the relative extent of such licensors’ financial participation in such action, if applicable.

 

7.2.6.2                                   The ReGenX Licensors retain the continuing right to intervene at their own expense and join Licensor or Licensee in any claim or suit for infringement of the Licensed Patents.

 

7.2.6.3                                   In any infringement prosecuted by the ReGenX Licensors, all financial recoveries will be ****.

 

7.2.6.4                                   In any infringement prosecuted by the ReGenX Licensors, Licensee agrees, at the request and expense of such licensors, to cooperate to the fullest extent reasonably possible, to the same extent as though Licensor were prosecuting such suit (as provided in this Section 7.2, including Section 7.2.2).

 

7.2.6.5                                   The written consent of the ReGenX Licensors will be required (a) for any decision that would have a materially adverse affect on the validity, scope of patent claims, or enforceability of the Patent Rights and (b) for any settlement or compromise of any infringement suit that would impose any obligations or restrictions on either of the ReGenX Licensors, or grants any rights to the Licensed Patents other than rights that Licensee has the right to grant under this Agreement.

 

7.3                               Defense of Infringement Claims.  In the event Licensee or Licensor becomes aware that Licensee’s or any of its Affiliates’ or any Sublicensees’ practice of the Licensed Patents is the subject of a claim for patent infringement by a Third Party, that Party shall promptly notify the other, and the Parties shall consider the claim and the most appropriate action to take.  Licensee shall cause each of its Affiliates and each Sublicensee to notify Licensee promptly in the event such entity becomes aware that its practice of the Licensed Patents is the subject of a claim of patent infringements by another.  To the extent Licensor takes any action, Licensor (or the ReGenX Licensors) shall have the right to require Licensee’s reasonable cooperation in any such suit, upon written notice to Licensee; and Licensee shall have the obligation to participate upon

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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Licensor’s request, in which event, Licensor shall bear the cost of Licensee’s participation.  Without Licensor’s prior written permission, which shall not be unreasonably denied, Licensee must not settle or compromise any such suit in a manner that imposes any material obligations or restrictions on Licensor or either of the ReGenX Licensors or grants any rights to the Licensed Patents other than rights that Licensee has the right to grant under this Agreement.

 

ARTICLE 8:  WARRANTIES; INDEMNIFICATION

 

8.1                               Representations and Warranties by Licensor.  Licensor represents and warrants to Licensee as of the Effective Date:

 

8.1.1                     Licensor has the right, power, and authority to enter into this Agreement and to grant to Licensee the rights specified in this Agreement;

 

8.1.2                     This Agreement when executed shall become the legal, valid, and binding obligation of it, enforceable against it, in accordance with its terms;

 

8.1.3                     There are no actions, suits, proceedings, or arbitrations pending or, to Licensor’s knowledge, threatened against Licensor relating to the Licensed Patents that would be inconsistent with the rights granted to Licensee under this Agreement;

 

8.1.4                     To Licensor’s knowledge, (a) the Licensed Patents are solely owned by The Trustees of the University of Pennsylvania, and (b) no Third Party (other than the ReGenX Licensors) has any right, interest, or claim in or to such Licensed Patents in the Field that are inconsistent with those granted to Licensee in the Field under this Agreement; and

 

8.1.5                     Licensor has not received any written notice from any Third Party patentee alleging infringement of such Third Party’s patents by the practice of the Licensed Patents in the Field.

 

8.2                               Representations and Warranties by Licensee.  Licensee represents and warrants to Licensor as of the Effective Date that:

 

8.2.1                     Licensee has the right, power, and authority to enter into this Agreement and to grant the rights granted by it hereunder;

 

8.2.2                     This Agreement when executed shall become the legal, valid, and binding obligation of it, enforceable against it, in accordance with its terms;

 

8.2.3                     Licensee has the ability and the resources, including financial resources, necessary to carry out its obligations under this Agreement; and

 

8.2.4                     There are no actions, suits, proceedings, or arbitrations pending or, to Licensee’s knowledge, threatened against Licensee that would impact activities under this Agreement.

 

8.3                               Disclaimer of Warranties, Damages.  EXCEPT AS SET FORTH IN SECTION 8.1, THE LICENSED PATENTS, LICENSED PRODUCTS, AND ALL RIGHTS LICENSED UNDER THIS AGREEMENT ARE PROVIDED ON AN “AS IS” BASIS, AND LICENSOR MAKES

 

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NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT THERETO.  BY WAY OF EXAMPLE BUT NOT OF LIMITATION, LICENSOR MAKES NO REPRESENTATIONS OR WARRANTIES, AND HEREBY DISCLAIMS ALL EXPRESS AND IMPLIED REPRESENTATIONS AND WARRANTIES, (i) OF COMMERCIAL UTILITY, ACCURACY, COMPLETENESS, PERFORMANCE, TITLE, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OR ENFORCEABILITY OF THE LICENSED PATENTS, AND PROFITABILITY; OR (ii) THAT THE USE OF THE LICENSED PATENTS OR LICENSED PRODUCTS WILL NOT INFRINGE ANY PATENT, COPYRIGHT, TRADEMARK, OR OTHER PROPRIETARY RIGHTS OF THIRD PARTIES.  EXCEPT AS SET FORTH HEREIN, NONE OF LICENSOR AND THE REGENX LICENSORS SHALL BE LIABLE TO LICENSEE, LICENSEE’S SUCCESSORS OR ASSIGNS, ANY SUBLICENSEES, OR ANY THIRD PARTY WITH RESPECT TO:  (a) ANY CLAIM ARISING FROM USE OF THE LICENSED PATENTS, LICENSED PRODUCTS, AND ANY OR ALL RIGHTS LICENSED UNDER THIS AGREEMENT OR FROM THE DEVELOPMENT, TESTING, MANUFACTURE, USE, OR SALE OF LICENSED PRODUCTS; OR (b) ANY CLAIM FOR LOSS OF PROFITS, LOSS OR INTERRUPTION OF BUSINESS, OR FOR INDIRECT, SPECIAL, INCIDENTAL, EXEMPLARY, PUNITIVE, OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING ANY ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT OR THE EXERCISE OF RIGHTS HEREUNDER, REGARDLESS OF ANY NOTICE OF SUCH DAMAGES.  NOTHING IN THIS SECTION 8.3 IS INTENDED TO LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS OF EITHER PARTY UNDER SECTION 8.4 OR TO LIMIT A PARTY’S LIABILITY FOR BREACHES OF ITS OBLIGATION REGARDING CONFIDENTIALITY UNDER ARTICLE 5.

 

8.4                               Indemnification.

 

8.4.1                     By Licensee.  Licensee shall defend, indemnify, and hold harmless Licensor, the ReGenX Licensors, and their respective shareholders, members, officers, trustees, faculty, students, contractors, agents, and employees (individually, a “Licensor Indemnified Party” and, collectively, the “Licensor Indemnified Parties”) from and against any and all Third Party liability, loss, damage, action, claim, fee, cost, or expense (including attorneys’ fees) (individually, a “Third Party Liability” and, collectively, the “Third Party Liabilities”) suffered or incurred by the Licensor Indemnified Parties from claims of such Third Parties that result from or arise out of:  ****; provided, however, that Licensee shall not be liable for claims to the extent based on any breach by Licensor of the representations, warranties, or obligations of this Agreement or the gross negligence or intentional misconduct of any of the Licensor Indemnified Parties.  Without limiting the foregoing, Licensee must defend, indemnify, and hold harmless the Licensor Indemnified Parties from and against any Third Party Liabilities resulting from:

 

(a)                                 any **** or other claim of any kind related to the **** by a Third Party of a Licensed Product that **** by Licensee, its Affiliates, any Sublicensees, their respective assignees, or vendors;

 

(b)                                 any claim by a Third Party that the ****; and

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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(c)                                  **** conducted by or on behalf of Licensee, its Affiliates, any Sublicensees, their respective assignees, or vendors relating to the Licensed Patents or Licensed Products, including any claim by or on behalf of a ****.

 

8.4.2                     Indemnification Procedure.  Licensee, as an indemnifying party (an “Indemnifying Party”), shall not be permitted to settle or compromise any claim or action giving rise to Third Party Liabilities in a manner that imposes any restrictions or obligations on Licensor, the ReGenX Licensors, or any indemnified party (an “Indemnified Party”) without Licensor’s prior written consent or that grants any rights to the Licensed Patents or Licensed Products other than those Licensee has the right to grant under this Agreement without Licensor’s prior written consent.  The Indemnifying Party shall be permitted to control any litigation or potential litigation involving the defense of any claim subject to indemnification pursuant to this Section 8.4, including the selection of counsel, with the reasonable approval of the Indemnified Party.  If an Indemnifying Party fails or declines to assume the defense of any such claim or action within **** after notice thereof, the Indemnified Party may assume the defense of such claim or action at the cost and risk of the Indemnifying Party, and any Third Party Liabilities related thereto shall be conclusively deemed a Third Party Liability of the Indemnifying Party.  The indemnification rights of a Indemnified Party contained in this Agreement are in addition to all other rights that such Indemnified Party may have at law or in equity or otherwise.  The Indemnifying Party will pay directly all Third Party Liabilities incurred for defense or negotiation of any claim hereunder or will reimburse the Indemnified Party for all documented Third Party Liabilities incident to the defense or negotiation of any such claim within **** after the Indemnifying Party’s receipt of invoices for such fees, expenses, and charges.

 

8.5                               Insurance.  Licensee will procure and maintain insurance policies for the following coverages with respect to product liability, personal injury, bodily injury, and property damage arising out of Licensee’s (and its Affiliates’ and any Sublicensees’) performance under this Agreement:  (a) during the term of this Agreement, comprehensive general liability, including broad form and contractual liability, in a minimum amount of **** combined single limit per occurrence (or claim) and in the aggregate annually; (b) prior to the commencement of clinical trials involving Licensed Products and thereafter for a period of not less than **** (or such longer period as Licensee is required by applicable law to continue to monitor the participants in the clinical trial), clinical trials coverage in amounts that are reasonable and customary in the U.S. pharmaceutical industry, subject always to a minimum limit of **** combined single limit per occurrence (or claim) and in the aggregate annually; and (c) from prior to the first commercial sale of a Licensed Product until **** after the last sale of a Licensed Product, product liability coverage, in amounts that are reasonable and customary in the U.S. pharmaceutical industry, subject always to a minimum limit of **** combined single limit per occurrence (or claim) and in the aggregate annually.  Licensor may review periodically the adequacy of the minimum amounts of insurance for each coverage required by this Section 8.5, and Licensor reserves the right to require Licensee to adjust the limits accordingly.  The required minimum amounts of insurance do not constitute a limitation on Licensee’s liability or indemnification obligations to the Licensor Indemnified Parties under this Agreement.  The policies of insurance required by this Section 8.5 will be issued by an insurance carrier with an A.M. best rating of **** or better and will name Licensor as an additional insured with respect

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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to Licensee’s performance (and its Affiliates’ and any Sublicensees’) under this Agreement.  Licensee will provide Licensor with insurance certificates evidencing the required coverage within **** after the Effective Date and the commencement of each policy period and any renewal periods.  Each certificate will provide that the insurance carrier will notify Licensor in writing at least **** prior to the cancellation or material change in coverage.  Licensee will cause all Sublicensees to comply with the terms of this Section 8.5 to the same extent as Licensee.

 

ARTICLE 9:  USE OF NAME

 

9.1                               Licensee, its Affiliates, any Sublicensees, and all of its and their employees and agents must not use Licensor’s, the University of Pennsylvania’s, or SmithKline Beecham Corporation’s name, seal, logo, trademark, or service mark (or any adaptation thereof) or the name, seal, logo, trademark, or service mark (or any adaptation thereof) of any of such entities’ representative, school, organization, employee, or student in any way without the prior written consent of Licensor or such entity, as applicable; provided, however that Licensee may acknowledge the existence and general nature of this Agreement, subject to Section 5.2 or 5.3, as applicable.

 

9.2                               Licensor and all of its employees and agents must not use Licensee’s name, seal, logo, trademark, or service mark (or any adaptation thereof) in any way without the prior written consent of Licensee; provided, however that Licensor may acknowledge the existence and general nature of this Agreement, subject to Section 5.2 or 5.3, as applicable, and refer to Licensee as a licensee of Licensor.

 

ARTICLE 10:  ADDITIONAL PROVISIONS

 

10.1                        Relationship.  Nothing in this Agreement shall be deemed to establish a relationship of principal and agent between Licensee and Licensor, nor any of their agents or employees for any purpose whatsoever, nor shall this Agreement be construed as creating any other form of legal association or arrangement which would impose liability upon one Party for the act or failure to act of the other Party.

 

10.2                        Assignment.  The rights and obligations of Licensee and Licensor hereunder shall inure to the benefit of, and shall be binding upon, their respective permitted successors and assigns.  Licensee may not assign this Agreement or any of its rights or obligations under this Agreement without the prior written consent of Licensor.  Such prohibition on assignment of this Agreement shall apply even with respect to a sale or merger of Licensee, the transfer of substantially all of Licensee’s business assets, or the sale of a majority of the capital stock of Licensee.  Licensor may assign this Agreement and its rights and obligations without the consent of Licensee.  No assignment shall relieve the assigning Party of responsibility for the performance of any accrued obligations which it has prior to such assignment.  Any attempted assignment by Licensee in violation of this Section 10.2 shall be null and void and of no legal effect.

 

10.3                        Waiver.  A waiver by either Party of a breach of any provision of this Agreement will not constitute a waiver of any subsequent breach of that provision or a waiver of any breach of any other provision of this Agreement.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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10.4                        Notices.  Notices, payments, statements, reports, and other communications under this Agreement shall be in writing and shall be deemed to have been received as of the date received if sent by public courier (e.g., Federal Express), by Express Mail, receipt requested, or by facsimile (with a copy of such facsimile also sent by one of the other methods of delivery) and addressed as follows:

 

	
If for   Licensor:
    	
with a   copy to:
    
	
 
    	
 
    
	
ReGenX   Biosciences, LLC
    	
ReGenX   Biosciences, LLC
    
	
750 17th   Street, NW
    	
750 17th   Street, NW
    
	
Suite 1100
    	
Suite 1100
    
	
Washington,   DC 20006
    	
Washington,   DC 20006
    
	
USA
    	
USA
    
	
Attn:   Chief Executive Officer
    	
Attn:   General Counsel
    
	
Telephone:   202-785-7438
    	
Telephone:   202-785-7438
    
	
Facsimile:   202-785-7439
    	
Facsimile:   202-785-7439
    
	
 
    	
 
    
	
If for   Licensee:
    	
 
    
	
 
    	
 
    
	
AveXis, Inc.
    	
 
    
	
4925   Greenville Avenue, Suite 604
    	
 
    
	
Dallas,   TX 75206
    	
 
    
	
Attn:   Chief Executive Officer
    	
 
    
	
Telephone:   972-725-7797
    	
 
    
	
Facsimile:   516-619-0412
    	
 
    

 

Either Party may change its official address upon written notice to the other Party.

 

10.5                        Applicable Law.  This Agreement shall be construed and governed in accordance with the laws of the State of New York, without giving effect to conflict of law provisions that may require the application of the laws of another jurisdiction.  Subject to Section 10.6, the Parties hereby submit to the exclusive jurisdiction of and venue in the courts located in the State of New York with respect to any and all disputes concerning the subject of this Agreement.

 

10.6                        Dispute Resolution.  In the event of any controversy or claim arising out of or relating to this Agreement, the Parties shall first attempt to resolve such controversy or claim through good faith negotiations for a period of not less than **** following notification of such controversy or claim to the other Party.  If such controversy or claim cannot be resolved by means of such negotiations during such period, then such controversy or claim shall be resolved by binding arbitration administered by the American Arbitration Association (“AAA”) in accordance with the Commercial Arbitration Rules of the AAA in effect on the date of commencement of the arbitration, subject to the provisions of this Section 10.6.  The arbitration shall be conducted as follows:

 

10.6.1              The arbitration shall be conducted by three arbitrators, each of whom by training, education, or experience has knowledge of the research, development, and commercialization of

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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biological therapeutic products in the United States.  The arbitration shall be conducted in English and held in New York, New York.

 

10.6.2              In its demand for arbitration, the Party initiating the arbitration shall provide a statement setting forth the nature of the dispute, the names and addresses of all other parties, an estimate of the amount involved (if any), the remedy sought, otherwise specifying the issue to be resolved, and appointing one neutral arbitrator.  In an answering statement to be filed by the responding Party within **** after confirmation of the notice of filing of the demand is sent by the AAA, the responding Party shall appoint one neutral arbitrator.  Within **** from the date on which the responding Party appoints its neutral arbitrator, the first two arbitrators shall appoint a chairperson.

 

10.6.3              If a Party fails to make the appointment of an arbitrator as provided in Section 10.6.2, the AAA shall make the appointment.  If the appointed arbitrators fail to appoint a chairperson within the time specified in Section 10.6.2 and there is no agreed extension of time, the AAA shall appoint the chairperson.

 

10.6.4              The arbitrators will render their award in writing and, unless all Parties agree otherwise, will include an explanation in reasonable detail of the reasons for their award.  Judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof, including in the courts described in Section 10.5.  The arbitrators will have the authority to grant injunctive relief and other specific performance; provided that the arbitrators will have no authority to award damages in contravention of this Agreement, and each Party irrevocably waives any claim to such damages in contravention of this Agreement.  The arbitrators will, in rendering their decision, apply the substantive law of the State of New York, without giving effect to conflict of law provisions that may require the application of the laws of another jurisdiction.  The decision and award rendered by the arbitrators will be final and non-appealable (except for an alleged act of corruption or fraud on the part of the arbitrator).

 

10.6.5              The Parties shall use their reasonable efforts to conduct all dispute resolution procedures under this Agreement as expeditiously, efficiently, and cost-effectively as possible.

 

10.6.6              All expenses and fees of the arbitrators and expenses for hearing facilities and other expenses of the arbitration will be borne equally by the Parties unless the Parties agree otherwise or unless the arbitrators in the award assess such expenses against one of the Parties or allocate such expenses other than equally between the Parties.  Each of the Parties will bear its own counsel fees and the expenses of its witnesses except to the extent otherwise provided in this Agreement or by applicable law.

 

10.6.7              Compliance with this Section 10.6 is a condition precedent to seeking relief in any court or tribunal in respect of a dispute, but nothing in this Section 10.6 will prevent a Party from seeking equitable or other interlocutory relief in the courts of appropriate jurisdiction, pending the arbitrators’ determination of the merits of the controversy, if applicable to protect the confidential information, property, or other rights of that Party or to otherwise prevent irreparable harm that may be caused by the other Party’s actual or threatened breach of this Agreement.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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10.7                        No Discrimination.  Licensee, its Affiliates, and any Sublicensees, in their respective activities under this Agreement, shall not discriminate against any employee or applicant for employment because of race, color, sex, sexual, or affectional preference, age, religion, national, or ethnic origin, handicap, or because he or she is a disabled veteran or a veteran (including a veteran of the Vietnam Era).

 

10.8                        Compliance with Law.  Licensee (and its Affiliates’ and any Sublicensees’) must comply with all prevailing laws, rules, and regulations that apply to its activities or obligations under this Agreement.  Without limiting the foregoing, it is understood that this Agreement may be subject to United States laws and regulations controlling the export of technical data, computer software, laboratory prototypes, and other commodities, articles, and information, including the Arms Export Control Act as amended in the Export Administration Act of 1979 and that Licensee’s obligations are contingent upon compliance with applicable United States export laws and regulations.  The transfer of certain technical data and commodities may require a license from the cognizant agency of the United States Government and/or written assurances by Licensee that Licensee shall not export data or commodities to certain foreign countries without prior approval of such agency.  Licensor neither represents that a license is not required nor that, if required, it will issue.

 

10.9                        Entire Agreement.  This Agreement embodies the entire understanding between the Parties relating to the subject matter hereof and supersedes all prior understandings and agreements, whether written or oral, including that certain Mutual Non-Disclosure Agreement, dated February 6, 2014, between Licensor and Licensee and that certain Mutual Non-Disclosure Agreement, dated March 29, 2013, between Licensor and Licensee (who was then known as BioLife Cell Bank, Inc.).  All “Confidential Information” disclosed by the Parties pursuant to such Confidential Disclosure Agreement shall be deemed “Confidential Information” under this Agreement (unless and until it falls within one of the exclusions set forth in Section 1.4).  This Agreement may not be varied except by a written document signed by duly authorized representatives of both Parties.

 

10.10                 Marking.  Licensee, its Affiliates, and any Sublicensees shall mark any Licensed Product (or their containers or labels) made, sold, or otherwise distributed by it or them with any notice of patent rights necessary or desirable under applicable law to enable the Licensed Patents to be enforced to their full extent in any country where Licensed Products are made, used, sold, offered for sale, or imported.

 

10.11                 Severability and Reformation.  If any provision of this Agreement is held to be invalid or unenforceable by a court of competent jurisdiction, then such invalid or unenforceable provision will be automatically revised to be a valid or enforceable provision that comes as close as permitted by law to the Parties’ original intent; provided that, if the Parties cannot agree upon such valid or enforceable provision, the remaining provisions of this Agreement will remain in full force and effect, unless the invalid or unenforceable provisions are of such essential importance to this Agreement that it is to be reasonably assumed that the Parties would not have entered into this Agreement without the invalid or unenforceable provisions.

 

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10.12                 Further Assurances.  Each Party hereto agrees to execute, acknowledge, and deliver such further instruments, and to do all other acts, as may be necessary or appropriate in order to carry out the purposes and intent of this Agreement.

 

10.13                 Interpretation; Construction.  The captions to the several Articles and Sections of this Agreement are included only for convenience of reference and shall not in any way affect the construction of, or be taken into consideration in interpreting, this Agreement.  In this Agreement, unless the context requires otherwise, (a) the word “including” shall be deemed to be followed by the phrase “without limitation” or like expression; (b) references to the singular shall include the plural and vice versa; (c) references to masculine, feminine, and neuter pronouns and expressions shall be interchangeable; (d) the words “herein” or “hereunder” relate to this Agreement; (e) “or” is disjunctive but not necessarily exclusive; (f) the word “will” shall be construed to have the same meaning and effect as the word “shall”; (g) all references to “dollars” or “$” herein shall mean U.S. Dollars; (h) unless otherwise provided, all reference to Sections, Articles, and exhibits in this Agreement are to Sections, Articles, and exhibits of and in this Agreement; and (i) whenever this Agreement refers to a number of days, such number shall refer to calendar days unless business days are specified.  Business days shall mean a day on which banking institutions in Washington, D.C. are open for business.  Each Party represents that it has been represented by legal counsel in connection with this Agreement and acknowledges that it has participated in the drafting hereof.  In interpreting and applying the terms and provisions of this Agreement, the Parties agree that no presumption will apply against the Party which drafted such terms and provisions.

 

10.14                 Cumulative Rights and Remedies.  The rights and remedies provided in this Agreement and all other rights and remedies available to either Party at law or in equity are, to the extent permitted by law, cumulative and not exclusive of any other right or remedy now or hereafter available at law or in equity.  Neither asserting a right nor employing a remedy shall preclude the concurrent assertion of any other right or employment of any other remedy, nor shall the failure to assert any right or remedy constitute a waiver of that right or remedy.

 

10.15                 Counterparts.  This Agreement may be executed in one or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

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

 

 

	
REGENX   BIOSCIENCES, LLC
    	
AVEXIS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/   Kenneth Mills
    	
 
    	
By:
    	
/s/ John A. Carbona
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Name:
    	
Kenneth   Mills
    	
 
    	
Name:
    	
John A. Carbona
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Title:
    	
President   & CEO
    	
 
    	
Title:
    	
CEO
    

 

 

Exhibit A

 

Licensed Patents

 

	
Application #
    	
 
    	
Patent #
    	
 
    	
Filing Date
    	
 
    	
Country
    	
 
    	
Status
    
	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    
	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    
	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    
	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    
	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    
	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    
	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    
	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    	
 
    	
****
    

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

 

DRAFT SUBJECT TO FINAL REVIEW AND APPROVAL

 

Exhibit B

 

Press Release

 

REGENX BIOSCIENCES AND AVEXIS ENTER INTO LICENSE AGREEMENT FOR DEVELOPMENT OF TREATMENTS FOR SPINAL MUSCULAR ATROPHY USING NAV® rAAV9 VECTORS

 

Washington, DC and Dallas, TX — REGENX Biosciences, LLC (REGENX) and AveXis, Inc. (AveXis) announce that they have entered into an agreement for the development and commercialization of products to treat Spinal Muscular Atrophy (SMA) using NAV rAAV9 vectors.

 

Under the terms of the agreement, REGENX granted AveXis an exclusive worldwide license, with rights to sublicense, to REG ENX’s NAV rAAV9 vector for treatment of SMA disease in humans.  In return for these rights, REGENX receives an up-front payment, certain milestone fees and royalties on net sales of products incorporating NAV rAAV9.

 

“We believe this exclusive license agreement is important to the successful development of NAV-based gene delivery treatments for patients with SMA,” said Ken Mills, President and CEO of REGENX.  “As a leader in gene therapy, we are pleased to be formally collaborating with AveXis which has assembled a world class team of scientific and clinical experts in SMA, led by Brian Kaspar, Ph.D. and his colleagues at Nationwide Children’s Hospital and The Ohio State University, who have demonstrated tremendous dedication to the development of innovative gene therapy treatments for patients with SMA.”

 

“AveXis is committed to the development of new treatments for patients with SMA using NAV-vector technology and we feel rAAV9 is the most promising vector to achieve this goal, something we like to call our ‘special snowflake’.  We believe the unique properties of rAAV9 will allow us to effectively develop novel treatments, and is at the center of research being done at the Kaspar Laboratory in Columbus, Ohio,” said John A. Carbona, CEO of AveXis.  “Everyone associated with our SMA program is very pleased to establish this agreement with REGENX, which provides an important foundation for our team to continue to develop novel therapies for patients with all types of SMA.”

 

About Spinal Muscular Atrophy

 

Spinal muscular atrophy (SMA) is an autosomal-recessive genetic disorder characterized by progressive weakness of the lower motor neurons.  SMA is caused by a genetic defect in the SMN1 gene which codes SMN, a protein necessary for survival of motor neurons.  SMA kills more infants than any other genetic disease in today’s world.

 

 

About REGENX Biosciences

 

REGENX Biosciences (www.regenxbio.com) is the leading AAV gene therapy company that is developing a new class of personalized therapies, based on its proprietary NAV vector technology platform, for a range of severe diseases with serious unmet needs.  NAV vector technology includes novel AAV vectors such as rAAV7, rAAV8, rAAV9, and rAAVrh10.  Our treatments in development include programs for hypercholesterolemia, mucopolysaccharidoses, and retinitis pigmentosa.  REGENX’s leadership in AAV gene therapy and corresponding intellectual property has enabled it to establish collaborations with leading global partners including Chatham Therapeutics, Fondazione Telethon, Audentes Therapeutics, Lysogene, and Esteve.  In addition, together with Fidelity Biosciences, REGENX has formed Dimension Therapeutics, a company focused on the development and commercialization of AAV gene therapies for rare diseases.  For more information regarding REGENX, please visit www.regenxbio.com.

 

About AveXis

 

Based in Dallas, Texas, AveXis is a clinic-ready synthetic biology platform company establishing unique industry alliances to create innovative treatments for people with unmet medical needs.  Spinal muscular atrophy is the company’s first focus.

 

For more information regarding AveXis, please visit www.avexisinc.com.

 

Contacts:

 

REGENX Biosciences
 Vit Vasista, 202-785-7438
 vvasista@regenxbio.com

 

AveXis

 

Corporate Contact:

 

John A. Carbona, Chief Executive Officer

972-725-7797 or jcPavexisinc.com

 

Media Contact:

 

Jillian Bowman, Administrative Specialist
 972-725-7797 or iillianb@avexisinc.comExhibit 10.9

 

CONFIDENTIAL TREATMENT REQUESTED

 

NON-EXCLUSIVE LICENSE AGREEMENT

 

This Non-Exclusive License Agreement (this “Agreement”) is made and entered into as of this 29th day of May, 2015 (the “Effective Date”), by and between ASKLEPIOS BIOPHARMACEUTICAL, INC., a North Carolina corporation with an address at 45 North Chatham Parkway, Chapel Hill, NC 27517 (“AskBio”), and AVEXIS, INC., a Delaware corporation with an address at 4925 Greenville Avenue, Suite 604, Dallas, Texas 75206 (“AveXis”).  AskBio and AveXis may be referred to herein individually as a “Party” and collectively as the “Parties.”

 

RECITALS

 

WHEREAS, AskBio has exclusively licensed from the University of North Carolina at Chapel Hill (“UNC”) all right and title in certain AskBio Patent Rights and AskBio Know-How for use in the Field;

 

WHEREAS, AveXis desires to acquire a non-exclusive license under the applicable AskBio Licensed Technology to develop, make, have made, use, sell, offer to sell, import, export and distribute the Licensed Product(s) in the Field and AskBio is willing to grant such a license to AveXis under the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the foregoing and the covenants and promises contained in this Agreement, in accordance with and subject to the terms and conditions specified below, the Parties agree as follows:

 

AGREEMENT

 

ARTICLE 1
  DEFINITIONS.

 

Unless otherwise defined in this Agreement, all capitalized terms shall have the meaning ascribed to them in this Article 1.  Unless otherwise indicated to the contrary in this Agreement by the context or use thereof:  (a) the words, “herein,” “hereto,” “hereof” and words of similar import refer to this Agreement and not to any particular Article or Section; (b) words importing the masculine gender shall also include the feminine and neutral genders, and vice versa; (c) words importing the singular shall also include the plural, and vice versa; and (d) the words “include”, “includes” and “including” when used in this Agreement shall be deemed to be followed by the phrase “without limitation.”

 

1.1                               “Affiliate” means, with respect to any person or entity, any other person or entity that directly or indirectly controls, is controlled by, or is under common control with such person or entity.  A person or entity shall be deemed to “control” another person or entity if (a) it owns or controls, directly or indirectly, more than fifty percent (>50%) of the issued and outstanding voting securities, capital stock, or other comparable equity or ownership interest of the other person or entity, (b) it possesses, directly or indirectly, the power to direct or cause the direction

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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of the management and policies of the person or other entity, or (c) it possesses the power to elect or appoint more than fifty percent (>50%) of the members of the governing body of the person or other entity.

 

1.2                               “Applicable Law” means any local, state or federal rule, regulation, statute or law in any jurisdiction relevant to the activities undertaken pursuant to this Agreement or applicable to either of the Parties with respect to any matters set forth herein.

 

1.3                               “AskBio Know-How” means all formulations, designs, technical information, know-how, knowledge, data, specifications, test results and other information, whether or not patentable, that (a) are owned or Controlled by AskBio as of the Effective Date or (b) are directly related to the AskBio Patent Rights, and, with respect to both (a) and (b) are necessary for the manufacture, use, development, testing, marketing, export, import, offer for sale or sale of Licensed Products.

 

1.4                               “AskBio Licensed Technology” means, collectively, the AskBio Patent Rights and the AskBio Know-How.

 

1.5                               “AskBio Patent Rights” means the Patent Rights owned or Controlled by AskBio as set forth on Appendix I.  For avoidance of doubt, the AskBio Patent Rights shall not include any Chimeric Vector Technology included within such AskBio Patent Rights.

 

1.6                               “AveXis Improvements” means all findings, technology, techniques, know-how, modifications, developments, inventions, discoveries, improvement to the AskBio Licensed Technology, whether or not patentable or otherwise eligible for other state, federal, or national intellectual property protection made, developed, conceived or reduced to practice by or at the direction of AveXis or its Sublicensees during the Term.  For avoidance of doubt, Licensed Products shall not be deemed AveXis Improvements.

 

1.7                               “BLA” means a Biologics License Application filed with the FDA pursuant to 21 C.F.R. § 601.2 et seq., or any foreign equivalent filed with the applicable Regulatory Authorities in a country or territory to obtain Marketing Authorization for Licensed Product(s) in such country or territory.

 

1.8                               “Chimeric Vector Technology” means ****.

 

1.9                               “Clinical Trials” means the testing or evaluation of any Licensed Product in the Field in human subjects and in connection with a process to obtain Regulatory Approval to market a Licensed Product in the Field.

 

1.10                        “Commercially Reasonable Efforts” means the use of such reasonably needed efforts and dedication of those resources reasonably needed for the development and commercialization of any Licensed Product(s) consistent with **** .

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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1.11                        “Confidentiality Agreement” means that certain Mutual Confidential Disclosure Agreement by and between AskBio and AveXis, dated effective as of April 1, 2014.

 

1.12                        “Control” means, with respect to any Patent Right or other intellectual property right, possession of the right, whether directly or indirectly, and whether by ownership, license or otherwise (other than by operation of any license and other grants hereunder), to assign or grant a license, sublicense or other right to or under such Patent Right or other intellectual property right as provided for herein without violating the terms of any agreement or other arrangement with any Third Party.

 

1.13                        “Cover”, “Covering” and “Covered” means that the making, having made, using, selling, offering for sale or importing of the relevant subject matter would, absent a license or ownership by a Party, infringe a Valid Claim of a patent or a claim in a currently pending patent application or any patents issuing thereupon.

 

1.14                        “Disclosing Party” means the Party disclosing Confidential Information to the other Party hereunder.

 

1.15                        “Dollar(s)” means United States dollars.

 

1.16                        “FDA” means the United States Food and Drug Administration, or any successor entity that may be established hereafter which has substantially the same authority or responsibility currently vested in the United States Food and Drug Administration.

 

1.17                        “Field” means the research, development and commercialization of agents for the treatment of Spinal Muscular Atrophy in humans.

 

1.18                        “First Clinical Trial” means that Clinical Trial entitled “Gene Transfer Clinical Trial for Spinal Muscular Atrophy Type 1” and bearing clinicaltrials.gov identifier number NCT02122952.

 

1.19                        “First Commercial Sale” means, with respect to the Licensed Product(s), the first sale by AveXis or any of its Sublicensees to a Third Party following receipt of Regulatory Approval in the country of sale.  A Licensed Product sale shall be deemed to occur on ****.  For avoidance of doubt, First Commercial Sale after receipt of Regulatory Approval does not include sale of a Licensed Product under ****.

 

1.20                        “IND” means an Investigational New Drug Application as filed with the FDA or equivalent applications filed with other Regulatory Authorities, including any foreign equivalent of the FDA.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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1.21                        “Licensed Product” means any product for use in the Field whose development, making, having made, use, sale, offer for sale, import, export and distribution would, in the absence of a license from AskBio, infringe one or more Valid Claims of the AskBio Patent Rights and/or use the AskBio Licensed Know-How.

 

1.22                        “Marketing Authorization” means the requisite governmental approval for the marketing and sale of a Licensed Product in a given country.

 

1.23                        “Net Sales” means the gross revenues invoiced by or on behalf of AveXis and any of its Sublicensees in connection with the sale, lease or other transfer for value of Licensed Product(s), in all cases after deduction of ****.

 

1.24                        “Patent Rights” means patents and patent applications, whether domestic or foreign, including all continuations, continuations-in-part, divisions, provisionals and renewals, and letters of patent granted with respect to any of the foregoing, patents of addition, supplementary protection certificates, registration or confirmation patents and all reissues, re-examination and extensions thereof.

 

1.25                        “Quarter” means the calendar quarterly periods ending March 31, June 30, September 30 and December 31.

 

1.26                        “Recipient” means the Party receiving Confidential Information hereunder.

 

1.27                        “Regulatory Approval” means with respect to a particular country in the Territory, receipt of all governmental approvals and authorizations necessary for the manufacture and commercial sale of the Licensed Product(s) in the applicable country, including, but not limited to, Marketing Authorization, pricing approval and reimbursement approval, as applicable.

 

1.28                        “Regulatory Authority” means, with respect to any country, any and all governmental or regulatory bodies or authorities having the authority to approve the import, storage, export, transport, manufacture, sale and/or use of the Licensed Product(s), including the FDA.

 

1.29                        “Royalty Term” means, with respect to each Licensed Product, on a country-by-country basis, the period beginning upon the Effective Date and ending upon expiration of all Valid Claims of the AskBio Patent Rights in such country that Cover such Licensed Product in such country.

 

1.30                        “Territory” means worldwide.

 

1.31                        “Third Party” means any entity other than AskBio or AveXis or their respective Affiliates.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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1.32                        “Valid Claim” means any claim of any Patent Rights that has issued, is unexpired and has not been rejected, revoked or held unenforceable or invalid by a final, non-appealable decision of a court or other governmental authority of competent jurisdiction or unappealed within the time allowable for appeal, and that has not been explicitly disclaimed, or admitted by AskBio to be invalid or unenforceable through reissue, disclaimer or otherwise.

 

ARTICLE 2
  LICENSE GRANTS

 

2.1                               License.  Subject to the terms and conditions of this Agreement, AskBio hereby grants to AveXis a non-exclusive, royalty-bearing, non-transferable (except in accordance with Section 13.1) license, with the right to sublicense (subject to the conditions set forth in Section 2.2 below) under the AskBio Licensed Technology to develop, make, have made, use, sell, offer to sell, import, export and distribute Licensed Products in the Field in the Territory.

 

2.2                               Terms of Sublicenses.  AveXis shall have the right to grant sublicenses of the licenses granted to AveXis hereunder upon obtaining the prior written consent of AskBio, such consent not to be unreasonably withheld or delayed.  AveXis shall enter into a written agreement with each such approved sublicensee (each, a “Sublicensee”), which such agreement shall be consistent with the terms and conditions of this Agreement.  Any act or omission in contravention of any provision of this Agreement by any Sublicensee shall be deemed a material breach of this Agreement by AveXis.  AveXis shall provide a copy of all sublicense agreements to AskBio within **** of executing the same.  If AveXis becomes aware of any Sublicensee not complying with this Agreement, then AveXis shall inform AskBio within **** thereof and shall take all steps reasonably necessary to ensure compliance herewith by such Sublicensee or terminate the agreement with such Sublicensee that fails to comply with the provisions of this Agreement.  No Sublicensees shall be permitted to further sublicense the rights granted hereunder without ****.

 

2.3                               No Implied Rights or Licenses.  Except as expressly provided herein, AskBio does not grant to AveXis, whether by implication, estoppel or otherwise, any right or license under this Agreement to use any AskBio Licensed Technology, AskBio Confidential Information, or any other trademark, copyright, trade secret, know-how or any other intellectual property owned or Controlled by AskBio.  Any use or practice of the intellectual property rights licensed to AveXis under this Agreement except as expressly permitted by this Agreement shall constitute a material breach of this Agreement.  AveXis covenants and agrees to immediately cease any non-permitted use.

 

ARTICLE 3
  DILIGENCE REQUIREMENTS

 

Within **** following the Effective Date, AveXis shall provide AskBio with a clinical development plan for Licensed Products.  AveXis shall use its Commercially Reasonable Efforts to research, develop, commercialize and sell Licensed Products in the Field throughout the Term.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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Failure by AveXis to use Commercially Reasonable Efforts in accordance with this Article 3 shall constitute a material breach of this Agreement.

 

ARTICLE 4
  MILESTONES; MINIMUM SALES; ROYALTY PAYMENTS; ROYALTY REPORTS.

 

4.1                               License Issue Fee.  AveXis shall pay AskBio a one-time, non-refundable license issue fee of One Million Dollars ($1,000,000), payable as follows: (a) Three Hundred Thousand Dollars ($300,000) within thirty (30) days following the Effective Date; (b) Three Hundred Thousand Dollars ($300,000) within thirty (30) days following the first dosing of the first patient immediately following the Effective Date in the First Clinical Trial; and (c) Four Hundred Thousand Dollars ($400,000) within thirty (30) days following the first dosing of the ninth (9th) study subject in the First Clinical Trial, unless ****.

 

4.2                               Annual Payments.  AveXis shall pay AskBio an annual license fee of Fifty Thousand Dollars ($50,000) per year beginning on the first anniversary of the Effective Date, payable within **** of and on each anniversary of the Effective Date during the Term.

 

4.3                               Development Milestone Payment.  Within **** following ****, AveXis shall pay to AskBio Six Hundred Thousand Dollars ($600,000) (the “Milestone Payment”).  The Milestone Payment will be payable only once regardless of (a) whether such milestone is achieved by more than one Licensed Product and (b) whether such milestone is achieved by AveXis, or any Sublicensee (or any of their respective permitted sublicensees).  The Milestone Payment shall ****.  For avoidance of doubt, the Milestone Payment remains in effect on a country-by-country basis until the later of ****.

 

4.4                               Sales Milestones.  Within **** following the achievement of the following sales based milestones (each, a “Sales-Based Milestone”), AveXis shall pay to AskBio the following amounts (each, a “Sales-Based Milestone Payment”), regardless of whether such Sales-Based Milestone is achieved by AveXis, or any Sublicensee (or any of their respective permitted sublicensees):

 

(a)                                 **** Commercial Sale of the **** Licensed Product to receive Regulatory Approval ****: $4,000,000;

 

(b)                                 **** Commercial Sale of the **** Licensed Product to receive Regulatory Approval ****: $4,000,000; and

 

(c)                                  The **** calendar year in which worldwide Net Sales of a Licensed Product exceeds **** in ****:  $1,000,000.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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Sales-Based Milestones Payments will be payable only once regardless of (i) whether such Sales­ Based Milestone is achieved by more than one Licensed Product and (ii) whether such Sales­ Based Milestone is achieved by AveXis, or any Sublicensee of AveXis (or any of their respective permitted sublicensees).  Sales-Based Milestone Payments will be paid to AskBio regardless of ****.

 

4.5                               Royalties.  During the Royalty Term, with respect to each Licensed Product, AveXis shall pay to AskBio tiered royalties (the “Royalty(ies)”) based on aggregate, annual Net Sales of all Licensed Products on a Field-by-Field basis, in all countries in which Royalties are payable at that time in an amount equal to:

 

(a)                                 **** of Net Sales for Net Sales ****;

 

(b)                                 **** of Net Sales for Net Sales **** up to and including ****; and

 

(c)                                  **** of Net Sales for Net Sales ****.

 

For clarity, an example of Royalties due to AskBio if AveXis receives **** in cumulative Net Sales of all Licensed Products in a calendar year is below:

 

(d)                                 **** of the first **** or **** for such calendar year; and

 

(e)                                  **** of the next **** or ****, for a total Royalty of **** for such calendar year.

 

During the period commencing on the Effective Date and expiring **** following the receipt of Regulatory Approval in the United States for the first Licensed Product (the “Royalty Option Period”), AskBio hereby grants AveXis the option, upon written notice and payment to AskBio of the Royalty Option Fee (as defined below), to reduce all Royalty percentages set forth in this Section 4.5 for all Licensed Products by **** (the “Royalty Buy-Down Option”), for a one-time payment to AskBio of Three Million Dollars ($3,000,000) (the “Royalty Option Fee”).  For avoidance of doubt, in the event AveXis does not notify AskBio of its exercise of the option hereunder and pay the full amount of the Royalty Option Fee prior to expiration of the Royalty Option Period, the Royalty percentages set forth above shall continue to apply to all Licensed Products during the entire Royalty Term.

 

For avoidance of doubt, if AveXis exercises the Royalty Buy-Down Option, then from and after such date, the Royalties due to AskBio will be as follows:

 

(a)                                 **** of Net Sales for Net Sales ****;

 

(b)                                 **** of Net Sales for Net Sales **** up to and including ****; and

 

(c)                                  **** of Net Sales for Net Sales****.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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4.6                               Royalty Stacking.  If AveXis is reasonably required to take a royalty-bearing license under any Third-Party Patent Rights to avoid infringement of such Third-Party Patent Rights in order to manufacture, use or sell a Licensed Product and if AveXis’ total royalty burden to all licensors (including to AskBio hereunder) for Net Sales of a Licensed Product exceeds ****, the Royalties due hereunder for such Licensed Product shall be reduced proportionally in accordance with the following formula:

 

R2 = ****,

where:

R2 is the reduced Royalty due to AskBio;

R1 is the unreduced Royalty due to AskBio; and

T is the total royalty due to all AveXis licensors required in accordance with this Section 4.6;

 

provided, however, that in no event shall AveXis pay less than **** of the Royalties that AveXis would otherwise pay to AskBio with respect to Net Sales if there were no Third-Party royalties due in accordance with this Section 4.6.

 

4.7                               Sublicensing Income.  Within **** of receipt of the following payments by AveXis, AveXis shall pay AskBio, **** of any and all non-Royalty, non-Milestone Payments and non-Sales-Based Milestone Payment consideration attributable to each Licensed Product, including without limitation, any payment due to AveXis in consideration for sublicensing any license granted hereunder or distribution of any Licensed Product, including **** (but excluding ****).

 

In the event AveXis receives any non-cash consideration in accordance with this Section 4.7, AveXis shall pay AskBio **** of the fair market value of such non-cash consideration within **** following receipt by AveXis of such non-cash consideration.  For avoidance of doubt, the fees payable to AskBio pursuant to this Section 4.7 shall not apply to ****.

 

In the event AveXis receives **** from a Sublicensee as a result of such Sublicensee achieving one or more of the Milestone or Sales-Based Milestones, then the amount of the payment due to AskBio with respect to such sublicense fee payments shall be calculated by applying the **** sublicensing fee rate to the sublicense fees received by AveXis from such Sublicensee for achievement of the applicable Milestone or Sales­ Based Milestones after deducting ****.  For clarity and avoidance of doubt, the **** sublicense fee rate shall be applied to the total amount of all sublicense fee payments received by AveXis corresponding to Milestone and Sales­Based Milestone after deducting ****.  By way of example, but not limitation, if a Sublicensee achieves the Milestone set forth in Section 4.3, and the terms of the sublicense agreement between AveXis and such Sublicensee requires such Sublicensee to pay to AveXis **** for the achievement of such milestone, then AveXis would be required to pay to AskBio (a) **** (the amount the Milestone due to AskBio), plus (b) **** of the difference between **** and **** (i.e., an additional ****).

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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4.8                               Payments, Reports, Exchange Rates.  AveXis shall keep AskBio reasonably informed, but no less than ****, about the progress of its development and commercialization of the Licensed Product(s) and AveXis shall notify AskBio within **** following any of the Milestone Events or Sales-Based Milestones have been achieved.  AveXis shall notify AskBio within **** following ****.  Commencing with the conclusion of **** during which ****, AveXis shall, within **** of the end of each Quarter during the Term, furnish to AskBio a written report (each, a “Royalty Report”) showing for such reporting period, on a Licensed Product-by-Licensed Product and country-by-country basis: ****.  AveXis shall remit Royalties to AskBio on a **** basis with the submission of each Royalty Report.  All reports delivered hereunder shall be the Confidential Information of AveXis.  Further, AveXis shall include a detailed listing of each of the items ****.

 

ARTICLE 5
  RECORDS; AUDITS; PAYMENT TERMS.

 

5.1                               Records.  AveXis shall keep, and shall ensure that its Sublicensees shall keep, complete and accurate records in sufficient detail to make the reports required hereunder, to confirm compliance with the provisions of this Agreement, to properly reflect all amounts billed, owed or reported and to verify the amounts payable hereunder during the Term and for a period of **** after such payments are made.

 

5.2                               Currency Conversion.  With respect to sales of Licensed Product(s) invoiced in Dollars, the gross invoiced sales, Net Sales, and Royalties payable shall be expressed in the report in Dollars.  With respect to sales of Licensed Product(s) invoiced in a currency other than Dollars, the gross invoiced sales, Net Sales and Royalties payable shall be expressed in the Royalty Report in the domestic currency of the country in which such sale was made as well as in the Dollar equivalent of the Royalty payable and the exchange rate used in determining the amount of Dollars.  The Dollar equivalent shall be calculated using the average exchange rate for the applicable Quarter (local currency per Dollar) as published by Bloomberg on the last business day of each month during the applicable Quarter.

 

5.3                               Audits.  Upon **** prior written notice from AskBio, AveXis shall permit, and shall ensure that its Sublicensees shall permit, an independent certified public accounting firm of recognized national standing in the United States, selected by AskBio and reasonably acceptable to AveXis, at AskBio’s expense, to have access to AveXis’ (or its Sublicensees) records as may be reasonably necessary to verify the accuracy of any amounts reported, actually paid or payable under this Agreement.  Such audits may be made no more than ****, during normal business hours at reasonable times mutually agreed by the Parties.  If such accounting firm concludes that additional amounts were owed to AskBio during such period, AveXis shall pay such additional amounts or refund such overpayment (including interest on such additional sums in accordance with Section 5.4) within **** following the date AskBio delivers to AveXis such accounting firm’s written report so concluding.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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The fees charged by such accounting firm shall be paid by ****; provided, however, that if the audit discloses that the AveXis underpaid AskBio by more than **** of the amounts actually due for such period, then the AveXis shall pay the reasonable fees and expenses charged by such accounting firm.

 

5.4                               Interest.  Notwithstanding anything to the contrary in this Agreement, all payments due hereunder shall be due and payable in accordance with the terms and conditions of this Agreement and shall be paid in full in immediately available funds.  All payments required under this Agreement, including any discovered underpayment or any other payment under this Agreement, shall, if overdue, bear interest until paid at a per annum rate that is **** above the prime rate quoted in the Money Rates section of The Wall Street Journal, Eastern Edition, from the date on which payment was due, calculated daily on the basis of a 365-day year; provided, however, that in no event shall such rate exceed the highest rate allowed under Applicable Law.  The payment of such interest shall not foreclose AskBio from exercising any other rights or remedies it may have as a consequence of the lateness of any payment.

 

5.5                               Payment Method.  All payments by AveXis under this Agreement shall be paid in Dollars.  All such payments shall be made by electronic funds transfer in immediately available funds to such account as AskBio shall designate before such payment is due.  AveXis shall be responsible for the full amount of any fees associated with any payment made hereunder and shall use reasonable efforts to pay such fees prior to or at the time of such transfer so that the fees are not passed on to AskBio.  If at any time, legal restrictions prevent the prompt remittance of part or all Royalties due with respect to sales of any Licensed Product(s) in any country where such Licensed Product(s) is sold, AveXis shall use its reasonable efforts to ensure that such payments shall be made promptly through such lawful means or methods as AveXis and AskBio shall reasonably determine.

 

ARTICLE 6
  REGULATORY FILINGS; RIGHT OF CROSS-REFERENCE

 

6.1                               Licensed Product Regulatory Filings.  AveXis shall be responsible for obtaining any reasonably necessary or appropriate Regulatory Approvals and/or product registrations for the use, distribution or sale of Licensed Products.  The decision to seek such Regulatory Approvals and/or product registrations for such Licensed Products shall be made solely by AveXis or a Sublicensee or Affiliate of AveXis.  The costs and expenses of securing such Regulatory Approvals and/or product registrations shall be borne solely by AveXis.

 

6.2                               AskBio Right of Cross-Reference.  AskBio shall have a non-transferrable, non-sublicensable (except to AskBio’s Affiliates) right to cross-reference any IND or BLA (as applicable, and including any foreign equivalent thereof) filed with the FDA (or any applicable foreign agency) for any Licensed Product; ****.  AskBio shall provide not less than **** prior written notice to AveXis before cross-referencing such applications with respect to any field or indication.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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AveXis shall submit to the appropriate Regulatory Authorities all documentation required under Applicable Laws to effectuate such right of reference by AskBio.  The rights of AskBio set forth in this paragraph shall immediately terminate upon ****.

 

ARTICLE 7
  CONFIDENTIALITY.

 

7.1                               In General.  During the Term and for a period of **** thereafter, each Party shall maintain in confidence all information and materials of the other Party disclosed or provided to it by or on behalf of the other Party (either pursuant to this Agreement or the Confidentiality Agreement) including the terms and conditions (but not the existence) of this Agreement.  Confidential Information shall be identified as confidential in writing or, if disclosed verbally or by observation, summarized in writing and submitted to Recipient within **** of the oral or visual disclosure thereof (together with all embodiments thereof, the “Confidential Information”).  Confidential Information shall include (a) in the case of AskBio, all AskBio Know-How and (b) Confidential Information of either Party disclosed under the Confidentiality Agreement.  It may also include information regarding intellectual property and confidential or proprietary information of Affiliates and Third Parties.  The terms and conditions of this Agreement shall be deemed Confidential Information of both Parties.

 

7.2                               Notwithstanding the foregoing, Recipient’s obligations of confidentiality and restricted use shall not apply to any Confidential Information of the Disclosing Party that the Recipient can demonstrate by contemporaneous written records was:

 

(a)                                 known to the general public at the time of its disclosure to the Recipient, or thereafter became generally known to the general public, other than as a result of actions or omissions of the Recipient in violation of this Agreement or the Non-Disclosure Agreement;

 

(b)                                 disclosed to the Recipient on an unrestricted basis from a source unrelated to the Disclosing Party and not known by the Recipient to be under a duty of confidentiality to the Disclosing Party; or

 

(c)                                  independently developed by the Recipient, or known by the Recipient prior the date of disclosure by the Recipient, without the use of Confidential Information of the Disclosing Party.

 

7.3                               Additional Protections.  Each Party shall take all reasonable steps to maintain the confidentiality of the Confidential Information of the other Party, which steps shall be no less protective than those that such Party takes to protect its own information and materials of a similar nature, but in no event less than a reasonable degree of care.  Neither Party shall use or permit the use of any Confidential Information of the other Party except for the purposes of carrying out its obligations or exercising its rights under this Agreement.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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All Confidential Information of a Party, including all copies and derivations thereof, is and shall remain the sole and exclusive property of the Disclosing Party and subject to the restrictions provided for herein.  Neither Party shall disclose any Confidential Information of the other Party other than ****.

 

7.4                               Permitted Disclosures.  The obligations set forth in this ARTICLE 7 shall not apply to the extent that Recipient is required to disclose information under Applicable Law, judicial order by a court of competent jurisdiction, the rules of a securities exchange or requirement of a Regulatory Authority for purposes of obtaining approval to test or market Licensed Product(s); provided, however, that the Recipient shall provide prior written notice thereof to the Disclosing Party and sufficient opportunity for the Disclosing Party to review and comment on such required disclosure and request confidential treatment thereof or a protective order therefore.  ****.

 

7.5                               Irreparable Injury.  The Parties acknowledge that either Party’s breach of this ARTICLE 7 may cause the other Party irreparable injury for which it may not have an adequate remedy.  In the event of a breach, the non-breaching Party shall be entitled to seek injunctive relief (without the proof of actual damages or posting of a bond) in addition to any other remedies it may have under Applicable Law or in equity.

 

ARTICLE 8
  INTELLECTUAL PROPERTY MATTERS.

 

8.1                               Improvements.

 

(a)                                 Disclosure.  AveXis shall promptly (but in no event more than **** following the making, conception, or reduction to practice thereof) disclose and briefly describe each AveXis Improvement, in writing to AskBio.

 

(b)                                 AveXis Improvements.  The entire right and title in all AveXis Improvements, and any Patent Rights Covering any AveXis Improvements, shall be owned solely by AskBio, regardless of inventorship.  AveXis shall assign to AskBio (and shall cause any permitted Sublicensees to assign), and hereby assigns to AskBio, all right, title and interests in and to all AveXis Improvements without the payment of any compensation to AveXis.  AveXis shall require all employees or others acting on behalf of AveXis (including without limitation, AveXis’ contractors, agents and Sublicensees) to be obligated under a binding written agreement to assign all AveXis Improvements made or developed by such party to AveXis.  AveXis shall execute all documents and perform all acts required to secure to AskBio or its nominees, patent protection throughout the world upon all such AveXis Improvements.  AskBio shall directly pay the expenses related to the foregoing, or shall reimburse Licensee for its reasonable expenses in this regard.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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(c)                                  License Grant.  AskBio shall grant, and hereby grants, to AveXis a non-exclusive, worldwide, royalty-free, transferable, sublicensable, irrevocable, perpetual license to practice any AveXis Improvements, including the right to research, develop, use, make, sell, offer to sell Licensed Products.  For avoidance of doubt, the foregoing license to AveXis Improvements shall not expand the rights of AveXis to use any AskBio Licensed Technology outside the Field and, to the extent that use of such AveXis Improvements outside the Field would, but for a license from AskBio in such additional fields, infringe one or more Valid Claims of the AskBio Patent Rights or otherwise use the AskBio Know-How, AveXis shall be required to obtain additional rights to the AskBio Licensed Technology from AskBio, which AskBio may or may not grant to AveXis, in its sole discretion.

 

8.2                               Prosecution and Maintenance of AskBio Patent Rights.  AskBio shall be responsible for the prosecution, maintenance and enforcement of the AskBio Patent Rights.  AskBio shall use commercially reasonable efforts to maintain all AskBio Patent Rights in the Field during the Term; provided, however, that AskBio shall have the right to abandon applicable patents or patent applications (or specific claims included therein) in which ****.

 

8.3                               Patent Marking and Licensed Product(s) & Licensed Product(s) Marking.  AveXis shall place appropriate patent and/or patent pending markings on each Licensed Product(s) or the packaging therefore in compliance with Applicable Laws.  The content, form, size, location and language of such markings shall be in accordance with Applicable Laws and practices of the country in which the applicable units of each Licensed Product(s) are distributed.  AveXis shall be responsible for all packaging (non-commercial and commercial) and labeling of Licensed Product(s).

 

ARTICLE 9
  ENFORCEMENT AND DEFENSE OF ASKBIO LICENSED TECHNOLOGY.

 

9.1                               Notice of Infringement.  In the event of any actual or threatened infringement or misappropriation by any Third Party of any AskBio Licensed Technology in the Field, the Party first having knowledge of such infringement or misappropriation shall promptly notify the other Party in writing.  The notice shall set forth the facts of such infringement or misappropriation in reasonable detail.

 

9.2                               Prosecution of Actions.  AskBio shall have the sole right, but not the obligation, to carry out actions against Third Parties arising from such Third Parties’ infringement or misappropriation of the AskBio Licensed Technology.

 

9.3                               Third Party Claim of Infringement.  AveXis shall immediately notify AskBio in writing if it has knowledge of any Third Party claim challenging the validity or scope of any AskBio Licensed Technology.  In the event that a Third Party asserts a claim challenging the validity or scope of any AskBio Licensed Technology, AskBio shall have the sole right, but not the obligation, to control the defense of such claim.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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AskBio shall not offer to settle, settle or otherwise compromise any such claim within the Field that admits fault or liability of AveXis without AveXis’ prior written consent, which consent shall not be unreasonably withheld or delayed.

 

ARTICLE 10
  REPRESENTATIONS & WARRANTIES; LIMITATION OF LIABILITY.

 

10.1                        Mutual Representations and Warranties.  Each Party represents and warrants to the other that as of the Effective Date to the best of its knowledge and belief:

 

(a)                                 that it is a corporation duly organized, validly existing and in good standing under the laws and regulations of the jurisdiction in which it is incorporated;

 

(b)                                 the execution, delivery and performance of this Agreement by such party and all instruments and documents to be delivered by such Party hereunder (i) are within the corporate power of such Party and (ii) have been duly authorized by all necessary or proper corporate action; and

 

(c)                                  this Agreement has been duly executed and delivered by such Party and constitutes a legal, valid, and binding obligation of such Party, enforceable against such Party in accordance with its terms, except as such enforceability may be limited by applicable insolvency and other laws affecting creditors’ rights generally or by the availability of equitable remedies.

 

10.2                        AskBio Representations and Warranties.  AskBio represents and warrants to AveXis that as of the Effective Date AskBio has the right to grant to AveXis the license hereunder.

 

10.3                        Disclaimer.  EXCEPT AS EXPRESSLY SET FORTH HEREIN, NEITHER PARTY MAKES ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY REPRESENTATION OR WARRANTY OF (A) MERCHANTABILITY, (B) FITNESS FOR A PARTICULAR USE OR PURPOSE, (C) NON-INFRINGEMENT BY THIRD PARTIES, (D) INFRINGEMENT OR MISAPPROPRIATION OF THIRD PARTIES’ INTELLECTUAL PROPERTY RIGHTS, (E) VALIDITY OR ENFORCEABILITY OF THE ASKBIO PATENT RIGHTS; (F) COMMERCIAL UTILITY, (G) THAT ANY PATENT APPLICATION INCLUDED IN THE ASKBIO PATENT RIGHTS WILL ULTIMATELY ISSUE, (H) SAFETY, RELIABILITY, OR EFFICACY OF ANY LICENSED PRODUCT(S), OR (I) THAT ANY LICENSED PRODUCT(S) DEVELOPED FROM THE ASKBIO PATENT RIGHTS WILL NOT INFRINGE THE INTELLECTUAL PROPERTY RIGHTS OF ANY THIRD PARTY, AND EACH PARTY HEREBY EXPRESSLY DISCLAIMS THE FOREGOING SET FORTH IN SUBSECTIONS (A)-(I).

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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10.1                        Limitation of Liability.  EXCEPT FOR ****, IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL, PUNITIVE OR INDIRECT DAMAGES ARISING OUT OF OR RELATING TO THIS AGREEMENT ON ANY THEORY OF LIABILITY, WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY OR OTHERWISE, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSS OR DAMAGES.

 

ARTICLE 11
  INSURANCE; INDEMNIFICATION.

 

11.1                        Insurance.  AveXis shall, at its own expense, maintain comprehensive general liability insurance, in the minimum amount of **** per occurrence and **** in the aggregate, and product liability insurance, in the minimum amount of **** per occurrence, and **** in the aggregate.  Following receipt of Marketing Authorization and for a period of **** after the expiration or earlier termination of this Agreement, AveXis shall, at its own expense, maintain comprehensive general liability insurance, including product liability insurance, in the minimum amount of **** per occurrence, and **** in the aggregate.  Any independent insurance carriers must be rated ****.  AveXis shall maintain such insurance for the Term of this Agreement and during any period in which AveXis is performing a Clinical Trial with a Licensed Product, and shall from time to time provide copies of certificates of such insurance to AskBio upon request.

 

11.2                        Indemnification Obligations.

 

(a)                                 AskBio’s Obligations.  AskBio shall defend, indemnify and hold AveXis and its shareholders, directors, officers, employees and agents (each, a “AveXis Indemnitee”) harmless from and against all losses, liabilities, damages, costs and expenses (including reasonable attorney’s fees and costs of investigation and litigation, regardless of outcome) resulting from all claims, demands, actions and other proceedings (collectively, “Claims”) to the extent arising from the gross negligence, recklessness or willful misconduct of any AskBio Indemnitee.  Notwithstanding the foregoing, AskBio shall not be liable for any Claims to the extent any such Claims are caused by or arise from any act or omission by any AveXis Indemnitee for which AveXis is obligated to indemnify AskBio pursuant to Section 11.2(b).

 

(b)                                 AveXis’ Obligations.  AveXis assumes all responsibility for and all risk of damage or injury that may occur as a result of AveXis’ or its Sublicensees’ manufacture, storage, fill and finish, using, marketing, selling, offering to sell, importing, exporting or distributing Licensed Products.  AveXis shall defend, indemnify and hold AskBio, AskBio’s Affiliates, and their respective shareholders, directors, officers, employees and agents, and (each, an “AskBio Indemnitee”) harmless from and against all Claims to the extent arising from: (i) the development (including, without limitation, the conduct of Clinical Trials), manufacturing, testing, storage, handling, transportation, disposal, commercialization (including any recalls, field corrections or market withdrawals), marketing, distribution, promotion, sale or use of

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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Licensed Product(s) (including as a result of any illness, injury or death to persons (including employees, agents or contractors of AveXis or its Sublicensees) or damage to property); (ii) any infringement of Third Party patents or misappropriation of Third Party know-how by a Licensed Product other than by the AskBio Patent Rights; (iii) claims or actions by any Necessary Sublicensee arising from or based on a breach of AveXis’ obligations under a sublicense agreement; or (iv) the gross negligence, recklessness or willful misconduct of AveXis or its Sublicensees or any of their respective Third-Party agents or subcontractors in the performance of its or their obligations under this Agreement.  Notwithstanding the foregoing, AveXis shall not be liable for any Claims to the extent any such Claims are caused by or arise from any act or omission by any AskBio Indemnitee for which AskBio is obligated to indemnify AveXis pursuant to Section 11.2(a).

 

11.3                        Procedures.  If any Claim covered by Section 11.2 is brought, the indemnifying Party’s obligations are conditional upon the following:

 

(a)                                 the indemnified Party shall promptly notify the indemnifying Party in writing of such Claim; provided, however, the failure to provide such notice within a reasonable period of time shall not relieve the indemnifying Party of any of its obligations hereunder except to the extent the indemnifying Party is actually prejudiced by such failure or delay;

 

(b)                                 the indemnifying Party shall assume, at its cost and expense, the sole defense of such Claim through counsel selected by the indemnifying Party and reasonably acceptable to the other Party, except that those indemnified may at its option and expense select and be represented by separate counsel;

 

(c)                                  the indemnifying Party shall maintain control of such defense and/or the settlement of such Claim;

 

(d)                                 the indemnifying Party shall not have authority to consent to the entry of any judgment or to enter into any settlement or otherwise to dispose of such Claim without the prior written consent of the indemnified Party, such consent not to be unreasonably withheld or delayed; and

 

(e)                                  the indemnifying Party shall pay the full amount of any judgment, award or settlement with respect to such Claim and all other costs, fees and expenses related to the resolution thereof.

 

ARTICLE 12
  TERM AND TERMINATION.

 

12.1                        Term.  Unless earlier terminated in accordance with this Agreement, the term of this Agreement (the “Term”) shall commence on the Effective Date and shall automatically terminate upon the expiration and payment of all payment obligations by AveXis hereunder.

 

12.2                        Termination.

 

(a)                                 Termination without Cause.  AveXis shall be entitled to terminate this Agreement upon six (6) months’ advanced written notice to AskBio.

 

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(b)                                 Termination for Cause.  Each Party shall have the right to terminate this Agreement in its entirety by providing written notice to the other Party if such other Party commits a material breach of any of its obligations under this Agreement and such breaching Party fails to cure such breach within: (i) **** of written notice of any failure to make timely payment of Royalties, Milestone Payment or Sales-Based Milestone Payment or any other amount that is not in dispute, when due hereunder, or (ii) **** of receipt of written notice of any other failure from the non-breaching Party (in either case, without such termination giving rise to the payment of any penalty, damages or indemnity by the non­breaching Party).

 

(c)                                  Termination for Insolvency.  Notwithstanding anything contained in this Agreement to the contrary, either Party may terminate this Agreement immediately by written notice in the event: (i) the other Party voluntarily enters into bankruptcy proceedings; (ii) the other Party makes an assignment for the benefit of creditors; (iii) a petition is filed against the other Party under a bankruptcy law, a corporate reorganization law, or any other law for relief of debtors or similar law analogous in purpose or effect, which petition is not stayed or dismissed within **** of filing thereof; or (iv) the other Party enters into liquidation or dissolution proceedings or a receiver is appointed with respect to any assets of the other Party, which appointment is not vacated within ****.

 

(d)                                 Change of Control.  AskBio may terminate this Agreement in the event AveXis (i) researches, develops or commercializes any AAV-based treatment for hemophilia, or (ii) undergoes a change of control or is otherwise acquired by a Third Party that researches, develops or commercializes any AAV-based treatment for hemophilia, in each case, from the period beginning on the Effective Date until April 1, 2019 and, in each case, unless such change of control is first approved by AskBio, such approval not to be unreasonably withheld, delayed or conditioned if the party in control following such a change of control event agrees to additional restrictive measures as reasonably proposed by AskBio in its sole discretion prior to such change of control respecting the use of the AskBio Licensed Technology, including without limitation, an appropriate “firewall” between the AskBio Licensed Technology and the applicable AAV-based hemophilia program.  For avoidance of doubt, but without limitation, it shall not be unreasonable for AskBio to withhold its consent to a change of control if ****.

 

(e)                                  Challenge of Patent Rights.  Except at prohibited by Applicable Law, in the event AveXis institutes any legal action challenging the validity and/or enforceability of any of the AskBio Patent Rights during the Term of this Agreement, AskBio shall have the right, upon written notice to AveXis terminate this Agreement.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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12.3                        Effect of Termination or Expiration.

 

(a)                                 Accrued Obligations.  Termination or expiration of this Agreement, in whole or in part, shall be without prejudice to: (i) any right or obligation having accrued or arisen on or before the effective date of such termination or expiration, including the right of either Party to receive all payments accrued and unpaid as of the effective date of such termination or expiration; (ii) the remedy of any Party in respect to any previous breach of this Agreement; and/or (iii) any other provisions hereof which expressly or necessarily call for performance after such termination or expiration.

 

(b)                                 General.  Subject to Section 12.3(c), upon termination of this Agreement for any reason whatsoever, all licenses and sublicenses granted to AveXis by AskBio hereunder shall automatically terminate.  Upon the early termination or expiration of this Agreement, the Receiving Party shall return to the Disclosing Party, such Disclosing Party’s Confidential Information; provided, however, that each Party’s legal counsel shall have the right to retain one (1) copy of the Disclosing Party’s Confidential Information in a secure location for the exclusive purposes of identifying and monitoring the Recipient’s continuing obligations under this Agreement.

 

(c)                                  Sell-Off of Inventory.  Upon termination of this Agreement by AveXis pursuant to Sections, 12.2(b) and 12.2(c), subject to payment of Royalties thereon (and if applicable, any Sales­ Based Milestone Payments), AveXis and its Sublicensees shall each be entitled to sell its remaining inventory of Licensed Product(s) under the terms and conditions set forth in this Agreement until the applicable expiration date for each such unit of Licensed Product(s).

 

(d)                                 Survival.  The following provisions shall survive expiration or termination of this Agreement: Articles 1, 5, 6, 7, 11 and 13 and Sections 8.1(a), 8.1(b), 8.1(c), 10.2, 10.3 and 12.3.

 

ARTICLE 13
  MISCELLANEOUS

 

13.1                        Assignment.  Unless otherwise expressly permitted hereunder, neither Party may assign any of its rights or delegate any of its duties under this Agreement without the prior written consent of the other Party; provided, however, that AskBio may assign any or all of its rights, except for the Right of Cross Reference under Section 6.2, and/or responsibilities hereunder without the other Party’s consent as part of: (a) the sale of all or substantially all of the assets or the entire business to which this Agreement relates, or (b) a merger, consolidation, reorganization or other combination with or into another person or entity.  Any assignment made in violation of this Section 13.1 shall be null and void.

 

13.2                        Notices.  All notices and reports required under, and other communications with respect to, this Agreement shall be in writing, in the English language, and given or sent to the Party to be notified at its respective address set forth below either (a) personally and thereby deemed to be given on that day, (b) by internationally recognized overnight courier service (e.g., Federal Express) and thereby deemed to be given on the third business day following dispatch, or

 

18

 

(c) by registered letter and thereby deemed to be given on the tenth (10th) day following the day of posting.  Either Party may change its address and related information by giving notice to the other Party in the manner set forth in this Section 13.2.

 

If to AveXis, addressed to:

 

AveXis, Inc.

4925 Greenville Avenue, Ste. 604

Dallas, Texas 75206

Attention:  Chief Executive Officer

 

With copy to:

 

Margaret Brivanlou, Esq.

King & Spalding LLP

1185 Avenue of the Americas

New York, New York 10036

Dallas, Texas 75206

 

If to AskBio, addressed to:

 

Asklepios Biopharmaceutical, Inc.

45 N. Chatham Parkway

Chapel Hill, NC 27517

Attention:  Jade Samulski, Vice President

 

13.3                        Force Majeure.  Except for AveXis’ payment obligations hereunder, the obligations of either Party under this Agreement shall be excused during each period of delay caused by matters such as acts of God, strikes, shortages of raw materials, government orders, sufferance of or voluntary compliance with acts of government or governmental regulation (excluding acts of Regulatory Authorities), or acts of war or terrorism, which are reasonably beyond the control of the Party obligated to perform (each, a “Force Majeure Event”).  For the avoidance of doubt, the term Force Majeure Event shall not include a lack of funds, bankruptcy or other financial cause or disadvantage.  A Force Majeure Event shall be deemed to continue only so long as the affected Party shall be taking all reasonable actions necessary to overcome such condition.  If either Party shall be affected by a Force Majeure Event, such Party shall give the other Party prompt notice thereof, which notice shall contain the affected Party’s estimate of the duration of such condition and a description of the steps being taken or proposed to be taken to overcome such Force Majeure Event.  Any delay occasioned by any such cause shall not constitute a default under this Agreement, and the obligations of the Parties shall be suspended during the period of delay so occasioned.

 

13.4                        Severability.  If any provision of this Agreement shall be found by a court of competent jurisdiction or an arbitral panel convened pursuant to Section 13.11 to be invalid or unenforceable, it is the intention of the Parties that the other provisions of this Agreement shall continue in full force and effect.  It is further the intention of the Parties that in lieu of each such provision which is invalid, illegal or unenforceable, the Parties shall substitute or add as part of this Agreement a provision which shall be as similar as possible in the economic and business

 

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objectives intended by the Parties to such invalid, illegal or unenforceable provision, but which shall be valid, legal and enforceable.

 

13.5                        Amendment.  This Agreement may not be amended, varied or modified in any manner except by an instrument in writing signed by a duly authorized officer or representative of each Party hereto.

 

13.6                        No Waiver.  Any waiver by either Party of a breach of any provision of this Agreement shall not operate as or be construed to be a waiver of any other breach of that provision or of any breach of any other provision of this Agreement.  The failure of either Party to insist upon strict adherence to any term of this Agreement on one or more occasions will not be considered a waiver or deprive that Party of the right to thereafter insist upon strict adherence to that term or any other term of this Agreement.  Any waiver must be in writing and signed by the Party against whom enforcement is sought.

 

13.7                        No Partnership.  AskBio and AveXis shall act as independent contractors and nothing herein shall be construed so as to constitute AskBio or AveXis as being a partner, joint venturer, agent or representative of the other Party for any purpose whatsoever.  Neither AskBio nor AveXis shall engage in any conduct which might create the impression or inference that the other Party is a partner, joint venturer, agent or representative thereof.

 

13.8                        Headings.  The headings contained in this Agreement are for convenience of reference only and are not considered a part of this Agreement and shall in no way affect or alter the meaning or effect of any of the provisions of this Agreement.

 

13.9                        Entire Agreement.  This Agreement (including the Exhibits hereto, all of which are incorporated herein by reference) constitute the entire agreement between the Parties with respect to the subject matter hereto and supersedes any prior or contemporaneous written or oral understanding, negotiations or agreements between and among them relating to the subject matter of this Agreement, including the Confidentiality Agreement; provided, however, that Confidential Information of either Party previously disclosed to the other Party under the Confidentiality Agreement shall be subject to the provisions of Article 7 of this Agreement from and after the Effective Date.  This Agreement shall be binding upon, and inure to the benefit of, the Parties and their respective successors and permitted assigns.

 

13.10                 Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of New York, U.S.A. without regard to its or any other jurisdiction’s choice of law rules.

 

13.11                 Dispute Resolution.

 

(a)                                 The Parties shall attempt to resolve any dispute, controversy, or claim arising out of, or in connection with, this Agreement amicably and promptly by negotiations between executives who have authority to settle the controversy.  Either Party may give the other

 

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Party written notice of any dispute not resolved in the normal course of business.  Within **** after delivery of such notice, executives of the Parties shall agree to meet at a mutually acceptable time and place (in person or via electronic communication methods), and thereafter as often as they reasonably deem necessary, to attempt to resolve the dispute.  If the matter has not been resolved within **** of the first meeting of such executives, either Party may initiate arbitration of the dispute as provided for in Section 13.11(b).

 

(b)                                 All disputes which the Parties are unable to resolve amicably in accordance with Section 13.11(a) hereof within a period of **** from written notice by a Party of its intent to initiate such good faith negotiations, shall be finally settled by binding arbitration in accordance with the Rules of Arbitration of the American Arbitration Association (the “AAA”) by **** appointed in accordance with said rules.  The seat of arbitration shall be New York, New York.  The main and the official language of the arbitration proceedings shall be, and all documents submitted in connection therewith shall be in the English language.  Judgment upon the award may be entered in any court having jurisdiction thereof or having jurisdiction over the applicable Party and/or its assets.  Notwithstanding the generality of Sections 13.11(a) and 13.11(b), and without waiver of a Party’s right to final adjudication on the merits by arbitration as provided herein, either Party may seek provisional remedies by filing a lawsuit in any court, domestic or foreign, having jurisdiction over the Parties or any assets of the Parties, to toll the running of a relevant statute of limitations or to seek equitable or other judicial relief to prevent or stop the breach or threatened breach of this Agreement, including the misuse or disclosure of Confidential Information or otherwise, and to enforce the Parties’ obligations hereunder.

 

13.12                 Publicity.  Neither Party shall make any public announcement or statement concerning this Agreement, its terms or its existence, without the prior written consent of the other Party, such consent not to be unreasonably withheld or delayed.

 

13.13                 Compliance with Applicable Law.  Each Party will comply with all Applicable Laws in performing its obligations and exercising its rights hereunder.  Nothing in this Agreement shall be deemed to permit AveXis or its Sublicensees to export, re-export or otherwise transfer any information or materials transferred hereunder or to deal in any way with Licensed Product(s) without complying with Applicable Laws.

 

13.14                 Counterparts; Facsimile.  This Agreement may be executed in more than one counterpart, each of which constitutes an original and all of which together shall constitute one enforceable agreement.  For purposes of this Agreement and any other document required to be delivered pursuant to this Agreement, facsimiles of signatures shall be deemed to be original signatures.  In addition, if any of the Parties sign facsimile copies of this Agreement, such copies shall be deemed originals.

 

[Signature Page Follows]

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

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IN WITNESS WHEREOF, the Parties hereto have caused their authorized representatives to execute this Agreement as of the Effective Date.

 

 

	
ASKLEPIOS   BIOPHARMACEUTICAL, INC.
    	
 
    	
AVEXIS, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Signature:
    	
/s/ Jade Samulski
    	
 
    	
Signature:
    	
/s/ John D. Harkey, Jr.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Name:
    	
Jade Samulski
    	
 
    	
Name:
    	
John D. Harkey, Jr.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Title:
    	
Vice President
    	
 
    	
Title:
    	
Executive Chairman of   the Board
    

 

 

APPENDIX I

AskBio Patent Rights

 

Self-Complementary Patent Rights:

 

	
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   Publication
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   Date
    
	
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Hybrid Patent Rights

 

The following foreign patents include claims directed to AskBio’s Chimeric Vector Technology, which claims are expressly excluded from the definition of “AskBio Patent Rights” and no right or license is granted in or to such AskBio Chimeric Vector Technology claims under this Agreement.  For the avoidance of doubt, the specific claims that are included in the license grant are listed below.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

 

	
Patent Filing
    	
 
    	
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Included claims
    
	
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*The “AskBio Patent Rights” include all patents and applications claiming the same priority as the above PCT filing, limited to the included claims; provided, however, in no event shall the AskBio Patent Rights include ****.  Notwithstanding the anything to the contrary in this Agreement, if any future Patent Rights (e.g., any correction, divisions, etc.) in any of the Hybrid Patent Rights set forth in this Exhibit A **** shall not be included within the AskBio Patent Rights.

 

****CERTAIN INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

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