Document:

exv10w4

Exhibit 10.4

Text Marked By [* * *] Has Been Omitted Pursuant To A Request For Confidential Treatment And Was

Filed Separately With The Securities And Exchange Commission.

NON-EXCLUSIVE LICENSE AGREEMENT

     This Agreement, effective as of April 15, 2003 (the “Effective Date”), is between the
University of Massachusetts Medical School (“Medical School”), a public institution of
higher education of the Commonwealth of Massachusetts having an address of 55 Lake Avenue North,
Worcester, MA 01655 and CytRx Corporation (“Company”), a Delaware corporation having an
address of 11726 San Vicente Blvd., Suite 650, Los Angeles, CA 90049.

R E C I T A L S

     WHEREAS, Medical School is owner by assignment of the invention claimed in the United States
Patent Application listed in Exhibit A pertaining to the Medical School’s invention
disclosure number UMMC 01-36 entitled RNA Sequence-Specific Mediators of RNA Interference;

     WHEREAS, Company desires to obtain a non-exclusive license in the field of therapeutics
limited to the narrowed fields of other Medical School license agreements; specifically, using RNAi
to inhibit HCMV Immediate Early (IE) gene expression in Retinitis applications, using RNAi to
inhibit mutant SOD1 gene expression in Amytrophic Lateral Sclerosis (ALS) applications, and using
RNAi to inhibit gene targets implicated in Type II Diabetes and Obesity under the rights of Medical
School in any patent rights claiming those inventions; and

     WHEREAS, Medical School is willing to grant Company a non-exclusive license on the terms set
forth in this Agreement.

     NOW, THEREFORE, Medical School and Company hereby agree as follows:

     1. Definitions.

          1.1. “Affiliate” means any legal entity (such as a corporation, partnership, or limited
liability company) that is controlled by Company. For the purposes of this definition, the term
“control” means (a) beneficial ownership of at least fifty percent (50%) of the voting securities
of a corporation or other business organization with voting securities or (b) a fifty percent (50%)
or greater interest in the net assets or profits of a partnership or other business organization
without voting securities.

          1.2. “Biological Materials” means the tangible biological materials described on
Exhibit A, as well as tangible materials that are routinely produced through use of the
original materials, including, for example, any progeny derived from a cell
line, monoclonal antibodies produced by hybridoma cells, DNA or RNA replicated from isolated
DNA or RNA, recombinant proteins produced through use of isolated DNA or RNA, and substances
routinely purified from a source material included in the original materials (such as recombinant
proteins isolated from a cell extract or supernatant by non-proprietary affinity purification
methods). These Biological

 

 

Materials shall be listed on Exhibit A, which will be
periodically amended to include any additional Biological Materials that Medical School may furnish
to Company.

          1.3. “Combination Product” means a product that contains a Licensed Product component
and at least one other essential functional component.

          1.4. “Confidential Information” means any confidential or proprietary information
furnished by one party (the “Disclosing Party”) to the other party (the “Receiving
Party”) in connection with this Agreement, provided that such information is specifically
designated as confidential. Such Confidential Information shall include, without limitation, any
diligence reports furnished to Medical School under Section 3.1 and royalty reports furnished to
Medical School under Section 5.2.

          1.5. “Field” means therapeutics, prophylactics, and diagnostics arising from the limited
use of RNAi to inhibit HCMV Immediate Early (IE) gene expression in Retinitis applications, using
RNAi to inhibit mutant SOD1 gene expression in Amyotrophic Lateral Sclerosis (ALS) applications,
and using RNAi to inhibit gene targets implicated in Type II Diabetes and Obesity.

          1.6. “Licensed Product” means any product that cannot be developed, manufactured, used,
or sold without (a) infringing one or more claims under the Patent Rights or (b) using or
incorporating some portion of one or more Biological Materials.

          1.7. “Net Sales” means the gross amount billed or invoiced on sales by Company and its
Affiliates and Sublicensees of Licensed Products, less the following: (a) customary trade,
quantity, or cash discounts and commissions to non-affiliated brokers or agents to the extent
actually allowed and taken; (b) amounts repaid or credited by reason of rejection or return; (c) to
the extent separately stated on purchase orders, invoices, or other documents of sale, any taxes or
other governmental charges levied on the production, sale, transportation, delivery, or use of a
Licensed Product which is paid by or on behalf of Company; (d) outbound transportation costs
prepaid or allowed and costs of insurance in transit; and (e) allowance for bad debt that is
customary and reasonable for the industry and in accordance with generally accepted accounting
principles. Notwithstanding anything to the contrary in this Section 1.7, Net Sales does not
include sales of Licensed Products at or below the fully burdened cost of manufacturing solely for
research or clinical testing or for indigent or similar public support or compassionate use
programs.

     In any transfers of Licensed Products between Company and an Affiliate or Sublicensee, Net
Sales shall be calculated based on the final sale of the Licensed Product to an independent third
party. In the event that Company or an Affiliate or Sublicensee receives
non-monetary consideration for any Licensed Products, Net Sales shall be calculated based on
the fair market value of such consideration.

     In the case of Combination Products, Net Sales means the gross amount billed or invoiced on
sales of the Combination Product less the deductions set forth above, multiplied by a proration
factor that is determined as follows:

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                    (i) If all components of the Combination Product were sold separately during the same or
immediately preceding Royalty Period, the proration factor shall be determined by the formula [A /
(A+B)], where A is the aggregate gross sales price of all Licensed Product components during such
period when sold separately from the other essential functional components, and B is the aggregate
gross sales price of the other essential functional components during such period when sold
separately from the Licensed Product Components; or

                    (ii) If all components of the Combination Product were not sold separately during the same or
immediately preceding Royalty Period, the proration factor shall be determined by the formula [C /
(C+D)], where C is the aggregate fully absorbed cost of the Licensed Product components during the
prior Royalty Period and D is the aggregate fully absorbed cost of the other essential functional
components during the prior Royalty Period, with such costs being determined in accordance with
generally accepted accounting principles.

          1.8. “Patent Rights” means the U.S. patent applications listed on Exhibit A, and
any divisional, continuation, or continuation-in-part of such patent applications to the extent the
claims are directed to subject matter specifically described therein, as well as any patent issued
thereon and any reissue or reexamination of such patent, and any foreign counterparts to such
patents and patent applications. Exhibit A shall be periodically amended to include any
additional Patent Rights that may arise. “Medical School Patent Rights” means Patent
Rights assigned to the Medical School and the joint owners Massachusetts Institute of Technology,
the Whitehead Institute for Biomedical Research, and Max-Planck-Gesellschaft Zur Foerderung Der
Wissenschaften E.V.

          1.9. “Royalty Period” means the partial calendar quarter commencing on the date on which
the first Licensed Product is sold or used every complete or partial calendar quarter thereafter
during which either (a) this Agreement remains in effect or (b) Company has the right to complete
and sell work-in-progress and inventory of Licensed Products pursuant to Section 6.5.

          1.10. “Sublicensee” means any permitted sublicensee of the rights granted Company under
this Agreement, as further described in Section 2.2.

          1.11. “Sublicense Income” means any payments that Company receives from a Sublicensee in
consideration of the sublicense of the rights granted Company under Section 2.1, including without
limitation license fees, royalties, milestone payments,
and license maintenance fees, but excluding the following payments: (a) payments made in
consideration for the issuance of equity or debt securities of Company at fair market value, and
(b) payments specifically committed to the development of Licensed Products.

     2. Grant of Rights.

          2.1. Subject to the terms of this Agreement, Medical School hereby grants to Company and its
Affiliates a non-exclusive, worldwide, royalty-bearing license (with the right to sublicense) under
its commercial rights in the Patent Rights and Biological Materials to develop, make, have made,
use, and sell Licensed Products in the Field.

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          2.2. Sublicenses. Company shall have the right to grant sublicenses of its rights under Section
2.1 with the consent of Medical School, which consent shall not be unreasonably withheld or
delayed. All sublicense agreements executed by Company pursuant to this Article 2 shall expressly
bind the Sublicensee to the terms of this. Company shall promptly furnish Medical School with a
fully executed copy of any such sublicense agreement.

     3. Company Obligations Relating to Commercialization.

          3.1. Diligence Requirements. Company shall use diligent efforts or shall cause its Affiliates
or Sublicensees to use diligent efforts to develop Licensed Products and to introduce Licensed
Products into the commercial market; thereafter, Company or its Affiliates or Sublicensees shall
make Licensed Products reasonably available to the public. Specifically, Company or its Affiliates
or Sublicensees shall fulfill the following obligations:

               (a) Within ninety (90) days after the Effective Date, Company shall furnish Medical School
with a written research and development plan under which Company intends to develop Licensed
Products.

               (b) Within sixty (60) days after each anniversary of the Effective Date, Company shall
furnish Medical School with a written report on the progress of its efforts during the prior year
to develop and commercialize Licensed Products, including without limitation research and
development efforts, efforts to obtain regulatory approval, marketing efforts, and sales figures.
The report shall also contain a discussion of intended efforts and sales projections for the
current year.

               (c) Company shall endeavor to obtain all necessary governmental approvals for the
manufacture, use and sale of Combination Product and Licensed Product. Specifically, Company
shall:

                    (i) Within eight (8) years after the Effective Date, file an Investigational New Drug
Application (“IND”) or its equivalent covering at least one Combination Product or Licensed
Product with the U.S. Food and Drug Administration (“FDA”);

                    (ii) Within thirteen (13) years after the Effective Date, file a New Drug Application
(“NDA”) with the FDA covering at least one Combination Product or Licensed Product;

                    (iii) Within eighteen (18) months after receiving FDA approval of the NDA for a Combination
Product or Licensed Product, market at least one Combination Product or Licensed Product in the
U.S.; and

                    (iv) reasonably fill the market demand for any Combination Product or Licensed Product
following commencement of marketing of such product at any time during the exclusive period of this
Agreement.

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               (d) Within eighteen (18) months after the Effective Date, Company shall successfully
undertake a public or private offering of raising ten million dollars ($10,000,000).

               (e) In addition to the obligations set forth above, Company or its Affiliates or Sublicensees
shall spend (either directly or through sponsored research by Company or its Affiliates or
Sublicensees at the Medical School) an aggregate of not less than [* * *] per calendar
year for the development of Combination Product and/or Licensed Product commencing with the year
2004.

     Company shall have the responsibility to finance its obligations in this Section 3.1, and the
Medical School shall provide reasonable cooperation to Company in this regard. In the event that
Medical School determines that Company (or an Affiliate or Sublicensee) has not fulfilled its
obligations under this Section 3.1, Medical School shall furnish Company with written notice of
such determination. Within sixty (60) days after receipt of such notice, Company shall either (i)
fulfill the relevant obligation or (ii) negotiate with Medical School a mutually acceptable
schedule of revised diligence obligations, failing which Medical School shall have the right,
immediately upon written notice to Company, to terminate this Agreement.

          3.2. Indemnification.

               (a) Indemnity. Company shall indemnify, defend, and hold harmless Medical School and
its trustees, officers, faculty, students, employees, and agents and their respective successors,
heirs and assigns (the “Indemnitees”), against any liability, damage, loss, or expense
(including reasonable attorneys fees and expenses of litigation) incurred by or imposed upon any of
the Indemnitees in connection with any claims, suits, actions, demands or judgments arising out of
any theory of liability (including without limitation actions in the form of tort, warranty, or
strict liability and regardless of whether such action has any factual basis) concerning any
product, process, or service that is made, used, or sold pursuant to any right or license granted
under this Agreement; provided, however, that such indemnification shall not apply to any
liability, damage, loss, or expense to the extent directly
attributable to (i) the negligent activities or intentional misconduct of the Indemnitees or
(ii) the settlement of a claim, suit, action, or demand by Indemnitees without the prior written
approval of Company.

               (b) Procedures. The Indemnitees agree to provide Company with prompt written notice
of any claim, suit, action, demand, or judgment for which indemnification is sought under this
Agreement. Company agrees, at its own expense, to provide attorneys reasonably acceptable to
Medical School to defend against any such claim. The Indemnitees shall cooperate fully with
Company in such defense and will permit Company to conduct and control such defense and the
disposition of such claim, suit, or action (including all decisions relative to litigation, appeal,
and settlement); provided, however, that any Indemnitee shall have the right to retain its own
counsel, at the expense of Company, if representation of such Indemnitee by the counsel retained by
Company would be inappropriate because of actual or potential differences in the interests of such
Indemnitee and any other party represented by such counsel. Company agrees to keep Medical School
informed of the progress in the defense and disposition of such claim and to consult with Medical
School with regard to any proposed settlement.

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               (c) Insurance. Company shall maintain insurance or self-insurance that is
reasonably adequate to fulfill any potential obligation to the Indemnitees, but in any event not
less than one million dollars ($1,000,000) for injuries to any one person arising out of a single
occurrence and five million dollars ($5,000,000) for injuries to all persons arising out of a
single occurrence. Company shall provide Medical School, upon request, with written evidence of
such insurance or self-insurance. Company shall continue to maintain such insurance or
self-insurance after the expiration or termination of this Agreement during any period in which
Company or any Affiliate or Sublicensee continues to make, use, or sell a product that was a
Licensed Product under this Agreement and thereafter for a period of two (2) years.

          3.3. Use of Medical School Name. In accordance with Section 6.3, Company and its
Affiliates and Sublicensees shall not use the name “University of Massachusetts Medical
School” or any variation of that name in connection with the marketing or sale of any Licensed
Products.

          3.4. Marking of Licensed Products. To the extent commercially feasible and consistent
with prevailing business practices, Company shall mark, and shall cause its Affiliates and
Sublicensees to mark, all Licensed Products that are manufactured or sold under this Agreement with
the number of each issued patent under the Patent Rights that applies to such Licensed Product.

          3.5. Compliance with Law. Company shall comply with, and shall ensure that its
Affiliates and Sublicensees comply with, all local, state, federal, and international laws and
regulations relating to the development, manufacture, use, and sale of Licensed Products. Company
expressly agrees to comply with the following:

               (a) Company or its Affiliates and Sublicensees shall obtain all necessary approvals from the
United States Food & Drug Administration and any similar governmental authorities of any foreign
jurisdiction in which Company or an Affiliate or Sublicensee intends to make, use, or sell Licensed
Products.

               (b) Company and its Affiliates and Sublicensees shall comply with all United States laws and
regulations controlling the export of certain commodities and technical data, including without
limitation all Export Administration Regulations of the United States Department of Commerce.
Among other things, these laws and regulations prohibit, or require a license for, the export of
certain types of commodities and technical data to specified countries. Company hereby gives
written assurance that it will comply with, and will cause its Affiliates and Sublicensees to
comply with, all United States export control laws and regulations, that it bears sole
responsibility for any violation of such laws and regulations by itself or its Affiliates and
Sublicensees, and that it will indemnify, defend, and hold Medical School harmless (in accordance
with Section 3.1) for the consequences of any such violation.

     4. Consideration for Grant of Rights.

          4.1. License Fee. In partial consideration of the rights granted Company under this
Agreement, Company shall pay to Medical School, within thirty (30) days after the Effective Date,
(a) a license fee of [* * *], and (b) a payment in the amount of [* * *] to
reimburse Medical

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School for its actual expenses incurred as of January 31, 2003 in connection with
obtaining the Patent Rights. These license fee payments are nonrefundable and are not creditable
against any other payments due to Medical School under this Agreement.

          4.2. Equity. In partial consideration of the license granted to Company under this
Agreement, on or about April 18, 2003, Company shall issue to Medical School a total number of
shares of Common Stock of Company, ($.01 par value per share) equal to [* * *] of the
outstanding shares of Company. Company shall register the shares that are issued to the Medical
School within ninety (90) days after their issuance and those shares will then be unrestricted.

          4.3. License Maintenance Fee. Beginning on the anniversary of the Effective Date, and
in each calendar year during the term of the Agreement, Company shall pay to Medical School [*
* *]. This annual license maintenance fee is nonrefundable and is not creditable against any
other payments due to Medical School under this Agreement.

          4.4. Royalties. In partial consideration of the rights granted Company under this
Agreement, Company shall pay to Medical School a royalty of [* * *] of Net Sales of
Licensed Products by Company and its Affiliates.

               (a) If there is a competing product in the marketplace, no royalties are due for a Licensed
Product that is within the definition of “Licensed Product” because it uses or incorporates
only Biological Materials.

               (b) If during the Royalty Period, patents under the Patent Rights have expired or have been
abandoned in a particular country, (i) no royalty is payable by Company, if there is a competing
product in that country, and (ii) if Company reduces its prices for Licensed Products in that
country, even if there is no competing product in that country, Company and Medical School shall
negotiate in good faith a reduction in the royalty rate to reflect the reduction in Company’s gross
margins caused by the price reduction.

               (c) Company shall pay Medical School [* * *] of Net Sales of commercial clinical
laboratory services by Company and its Affiliates.

          4.5. Minimum Royalty. At the beginning of each calendar year during the term of this
Agreement, beginning January 1, 2016, Company shall pay to Medical School a minimum royalty of
[* * *]. If the actual royalty payments to Medical School in any calendar year are less
than the minimum royalty payment required for that year, Company shall have the right to pay
Medical School the difference between the actual royalty payment and the minimum royalty payment in
full satisfaction of its obligations under this Section, provided such minimum payment is made to
Medical School within sixty (60) days after the conclusion of the calendar year. Waiver of any
minimum royalty payment by Medical School shall not be construed as a waiver of any subsequent
minimum royalty payment. If Company fails to make any minimum royalty payment within the sixty-day
period, such failure shall constitute a material breach of its obligations under this Agreement,
and Medical School shall have the right to terminate this Agreement in accordance with Section 7.3.

          4.6. Third-Party Royalties. If Company is legally required to make royalty payments to
Medical School under any agreement other than this Agreement (the “Other

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Medical School
Licenses”), or to one or more third parties in the same Royalty Period for which royalties are
due under Section 4.5 or 4.7 in order for Company to make, use or sell Licensed Products or have
its sublicense make, use, or sell Licensed Products:

               (a) in the case of any payments to Medical School under Other Medical School Licenses with
respect to Licensed Products under this Agreement, the royalty payment made by Company to Medical
School under this Agreement for the applicable Royalty Payment shall be reduced by fifty percent
(50%) of the aggregate amounts payable for the same Royalty Period under the Other Medical School
Licenses (before making any similar reduction in those payments pursuant to a corresponding
reduction clause in those agreements), with a minimum floor of [* * *] of Net Sales of
Licensed Products or [* * *] of the Sublicense Income to be paid under this Agreement;
and

               (b) in the case of payments to one or more third parties, an offset of fifty percent (50%) of
the amount paid to third parties may be taken by Company against any royalties payable by Company
to the Medical School under this Agreement with a minimum floor of [* * *] of Net Sales
of Licensed Products or [* * *] of all Sublicense Income, provided that in no event shall
the
royalty payments under Section 4.5 and 4.7, when aggregated with any other offsets and credits
allowed under this Agreement, be reduced by more than fifty percent (50%); in the case of payments
to one or more third parties, Medical School shall receive [* * *] of the Sublicense
Income net of the foregoing third party payments; and

               (c) in the case of both payments under Other Medical School Licenses and to third parties in
the same Royalty Period, the reduction described in (i) above shall first be made, and then the
offset described in (ii) above shall be taken, provided that only a pro rata amount of the offset
pursuant to (ii) above shall be taken against the royalties payable under this Agreement (with the
pro-ration calculated based on the relative royalty rates under this Agreement and the Other
Medical School Licenses), with a minimum floor under this Agreement of [* * *] of Net
Sales of Licensed Products and [* * *] of Sublicense Income.

     By way of illustration, assume a royalty of [* * *] under the Other Medical School
Licenses of Net Sales of Licensed Products and a payment of [* * *] of Net Sales of
Licensed Products to a third party. The reduction and offsets calculation would be as follows:

                    (i) The [* * *] of Net Sales of Licensed Products would be reduced to [* * *]
of Net Sales of Licensed Products (i.e., a reduction of 50% of the [* * *] of Net
Sales of Licensed Products under Other Medical School Licenses); and

                    (ii) The remaining [* * *] of Net Sales of Licensed Products would be offset by an
amount equal to [* * *] of Net Sales of Licensed Products, for a net royalty to the
Medical School under this Agreement of [* * *] of Net Sales of Licensed Products (i.e.,
the offset of 50% of the [* * *] of Net Sales of Licensed Products payable to the third
party is allocated pro rata against Medical School under this Agreement, with 33 1/3% of this net
offset of [* * *] of Net Sales of Licensed Products being allocated to the royalties
under this Agreement (the [* * *] royalty rate under this Agreement divided by the
[* * *] royalty rate under this Agreement plus the [* * *] royalty rate under
the Other Medical School Licenses)).

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     5. Royalty Reports; Payments; Records.

          5.1. First Sale. Company shall report to Medical School the date of first commercial
sale of each Licensed Product within thirty (30) days of occurrence in each country.

          5.2. Reports and Payments. Within sixty (60) days after the conclusion of each Royalty
Period, Company shall deliver to Medical School a report containing the following information:

               (a) the number of Licensed Products sold to independent third parties in each country, and the
number of Licensed Products used by Company and its Affiliates in the provision services in each
country;

               (b) the gross sales price for each Licensed Product by Company and its Affiliates or
Sublicensees during the applicable Royalty Period in each country;

               (c) calculation of Net Sales for the applicable Royalty Period in each country, including a
listing of applicable deductions; and

               (d) total royalty payable on Net Sales in U.S. dollars, together with the exchange rates used
for conversion.

     If no royalties are due to Medical School for any Royalty Period, the report shall so state.
Concurrent with this report, Company shall remit to Medical School any payment due for the
applicable Royalty Period. Medical School shall instruct Company as to the method of payment.

     The contents of all such reports shall be the confidential and proprietary information of
Company. To the extent permitted by applicable law, Medical School shall use reasonable efforts to
maintain the confidentiality of such reports.

          5.3. Payments in U.S. Dollars. All payments due under this Agreement shall be payable
in United States dollars. Conversion of foreign currency to U.S. dollars shall be made at the
conversion rate existing in the United States (as reported in the Wall Street Journal) on
the last working day of the calendar quarter preceding the applicable Royalty Period. Such
payments shall be without deduction of exchange, collection, or other charges.

          5.4. Payments in Other Currencies. If by law, regulation, or fiscal policy of a
particular country, conversion into United States dollars or transfer of funds of a convertible
currency to the United States is restricted or forbidden, Company shall give Medical School prompt
written notice of such restriction, which notice shall satisfy the sixty-day payment deadline
described in Section 5.2. Company shall pay any amounts due Medical School through whatever lawful
methods Medical School reasonably designates; provided, however, that if Medical School fails to
designate such payment method within thirty (30) days after Medical School is notified of the
restriction, Company may deposit such payment in local currency to the credit of Medical School in
a recognized banking institution selected by Company and identified by written notice to Medical
School, and such deposit shall fulfill all obligations of Company to Medical School with respect to
such payment.

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          5.5. Records. Company shall maintain, and shall cause its Affiliates to maintain,
complete and accurate records of Licensed Products that are made, used, sold, or performed under
this Agreement and any amounts payable to Medical School in relation to such Licensed Products,
which records shall contain sufficient information to permit Medical School to confirm the accuracy
of any reports delivered to Medical School under Section 5.2. The relevant party shall retain such
records relating to a given Royalty Period for at least three (3) years after the conclusion of
that Royalty Period, during which time Medical School shall have the
right, at its expense, to cause its internal accountants or an independent, certified public
accountant to inspect such records during normal business hours for the sole purpose of verifying
any reports and payments delivered under this Agreement. Such accountant shall not disclose to
Medical School any information other than information relating to accuracy of reports and payments
delivered under this Agreement. The parties shall reconcile any underpayment or overpayment within
thirty (30) days after the accountant delivers the results of the audit. In the event that any
audit performed under this Section reveals an underpayment in excess of the greater of (a) five
thousand dollars ($5,000) or (b) ten percent (10%) in any Royalty Period, Company shall bear the
full cost of such audit. Medical School may exercise its rights under this Section only once every
year and only with reasonable prior notice to Company.

          5.6. Late Payments. Any payments by Company that are not paid on or before the date
such payments are due under this Agreement shall bear interest, to the extent permitted by law, at
two percentage points above the Prime Rate of interest as reported in the Wall Street
Journal on the date payment is due, with interest calculated based on the number of days that
payment is delinquent.

          5.7. Method of Payment. All payments under this Agreement should be made in the name of
the “Medical School of Massachusetts” and sent to the address identified below. Each
payment should reference this Agreement and identify the obligation under this Agreement that the
payment satisfies.

          5.8. Withholding and Similar Taxes. Royalty payments and other payments due to Medical
School under this Agreement shall be reduced by reason of any withholding or similar taxes
applicable to such payments to Medical School, which shall be paid by Company as required by
applicable law and reported by Company to the Medical School.

     6. Confidential Information; Publications; Publicity.

          6.1. Confidential Information.

               (a) Designation. Confidential Information that is disclosed in writing shall be
marked with a legend indicating its confidential status (such as “Confidential” or
“Proprietary”). Confidential Information that is disclosed orally or visually shall be
documented in a written notice prepared by the Disclosing Party and delivered to the Receiving
Party within thirty (30) days of the date of disclosure; such notice shall summarize the
Confidential Information disclosed to the Receiving Party and reference the time and place of
disclosure.

               (b) Obligations. For a period of five (5) years after disclosure of any portion of
Confidential
Information, the Receiving Party shall (i) maintain such Confidential

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Information in
strict confidence, except that the Receiving Party may disclose or permit the disclosure of any
Confidential
Information to its directors, officers, employees, consultants, and advisors who are
obligated to maintain the confidential nature of such Confidential Information and who need to
know such Confidential Information for the purposes of this Agreement; (ii) use such Confidential
Information solely for the purposes of this Agreement; and (iii) allow its trustees or directors,
officers, employees, consultants, and advisors to reproduce the Confidential Information only to
the extent necessary for the purposes of this Agreement, with all such reproductions being
considered Confidential Information.

               (c) Exceptions. The obligations of the Receiving Party under Subsection 6.1.(b)
above shall not apply to the extent that the Receiving Party can demonstrate that certain
Confidential Information (i) was in the public domain prior to the time of its disclosure under
this Agreement; (ii) entered the public domain after the time of its disclosure under this
Agreement through means other than an unauthorized disclosure resulting from an act or omission by
the Receiving Party; (iii) was independently developed or discovered by the Receiving Party without
use of the Confidential Information; (iv) is or was disclosed to the Receiving Party at any time,
whether prior to or after the time of its disclosure under this Agreement, by a third party having
no fiduciary relationship with the Disclosing Party and having no obligation of confidentiality
with respect to such Confidential Information; or (v) is required to be disclosed to comply with
applicable laws or regulations, or with a court or administrative order, provided that the
Disclosing Party receives reasonable prior written notice of such disclosure.

               (d) Ownership and Return. The Receiving Party acknowledges that the Disclosing Party
(or any third party entrusting its own information to the Disclosing Party) claims ownership of its
Confidential Information in the possession of the Receiving Party. Upon the expiration or
termination of this Agreement, and at the request of the Disclosing Party, the Receiving Party
shall return to the Disclosing Party all originals, copies, and summaries of documents, materials,
and other tangible manifestations of Confidential Information in the possession or control of the
Receiving Party, except that the Receiving Party may retain one copy of the Confidential
Information in the possession of its legal counsel solely for the purpose of monitoring its
obligations under this Agreement.

          6.2. Publications. Medical School and its employees will be free to publicly disclose
(through journals, lectures, or otherwise) the results of any research in the Field or relating to
the subject matter of the Patent Rights, except as otherwise provided by written agreement between
Medical School and Company (e.g., a sponsored research agreement).

          6.3. Publicity Restrictions. Company shall not use the name of Medical School or any of
its trustees, officers, faculty, students, employees, or agents, or any adaptation of such names,
or any terms of this Agreement in any promotional material or other public announcement or
disclosure without the prior written consent of Medical School. The foregoing notwithstanding,
Company shall have the right to disclose such information without the consent of Medical School in
any prospectus, offering memorandum, or other document or filing required by applicable securities
laws or other applicable law or regulation, provided that Company shall have given Medical School
at least ten (10) days (or such prior shorter period in order to enable Company to make a
timely announcement, while affording the Medical School

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the
maximum feasible time to review
the announcement) prior written notice of the proposed text for the purpose of giving Medical
School the opportunity to comment on such text.

     7. Term and Termination.

          7.1. Term. This Agreement shall commence on the Effective Date and shall remain in
effect until (a) the expiration of all issued patents within the Patent Rights or (b) for a period
of ten (10) years after the Effective Date if no such patents have issued within that ten-year
period, unless earlier terminated in accordance with the provisions of this Agreement.

          7.2. Termination for Default. In the event that either party commits a material breach
of its obligations under this Agreement and fails to cure that breach within sixty (60) days after
receiving written notice thereof, the other party may terminate this Agreement immediately upon
written notice to the party in breach.

          7.3. Force Majeure. Neither party will be responsible for delays resulting from causes
beyond the reasonable control of such party, including without limitation fire, explosion, flood,
war, strike, or riot, provided that the nonperforming party uses commercially reasonable efforts to
avoid or remove such causes of nonperformance and continues performance under this Agreement with
reasonable dispatch whenever such causes are removed.

          7.4. Effect of Termination. The following provisions shall survive the expiration or
termination of this Agreement: Articles 1 and 8; Sections 3.2, 3.5., 5.2. (obligation to provide
final report and payment), 6.1., 7.5., and 9.9. Upon the early termination of this Agreement,
Company and its Affiliates or Sublicensees may complete and sell any work-in-progress and inventory
of Licensed Products that exist as of the effective date of termination, provided that (a) Company
is current in payment of all amounts due Medical School under this Agreement, (b) Company pays
Medical School the applicable royalty on such sales of Licensed Products in accordance with the
terms and conditions of this Agreement, and (c) Company and its Affiliates or Sublicensees shall
complete and sell all work-in-progress and inventory of Licensed Products within six (6) months
after the effective date of termination.

     8. Dispute Resolution.

          8.1. Procedures Mandatory. The parties agree that any dispute arising out of or
relating to this Agreement shall be resolved solely by means of the procedures set forth in this
Article, and that such procedures constitute legally binding obligations that are an essential
provision of this Agreement; provided, however, that all procedures and deadlines specified in this
Article may be modified by written agreement of the parties. If either party fails to observe the
procedures of this Article, as modified by their written agreement, the other party may bring an
action for specific performance in any court of competent jurisdiction.

          8.2. Dispute Resolution Procedures.

               (a) Negotiation. In the event of any dispute arising out of or relating to this
Agreement, the affected party shall notify the other party, and the parties shall attempt in good
faith to resolve the matter within ten (10) days after the date of such notice (the “Notice
Date”). Any disputes not resolved by good faith discussions shall be referred to senior

12

 

executives of each party, who shall meet at a mutually acceptable time and location within thirty
(30) days after the Notice Date and attempt to negotiate a settlement.

               (b) Mediation. If the matter remains unresolved within sixty (60) days after the
Notice Date, or if the senior executives fail to meet within thirty (30) days after the Notice
Date, either party may initiate mediation upon written notice to the other party, whereupon both
parties shall be obligated to engage in a mediation proceeding under the then current Center for
Public Resources (“CPR”) Model Procedure for Mediation of Business Disputes, except that
specific provisions of this Section shall override inconsistent provisions of the CPR Model
Procedure. The mediator will be selected from the CPR Panels of Neutrals. If the parties cannot
agree upon the selection of a mediator within ninety (90) days after the Notice Date, then upon the
request of either party, the CPR shall appoint the mediator. The parties shall attempt to resolve
the dispute through mediation until one of the following occurs: (i) the parties reach a written
settlement; (ii) the mediator notifies the parties in writing that they have reached an impasse;
(iii) the parties agree in writing that they have reached an impasse; or (iv) the parties have not
reached a settlement within one hundred and twenty (120) days after the Notice Date.

               (c) Trial Without Jury. If the parties fail to resolve the dispute through
mediation, or if neither party elects to initiate mediation, each party shall have the right to
pursue any other remedies legally available to resolve the dispute, provided, however, that the
parties expressly waive any right to a jury trial in any legal proceeding under this Section.

          8.3. Preservation of Rights Pending Resolution.

               (a) Performance to Continue. Each party shall continue to perform its obligations
under this Agreement pending final resolution of any dispute arising out or relating to this
Agreement; provided, however, that a party may suspend performance of its obligations during any
period in which the other party fails or refuses to perform its obligations.

               (b) Provisional Remedies. Although the procedures specified in this Article are the
sole and exclusive procedures for the resolution of disputes arising out of relating to this
Agreement, either party may seek a preliminary injunction or other provisional equitable relief if,
in its reasonable judgment, such action is necessary to avoid irreparable harm to itself or to
preserve its rights under this Agreement.

               (c) Statute of Limitations. The parties agree that all applicable statutes of
limitation and time-based defenses (such as estoppel and laches) shall be tolled while the
procedures set forth in Subsections 8.2.(a) and 8.2(b) are pending. The parties shall take any
actions necessary to effectuate this result.

     9. Miscellaneous.

          9.1. Representations and Warranties. Representations and Warranties. Medical School
represents and warrants that its employees have assigned to Medical School their entire right,
title, and interest in the Patent Rights, that it has authority to grant the rights and licenses
set forth in this Agreement, and that, to its best knowledge, Medical School does not hold any
other intellectual property rights that would be infringed by the exploitation of the Patent
Rights. MEDICAL SCHOOL MAKES NO OTHER WARRANTIES CONCERNING

13

 

THE PATENT RIGHTS AND BIOLOGICAL
MATERIALS, INCLUDING WITHOUT LIMITATION ANY EXPRESS OR IMPLIED WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE. Specifically, Medical School makes no warranty or representation
(a) that the exploitation of any Licensed Product will not infringe any patents or other
intellectual property rights of a third party, (b) regarding the validity or scope of the Patent
Rights, and (c) that any third party is not currently infringing or will not infringe the Patent
Rights.

          9.2. Compliance with Law and Policies. Company agrees to comply with applicable law and
the policies of Medical School in the area of technology transfer and shall promptly notify Medical
School of any violation that Company knows or has reason to believe has occurred or is likely to
occur. The Medical School policies currently in effect at 365 Plantation Street, Ste. 130,
Worcester MA, 01605 campus are available online at www.umassmed.edu/research/policies.

          9.3. Tax-Exempt Status. Company acknowledges that Medical School, as a public
institution of the Commonwealth of Massachusetts, holds the status of an exempt organization under
the United States Internal Revenue Code. Company also acknowledges that certain facilities in
which the licensed inventions were developed may have been financed through offerings of tax-exempt
bonds. If the Internal Revenue Service determines, or if counsel to Medical School reasonably
determines, that any term of this Agreement jeopardizes the tax-exempt status of Medical School or
the bonds used to finance Medical School facilities, the relevant term shall be deemed an invalid
provision and modified in accordance with Section 10.11.

          9.4. Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, and all of which together shall be deemed to be one and the same
instrument.

          9.5. Headings. All headings are for convenience only and shall not affect the meaning
of any provision of this Agreement.

          9.6. Binding Effect. This Agreement shall be binding upon and inure to the benefit of
the parties and their respective permitted successors and assigns.

          9.7. Assignment. This Agreement may not be assigned by either party without the prior
written consent of the other party, except that Company may assign this Agreement to an Affiliate
or to a successor in connection with the merger, consolidation, or sale of all or substantially all
of its assets or that portion of its business to which this Agreement relates.

          9.8. Amendment and Waiver. This Agreement may be amended, supplemented, or otherwise
modified only by means of a written instrument signed by both parties. Any waiver of any rights or
failure to act in a specific instance shall relate only to such instance and shall not be construed
as an agreement to waive any rights or fail to act in any other instance, whether or not similar.

14

 

          9.9. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Massachusetts irrespective of any conflicts of law principles.

          9.10. Notice. Any notices required or permitted under this Agreement shall be in
writing, shall specifically refer to this Agreement, and shall be sent by hand, recognized national
overnight courier, confirmed facsimile transmission, confirmed electronic mail, or registered or
certified mail, postage prepaid, return receipt requested, to the following addresses or facsimile
numbers of the parties:

If to Medical School:

Office of Technology Management

Medical School of Massachusetts

365 Plantation Street, Suite 130

Worcester, MA 01605

Attention: Joseph F.X. McGuirl

                 Executive Director

Tel:            (508) 856-1626

Fax:            (508) 856-1482

If to Company:

CytRx Corporation

11726 San Vicente Blvd., Suite 650

Los Angeles, CA 90049

Attention: Steven A. Kriegsman

                 Chief Executive Officer

Tel: (310) 826-5449

Fax: (310) 826-5529

     All notices under this Agreement shall be deemed effective upon receipt. A party may change
its contact information immediately upon written notice to the other party in the manner provided
in this Section.

          9.11. Severability. In the event that any provision of this Agreement shall be held
invalid or unenforceable for any reason, such invalidity or unenforceability shall not affect any
other provision of this Agreement, and the parties shall negotiate in good faith to modify the
Agreement to preserve (to the extent possible) their original intent. If the parties fail to reach
a modified agreement within sixty (60) days after the relevant provision is held invalid or
unenforceable, then the dispute shall be resolved in accordance with the procedures set forth in
Article 7. While the dispute is pending resolution, this Agreement shall be construed as if such
provision were deleted by agreement of the parties.

          9.12. Entire Agreement. This Agreement constitutes the entire agreement between the
parties with respect to its subject matter and supersedes all prior agreements or understandings
between the parties relating to its subject matter.

15

 

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

	 	 	 	 	 	 	 

	MEDICAL SCHOOL OF MASSACHUSETTS	 	CYTRX CORPORATION
	 
	 	 	 	 	 	 
	By:

	 	/s/ Joseph F.X. McGuirl
	 	By:
	 	/s/ Steven A. Kriegsman
	 

	 	 
	 	 	 	 
	 

	 	Joseph F.X. McGuirl
	 	 	 	Steven A. Kriegsman
	 

	 	Executive Director, CVIP
	 	 	 	Chief Executive Officer

16

 

Exhibit A

List of Patent Rights

     UMMC 01-36 “RNA Sequence-Specific Mediators of RNA Interference” Inventors: David P.
Bartel, Philip A. Sharp, Thomas Tuschl, and Philip D. Zamore

I. United States Patents and Application

	 	 	USSN 60/265232 entitled “RNA Sequence-Specific Mediators of RNA
Interference”, by David P. Bartel, Philip A. Sharp, Thomas Tuschl, and
Philip D. Zamore

	 	 	USSN 09/821832 entitled “RNA Sequence-Specific Mediators of RNA
Interference”, by David P. Bartel, Philip A. Sharp, Thomas Tuschl, and
Philip D. Zamore

II. International (non-U.S.) Patents and Applications

	 	 	PCT/US01/10188 entitle “RNA Sequence-Specific Mediators of RNA
Interference”, by David P. Bartel, Philip A. Sharp, Thomas Tuschl, and
Philip D. Zamore

A - 1

 

AMENDMENT NO. 1

TO

NON-EXCLUSIVE LICENSE AGREEMENT

(UMMC 01-36)

     This Amendment No. 1, dated as of February 1, 2004 (the “Amendment”) is being made to
the Non-Exclusive License Agreement relating to UMMC 01-36 (the “License Agreement”),
effective as of April 15, 2003, by and between the University of Massachusetts Medical School
(“Medical School”), a public institution of higher education of the Commonwealth of
Massachusetts having an address of 55 Lake Avenue North, Worcester, MA 01655, and CytRx Corporation
(“Company”), a Delaware corporation having an address of 11726 San Vicente Boulevard, Suite
650, Los Angeles, California 90049.

R E C I T A L S

     WHEREAS, Section 4.6 of the License Agreement provided for the calculation of payments payable
to Medical School under Section 4.4 of the License Agreement in the event Company was required to
make certain other payments to Medical School or third parties; and

     WHEREAS, Medical School and Company wish to clarify the manner in which Section 4.6 of the
License Agreement shall operate;

     NOW, THEREFORE, Medical School and Company hereby agree as follows:

     1. Amendment to Section 4.6.

     Section 4.6 of the License Agreement is hereby amended to read in full as follows:

     “4.6 Third-Party and Other Payments. If Company is legally required to make royalty
or sublicense income payments to Medical School under any other license agreement, as well as this
Agreement, or to one or more third parties, as well as this Agreement, in the same Royalty Period
for which payments are due under Section 4.4 in order for Company to make, use or sell Licensed
Products or have its Sublicensee make, use, or sell Licensed Products:

     (a) Other Medical School Payments. In the case of payments to Medical School under
Section 4.4 with respect to any Licensed Product, Company shall pay only the highest rate among
this Agreement and any other Medical School licenses, and that one payment shall be deemed to
satisfy the payment requirements for the applicable period under not only this Agreement but each
of the other Medical School licenses.

     (b) Third Party Payments. In the case of payments to one or more third parties with
respect to any Licensed Product under this Agreement, Company may reduce its payment to Medical
School under Section 4.4 of this Agreement for the applicable Royalty Period by fifty percent (50%)
of the amount actually paid to third parties. However, in no event will the reductions made
pursuant to this Section 4.6(b) result in more than a fifty percent (50%) reduction in the payments
that would otherwise be payable to Medical School under Section 4.4 (after taking into account
Section 4.6(b)).

-1-

 

     (c) Example: Royalty Reductions. By way of illustration for Section 4.4 royalty
payment reductions, for a particular Licensed Product, assume a royalty of [* * *] of Net
Sales under another Medical School license and a payment of [* * *] of Net Sales to a
third party. The reduction calculation would be as follows: The total [* * *] royalty
rate in this Agreement would apply, and Company would reduce that rate by 50% due to the [* *
*] due to the third party (with a 50% cap on the rate reduction pursuant to Section 4.6),
resulting in a [* * *] royalty to Medical School under this Agreement, and no royalties
payable to the Medical School under the other Medical School license.

     2. Continuation of All Other Terms of Agreement.

     Except for the amendment of Section 4.6 of the License Agreement provided for in Section 1 of
this Amendment, all of the terms and conditions of the License Agreement shall continue in full
force and effect.

     3. Miscellaneous.

          3.1 Dispute Resolution. The parties agree that any dispute arising out of or relating
to this Amendment shall be resolved solely by means of the procedures set forth in Article 8 of the
Agreement.

          3.2 Counterparts. This Amendment may be executed in one or more counterparts, each of
which shall be deemed an original, and all of which together shall be deemed to be one and the same
instrument.

          3.3 Headings. All headings are for convenience only and shall not affect the meaning
of any provision of this Amendment.

          3.4 Binding Effect. This Amendment shall be binding upon and inure to the benefit of
the parties and their respective permitted successors and assigns.

          3.5 Amendment. This Amendment may be amended, supplemented, or otherwise modified
only by means of a written instrument signed by all of the parties.

          3.6 Governing Law. This Amendment shall be governed by and construed in accordance
with the laws of the Commonwealth of Massachusetts irrespective of any conflicts of law principles.

-2-

 

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

	 	 	 	 	 	 	 

	MEDICAL SCHOOL OF MASSACHUSETTS	 	CYTRX CORPORATION
	 
	 	 	 	 	 	 
	By:

	 	/s/ Chester A. Bisbee
	 	By:
	 	/s/ Steven A. Kriegsman
	 

	 	 
	 	 	 	 
	 

	 	Acting Executive Director
	 	 	 	Steven A. Kriegsman
	 

	 	Office of Technology Management
	 	 	 	Chief Executive Officer

-3-exv10w5

Exhibit 10.5

PATENT AND TECHNOLOGY ASSIGNMENT AGREEMENT

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

1.0 Background of Agreement

     1.1 ADVIRNA owns certain PATENT RIGHTS and TECHNOLOGY RIGHTS.

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

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

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

2.0 Definitions

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

     2.1 “EFFECTIVE DATE” means September 24, 2011.

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

     2.3 [Intentionally Omitted]

     2.4 [Intentionally Omitted]

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

1

 

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

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

     2.8 “TERRITORY” means worldwide.

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

3.0 Assignment; Exclusive License in Favor of ADVIRNA

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

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

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

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

2

 

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

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

4.0 Stock Payment

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

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

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

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

3

 

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

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

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

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

5.0 Fees and Other Consideration

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

4

 

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

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

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

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

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

5

 

6.0 Licensing

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

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

7.0 Payments

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

8.0 Representations and Disclaimer of Warranties

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

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

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

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

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

6

 

	 	 	 	performance of this AGREEMENT; and

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

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

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

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

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

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

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

7

 

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

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

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

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

9.0 Confidential Information

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

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

8

 

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

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

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

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

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

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

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

10.0 Termination

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

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

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

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

9

 

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

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

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

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

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

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

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

	 	(f)	 	The confidentiality provisions of Section 9.0.

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

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

11.0 Litigation

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

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

10

 

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

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

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

12.0 Indemnification

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

13.0 General Provisions

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

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

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

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

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

11

 

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

ATTENTION:

ADVIRNA, LLC

10 Rocklawn Road

Westborough, MA 01581

or in the case of RXi to:

President and CEO

RXi Pharmaceuticals Corporation

60 Prescott St.

Worcester, MA 01605

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

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

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

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

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

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

12

 

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

	 	 	 	 	 
	 	ADVIRNA, LLC

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

	 	 	 	 	 
	 	RXi PHARMACEUTICALS CORPORATION

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

13

 

	 	 	 	 	 

EXHIBIT A

ASSIGNMENT OF PATENT APPLICATIONS

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

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

	 	61/192,954

(Atty. Dock. No. 

007330-01 USPRV) 

PCT/US2009/005247

PCT/US2009/005246

13/069,780

PCT/US2009/005251
	 	September 22, 2008

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

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

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

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

14

 

right of priority without further written or oral authorization.

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

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

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

	 	 	 	 	 
	 	ADVIRNA, LLC

 	 
	 	By:  	 	 
	 	 	Printed Name:  	 	 
	 	 	Date: 	 	 
	 

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

	 	 	 	 	 
	 	RXI PHARMACEUTICALS CORPORATION

 	 
	 	By:  	 	 
	 	 	Printed Name:  	 	 
	 	 	Date: 	 	 

15

 

	 	 	 	 	 

EXHIBIT B

SECURITY AGREEMENT

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

RECITALS

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

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

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

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

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

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

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

16

 

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

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

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

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

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

17

 

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

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

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

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

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

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

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

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

[remainder of page intentionally left blank]

18

 

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

	 	 	 	 	 
	 	RXI PHARMACEUTICALS CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	ADVIRNA, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

19

 

	 	 	 	 	 

EXHIBIT C

PATENT AND TECHNOLOGY

LICENSE AGREEMENT

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

1. Background of Agreement.

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

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

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

20

 

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

3. License to ADVIRNA.

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

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

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

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

21

 

4. Sublicensing.

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

5. [Intentionally Omitted].

6. Patent Prosecution.

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

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

22

 

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

7. Litigation.

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

8. Representations and Disclaimer of Warranties.

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

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

23

 

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

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

24

 

9. Limitation of Liability.

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

10. Confidential Information.

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

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

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

25

 

11. Termination.

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

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

12. Indemnification.

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

13. General Provisions.

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

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

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

26

 

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

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

ATTENTION:

ADVIRNA, LLC

10 RockLawn, Westborough, MA 01581

with a copy, which shall not constitute notice to:

Rubin and Rudman LLP

50 Rowes Wharf

Boston, MA 02110

Attn: Peter B. Finn, Esq.

or in the case of RXi to:

President and CEO

RXi Pharmaceuticals Corporation

60 Prescott St.

Worcester, MA 01605

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

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

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

27

 

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

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

[remainder of this page left intentionally blank]

28

 

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

	 	 	 	 	 
	 	ADVIRNA, LLC

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

Date: September  , 2011
 	 
	 

	 	 	 	 	 
	 	RXI PHARMACEUTICALS CORPORATION

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

Date: September  , 2011
 	 

[Signature Page to Advirna License-Back Amendment]

 

 

	 	 	 	 	 

APPENDIX 1

List of RNAi related patent applications covered by Patent Rights:

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

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