Document:

rgnx-ex101_99.htm

EXHIBIT 10.1

 

[Letterhead of REGENXBIO Inc.]

This Employment Agreement (this “Agreement”) is entered into as of March 6, 2019, by and between Stephen Pakola (the “Employee”) and REGENXBIO Inc., a Delaware corporation (the “Company”) and made effective as of the Commencement Date as herein defined.

	
 
	
1.
	
Position.

	
 
	
(a)
	
You agree that the Company’s offer to employ you is contingent upon the Company obtaining results of its investigation into your background that it determines in its sole discretion to be satisfactory.  This Agreement shall not become effective until you report, ready, willing and able to work on April 15, 2019 (“Commencement Date”). During your employment with the Company pursuant to this Agreement, you will hold the title of Senior Vice President, Chief Medical Officer. As the Senior Vice President, Chief Medical Officer you shall report directly to the Chief Executive Officer. By signing this Agreement, you agree to perform the duties and fulfill the responsibilities normally inherent in the position of Senior Vice President, Chief Medical Officer and such other duties and responsibilities as may from time to time reasonably be assigned to you.  You will be primarily located and working from our New York office, located at 400 Madison Avenue, New York, NY.  For the first calendar year of your employment, you agree to spend four days per week at our Maryland, Corporate Headquarters office located in Rockville, MD, unless otherwise mutually agreed to in writing.

	
 
	
(b)
	
You agree that, to the best of your ability and experience, you will at all times loyally and conscientiously perform all of the duties and obligations required of and from you pursuant to the express and implicit terms hereof, and to the reasonable satisfaction of the Company.  During the term of your employment with the Company, you further agree that (i) you will devote substantially all of your business time and attention to the business of the Company, (ii) the Company will be entitled to all of the benefits and profits arising from or incident to all such business services, (iii) you will not render commercial or professional services of any nature to any person or organization outside of the Company without the prior written approval of the Company’s Board of Directors (the “Board”), and (iv) you will not directly or indirectly engage or participate in any business that is competitive in any manner with the business of the Company. Notwithstanding the above, you may continue, on your own time, at your own expense and so as to not interfere with your duties and responsibilities at the Company to (i) subject to the prior approval of the Company’s Chief Executive Officer, serve as a member of an advisory board or board of directors of other companies that are not competitive in any manner with the Company, (ii) accept speaking or presentation engagements in exchange for honoraria, and (iii) participate in civic, educational, charitable or fraternal organizations. This Agreement does not prevent you from owning no more than one percent (1%) of the outstanding equity securities of a corporation whose stock is listed on a national stock exchange and is a competitor or potential competitor of the Company.

 

 

	
 
	
2.
	
Compensation.

	
 
	
(a)
	
Base Salary.  You will be paid a salary at a rate of $16,538.47, which is equivalent to $430,000 on an annualized basis, which will be paid bi-weekly in accordance with the Company’s standard payroll procedures.   

	
 
	
(b)
	
Incentive Bonus.  You shall be eligible for an annual incentive bonus with a target amount equal to 40% of your Base Salary (the “Annual Target Bonus”).  Such bonus (if any) shall be awarded based on criteria established in advance by the Board or the Compensation Committee of the Board (the “Compensation Committee”).  Any incentive bonus earned by you for any fiscal year shall only be paid to you if you remain employed by the Company through the payment date for the bonus.  The Company shall determine when to pay to you any earned incentive bonus, but shall in no event pay such bonus more than 21⁄2 months following the close of the fiscal year for which it is earned.  Any bonus for the fiscal year in which your employment begins will be prorated, based on the number of days you are employed by the Company during that fiscal year.  Employees starting employment on or after October 1 are not eligible for a bonus for that fiscal year.  The determinations of the Board or the Compensation Committee with respect to such bonus shall be final and binding.

	
 
	
(c)
	
Annual Review.  Your compensation will be reviewed by the Board or Compensation Committee annually.

	
 
	
(d)
	
Stock Options.  Subject to the approval of the Board or its Compensation Committee, you will be granted an option to purchase 95,000 shares of the Company’s Common Stock (the “Option”). The Option will be subject to the terms and conditions applicable to options granted under the Company’s 2015 Equity Incentive Plan (the “Plan”), as described in the Plan and the related agreement governing the Option. You will vest in 25% of the shares after 12 months of continuous service, and the balance will vest in equal monthly installments over the next 36 months of continuous service, as described in the applicable agreement governing the Option.

	
 
	
3.
	
Benefits. As an employee of the Company, you will also be eligible to receive certain employee benefits including paid time off and medical, dental, life, and long term disability insurance. You will also be eligible to participate in our 401(k) savings plan.

	
 
	
4.
	
At-Will Employment; Proprietary Information and Inventions Agreement.  Employment with the Company is for no specific period of time.  Your employment with the Company is “at will,” meaning that either you or the Company may terminate your employment at any time and for any reason, with or without cause.  In addition, you should note that the Company may modify your job title, salary or benefits at its discretion.  You agree and affirm that your continued employment with the Company is contingent upon your agreement to comply with the Proprietary Information and Inventions Agreement, a copy of which is attached hereto as Exhibit A.

2

 

	
 
	
5.
	
Indemnification.  The Company shall indemnify you to the fullest extent allowed by law, in accordance with the terms of the Company’s Certificate of Incorporation and Bylaws. You shall become a party to the Company’s standard Indemnification Agreement.

	
 
	
6.
	
Company Handbook.  As a Company employee, you will be expected to abide by the Company's rules of operation and standards of conduct, as amended from time to time in the Company’s discretion.  Specifically, you will be required to sign acknowledgments that you have read and that you understand such rules and standards, which are set forth in the Company Handbook and other written policies. 

	
 
	
7.
	
Termination of Employment and Severance Benefits.

	
 
	
(a)
	
Preconditions.  Any other provision of this Agreement notwithstanding, Subsections of this Section 7 providing for the payment of severance benefits shall not apply unless each of the following requirements is satisfied:

	
 
	
(i)
	
You have executed a general release of all known and unknown claims that you may then have against the Company or persons affiliated with the Company in a form prescribed by the Company, without alterations.  You shall execute and return the release on or before the date specified by the Company in the prescribed form.  The release deadline shall in no event be later than sixty (60) days after your termination of employment (the “Release Deadline”).  If the 60-day period described in the prior sentence spans two calendar years, then the payments will begin on the first payroll period, following expiration of the revocation period, in the second calendar year. If you fail to return the release on or before the Release Deadline, or if you revoke the release, then you shall not be entitled to the benefits described in this Section 7; and 

	
 
	
(ii)
	
You have returned all property of the Company in your possession.

	
 
	
(b)
	
Termination of Employment.  Except for the severance benefits provided below, the Company’s obligations under this Agreement may be terminated upon the occurrence of any of the following events:

	
 
	
(i)
	
The Company’s determination in good faith that it is terminating you for Cause (“Termination for Cause”);

	
 
	
(ii)
	
The Company’s determination that it is terminating you without Cause, which determination may be made by the Company at any time at the Company’s sole discretion, for any or no reason (“Termination Without Cause”); 

	
 
	
(iii)
	
Thirty (30) days following delivery by you of a written notice to the Company stating that you are electing to terminate your employment with the Company (“Voluntary Termination”);

	
 
	
(iv)
	
Following your death or Disability (as defined below); or

	
 
	
(v)
	
Your determination in good faith that you are electing to terminate your employment with the Company for Good Reason.

3

 

	
 
	
(c)
	
Severance Benefits.  You shall be entitled to receive severance benefits upon termination of employment only as set forth in this Section 7(c):

	
 
	
(i)
	
Voluntary Termination.  In the event of a Voluntary Termination you shall not be entitled to receive payment of any severance benefits.  You will receive payment(s) for all salary and unpaid vacation accrued as of the date of your Voluntary Termination and your benefits will be continued under the Company’s then existing benefit plans and policies to the extent permitted under such plans and policies and in accordance with such plans and policies in effect on the date of your Voluntary Termination and in accordance with applicable law.

	
 
	
(ii)
	
Involuntary Termination/No Change in Control.  If your employment is terminated under Section 7(b)(ii) or (v) above (such termination, an “Involuntary Termination”), you, or your estate or representative, if applicable, will be entitled to receive payment of severance benefits on the date of your Involuntary Termination (the “Severance Benefits”).  The Severance Benefits shall consist of salary continuation for nine (9) months of monthly Base Salary amounts; provided that if you become employed during this period, then the Company’s obligation to pay Severance Benefits shall cease upon commencement of your new employment.  If you elect to continue your health insurance coverage under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) following the Separation, then the Company shall pay your monthly premium under COBRA until the earliest of (A) the date that is nine (9) months following your Involuntary Termination (the “Continuation Period”), (B) the expiration of your continuation coverage under COBRA and (C) the date when you are offered substantially equivalent health insurance coverage in connection with new employment or self-employment.  Notwithstanding anything to the contrary above, if deemed necessary or advisable by the Company in its sole discretion to avoid adverse tax consequences to the Company or any employee thereof, such COBRA premium payments will be treated as taxable compensation income to you, subject to all applicable withholdings.  

4

 

	
 
	
(iii)
	
Involuntary Termination/ Change in Control.  If your employment is terminated in an Involuntary Termination immediately prior to or in the eighteen months following a Change in Control, you, or your estate or representative, if applicable, will be entitled to receive payment of severance benefits on the date of your Involuntary Termination (the “Change in Control Severance Benefits”).  The Change in Control Severance Benefits shall consist of salary continuation for twelve (12) months of monthly Base Salary plus a monthly amount equal to your Annual Target Bonus divided by twelve (12).  If you elect to continue your health insurance coverage under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) following the Separation, then the Company shall pay your monthly premium under COBRA until the earliest of (A) the date that is twelve (12) months following your Involuntary Termination (the “Continuation Period”), (B) the expiration of your continuation coverage under COBRA and (C) the date when you are offered substantially equivalent health insurance coverage in connection with new employment or self-employment.  Notwithstanding anything to the contrary above, if deemed necessary or advisable by the Company in its sole discretion to avoid adverse tax consequences to the Company or any employee thereof, such COBRA premium payments will be treated as taxable compensation income to you, subject to all applicable withholdings.  If immediately prior to or following a Change in Control (as defined in the Company’s 2015 Equity Incentive Plan), your employment with the Company (or the Company’s successor) is terminated in an Involuntary Termination during the remaining vesting period of the options then outstanding as of the date of closing of the Change in Control (the “Options”), then one hundred percent (100%) of the unvested shares subject to the Options shall automatically vest.

	
 
	
(iv)
	
Termination for Cause.  In the event of your Termination for Cause, you will not be entitled to receive any severance payments.  You will receive payment(s) for all salary and unpaid vacation accrued as of the date of your Termination for Cause.  

	
 
	
(v)
	
Termination by Reason of Death or Disability.  In the event that your employment with the Company terminates as a result of your death or Disability (as defined below), you or your estate or representative will receive all salary and unpaid vacation accrued as of the date of your death or Disability, all severance benefits payable under Section 7(b)(ii) above (only to the extent that you were entitled to such benefits before your death) and any other benefits payable under the Company’s then existing benefit plans and policies, to the extent permitted under such plans and policies and in accordance with such plans and policies in effect on the date of death or Disability and in accordance with applicable law.  For purposes of this Agreement, “Disability” shall mean that you have been unable to perform your duties hereunder as the result of physical or mental incapacity lasting at least forty-five (45) consecutive calendar days or ninety (90) calendar days during any consecutive twelve-month period, after which time such incapacity is determined to be permanent by a physician chosen by the Company and its insurers and acceptable to you or to your legal representative (with such agreement on acceptability not to be unreasonably withheld).

5

 

	
 
	
(d)
	
Cause.  For purposes of this Agreement, “Cause” shall mean:

	
 
	
(i)
	
the conviction of, or the entering a plea of guilty or no contest (or pleading or accepting deferred adjudication or receiving unadjudicated probation) to or for, any felony or any crime involving moral turpitude;

	
 
	
(ii)
	
the commission of a material breach of any of the covenants, terms and provisions of this Agreement, the Proprietary Information and Inventions Agreement you will enter into as a condition of your employment, or any other agreement you enter into with the Company;

	
 
	
(iii)
	
the commission of an act of fraud, embezzlement, misappropriation, willful misconduct or breach of fiduciary duty against the Company or other similar conduct materially harmful or potentially materially harmful to the Company’s best interest, as determined by the Board, in its reasonable sole discretion;

	
 
	
(iv)
	
the failure to perform assigned duties or responsibilities as the Senior Vice President, Chief Medical Officer (other than a failure resulting from Disability (as defined below)); provided, however, that you shall be given written notice of, and shall have a ten (10) day period following such notice to cure a failure or refusal under this subclause (iv); or 

	
 
	
(v)
	
the violation of any federal or state law or regulation applicable to the Company’s business.

	
 
	
(e)
	
Good Reason. For purposes of this Agreement, “Good Reason” shall mean the occurrence of any of the following, without your written consent:

	
 
	
(i)
	
a significant reduction in your duties or responsibilities or your removal from the position contemplated by this Agreement;

	
 
	
(ii)
	
a significant reduction (thirty percent (30%) or more) in your base salary as in effect immediately prior to such reduction;

	
 
	
(iii)
	
a significant reduction in the type or level of employee benefits to which you are entitled that results in a significant reduction to your overall benefits package, as determined by the Board in its sole discretion; or

	
 
	
(iv)
	
relocation of your principal workplace by more than 35 miles from the primary office where you performed services prior to the relocation.

Good Reason will not be deemed to occur unless you give the Company written notice of the condition within 90 days after the condition comes into existence and the Company fails to remedy the condition with 30 days after receiving said notice.

6

 

	
 
	
8.
	
Tax Matters.

	
 
	
(a)
	
Withholding.  All forms of compensation referred to in this Agreement are subject to reduction to reflect applicable withholding and payroll taxes and other deductions required by law.

	
 
	
(b)
	
Tax Advice.  You are encouraged to obtain your own tax advice regarding your compensation from the Company.  You agree that the Company does not have a duty to design its compensation policies in a manner that minimizes your tax liabilities, and you will not make any claim against the Company or the Board related to tax liabilities arising from your compensation.

	
 
	
(c)
	
280G.  Notwithstanding anything contained in this Agreement to the contrary, if any of the payments or benefits received or to be received by you pursuant to this Agreement when taken together with payments and benefits provided to you under any other plans, contracts, or arrangements with the Company (all such payments and benefits, the “Total Payments”), would be subject to any excise tax (together with any interest or penalties, the “Excise Tax”) imposed under Section 4999 of the Internal Revenue Code (the “Code”), then such Total Payments will be reduced to the extent necessary so that no portion thereof will be subject to the Excise Tax; provided, however, that if you would receive in the aggregate greater value (as determined under Section 280G of the Code and the regulations thereunder) on an after tax basis if the Total Payments were not subject to such reduction, then no such reduction will be made. To effect the reduction described herein, if applicable, the Company will first reduce or eliminate the payments and benefits provided under this Agreement. All calculations required to be made under this Section will be made by the Company’s independent public accountants, subject to the right of your representative to review the same.

	
 
	
(d)
	
409A.  The intent of the parties is that payments and benefits under this Agreement comply with or be exempt from Section 409A of the Code and the regulations and guidance promulgated thereunder (collectively, “Code Section 409A”), and this Agreement shall be interpreted and construed in a manner that establishes an exemption from (or compliance with) the requirements of Code Section 409A.  Any terms of this Agreement that are undefined or ambiguous shall be interpreted in a manner that complies with Code Section 409A to the extent necessary to comply with Code Section 409A.  For purposes of Code Section 409A, your right to receive any installment payments shall be treated as a right to receive a series of separate and distinct payments.  Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of the Company.  In no event may you, directly or indirectly, designate the calendar year of any payment to be made under this Agreement, to the extent such payment is subject to Code Section 409A.  The Company makes no representation or warranty and shall have no liability to you or any other person if any provisions of this Agreement are determined to constitute deferred compensation subject to Code Section 409A but do not satisfy an exemption from, or the conditions of, Code Section 409A.”

7

 

	
 
	
9.
	
Miscellaneous Provisions.  

	
 
	
(a)
	
Choice of Law.  The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of Maryland, without giving effect to the principles of conflicts of law.

	
 
	
(b)
	
Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together will constitute one and the same instrument.

	
 
	
(c)
	
Severability.  In the event that any provision hereof becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable, or void, this Agreement shall continue in full force and effect without such provision.

	
 
	
(d)
	
Acknowledgment.  You acknowledge that you have had the opportunity to discuss this matter with and obtain advice from your private attorney, have had sufficient time to read, and have carefully read and fully understand, all the provisions of this Agreement, and are knowingly and voluntarily entering into this Agreement.

	
 
	
(e)
	
Arbitration.  Any controversy or claim arising out of this Agreement and any and all claims relating to the Employee’s employment with the Company shall be settled by final and binding arbitration.  The arbitration shall take place in Montgomery County, Maryland, or, at the Employee’s option, the County in which the Employee primarily worked when the arbitrable dispute or claim first arose.  The arbitration shall be administered by the American Arbitration Association under its National Rules for the Resolution of Employment Disputes.  Any award or finding shall be confidential.  The Employee and the Company agree to provide one another with reasonable access to documents and witnesses in connection with the resolution of the dispute.  The Company shall pay the costs of arbitration.  However, each party shall be responsible for its own attorneys’ fees, and the arbitrator may not award attorneys’ fees unless a statute or contract at issue specifically authorizes such an award.  This Section 9(e) shall not apply to claims for workers’ compensation benefits or unemployment insurance benefits.  This Section 9(e) also shall not apply to claims concerning the ownership, validity, infringement, misappropriation, disclosure, misuse or enforceability of any confidential information, patent right, copyright, mask work, trademark or any other trade secret or intellectual property held or sought by either the Employee or the Company (whether or not arising under the Proprietary Information and Inventions Agreement between the Employee and the Company) or with respect to any action the Company wishes to bring for injunctive relief.

	
 
	
(f)
	
Entire Agreement. This Agreement, together with the exhibits hereto, sets forth the terms and conditions of employment between the parties and fully supersedes and replaces any other agreement with respect to the terms and conditions of employment. 

[The remainder of this page intentionally left blank]

8

 

IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorized officer, as of the day and year first above written.

 

	
REGENXBIO INC.
	
 
	
EMPLOYEE

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
By:
	
 
	
/s/ Kenneth Mills
	
 
	
/s/ Stephen Pakola

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Name:
	
 
	
Kenneth Mills
	
 
	
Date:
	
 
	
March 6, 2019

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Title:
	
 
	
President & CEO
	
 
	
 
	
 
	
 

 

9

 

EXHIBIT A

 

PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT

 

10rgnx-ex102_273.htm

EXHIBIT 10.2

Certain identified information has been excluded from this exhibit because such information both (i) is not material and (ii) would likely cause competitive harm if publicly disclosed. Excluded information is indicated with brackets and asterisks.

 

University of Pennsylvania

 

Fourth Amendment to License Agreement

 

This Fourth Amendment to License Agreement (this “Fourth Amendment”) effective as of  April 4, 2019 (this “Fourth Amendment Effective Date”), is made by and between The Trustees of the University of Pennsylvania (“Penn”) and REGENXBIO Inc. (“Company”) (collectively, the “Parties”) and amends the License Agreement between the Parties, which was effective as of February 24, 2009, as subsequently amended by a First Amendment dated March 6, 2009, a Second Amendment dated September 9, 2014, and a Third Amendment dated April 29, 2016 (the “License Agreement”).  All capitalized terms used but not defined herein shall have the meaning set forth in the License Agreement.

 

BACKGROUND

 

WHEREAS, there is a Sponsored Research Agreement between the Parties, which has an effective date of December 1, 2014, as subsequently amended by the First Amendment to Sponsored Research Agreement dated April 30, 2016, the Second Amendment to Sponsored Research Agreement dated December 21, 2016, the Third Amendment to Sponsored Research Agreement dated December 23, 2016, the Fourth Amendment to Sponsored Research Agreement dated June 15, 2017, the Fifth Amendment to Sponsored Research Agreement dated January 18, 2018, the Sixth Amendment to Sponsored Research Agreement dated June 20, 2018, and the Seventh Amendment to Sponsored Research Agreement dated December 18, 2018 (“2014 SRA”), and the 2014 SRA includes research relating to Batten disease as part of the Sponsored Research (as defined in the 2014 SRA); 

 

WHEREAS, Penn has agreed to grant Company a license under the Institution Intellectual Property (as defined in the 2014 SRA) in the 2014 SRA; and

 

WHEREAS, the Parties desire that the License Agreement be amended as set forth below to reflect the rights and licenses granted to Company in accordance with the 2014 SRA;

 

NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, the Parties, intending to be bound, hereby mutually agree to the following:

 

	
1.
	
The following definitions shall be added to Section 1.2 of the License Agreement and incorporated in its entirety:

 

“Background Know-How” means all: 

 

(i)Know-How that (a) was developed by Dr. Wilson, or other Penn researchers working under his direct supervision, at Penn, and (b) is related to the adeno 

 

 

associated virus technology platform discovered by Dr. Wilson at Penn prior to September 9, 2014 or is related to the adeno associated virus technology platform discovered by Dr. Wilson at Penn during the performance of a Company sponsored research program after September 9, 2014, and (c) is owned by Penn, and (d) is necessary or useful for the practice of the Patent Rights in connection with the manufacture, use, sale, importation and/or other exploitation of the Licensed Products or the practice of the Licensed Processes in the Territory in the Field of Use, including, without, limitation, any Know-How necessary for the Company to  manufacture or have manufactured the materials produced by the Penn Vector Core or Dr. Wilson's lab at Penn; and 

 

(ii)Penn Study Data; and 

 

(iii)any and all information, discoveries, software, methods, works of authorship, techniques, formulae, data, biological materials, processes, unpatentable inventions and other know-how, not including the Patent Rights, that (a) was developed on or after October 1, 2015 by Dr. Wilson, or other Penn researchers working under his direct supervision, at Penn, and (b) is related to Batten disease, and (c) is owned by Penn, and (d) is necessary or useful for the practice of the Patent Rights in connection with the manufacture, use, sale, importation and/or other exploitation of the Licensed Products or the practice of the Licensed Processes in the Territory in the Batten Field of Use.

 

 “Batten’s Field of Use” means the treatment of a form of Batten disease known as late infantile ceroidal lipofuscinosis (LINCL) via AAV mediated gene therapy delivery of tripeptidyl peptidase 1 (TPP1).

 

	
2.
	
The following definitions in Section 1.2 of the License Agreement shall be amended and restated in their entirety as follows:

 

“Field of Use” means any and all fields of use, except with respect to (i) the Patent Rights listed in Exhibit A, Part 2 and all related Know-How and data, for which the Field of Use is limited to viral vector mediated gene therapy, and (ii) the Penn Study Data, for which the Field of Use is limited to the treatment of familial hypercholesterolemia (FH).  For clarity, the Field of Use includes the Batten Field of Use.

 

2

 

“Patent Rights” means: 

 

(i)all of Penn’s patent rights represented by or issuing from the United States patents and patent applications (including provisional patent applications) listed in Exhibit A, as well as any continuations, continuations-in-part (to the extent the inventions claimed or disclosed in any such patent or patent applications are directed to subject matter specifically described in the patent or patent applications listed in Exhibit A), divisionals, reexaminations, renewals, re-issues, substitutions, extensions and foreign counterparts of any of the foregoing, and all other patents and patent applications that claim priority from or have common priority with any of the foregoing patents and patent applications (to the extent the inventions claimed or disclosed in any such patent or patent applications are directed to subject matter specifically described in the patent or patent applications listed in Exhibit A) and including any patents issuing from any of the foregoing; and 

 

(ii)all patentable inventions (to the extent they are or become available for license) that (a) were discovered by Dr. Wilson, or other Penn researchers working under his direct supervision at Penn and (b) (I) are related to the adeno associated virus technology platform discovered by Dr. Wilson at Penn prior to the Effective Date or under the SRA, or (II) are necessary or useful for the practice of Penn’s patent rights in the Batten’s Field of Use and conceived and reduced to practice on or after October 1, 2015; and (c) are owned and controlled by Penn. 

 

“SRA” means each of: 1) the Sponsored Research Agreement between the Company and Penn effective as of February 24, 2009, as subsequently amended; 2) the Sponsored Research Agreement between the Company and Penn effective as of November 1, 2013 and any subsequent amendments thereof; and 3) the 2014 SRA and any future amendments thereof.

 

	
3.
	
Section 3 is hereby amended to add Section 3.1.1 after Section 3.1 as follows:

 

3.1.1  Upfront Fees.  In partial consideration of the licenses and rights granted to Company in this Agreement, Company shall pay Penn a one-time upfront fee of [****] within [****] of the Fourth Amendment Effective Date.

 

3

 

	
4.
	
New Section 3.2(d) of the License Agreement is hereby added as set forth below:

 

“3.2(d) In addition to the royalty due under this Section 3.2, Company shall pay to Penn a [****] additional royalty percentage on Net Sales of Licensed Pharmaceutical Products in the Batten Field of Use sold by Company and its Affiliates and an additional [****] royalty percentage received by Company from third parties on Net Sales of Licensed Pharmaceutical Products in the Batten Field of Use by such third parties.  For example, for Net Sales of Licensed Pharmaceutical Products using a novel AAV sold by Company or its Affiliates where annual Net Sales are greater than or equal to [****], the royalty is [****] for such Licensed Pharmaceutical Products in the Batten Field of Use.  As a further example, for Net Sales of Licensed Pharmaceutical Products sold by third parties where third party annual Net Sales are greater than or equal to [****], Company shall pay Penn [****] of the royalties received by Company from third parties for such Licensed Pharmaceutical Products in the Batten Field of Use.”

 

	
5.
	
The last paragraph of Section 3.2 of the License Agreement is amended and restated in its entirety as follows: 

 

“Notwithstanding the foregoing (i) in no event shall the [****] paid to Penn by the Company pursuant to Sections 3.2(c) and 3.2(d) above, [****] that would be payable to Penn by the Company on such Net Sales of Licensed Pharmaceutical Products sold by Company and (ii) in no event shall [****] be payable in connection with any [****].  No royalties other than the payments set forth herein shall be due in connection with the exercise of the rights granted herein.  [****].”

 

	
6.
	
The following provision shall be added to the License Agreement as Section 3.3 and incorporated in its entirety:

 

3.3 Development Milestones.  In partial consideration of the rights and licenses granted to Company under the Agreement, Company shall pay Penn the following milestone payments within [****] after the first achievement of each event for the first Licensed Product in the Batten Field of Use to achieve the following milestone events:

 

		
	
Development Milestone
	
Milestone Payment

	
1. First dosing of the first human subject in a Phase 1/2 Clinical Trial in the Batten Field of Use

 
	
[****]

	
2. First dosing of the first human subject in a Phase 3 Clinical Trial in the Batten Field of Use

 
	
[****]

	
3. BLA Acceptance in the Batten Field of Use in the United States 

 
	
[****]

	
4. Receipt of Marketing Authorization in the Batten Field of Use outside of the United States

 
	
[****]

	
Total
	
[****]

4

 

 

For clarity, the milestone payments set forth in Section 3.3 are [****] with respect to the first Licensed Product in the Batten Field of Use to achieve the foregoing milestone events, regardless of the total number of Licensed Products arising in the Batten Field of Use that achieve the milestone event, and regardless of whether the milestone is achieved by Company, any Affiliate, or any sublicensee.  

 

	
7.
	
The following provision shall be added to the License Agreement as Section 3.4 and incorporated in its entirety:

 

3.4 Net Sales Milestones.  In partial consideration of the rights and licenses granted to Company under this Agreement, Company shall pay Penn the following milestone payments within [****] following the end of the calendar year during which annual Net Sales of Licensed Products within the Batten Field of Use achieve the sales milestones indicated below, regardless of whether the milestone is achieved by Company, any Affiliate, or any sublicensee:

 

		
	
Milestone
	
Milestone Payment

	
1. Annual worldwide Net Sales of Licensed Products within the Batten Field of Use are [****]

 
	
[****]

	
2. Annual worldwide Net Sales of Licensed Products within the Batten Field of Use are [****]

 
	
[****]

	
Total
	
[****]

 

For clarity, the foregoing annual Net Sales milestones are [****] Licensed Products within the Batten Field of Use achieve the above annual Net Sales.  In addition, in the event that the second annual Net Sales milestone is met with respect to Licensed Products within the Batten Field of Use prior to the achievement of the first annual Net Sales milestone, then the first annual Net Sales milestone with respect to Licensed Products shall also be due along with the payment of the second annual Net Sales milestone.  

 

	
8.
	
Section 3.5 of the License Agreement shall be amended as follows:

 

a.The heading “A. In all Fields of Use other than the Batten Field of Use” shall be added before the table listing the Date of Sublicense Grant and Sublicensing Fees.

 

b.The following shall be added after the table listing the Date of Sublicense Grant and Sublicensing Fees:

 

5

 

B.In the Batten Field of Use:

 

		
	
Date of Sublicense Grant
	
Sublicensing Fees

	
During the period commencing on the Fourth Amendment Effective Date and ending the day prior to the first dosing of the first human subject in a Phase 1/2 Clinical Trial

 
	
[****]

	
Any date on or after the first dosing of the first human subject in a Phase 1/2 Clinical Trial
	
[****]

 

	
9.
	
The following definitions shall be added to Section 3.8 of the License Agreement and incorporated herein in their entirety:

 

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

 

“Marketing Authorization” means all approvals, licenses, registrations or authorizations of any federal, state or local regulatory agency, department, bureau or other governmental entity, necessary for the manufacturing, use, storage, import, transport, marketing and sale of Licensed Products in a country or regulatory jurisdiction.

 

	
10.
	
Exhibit A of the License Agreement is hereby amended and restated in its entirety to add the Patent Rights as set forth in Appendix A to this Fourth Amendment.  

 

	
11.
	
To Penn’s knowledge through its Penn Center for Innovation, as of the Fourth Amendment Effective Date, Penn does not Control any patent or patent application related to the Batten disease clinical candidate RGX-181 ([****]) (the “Batten Clinical Candidate”) transgene and expression cassette (other than the Patent Rights set forth in Appendix A to this Fourth Amendment) that would necessarily be infringed by the use or sale of a Licensed Product containing the Batten Clinical Candidate within the Batten Field of Use.  If it is determined that as of the Fourth Amendment Effective Date Penn Controls a patent or patent application directly related to the Batten Clinical Candidate transgene and expression cassette (other than the Patent Rights set forth in Appendix A) that was conceived and reduced to practice solely in the Wilson Lab and that would necessarily be infringed by the use or sale of  a Licensed Product containing the Batten Clinical Candidate within the Batten Field of Use, then the Parties shall amend Exhibit A to include such applicable patent or patent application  For the purpose of this Section 11, “Control” means the possession by Penn (whether by ownership or license, other than pursuant to this Agreement) of the ability to grant to Company access, a license, or a sublicense (as applicable) to the applicable patent or patent application on the terms and conditions set forth herein without violating the terms of any agreement or other arrangement with any third party.

6

 

 

	
12.
	
This Fourth Amendment amends the terms of the License Agreement and is deemed incorporated into, and governed by all other terms of, the License Agreement.  To the extent that the License Agreement is explicitly amended by this Fourth Amendment, the terms of this Fourth Amendment will control where the terms of the License Agreement are contrary to or conflict with the terms of this Fourth Amendment.  All other terms and conditions of the License Agreement not explicitly amended by this Fourth Amendment shall remain in full force and effect.  The License Agreement, as previously amended, shall, together with this Fourth Amendment, be read and construed as a single instrument.

 

	
13.
	
Signatures on this Fourth Amendment may be communicated by facsimile or e-mail transmission and shall be binding upon the Parties upon receipt by transmitting the same by facsimile or e-mail transmission, which signatures shall be deemed originals.  If executed in counterparts, the Fourth Amendment shall be effective as if simultaneously executed.

 

[Intentionally left blank]

7

 

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

 

THE TRUSTEES OF THE UNIVERSITY OF PENNSYLVANIA

 

	
By:
	
 
	
/s/ John S. Swartley

	
Name:
	
 
	
John S. Swartley, PhD

	
Title:
	
 
	
Associate Vice Provost for Research

and Managing Director, PCI

	
Date:
	
 
	
April 5, 2019

 

REGENXBIO INC.

 

	
By:
	
 
	
/s/ Kenneth T. Mills

	
Name:
	
 
	
Kenneth T. Mills

	
Title:
	
 
	
President and CEO

	
Date:
	
 
	
April 5, 2019

 

8

 

Appendix A - Patent Rights

 

Exhibit A

 

Patents and Patent Applications in the Patent Rights

 

Exhibit A- Part 1; No Field of Use Limitation

 

[****]

 

Exhibit A, Part 2- 

Field of Use limited to viral vector mediated delivery of gene therapy product.

 

[****]

 

Penn / Wilson Lab Know-How for the Familial Hypercholesterolemia and Onithine 

Transcarbamylase Deficiency (OTC) Programs

 

 

FH Know-How (associated with [****])

 

[****]

 

 

OTC Know-How (associated with [****])

 

[****]

9

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