Document:

Exhibit 10.2

 

SUBORDINATION, NONDISTURBANCE AND ATTORNMENT
AGREEMENT

 

New York

 

AGREEMENT dated as of the 29th day of April,
2008, between VISION-SCIENCES, INC., a Delaware corporation whose address is 40
Ramland Road, Orangeburg, New York  
10962 (“Tenant”), and M&T REAL ESTATE TRUST, a Maryland  real estate investment trust with its
principal banking office at One M&T Plaza, Buffalo, NY 14240.  Attention: 
Office of General Counsel (the “Mortgagee”).

 

WHEREAS, RAMLAND REALTY ASSOCIATES, a New
York limited liability company whose address is 100 Clearbrook Road, Elmsford,
New York 10532 (“Landlord”), owns the real property located at One Ramland
Road, Orangeburg, New York  (such real
property, including all buildings, improvements, structures and fixtures located
thereon, “Landlord’s Premises”), as more particularly described in Schedule A;

 

WHEREAS, Mortgagee has made a loan to
Landlord in the original principal amount of $17,300,000.00 as the loan may be
modified or amended from time to time (the “Loan”);

 

WHEREAS, to secure the Loan, Landlord has
encumbered Landlord’s premises by entering into a mortgage dated on or about December 24,
1999 in favor of Mortgagee (as amended, increased, renewed, extended, spread,
consolidated, severed, restated, or otherwise changed from time to time the “Mortgage”)
recorded on January 13, 2000 as Instrument ID 200-00002121, in the
Official Records of the County of 
Rockland, State of New York or to be recorded in such Land Records (the “Land
Records”);

 

WHEREAS, pursuant to a Lease dated as of April 29th,
2008, as such lease may have been, or may be amended from time to time (the “Lease’),
Landlord demised to Tenant a portion of Landlord’s Premises (the “Tenant’s
Premises”) effective as of the Commencement Date as defined in the Lease; and

 

WHEREAS, Tenant and Mortgagee desire to agree upon the relative
priorities of their interests in Landlord’s Premises and their rights and
obligations if certain events occur.

 

NOW, THEREFORE, for good and sufficient consideration, the receipt and
sufficiency of which is hereby acknowledged, Tenant and Mortgagee agree as
follows:

 

1.                                      DEFINITIONS.

 

The following terms shall have the following
meanings for purposes of this Agreement:

 

1.1          “Construction-Related
Obligation” means any obligation of Landlord under the Lease to
make, pay for, or reimburse Tenant for any alterations, demolition or other
improvements or work at Landlord’s Premises, including Tenant’s Premises.  Construction-Related Obligations shall not
include:  (a) reconstruction or
repair following fire, casualty or condemnation; or (b) day-to-day
maintenance and repairs.

 

© Manufacturers and
Traders Trust Company, 2004

Execution Copy

 

 

1.2                               “Foreclosure
Event” means (a) foreclosure under the Mortgage; (b) any other
exercise by Mortgagee of rights and remedies (whether under the Mortgage or
under applicable law, including bankruptcy law) as holder of the Loan and/or
the Mortgage, as a result of which Successor Landlord becomes owner of Landlord’s
Premises; or (c) delivery by Landlord to Mortgagee (or its designee or
nominee) of a deed or other conveyance of Landlord’s interest in Landlord’s
Premises in lieu of any of the foregoing.

 

1.3                               “Former
Landlord” means Landlord and any other party that was
landlord under the Lease at any time before the occurrence of any attornment
under this Agreement.

 

1.4                               “Offset
Right” means any right or alleged right of Tenant to any offset, defense
(other than one arising from actual payment and performance, which payment and
performance would bind a Successor Landlord pursuant to this Agreement), claim,
counterclaim, reduction, deduction, or abatement against Tenant’s payment of
Rent or performance of Tenant’s other obligations under the Lease, arising
(whether under the Lease or other applicable law) from Landlord’s breach or
default under the Lease.

 

1.5                               “Rent” means any
fixed rent, base rent or additional rent under the Lease.

 

1.6                               “Successor
Landlord” means any party that becomes owner of Landlord’s
Premises as the result of a Foreclosure Event.

 

1.7                               “Termination
Right” means any right of Tenant to cancel or terminate the Lease or to claim
a partial or total eviction arising (whether under the Lease or under
applicable law) from Landlord’s breach or default under the Lease.

 

2.                                      SUBORDINATION.  Subject to the provisions of this Agreement,
the Lease and all of Tenant’s rights thereunder shall be, and shall at all
times remain, subject and subordinate to the Mortgage, the lien imposed by the
Mortgage, and all indebtedness secured by the Mortgage.

 

3.                                      NONDISTURBANCE,
RECOGNITION AND ATTORNMENT.

 

3.1                               No
Exercise of Mortgage Remedies Against Tenant. 
So long as the Lease has not been terminated on account of Tenant’s
default that has continued beyond applicable cure periods (an “Event of Default”),
Mortgagee shall not name or join Tenant as a defendant in any exercise of
Mortgagee’s rights and remedies arising upon a default under the Mortgage
unless applicable law requires Tenant to be made a party thereto as a condition
to proceeding against Landlord or prosecuting such rights and remedies.  In the latter case, Mortgagee may join Tenant
as a defendant in such action only for such purpose and not to terminate the
Lease or otherwise adversely affect Tenant’s rights under the Lease or this
Agreement in such action.

 

3.2                               Nondisturbance
and Attornment.  If the Lease
has not been terminated on account of an Event of Default by Tenant, then, when
Successor Landlord takes title to Landlord’s Premises (“Attornment Date”):  (a) Successor Landlord shall not
terminate or disturb Tenant’s possession of Tenant’s Premises under the Lease,
except in accordance with the terms of the Lease and this Agreement;  (b) Successor Landlord shall be bound to
Tenant under all the terms and conditions of the Lease (except as provided in
this Agreement); (c) Tenant shall recognize and attorn to Successor
Landlord as Tenant’s direct landlord under the Lease as affected by this
Agreement; and (d) the Lease shall continue in full force and effect as a
direct 

 

© Manufacturers and
Traders Trust Company, 2006

Execution Copy

 

2

 

lease, in accordance with its terms (except as provided in this
Agreement), between Successor Landlord and Tenant.  All condemnation awards and insurance
proceeds paid or payable with respect to the Tenant’s Premises or any part of
the Landlord’s Premises shall be applied and paid in the manner set forth in
the Lease, except that any awards and/or proceeds payable to the Landlord shall
be subject to the rights of Mortgagee under the Mortgage.

 

3.3                               Further
Documentation.  The
provisions of this Article shall be effective and self-operative without
any need for Successor Landlord or Tenant to execute any further
documents.  Tenant and Successor Landlord
shall, however, confirm the provisions of this Article in writing upon
request by either of them.

 

4.                                      PROTECTION
OF SUCCESSOR LANDLORD. 
Notwithstanding anything to the contrary in the Lease or the Mortgage,
neither Mortgagee nor the Successor Landlord shall be liable for or bound by
any of the following matters:

 

4.1                               Claims
Against Former Landlord.  Any
Offset Right that Tenant may have against any Former Landlord relating to any
event or occurrence before the Attornment Date, including any claim for damages
of any kind whatsoever as the result of any breach by Former Landlord that
occurred before the Attornment Date, unless Tenant has given Mortgagee notice
of such breach as provided in the Lease. 
The foregoing shall not limit either (a) Tenant’s right to exercise
against Successor Landlord any Offset Right otherwise available to Tenant
because of events occurring after the Attornment Date; or (b) Successor
Landlord’s obligation to correct any conditions that existed as of the
Attornment Date and violate Successor Landlord’s obligations as Landlord under
the Lease.

 

4.2                               Prepayments.  Any payment of Rent that Tenant may have made
to Former Landlord more than thirty days before the date such Rent was first
due and payable under the Lease with respect to any period after the Attornment
Date other than, and only to the extent that, the Lease expressly required such
a prepayment.

 

4.3                               Payment;
Security Deposit.  Any
obligation:  (a) to pay Tenant any
sum(s) that any Former Landlord owed to Tenant; or (b) with respect
to any security deposited with Former Landlord, unless  such security deposit was actually
transferred to Mortgagee.  This paragraph
is not intended to apply to Landlord’s obligation to make any payment that
constitutes a “Construction-Related Obligation”.

 

4.4                               Modification,
Amendment, or Waiver.  Any
material modification or material amendment of the Lease, or any waiver of any
terms of the Lease, made without Mortgagee’s written consent, which consent
shall not be unreasonably withheld, conditioned or delayed.  In the event Mortgagee does not grant or deny
its consent to such material modification or material amendment within ten (10) days
of receipt of the proposed material modification or material amendment,
Mortgagee’s consent shall be deemed to have been given.  Notwithstanding the foregoing, any change to
the monetary obligations of either Landlord or Tenant under the Lease, any
change to the term of the Lease, any change to the parking provided to Tenant,
and any change to the square footage of Tenant’s Premises shall require the
consent of the Mortgagee in its sole discretion.

 

4.5                               Surrender,
Etc.  Any consensual or negotiated
surrender, cancellation, or termination of the Lease, in whole or in part,
agreed upon between Landlord and Tenant, unless effected unilaterally by Tenant
pursuant to the express terms of the Lease.

 

3

 

4.6                               Construction-Related
Obligations.  Any
Construction-Related Obligation of Former Landlord, except as expressly
provided for in Schedule B (if any) attached to this Agreement.

 

5.                                      EXCULPATION
OF SUCCESSOR LANDLORD. 
Notwithstanding anything to the contrary in this Agreement or the Lease,
upon any attornment pursuant to this Agreement, the Lease shall be deemed to
have been automatically amended to provide that Successor Landlord’s
obligations and liability under the Lease shall never extend beyond Successor
Landlord’s (or is successors’ or assigns’) interest, if any, in Landlord’s
Premises from time to time, including insurance and condemnation proceeds,
Successor Landlord’s interest in the Lease, and the proceeds from any sale or
other disposition of Landlord’s Premises by Successor Landlord (collectively, “Successor
Landlord’s Interest”).  Tenant shall look
exclusively to Successor Landlord’s Interest (or that of its successors and
assigns) for payment or discharge of any obligations of Successor Landlord
under the Lease as affected by this Agreement. 
If Tenant obtains any money judgment against Successor Landlord with
respect to the Lease or the relationship between Successor Landlord and Tenant,
then Tenant shall look solely to Successor Landlord’s Interest (or that of its
successors and assigns) to collect such judgment.  Tenant shall not collect or attempt to
collect any such judgment out of any other assets of Successor Landlord.

 

6.                                      MORTGAGEE’S
RIGHT TO CURE.

 

6.1                               Notice
to Mortgagee. 
Notwithstanding anything to the contrary in the Lease or this Agreement,
before exercising any Termination Right or Offset Right, Tenant shall provide
Mortgagee with notice of the breach or default by Landlord giving rise to same
(the “Default Notice”) and, thereafter, the opportunity to cure such breach or
default as provided for below.

 

6.2                               Mortgagee’s
Cure Period.  After
Mortgagee receives a Default Notice, Mortgagee shall have to the same period of
time as Landlord under the Lease in which to cure the breach or default by
Landlord (such cure period to run concurrently, and not consecutively, with
Landlord’s cure period.  Mortgagee shall
have no obligation to cure (and shall have no liability or obligation for not
curing) any breach or default by Landlord, except to the extent that Mortgagee
agrees or undertakes otherwise in writing.

 

6.3                               Extended
Cure Period.  In addition,
as to any breach or default by Landlord the cure of which requires possession
and control of Landlord’s Premises, provided only that Mortgagee undertakes to
Tenant by written notice to Tenant within thirty (30) days after receipt of the
Default Notice to exercise reasonable efforts to cure or cause to be cured by a
receiver such breach or default within the period permitted by this paragraph,
Mortgagee’s cure period shall continue for such additional time (the “Extended
Cure Period”) as Mortgagee may reasonably require to either (a) obtain
possessions and control of Landlord’s Premises and thereafter cure the breach
or default with reasonable diligence and continuity; or (b) obtain the
appointment of a receiver and give such receiver a reasonable period of time in
which to cure the default.  In no event
shall the Extended Cure Period last for a period in excess of six (6) months.

 

7.                                      CONFIRMATION
OF FACTS.  Tenant
represents to Mortgagee and to any Successor Landlord, in each case as of  the date of this Agreement (“Effective Date”):

 

7.1                               Effectiveness
of Lease.  The Lease is
in full force and effect, has not been modified, and constitutes the entire
agreement between Landlord and Tenant relating to Tenant’s Premises.  Tenant has no 

 

4

 

interest in Landlord’s Premises except pursuant to the Lease.  No unfulfilled conditions exist to Tenant’s
obligations under the Lease, except Landlord’s obligations under the Work
Letter (as defined in the Lease).

 

7.2                               Rent.  The payment of Rent has not yet commenced under
the Lease.

 

7.3                               No
Landlord Default.  To the best
of Tenant’s knowledge, no breach or default by Landlord exists and no event has
occurred that, with the giving of notice, the passage of time, or both, would
constitute such a breach or default.

 

7.4                               No
Tenant Default.  Tenant is
not in default under the Lease and has not received any uncured notice of any
default by Tenant under the Lease.

 

7.5                               No
Termination.  Tenant has
not commenced any action nor sent or received any notice to terminate the
Lease.  Tenant has no presently
exercisable Termination Right(s) or Offset Right(s).

 

7.6                               Commencement
Date.  The “Commencement Date” of the
Lease has not yet occurred.  Upon
request, Tenant shall provide Mortgagee with a copy of any commencement date
agreement executed by Landlord and Tenant.

 

7.7                               Acceptance.   Tenant has not accepted possession of Tenant’s
Premises as Landlord has not completed Landlord’s obligations under the Work
Letter.

 

7.8                               No
Transfer.  Tenant has
not transferred, encumbered, mortgaged, assigned, conveyed or otherwise
disposed of the Lease or any interest therein, other than sublease(s) made
in compliance with the Lease.

 

7.9                               Due
Authorization.  Tenant has
full authority to enter into this Agreement, which has been duly authorized by
all necessary actions.

 

8.                                      TENANT
COVENANTS.  Tenant
covenants with the Mortgagee that now and continuing as long as the Mortgage
shall remain unsatisfied of record as follows:

 

8.1                               Rent
Payment Notices.  From and
after Tenant’s receipt of written notice from Mortgagee (a “Rent Payment Notice”)
which directs Tenant to pay Rent to Mortgagee, Tenant shall pay all Rent to
Mortgagee or as Mortgagee shall direct in writing, until such time as Mortgagee
directs otherwise in writing. Tenant shall comply with the rental payment
directive contained in any Rent Payment Notice notwithstanding any contrary
instruction, direction or assertion from Landlord.  Mortgagee’s delivery to Tenant of a Rent
Payment Notice, or Tenant’s compliance therewith, shall not be deemed to:  (a) cause Mortgagee to succeed to or to
assume any obligations or responsibilities as Landlord under the Lease, all of
which shall continue to be performed and discharged solely by Landlord unless
and until any attornment has occurred pursuant to this Agreement; or (b) relieve
Landlord of any obligations under the Lease.

 

8.2                               Intentionally
omitted.

 

8.3                               If requested by
the Mortgagee or the Successor Landlord, Tenant shall deliver to Mortgagee or
the Successor Landlord (as the case may be) the same periodic deliveries (e.g., updated estoppel 

 

5

 

certificates) it delivers to Landlord pursuant to the Lease.  In the event Tenant ceases to be a publicly
company, Tenant shall provide financial reports to Mortgagee upon request by
Mortgagee

 

9.                                      MISCELLANEOUS.

 

9.1                               Notices.  Any demand or notice hereunder or under any
applicable law pertaining hereto shall be in writing and duly given if
delivered to any party (at the address on page one).  Such notice or demand shall be deemed
sufficiently given for all purposes when delivered (i) by personal
delivery and shall be deemed effective when delivered, or (ii) by mail or
courier and shall be deemed effective three (3) business days after
deposit in an official depository maintained by the United States Post Office
for the collection of mail or one (1) business day after delivery to a
nationally recognized overnight courier service (e.g., Federal Express).  Notice by e-mail is not valid notice under
this agreement.

 

9.2                               Successors
and Assigns.  This Agreement
shall bind and benefit the parties, their successors and assigns, any Successor
Landlord, and its successors and assigns. 
If Mortgagee assigns the Mortgage, then upon delivery to Tenant of
written notice thereof accompanied by the assignee’s written assumption of all
obligations under this Agreement, all liability of the assignor shall
terminate.

 

9.3                               Interaction
with Lease and with Mortgage.  If this Agreement conflicts with the Lease,
then this Agreement shall govern as between the parties and any Successor
Landlord, including upon any attornment pursuant to this Agreement.  This Agreement supersedes, and constitutes
full compliance with, any provisions in the Lease that provide for subordination
of the Lease to, or for delivery of nondisturbance agreements by the holder of,
the Mortgage, as it pertains only to the Mortgage and not to any future
mortgage on Landlord’s Premises. 
Mortgagee confirms that Mortgagee has consented to Landlord’s entering
into the Lease and covenants and agrees that the exercise by Tenant of any of
the rights and remedies therein contained shall not constitute a default under
the Mortgage provided that, in the exercise of any such rights and remedies,
Tenant is in compliance with the provisions of this Agreement..

 

9.4                               Mortgagee’s
Rights and Obligations. 
Except as expressly provided for in this Agreement, Mortgagee shall have
no obligations to Tenant with respect to the Lease.  If an attornment occurs pursuant to this
Agreement, then all rights and obligations of Mortgagee under this Agreement
shall terminate, without thereby affecting in any way the rights and
obligations of Successor Landlord provided for in this Agreement.

 

9.5                               Interpretation;
Governing Law.  The
interpretation, validity and enforcement of this Agreement shall be governed by
and construed under the internal laws of the State of New York, excluding its
principles of conflicts of laws. 
MORTGAGEE AND TENANT HEREBY
IRREVOCABLY CONSENT TO THE EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT
IN THE STATE OF NEW YORK, COUNTY OF WESTCHESTER, AND CONSENT THAT THE MORTGAGEE
MAY EFFECT ANY SERVICE OF PROCESS AT TENANT’S ADDRESS SET FORTH ABOVE.  Mortgagee and Tenant acknowledge and agree
that the venue provided above is the most convenient forum for both the
Mortgagee and Tenant.  Mortgagee and
Tenant waive any objection to venue and any objection based on a more
convenient forum in any action instituted under this Agreement.

 

9.6                               Miscellaneous.  This Agreement constitutes the entire
agreement between Mortgagee and Tenant regarding the subordination of the Lease
to the Mortgage and the rights and obligations of Tenant and 

 

6

 

Mortgagee as to the subject matter of this Agreement.  This Agreement may be amended, discharged or
terminated, or any of its provisions waived, only by a written instrument
executed by the party to be charged. 
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original and all of which together shall constitute
one and the same instrument.  Mortgagee
represents that Mortgagee has full authority to enter into this Agreement, and
Mortgagee’s entry into this Agreement has been duly authorized by all necessary
actions.  No provisions of this Agreement
may be amended, waived or modified except by an instrument in writing signed by
the party to be bound.  The headings and
captions in this Agreement are for convenience of reference only and in no way
define, limit or describe the scope or the intent of any provision or section
of this Agreement and shall not be deemed to have any substantive effect.  Inapplicability or unenforceability of any
provisions of this Agreement shall not limit or impair the operation or
validity of any other provision of this Agreement.

 

9.7                               Counterparts.  This Agreement may be executed in any number
of counterparts, each of which, when executed and delivered, shall be an
original, but such counterparts shall together constitute one and the same
instrument.

 

9.8                               No
Agency Relationship.  The
Mortgagee is not the agent or representative of Landlord and this Agreement
shall not make the Mortgagee liable to materialmen, contractors, craftsmen,
laborers or others for goods delivered to or services performed by them upon the
Landlord’s Premises, or for debts or claims accruing to such parties against
Landlord and there is no contractual relationship, either expressed or implied,
between the Mortgagee and any materialmen, subcontractors, craftsmen, laborers,
or any other person supplying any work, labor or materials for the
Improvements.

 

9.9                               WAIVER
OF JURY TRIAL.  TENANT AND THE MORTGAGEE
HEREBY KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY EACH WAIVE ANY RIGHT TO TRIAL
BY JURY THEY MAY HAVE IN ANY ACTION OR PROCEEDING, IN LAW OR IN EQUITY, IN
CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS RELATED THERETO. TENANT
REPRESENTS AND WARRANTS THAT NO REPRESENTATIVE OR AGENT OF THE MORTGAGEE HAS
REPRESENTED, EXPRESSLY OR OTHERWISE THAT THE MORTGAGEE WILL NOT, IN THE EVENT
OF LITIGATION, SEEK TO ENFORCE THIS RIGHT TO JURY TRIAL WAIVER.  THE TENANT ACKNOWLEDGES THAT THE MORTGAGEE
HAS BEEN INDUCED TO ACCEPT THIS AGREEMENT BY, AMONG OTHER THINGS, THE
PROVISIONS OF THIS SECTION.

 

7

 

IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the first date set forth above.

 

	
   

  	
  VISION SCIENCES, INC.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/Yoav M. Cohen

  
	
   

  	
   

  	
  Name:

  	
  Yoav M. Cohen

  
	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  M&T
  REAL ESTATE TRUST

  
	
   

  	
  By:

  	
  Manufacturers and Traders Trust Company

  
	
   

  	
   

  	
  Its Attorney-in-Fact

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
					

 

8

 

Landlord Consent

 

Landlord consents and agrees to the foregoing
Agreement, which was entered into at Landlord’s request.  The foregoing Agreement shall not alter,
waive or diminish any of Landlord’s obligations under the Mortgage or the
Lease.  The above Agreement discharges
any obligations of Mortgagee under the Mortgage and related loan documents to
enter into a nondisturbance agreement with Tenant.  Landlord is not a party to the above
Agreement.

 

Landlord irrevocably directs Tenant to comply
with any Rent Payment Notice, notwithstanding any contrary direction,
instruction or assertion by Landlord. 
Tenant shall be entitled to rely on any Rent Payment Notice.  Tenant shall be under no duty to controvert
or challenge any Rent Payment Notice. 
Tenant’s compliance with a Rent Payment Notice shall not be deemed to
violate the Lease.  Landlord hereby
releases Tenant from, and shall indemnify and hold Tenant harmless from and
against, any and all loss, claim, damage, liability, cost or expense (including
payment of reasonable attorneys’ fees and disbursements) arising from any claim
based upon Tenant’s compliance with any Rent Payment Notice.  Landlord shall look solely to Mortgagee with
respect to any claims Landlord may have on account of an incorrect or wrongful
Rent Payment Notice.

 

	
   

  	
  LANDLORD

  
	
   

  	
  RAMLAND REALTY ASSOCIATES

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

Dated: April      , 2008

 

ACKNOWLEDGMENT

(Tenant)

 

	
  STATE OF NEW YORK    

  	
  )

  	
   

  
	
   

  	
  : SS

  
	
  COUNTY OF           

  	
  )

  
					

 

On
the                  
day of
                            ,
in the year 2008, before me, the undersigned, a Notary Public in and for said
State, personally appeared                                            
, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual(s) whose name(s) is (are) subscribed to
the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their capacity(ies), and that by his/her/their signature(s) on
the instrument, the individual(s), or the person upon behalf of which the
individual(s) acted, executed the instrument.

 

 

	
   

  	
   

  
	
   

  	
  Notary Public

  

 

9

 

ACKNOWLEDGMENT

(Mortgagee)

 

 

	
  STATE OF NEW YORK    

  	
  )

  	
   

  
	
   

  	
  : SS

  
	
  COUNTY OF           

  	
  )

  
					

 

On the                      
day of
                              ,
in the year 202008, before me, the undersigned, a Notary Public in and for said
State, personally appeared
                                            
, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual(s) whose name(s) is (are) subscribed to
the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their capacity(ies), and that by his/her/their signature(s) on
the instrument, the individual(s), or the person upon behalf of which the
individual(s) acted, executed the instrument.

 

 

	
   

  	
   

  
	
   

  	
  Notary Public

  

 

ACKNOWLEDGMENT

(Landlord)

 

 

	
  STATE OF NEW YORK    

  	
  )

  	
   

  
	
   

  	
  : SS

  
	
  COUNTY OF           

  	
  )

  
					

 

On
the                        
day of
                            ,
in the year 2008 before me, the undersigned, a Notary Public in and for said
State, personally appeared                                                               ,
personally known to me or proved to me on the basis of satisfactory evidence to
be the individual(s) whose name(s) is (are) subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in
his/her/their capacity(ies), and that by his/her/their signature(s) on the
instrument, the individual(s), or the person upon behalf of which the
individual(s) acted, executed the instrument.

 

 

	
   

  	
   

  
	
   

  	
  Notary Public

  

 

10

 

SCHEDULE A

 

DESCRIPTION OF LANDLORD’S
PREMISES

 

ALL THAT CERTAIN REAL PROPERTY lying, being
and situated in the City
of                                                    ,
County of
                                                    
, and State of New York, more particularly described as follows.

 

11

 

SCHEDULE B

 

CONSTRUCTION-RELATED OBLIGATIONS

 

Construction-Related Obligations remaining to be performed as
of                            
,
19              /20                  ,
if any

[Summarize and Describe]

 

Successor Landlord’s Construction-Related Obligations after attornment,
if any:

[Negotiate and Describe]

 

12Exhibit 10.1

 

PRODUCT LICENSE AGREEMENT

 

This
PRODUCT LICENSE AGREEMENT (this “Agreement”) is entered into effective as of February 11, 2008
(the “Effective Date”),
is between DYAX CORP., a Delaware,
United States corporation, with offices at 300 Technology Square, Cambridge,
Massachusetts 02139, U.S.A. (“Dyax”), and SANOFI-AVENTIS, a French
corporation with its principal registered headquarters  at 174, avenue de France, 75013 Paris,
France  (“Licensee”).

 

WHEREAS, Dyax has identified
an antibody with binding affinity to the Tie-1 protein, known as DX-2240, which
is more specifically described in Appendix A attached hereto;

 

WHEREAS, Dyax has also developed and licensed certain
know-how and intellectual property relating to DX-2240;

 

WHEREAS,
Licensee and its Affiliates are engaged in the development, manufacture and
commercialization of products for human diseases and disorders;

 

WHEREAS, Licensee desires to
obtain a license for it and its Affiliates, under the know-how and intellectual
property owned and controlled by Dyax, to use, research, develop, manufacture
and commercialize DX-2240 under the terms and conditions hereof; and

 

WHEREAS, Dyax is willing to
grant such a license to Licensee and its Affiliates on the terms and conditions
set forth herein.

 

NOW, THEREFORE, in
consideration of the mutual covenants set forth in this Agreement, the Parties
hereto agree as follows:

 

ARTICLE 1

DEFINITIONS

 

1.1                                 “Affiliate” shall mean, with respect to
either Party, a corporation or other legal entity that controls, is controlled
by, or is under common control with such Party. 
For purposes of this definition, “control” means the ownership, directly
or indirectly, of more than fifty percent (50%) of the outstanding equity
securities of a corporation which are entitled to vote in the election of
directors or a more than fifty percent (50%) interest in the net assets or
profits of an entity which is not a corporation.

 

1.2                                 “CAT”
shall mean the business entity formerly known as Cambridge Antibody
Technologies, Limited and now known as MedImmune Limited.

 

1.3                                 “CAT
Patent Rights” shall mean the “Antibody Phage Display Patents” as that term
is defined in Clause 1.1 of the CAT Product License.

 

1.4                                 “CAT
Product License” shall mean that certain Product License to Tie-1, dated as
of April 3, 2006, between Dyax and CAT as amended from time to time under
which CAT has granted Dyax a license, under the CAT Patent Rights, to develop
and commercialize antibodies directed to the Target.  A redacted form of the CAT Product License as
of the Effective Date is attached hereto as Appendix C.

 

1.5                                 “CAT
Sublicense” has the meaning set forth in Section 2.1(b) hereof.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

 

1.6                                 “CAT
Valid Claim” shall mean a claim of an issued and unexpired patent included
within the CAT Patent Rights and that has been licensed to CAT by the Medical
Research Council, which has not been held permanently revoked, unenforceable or
invalid by a decision of a court or other governmental agency of competent
jurisdiction unappealed within the time allowed for appeal, and which has not
been admitted to be invalid or unenforceable through reissue or disclaimer or
otherwise.

 

1.7                                 “Cell
Lines” shall mean all cell lines developed as of the Effective Date that
express DX-2240, as specifically described in Appendix D attached
hereto.

 

1.8                                 “Combination
Product” shall mean commercial product that includes a Licensed Product and
one or more other products or active ingredients, devices or components that
are themselves not the Licensed Product.

 

1.9                                 “Commercially
Reasonable and Diligent Efforts” shall mean the level of effort and
resources normally used by a company engaged in the development of products for
human diseases and disorders for a product or compound owned or controlled by
it, which is of similar market potential and at a similar stage in its
development or product life, taking into account with respect to a product
issues of safety and efficacy, product profile, the proprietary position of the
product, the then current competitive environment for the product and the
likely timing of the product’s entry into the market, the regulatory
environment of the product, and other relevant scientific, technical and
commercial factors.

 

1.10                           “Confidential
Information” has the meaning set forth in Section 7.1 hereof.

 

1.11                           “Control”
shall mean, with respect to a Party, the ownership or, or possession of the
ability to assign, grant access to or license or sublicense intellectual
property, in any case without violating the terms of any agreement binding on
such Party.

 

1.12                           “DX-2240”
shall mean that certain antibody identified by Dyax with binding affinity to
Tie-1, as specifically described in Appendix A attached hereto.

 

1.13                           “DX-2240
Inventory” shall mean all existing GMP supplies of expressed and purified
DX-2240 owned by Dyax as of the Effective Date, as specifically described in Appendix
D attached hereto.

 

1.14                           “DX-2240
IP” shall mean the DX-2240 Patent Rights and the DX-2240 Know-How.

 

1.15                           “DX-2240
Know-How” shall mean any Know-How that is (a) Controlled by Dyax on
the Effective Date, and (b) used in or otherwise necessary or useful for
the research, development, manufacture and/or commercialization of DX-2240.

 

1.16                           “DX-2240
Patent Rights” shall mean (a) the Patent Rights listed in Appendix
E hereto and any patents issuing from such applications, together with any
reissues, reexaminations, renewals, and extensions thereof, and all
continuations, continuations-in-part and divisionals of the patents and patent
applications throughout the world.

 

1.17                           “EMEA”
shall mean the European Medicines Agency or any successor agency thereto.

 

1.18                           “FDA”
shall mean the United States Food and Drug Administration or any successor
agency thereto.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

2

 

1.19                           “Field
of Use” shall mean all human therapeutic uses, specifically excluding
Research Products and Separations Applications.

 

1.20                           “First
Commercial Sale” shall mean the first commercial sale of any Licensed
Product by Licensee or its Related Parties in any country after grant of a
Marketing Authorization in that country.

 

1.21                           “FTE” shall mean a
full-time equivalent person year (consisting of a total of 1,760 hours) of
work.

 

1.22                           “GMP”
shall mean current Good Manufacturing Practices as defined under the US Federal
Food Drug and Cosmetic Act as of the Effective Date.

 

1.23                           “IND”
shall mean an Investigational New Drug Application filed with FDA, or a similar
application to conduct clinical studies filed with an applicable Regulatory
Authority outside of the United States.

 

1.24                           “Indication”
shall mean a new and distinct disease category (for example, cancer versus
inflammation) and does not mean a different type or subpopulation within the
same primary disease (for example, colon cancer versus breast cancer).

 

1.25                           “Know-How” shall mean any
information and materials, whether proprietary or not and whether patentable or
not, including without limitation ideas, concepts, formulas, methods,
protocols, procedures, knowledge, know-how, trade secrets, processes, assays,
skills, experience, techniques, designs, compositions, plans, documents,
results of experimentation and testing, including without limitation,
pharmacological, toxicological, and pre-clinical and clinical test data and
analytical and quality control data, improvements, discoveries, works of
authorship, compounds and biological materials.

 

1.26                           “Licentia
Agreement” shall mean that certain Collaboration and License Agreement,
dated October 31, 2001, by and among Dyax, Licentia Limited (“Licentia”)
and Kari Alitalo, as amended from time to time. 
The Licentia Agreement as of the Effective Date is attached hereto as Appendix
F.

 

1.27                           “Licentia
IP” shall mean the Licentia Patent Rights and any Know-How or other
intellectual property rights to which Dyax has been granted rights under the
Licentia Agreement.

 

1.28                           “Licentia
Patent Rights” shall mean the “Licensed Patents” as that term is defined in
Section 1.8 of the Licentia Agreement.

 

1.29                           “Licensed
Product” shall mean any product intended for commercial sale in the in
Field of Use which comprises or incorporates DX-2240.  For the avoidance of doubt, a Licensed
Product that is developed or commercialized in additional Indications shall be
considered a single Licensed Product; provided  however, that if a
Licensed Product for any such additional Indication has a different Stock
Keeping Unit (SKU) or is otherwise traceable uniquely through IMS, it shall be
considered to be a separate Licensed Product.

 

1.30                           “Licensed
Product IP” shall mean all Patent Rights, Know-How and other intellectual
property rights  (but specifically
excluding the DX-2240 IP, CAT Patent Rights, Licentia IP and XOMA IP)
conceived, reduced to practice or otherwise made by Licensee or its Related
Parties (or by any person or business entity acting on Licensee’s or its
Related Parties’ behalf who is obligated by law or contract to assign such
intellectual property to Licensee or its Related Parties) on or after the
Effective Date  arising in connection with
the use, research, development, manufacture and/or commercialization of DX-2240
or Licensed Products.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

3

 

1.31                           “Licensed
Product Patent Rights” shall mean any Patent Rights that claim or cover
product or technology, or the use thereof, included in the Licensed Product IP.

 

1.32                           “Licensee”
shall mean sanofi-aventis, as identified above, and its Affiliates.

 

1.33                           “Lonza
Agreement” shall mean that certain Agreement, dated March 10, 2005, by
and among Dyax and Lonza Biologics PLC (“Lonza”), as amended to
date.  The Lonza Agreement is attached
hereto as Appendix G.

 

1.34                           “Marketing
Authorization” shall mean any approval (including all applicable pricing
and governmental reimbursement approvals) required from the relevant Regulatory
Authority to market and sell a Licensed Product in a particular country.

 

1.35                           “Net
Sales” shall mean, with respect to any Licensed Product sold by Licensee or
its Related Parties, the price invoiced by that party to the relevant purchaser
(or in the case of a sale or other disposal otherwise than at arm’s length, the
price which would have been invoiced in a bona fide arm’s length contract or
sale) but deducting the costs of packing, transport and insurance, customs
duties, any credits actually given for returned or defective Licensed Products,
normal trade discounts actually given, price concessions either mandated or
negotiated with both commercial and/or government payers, and sales taxes, VAT
or other similar tax charged on and included in the invoice price to the
purchaser.  In the event the Licensed
Product is sold in the form of a Combination Product, Net Sales will be
determined by multiplying actual Net Sales of such Combination Product by the
fraction A/(A+B), where A is the invoice price of the Licensed Product, if sold
separately, and B is the invoice price of any other active component or
components in the combination, if sold separately, in each case in the same
country and similar class, purity and dosage as in the Combination
Product.  If, on a country-by-country
basis, the Licensed Product or the other active component or components in the
Combination Product is / are not sold separately in such country, Net Sales
shall be determined by multiplying actual Net Sales of such Combination Product
by the fraction C/(C+D), where C is the fair market value of the Licensed
Product portion of such combination and D is the fair market value of the other
a active component or components (such fair market values to be determined by
mutual agreement of the parties or, in the absence of such mutual agreement, by
a neutral Third Party mutually designated by the parties and whose decision
shall be binding on the parties).

 

1.36                           “Patent
Rights” shall mean, with respect to any technology or product, (a) all
patent applications heretofore or hereafter filed or having legal force in any
country to the extent and only to the extent they claim or cover such
technology or product or the use thereof, (b) all patents that have issued
or in the future issue from such applications, including without limitation
utility, model and design patents and certificates of invention, and (c) all
divisionals, continuations, continuations-in-part, reissues, reexaminations,
renewals, extensions or additions to any such patent applications and patents.

 

1.37                           “Party”
shall mean Dyax or Licensee, and “Parties” means Dyax and Licensee.

 

1.38                           “Phase
I Clinical Trial” shall mean a human clinical trial in any country that is intended
to initially evaluate the safety of an investigational product in volunteer
subjects or patients that would satisfy the requirements of 21 CFR 312.21(a),
or other comparable regulation imposed by the FDA, the EMEA or their foreign
counterparts.

 

1.39                           “Phase II Clinical Trials” shall
mean the controlled human clinical trials conducted to evaluate the
effectiveness of the drug for a particular indication or indications in
patients with the disease or condition under study and to determine the common short-term
side effects and risks associated with the drug that would satisfy the

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

4

 

requirements of 21 CFR 312.21(b) or
other comparable regulation imposed by the U.S. Food and Drug Administration,
the EMEA  or their foreign counterparts.

 

1.40                           “Phase
III Clinical Trial” shall mean a pivotal human clinical trial in any
country the results of which could be used to establish safety and efficacy of
a product as a basis for a Marketing Authorization application that would
satisfy the requirements of 21 CFR 312.21(c) or other comparable
regulation imposed by the FDA, the EMEA or their foreign counterparts.

 

1.41                           “Quarter”
shall mean each period of three (3) months ending on March 31, June 30,
September 30, or December 31 and “Quarterly” shall be
construed accordingly.

 

1.42                           “Regulatory
Authority” shall mean the FDA, the EMEA or any national or local agency,
authority, department, inspectorate, minister, ministry official, parliament or
public or statutory person (whether autonomous or not) of any government of any
country having jurisdiction over any of the activities contemplated by this
Agreement or the Parties, or any successor bodies thereto.

 

1.43                           “Related
Party” shall mean a Party’s Affiliates and Sublicensees, which term
includes those distributors whose obligations to such Party or Affiliate
include responsibility for sales and/or marketing efforts in a country of the
Territory or sharing of costs and expenses with respect to sales and/or
marketing on behalf of a Party or its Affiliates, and which, for clarity, does
not include wholesale distributors of such Party or its Affiliates who purchase
Licensed Products from such party or its Affiliates in an arm’s length
transaction and who have no sales, marketing or reporting obligation to such
Party or its Affiliates.

 

1.44                           “Research
and Development” shall mean, solely for the purposes of the XOMA Covenant
(as described in Section 2.1(d), the identification, selection, isolation,
purification, characterization, study and/or testing of DX-2240 for any
purpose, including, without limitation, the discovery and development of human
therapeutics.  Included within the
definition of “Research and Development” shall be all in vitro screening or assays
customarily performed in pre-clinical and clinical research and uses associated
with obtaining FDA or EMEA or equivalent foreign counterpart Marketing
Authorization.

 

1.45                           “Research
Products” shall mean (a) any kit, vial or array (protein chip)
containing one or more antibodies intended for sale to an end user solely for
research purposes and (b) any antibodies sold to a Third Party for
incorporation into any kit, vial or array (protein chip) that are intended for
sale to an end user for research purposes.

 

1.46                           “Separations
Applications” shall mean the use of antibodies for the development and
manufacture of affinity chromatography purification media for use in the
separation and purification of pharmaceuticals.

 

1.47                           “Sublicensee”
shall mean an entity to which Licensee grants a sublicense pursuant to Section 2.2.

 

1.48                           “Target”
shall mean Tie-1, as specifically described in Appendix B attached hereto.

 

1.49                           “Third
Party” shall mean any entity other than Dyax or Licensee or their
respective Affiliates.

 

1.50                           “Valid
Claim” shall mean, with respect to the Patent Rights to which Licensee has
been granted rights under Section 2.1, a claim of (a) an issued and
unexpired patent, which has not been held invalid in a final decision of a
court or administrative authority of competent jurisdiction from which no
appeal may be taken, and

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

5

 

which has not been disclaimed
or admitted to be invalid or unenforceable through reissue or otherwise, or (b) a
pending patent application.

 

1.51                           “XOMA
Agreement” shall mean that certain Amended and Restated License Agreement,
dated October 27, 2006, by and between XOMA Ireland Limited (“XOMA”)
and Dyax, as amended from time to time. 
The XOMA Agreement as of the Effective Date is attached hereto as Appendix
H.

 

1.52                           “XOMA
Covenant” has the meaning set forth in Section 2.1(d) hereof.

 

1.53                           “XOMA
IP” shall mean the XOMA Patent Rights and the XOMA Know-How.

 

1.54                           “XOMA
Know-How” shall mean the “XOMA Know-How” as that term is defined in Section 1.23
of the XOMA Agreement.

 

1.55                           “XOMA
Patent Rights” shall mean the “XOMA Patent Rights” as that term is defined
in Section 1.24 of the XOMA Agreement.

 

ARTICLE 2

GRANT OF
LICENSE AND OTHER RIGHTS

 

2.1                                  Dyax
Grants.  During the term of this
Agreement, and subject to the terms and conditions of this Agreement, Dyax
hereby grants to Licensee the following (for the avoidance of doubt, it is
understood that “exclusive” means that the license is also exclusive vis a vis
Dyax) :

 

(a)                                  License to DX-2240 IP.  Dyax
hereby grants to Licensee an exclusive worldwide license under the DX-2240 IP
to use, research, develop,  offer for
sale, sell, have sold, import and export and have imported and exported,
Licensed Products, and to make or have made Licensed Products for such purposes.

 

(b)                                 Sublicense
under CAT Product License.  Subject
specifically to the terms and conditions set forth in Section 2.3, Dyax
hereby grants to Licensee a worldwide, non-exclusive sublicense of the rights
granted to Dyax under Clause 2.1 of the CAT Product License (the “CAT
Sublicense”) to use, research, develop, offer for sale, sell, have sold,
import and export and have imported and exported, Licensed Products, and to
make or have made Licensed Products for such purposes.

 

(c)                                  Sublicense
under Licentia Agreement.  Subject
specifically to the terms and conditions set forth in Section 2.4, Dyax
hereby grants to Licensee an exclusive worldwide sublicense of the rights
granted to Dyax under Article 2 of the Licentia Agreement (the “Licentia
Sublicense”) to use, research, develop, offer for sale, sell, have sold,
import and export and have imported and exported, Licensed Products, and to
make or have made Licensed Products for such purposes.  In case the Licentia Sublicense is terminated
by Licentia as a result of a Dyax breach, Dyax shall be deemed to have breached the covenant
made under Section 8.7(i) and Licensee shall be entitled to all legal
remedies provided hereunder.

 

Confidential
materials omitted and filed separately with the Securities and Exchange Commission.  Asterisks denote such omission.

 

6

 

(d)                                 XOMA
Covenant.  Subject specifically to
the restrictions set forth in Section 2.5, Dyax represents to Licensee
that, pursuant to a covenant running from XOMA to Dyax contained in the XOMA
Agreement (the “XOMA Covenant”), XOMA has agreed that it shall not
initiate or permit any Third Party over whom it has control to initiate or
assist in any way in the initiation or prosecution of any action asserting a
claim of infringement under the XOMA Patent Rights or misappropriation of the
XOMA Know-How to the extent reasonably necessary to allow the Licensee to
conduct the Research and Development activities that are contemplated under the
terms of this Agreement.

 

2.2                                  Sublicensing.  Subject to the restrictions set forth in
Sections 2.3, 2.4 and 2.5 and the terms of this Agreement, Licensee may
sublicense the rights granted to it under Section 2.1 to any Affiliate of
Licensee or to any Third Party; provided,
however, that such sublicense is in writing and:

 

(a)                                  Licensee
shall be responsible for the operations and activities of any Sublicensee as if
such operations and activities were carried out by Licensee itself, including
without limitation the payment of milestones, royalties, or other payments due
to Dyax hereunder, regardless of whether the terms of any such sublicense
provide for such amounts to be paid by the Sublicensee directly to Dyax;

 

(b)                                 any
such sublicense shall bind the Sublicensee in writing to all the applicable
terms and conditions of this Agreement for the benefit of Dyax, including,
without limitation Sections 2.3, 2.4 and 2.5 and shall require that the
Sublicensee shall make reports and keep and maintain records of sales to at
least the same extent required under this Agreement, allowing Dyax the same
access and audit rights permitted under this Agreement;

 

(c)                                  Licensee
agrees to deliver to Dyax, subject to the terms of confidentiality set forth in
Article 7, a copy of the written agreement evidencing such sublicense
within thirty (30) days following its execution (Licensee being entitled to
provide a redacted copy, the sole purpose of such copy being to allow Dyax to
ensure that the sublicense meets the obligations set forth in  Section 2.2 (b) above); and

 

(d)                                 in
the event that Licensee’s rights under this Agreement are terminated in
accordance with Article 11, such sublicense shall also terminate.

 

2.3                                  Terms
and Conditions Applicable to CAT Sublicense.

 

(a)                                  Licensee
hereby agrees:

 

(i)                                   to abide by all of
the terms and conditions applicable to Dyax and/or Dyax’s sublicensees  under the CAT Product License, subject to Section 2.3(a)(iii) hereafter;

 

(ii)                                that all rights of CAT
under the CAT Product License shall remain in full force and effect; and

 

(iii)                             that all obligations of
Dyax to CAT under the CAT Product License shall also be obligations of Licensee
to Dyax, except for (i) any obligations of Dyax contained

 

Confidential
materials omitted and filed separately with the Securities and Exchange Commission.  Asterisks denote such omission.

 

7

 

in Clause 6
(Consideration) and Clause 7 (Provisions Relating to the Payment of
Consideration) of the CAT Product License and (ii) any obligations set
forth in any portion of the CAT Product License that has been redacted by Dyax.

 

(b)                                 Notwithstanding
anything to the contrary contained in the CAT Product License, the CAT
Sublicense shall be subject to only the milestone and royalty payments set
forth in Article 5 below and Licensee shall
have no milestone or royalty payment obligations under the CAT Product License,
for which Dyax shall remain solely responsible.

 

(c)                                  Licensee
shall indemnify and hold Dyax and its Affiliates, officers, directors,
employees and agents harmless from and against any liability, damage, loss or
expense (including reasonable attorney fees and expenses of litigation)
incurred by any such party to CAT under or arising out of the CAT Product
License, to the extent that such liability, damage, loss or expense was
incurred by any such party  as a result of
a breach of any of the terms of this Agreement or of the CAT Product License by
Licensee, subject to Section 2.3(a)(iii) above.

 

(d)                                 CAT
shall be a third party beneficiary of the CAT Sublicense and shall have the
right to enforce the terms of this Section 2.3 (and claim damages as a
result of any breach) directly against Licensee.

 

2.4                                  Terms
and Conditions Applicable to Licentia Sublicense.

 

(a)                                  Licensee
hereby agrees:

 

(i)                                   to abide by all of
the terms and conditions applicable to Dyax and/or Dyax’s sublicensees) under
the Licentia Agreement;

 

(ii)                                that all rights of
Licentia and/or Kari Alitalo under the Licentia Agreement shall remain in full
force and effect; and

 

(iii)                             to abide by all
obligations of Dyax to Licentia and/or Kari Alitalo under the Licentia
Agreement, except for (A) any payment obligations of Dyax contained in Article 4
(Payment and Royalties) and (B) any obligations set forth in any portion
of the Licentia Agreement that has been redacted by Dyax.

 

(b)                                 Notwithstanding
anything to the contrary contained in the Licentia Agreement, the Licentia
Sublicense shall be subject to only the milestone and royalty payments set
forth in Article 5 below and Licensee shall have no payment obligations
under the Licentia Agreement, for which Dyax shall remain solely responsible.

 

(c)                                  Licensee
shall indemnify and hold Dyax and its Affiliates, officers, directors,
employees and agents harmless from and against any liability, damage, loss or
expense (including reasonable attorney fees and expenses of litigation)
incurred by any such party to Licentia and/or Kari Alitalo under or arising out
of the Licentia Agreement, to the extent that such liability, damage, loss or
expense was incurred by any such party  as a result of
a breach of any of the terms of this Agreement or the Licentia Agreement by
Licensee.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

8

 

(d)                                 Licentia
and Kari Alitalo shall each be a third party beneficiary of the Licentia
Sublicense and shall have the right to enforce the terms of this Section 2.4
(and claim damages as a result of any breach) directly against Licensee.

 

2.5                                  Restrictions
Applicable to the XOMA Covenant. 
Licensee acknowledges and agrees that:

 

(a)                                  Licensee
has received from Dyax a copy of the XOMA Agreement;

 

(b)                                 Licensee’s
rights under the XOMA Covenant are subject to all of the limitations, restrictions
and other obligations contained in the XOMA Agreement that are applicable to a
Dyax Collaborator who has received Licensed Immunoglobulin (as such terms are
defined in the XOMA Agreement), including those provisions set forth in Section 2.5(a)(i)-(viii) thereof;

 

(c)                                the XOMA Covenant, as
extended to Licensee, shall not apply to use of the XOMA Expression Technology
(as such term is defined in the XOMA Agreement) and Dyax has not provided to
Licensee any know-how or materials relating to the XOMA Expression Technology;
and

 

(d)                               Dyax shall have the
right to deliver to XOMA a written report which shall specify the name, address
and contact person for Licensee as required by Section 2.6(a) of the
XOMA Agreement.

 

2.6                                 Reservation
of Rights. No right or license under any intellectual property right
Controlled by either Party is granted or implied except as expressly granted in
this Agreement. Except for the rights specifically granted in this Agreement,
each Party expressly reserves all rights Controlled by it or its Affiliates to
all its products and intellectual property, and reserves the right to utilize
or allow its Affiliates or Third Parties to utilize such products and
intellectual property rights in any manner not conflicting with the terms of this
Agreement, including without limitation, to perform any applicable obligations
under this Agreement.

 

ARTICLE 3

TRANSFER OF MANUFACTURING TECHNOLOGY

AND LICENSED ANTIBODY MATERIALS

 

3.1                                 Transfer
of Manufacturing Technology.  As soon
as practicable but in any case no later than [*****] after the Effective Date,
Dyax shall deliver and assign to Licensee the technology Controlled by Dyax
necessary for the manufacture of Licensed Products. This technology transfer
shall comprise, inter alia:

 

(a)                                  the assignment of the Lonza Agreement to
Licensee; and

 

(b)                                 the transfer and assignment to Licensee of the
Cell Lines together with all Know-How, other intellectual property, scientific
data and other material documents relating to the Cell Lines, that are Controlled
by Dyax.

 

3.2                                 Transfer
of DX-2240 Inventory and DX-2240 Know How.  As soon as practicable but in
any case no later than [*****] after the Effective Date, Dyax shall deliver and
assign to Licensee the DX-2240 Inventory, and

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

9

 

shall deliver all DX-2240
Know-How. In consideration for the transfer of the DX-2240 Inventory, Licensee
shall pay to Dyax the DX-2240 Inventory fee set forth in Section 5.2.

 

3.3                                 Delivery. The technology, materials and associated data and documents that are
to be transferred to Licensee under Sections 3.1 and 3.2 shall be deemed
delivered hereunder upon Dyax’s tender to a carrier reasonably designated by
Licensee.

 

3.4                                 Additional Efforts.  Dyax
further agrees to cause to be performed such other lawful acts and to be
executed such further assignments and other lawful documents as Licensee may
reasonably require in order to complete and fully document the transfers and
assignments required under Sections 3.1 and 3.2.  Furthermore, subject to reasonable
availability, Dyax will make its employees and relevant consultants reasonably
available to Licensee for [*****] following receipt by Licensee of the Know-How
controlled by Dyax  to consult with
qualified personnel of Licensee on issues and questions related to technology,
materials and associated data and documents that are to be transferred and
assigned to Licensee under Sections 3.1 and 3.2, provided that in no event
shall Dyax be obligated to provide free of charge  more than three (3) FTE hours per week
of assistance to Licensee hereunder. If Licensee requests additional
assistance, the corresponding FTE’s hours shall be invoiced by Dyax to Licensee
at a rate of [*****] per FTE hour.  In no
case such additional assistance will represent more than ten (10) FTE
hours per week, unless the Parties have previously agreed that more assistance
will be required and provided.

 

ARTICLE 4

LICENSEE’S DILIGENCE OBLIGATIONS

 

4.1                                 Diligence
Requirements.  As between Dyax and Licensee, Licensee shall
be solely responsible, at its sole expense, for the research, development,
manufacture and commercialization of Licensed Products  Licensee shall use Commercially Reasonable
and Diligent Efforts to research, develop, manufacture and commercialize
Licensed Products .  Once an IND has been
filed for DX-2240, Commercially Reasonable and Diligent Efforts will be deemed
satisfied if, during any given calendar year, Licensee:

 

(a)                                is manufacturing a Licensed Product for a
clinical trial under an approved IND;

 

(b)                               is actively conducting a Phase I, II or
III Clinical Trial with respect to a Licensed Product (which may consist of any
activity such as  recruiting patients or
analyzing data) ;

 

(c)                                has filed for Marketing Authorization for a
Licensed Product in any Major Market Country;

 

(d)                               is pursuing a filed application for Marketing
Authorization for a Licensed Product in any Major Market Country;

 

(e)                                has received approval for Marketing
Authorization for a Licensed Product in any Major Market Country; or

 

(f)                                  has launched or is selling a Licensed Product
in a Major Market Country.

 

4.2                                 Annual Report. 
Within [*****] after the end of each calendar year following the
Effective Date until the first filing for Marketing Authorization of a Licensed
Product, Licensee shall provide Dyax with a written report to keep Dyax informed about the progress of Licensee’s
activities in connection with the Licensee development

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

10

 

activities for the Licensed Product, and such
report shall specifically identify how Licensee complied with its diligence
obligations under Section 4.1; provided that such reports shall not be
required to include any non-public technical or scientific information.

 

4.3                                 Remedy for Failing to Meet Obligations; Procedure.  In
the event that Dyax believes that Licensee has failed to comply with its due
diligence obligations under Section 4.1, Dyax shall notify Licensee in
writing.  Such notification will
constitute a notice of termination under Section 11.2 and this Agreement
will be terminated upon the expiration of the [*****] period provided within Section 11.2,
unless Licensee (a) pays Dyax a diligence extension fee of [*****], or (b) by
written notice, reasonably disputes that it has failed to comply with its due
diligence obligations and provides Dyax with specific documents evidencing how
Licensee complied with its due diligence obligations under Section 4.1.  If Dyax receives notice that Licensee
reasonably disputes that it has failed to comply with its due diligence
obligations under Section 4.1, Dyax shall have the right to request
arbitration (in accordance with Article 10.2), and if Dyax requests such
arbitration, this Agreement shall be terminated pursuant to Section 4.3 if
and when, in such arbitration, there is a final determination that Licensee has
failed to comply with its diligence obligations under Section 4.1.

 

ARTICLE 5

FINANCIAL TERMS

 

5.1                                 License
Fees.  Within [*****] following the
Effective Date, Licensee shall pay to Dyax an upfront license fee in the amount
of [*****].

 

5.2                                 Inventory
Supply Fee.  Within [*****] following Dyax’s delivery to Licensee of Dyax’s DX-2240
Inventory in accordance with Section 3.2 and an applicable invoice,
Licensee shall pay to Dyax an inventory supply fee as consideration for Dyax
having manufactured the DX-2240 Inventory, which the Parties have agreed to be [*****].

 

5.3                                 IND
Pharmacology Report Milestone. 
Within [*****] following
Licensee receipt from Dyax of the reports outlined in Appendix I,
Licensee shall pay Dyax a milestone payment of 
[*****].

 

5.4                                 Development
Milestones.  Within [*****] of the
first occurrence of each of the following events with respect to the first  Licensed Product, Licensee shall make the
following payments to Dyax:

 

	
  Milestone Event

  	
   

  	
  Payment

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (a)

  	
   

  	
  Upon
  dosing of first patient in a Phase I (or equivalent) Clinical Trial

  	
   

  	
  [*****]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  Upon
  dosing of first patient in a Phase II (or equivalent) Clinical Trial

  	
   

  	
  [*****]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (c)

  	
   

  	
  Upon
  dosing of first patient in a Phase III (or equivalent) Clinical Trial

  	
   

  	
  [*****]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (d)

  	
   

  	
  Upon
  first filing for Marketing Authorization with FDA

  	
   

  	
  [*****]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (e)

  	
   

  	
  Upon
  first filing for Marketing Authorization with EMEA

  	
   

  	
  [*****]

  

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

11

 

	
  (f)

  	
   

  	
  Upon
  first filing for Marketing Authorization in Japan

  	
   

  	
  [*****]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (g)

  	
   

  	
  Upon
  approval for Marketing Authorization from FDA

  	
   

  	
  [*****]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (h)

  	
   

  	
  Upon
  approval for Marketing Authorization from EMEA

  	
   

  	
  [*****]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (i)

  	
   

  	
  Upon
  approval for Marketing Authorization in Japan

  	
   

  	
  [*****]

  

 

Upon the second occurrence of
the foregoing events by Licensee or its Related Parties with respect to a Licensed
Product (as a result of development in second Indication), the development
milestone payments in the above chart shall be reduced by [*****]. Upon the
third occurrence of the foregoing events by Licensee or its Related Parties
with respect to a Licensed Product (as a result of development in a third
Indication), the development milestone payments in the above chart shall be
reduced by [*****].   No development
milestone payments shall be due (i) beyond the third occurrence of the
forgoing events with respect to the fist Licensed Product and (ii) upon
the occurrence of any events  with
respect to any other Licensed Product than the first Licensed Product.

 

5.5                                 Sales
Milestones.  Within [*****] of the
first occurrence of each of the following events with respect to all Licensed
Products, Licensee shall make the following payments to Dyax, it being
expressly understood and agreed that each of the following sales milestones
shall be due one time only:

 

	
  Milestone
  Event

  	
   

  	
  Payment

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (a)

  	
   

  	
  Total
  Annual Net Sales for all Licensed Products exceeds [*****]

  	
   

  	
  [*****]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  Total
  Annual Net Sales for all Licensed Products exceeds [*****]

  	
   

  	
  [*****]

  

 

5.6                                 Royalties.  Licensee shall
pay to Dyax the following royalties on Net Sales of Licensed Products:

 

	
  Annual Net Sales Worldwide for all Licensed Products

  	
   

  	
  Royalty Rate

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (a)

  	
   

  	
  Portion
  < [*****] in a calendar year

  	
   

  	
  [*****]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  Portion
  > [*****] but <
  [*****] in a calendar year

  	
   

  	
  [*****]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (c)

  	
   

  	
  Portion
  > [*****] in a calendar year

  	
   

  	
  [*****]

  

 

5.7                               Duration
of Royalty Payments.  The royalties
payable by Licensee to Dyax pursuant to Section 5.6 hereof shall be
payable on a country-by-country and Licensed Product-by-Licensed Product basis
for a period commencing with the First Commercial Sale in the relevant country
and ending on the later of:

 

(a)                                  ten
(10) years after First Commercial Sale; or

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

12

 

(b)                                 the expiration of the last Valid Claim to
expire under the DX-2240 Patent Rights, CAT Patents and Licentia Patents in
such country.

 

At
the expiration of the aforesaid period, Licensee shall have a fully-paid up
license.

 

5.8                                 Product
Patent Expiration; Generic Competition.

 

(a)                                On a Product-by-Product and country-by-country basis, if at any time
during  the royalty period outlined in Section 5.7
above, one or more biogeneric products containing DX-2240 are commercialized by
a Third Party in such country and represent during a consecutive  three month period [*****] or more of the
total market in such country, measured by the number of units sold (or in the
absence of such data in any country or countries, any other mean of measurement
which the parties will agree on in good faith, 
but excluding sales) (such date, the “Generic Competition Date”), the royalty rates set forth in Section 5.6
above  shall be substituted, with respect
to Net Sales occurring in such country, by reduced royalty rates  as set forth in Section (b) below.

 

(b)                               From and after the Generic Competition Date, and as long as Generic
Competition continues, and until expiration of the royalty duration set forth
in Section 5.7, Licensee shall pay the following royalties to Dyax with
respect to Net Sales of Licensed Product(s)

 

(i)                                     The royalty due under Section 5.6(a) above
[*****] shall be [*****];

 

(ii)                                  The royalty due under Section 5.6(b) above
[*****] shall be [*****]; and

 

(iii)                               The royalty due under Section 5.6(c) above
[*****] shall be [*****].

 

5.9           Deductions.

 

(a)                                In the event that Licensee must obtain a license to any intellectual
property that [*****], then Licensee shall be entitled to deduct
[*****] of the royalties paid to such Third Parties from the royalty due to
Dyax under Section 5.6.

 

(b)                               Furthermore, in the event that Licensee must obtain a license to any intellectual
property that [*****], then
Licensee shall be entitled to deduct [*****] of the royalties paid to such
Third Parties from the royalty due to Dyax under Section 5.6; provided however, that such deduction may not operate to
reduce any royalty due to Dyax under any royalty tier set forth in Section 5.6
above by more than [*****] in any calendar year.

 

(c)                                Except as set forth above,
Licensee shall not be entitled to deduct any royalties that may be due to any
Third Party in connection with the development, manufacture, use or sale of any
Licensed Product against any royalties due to Dyax under this Agreement.  Licensee shall be responsible for any and all
fees, royalties and other payments that may be due to any Third Party for any
Licensed Product, provided that Dyax shall be responsible for the payment of
all fees, royalties and other payments due under the CAT Product License, the
Licentia Agreement and the XOMA Agreement (which, for clarity, the

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

13

 

Parties acknowledge and agree may not
be deducted by Licensee under the terms of Section 5.9(a) or (b)).

 

(d)                               All fees payable by Licensee
under this Article 5 are non-refundable and, unless otherwise expressly
provided, may not be credited against any other sums which may be payable by
Licensee under this Agreement.

 

5.10         Reports, Payments, Records and
Audits.

 

(a)                                Licensee shall make the payments due to Dyax under this Article 5
in United States Dollars.  Where the payments due to Dyax under this Article 5
are being converted from a currency other than
United States Dollars, Licensee will use the conversion rate reported in The Wall Street Journal  two (2) business days before the day on
which Licensee pays Dyax.  Such
payment will be made without deduction of exchange, collection or other charges.

 

(b)                               All royalty payments will be made at Quarterly intervals.  Within [*****] of the end of each Quarter
after the First Commercial Sale of each Licensed
Product in any country, Licensee shall prepare a statement which shall
show on a country-by-country basis for the previous Quarter Net Sales of each Licensed Product by Licensee or its Related
Parties and all monies due to Dyax based on such Net Sales.  That statement shall include details of Net
Sales broken down to show the country of the sales and the total Net Sales by
Licensee or its Related Parties in such country and shall be submitted to Dyax
within such [*****] period together with remittance of the monies due.

 

(c)                                All payments shall be made free and clear of and without deduction or
deferment in respect of any disputes or claims whatsoever and/or as far as is
legally possible in respect of any taxes imposed by or under the authority of
any government or public authority.  Any
tax (other than VAT) which Licensee is required to pay or withhold with respect
of the payments to be made to Dyax hereunder shall be deducted from the amount
otherwise due provided that, in regard to any such deduction, Licensee shall
give Dyax such assistance, which shall include the provision of such
documentation as may be required by any revenue authority and other revenue
services, as may reasonably be necessary to enable Dyax to claim exemption
therefrom or obtain a repayment thereof or a reduction thereof and shall upon
request provide such additional documentation from time to time as is needed to
confirm the payment of tax.  If by law,
regulation or fiscal policy of a particular country, a remittance of royalties
in the currency stipulated in Section 5.9(a) above is restricted or
forbidden, notice thereof will be promptly given to Dyax, and payment of the
royalty shall be made by the deposit thereof in local currency to the credit of
Dyax in a recognized banking institution designated by Dyax or its
Affiliates.  When in any country a law or
regulation that prohibits both the transmittal and deposit of such payments
ceases to be in effect, all royalties or other sums that Licensee would have
been under obligation to transmit or deposit but for the prohibition, shall
forthwith be deposited or transmitted promptly to the extent allowable.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

14

 

(d)                               Licensee shall keep and shall procure that its Related Parties keep true
and accurate records and books of account containing all data necessary for the
calculation of the amounts payable by it to Dyax pursuant to this
Agreement.  Those records and books of account
shall be kept for [*****] following the end of the calendar year to which they
relate.  Upon Dyax’s written request, a
firm of accountants appointed by agreement between the Parties or, failing such
agreement within [*****] of the initiation of discussions between them on this
point Dyax shall have the right to cause an international firm of independent
certified public accountants that has not performed auditing or other services
for either Party or their Affiliates and is acceptable to Licensee, such
acceptance not to be unreasonably withheld, to inspect such records and books
of account.  In particular such firm:

 

(i)                                   shall be given access to and shall be
permitted to examine and copy such books and records of Licensee and its
Related Parties upon [*****] notice having been given by Dyax and at all
reasonable times on business days for the purpose of certifying that the Net
Sales or other relevant sums calculated by Licensee and its Related Parties
during any calendar year were reasonably calculated, true and accurate or, if
this is not their opinion, certify the Net Sales figure or other relevant sums
for such period which in their judgment is true and correct;

 

(ii)                                prior to any such examination taking place, such firm of accountants
shall undertake to Licensee that they shall keep all information and data
contained in such books and records, strictly confidential and shall not
disclose such information or copies of such books and records to any third
person including Dyax, but shall only use the same for the purpose of
calculations which they need to perform in order to issue the certificate to
which this Section envisages;

 

(iii)                           any such access examination and certification
shall occur no more than once per calendar year;

 

(iv)                            Licensee and its Related Parties shall make available personnel to
answer queries on all books and records required for the purpose of that
certification; and

 

(v)                               the cost of the accountant shall be the responsibility of Licensee if
the certification shows it to have underpaid monies to Dyax by more than
[*****] and the responsibility of Dyax otherwise.

 

(e)                                All payments due to Dyax under the terms of this Agreement are expressed
to be exclusive of value added tax (VAT) howsoever arising.  If Dyax is required to charge VAT on any such
payment, Dyax will notify Licensee. 
Licensee will then use all commercially reasonable endeavors to obtain a
VAT registration as soon as reasonably possible in order to allow it to reclaim
any VAT so chargeable.  If Licensee does
obtain a VAT registration then VAT will be added to any relevant payment at the
applicable rate.  If having used all
commercially reasonable endeavors Licensee is not able to reclaim the VAT (in
whole or in part) the Parties agree that the amount of any VAT payable will be
shared between them equally.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

15

 

5.11                           Payments
Made by Wire Transfer.  All payments
made to Dyax under this Agreement shall be made by wire transfer to the
following bank account of Dyax, or such other bank account as notified by Dyax
to Licensee from time to time:

 

[*****]

 

5.12                           Late Payments.  If
Licensee fails to make any payment to Dyax hereunder on the due date for
payment, without prejudice to any other right or remedy available to Dyax it
shall be entitled to charge Licensee interest (both before and after judgment)
of the amount unpaid at the annual rate of LIBOR (London Interbank Offering
Rate) plus [*****] calculated on a daily basis until payment in full is made
without prejudice to Dyax’s right to receive payment on the due date.

 

ARTICLE 6

INTELLECTUAL PROPERTY

 

6.1                                 Ownership.   As between the Parties, and
subject to the licenses granted in Section 2.1, ownership of certain
intellectual property shall be determined as follows:

 

(a)                                DX-2240 IP. Dyax shall own the DX-2240 IP, whether or not conceived, reduced to
practice or otherwise made by personnel of Licensee or its Related Parties,
either solely or jointly with Dyax personnel; and

 

(b)                               Licensed Product IP. 
Licensee shall own the Licensed Product IP.

 

Licensee
shall, and shall cause its Related Parties to, assign all DX-2240 IP to Dyax
and shall take all steps necessary to effect such assignment.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

16

 

6.2                                 Patent Filing, Prosecution and Maintenance.

 

(a)                                DX-2240 Patent Rights.  Licensee
shall have the first right at its sole expense, using counsel selected at
Licensee’s sole discretion, to prepare, file, prosecute, maintain and obtain
extensions of the DX-2240 Patent Rights in countries of Licensee’s choice in
Dyax’s name.  Licensee shall provide Dyax
with an annual report on or before each December 1 during the term of this
Agreement summarizing the patent filings, prosecutions or other proceedings and
will provide Dyax with copies of all material communications, search reports and
Third Party observations submitted to or received from applicable patent
offices.  Licensee shall consider in good
faith Dyax’s reasonable comments related thereto, if any, provided that final
decisions will be made solely by Licensee. If Licensee elects not to prosecute
or maintain any patent or patent application within the DX-2240 Patent Rights
for any reason, Licensee shall give Dyax notice thereof at least [*****] prior
to allowing such patent or patent application to lapse or become abandoned or unenforceable,
and Dyax shall thereafter have the right, at its sole expense, to prosecute and
maintain such patent or patent application. Except in case of willful
misconduct, Licensee shall in no case incur any liability to Dyax in relation
to its activities under this Section 6.2(a).

 

(b)                               Third Party Patent Rights.  The
preparation, filing, prosecution and maintenance of the CAT Patent Rights,
Licentia Patent Rights and XOMA Patent Rights shall be addressed in accordance
with the terms of the CAT Product License, Licentia Agreement and XOMA
Agreement, as applicable.

 

(c)                                Licensed Product Patent Rights. 
Licensee shall be solely responsible, at its sole discretion and
expense, for the prosecution, defense and maintenance of the Licensed Product
Patent Rights.

 

(d)                               Cooperation. Each Party agrees to cooperate with, and perform such lawful acts and
execute such documents in order to reasonably assist, the other with respect to
the preparation, filing, prosecution, defense and maintenance of patents and
patent applications pursuant to this Section 6.2.  Furthermore, the Parties shall cooperate with
each other in gaining patent term extensions wherever applicable to the DX-2240
Patent Rights.

 

6.3           Third Party Infringement.

 

(a)                                Notice.  Each Party shall promptly report
in writing to the other Party if (i) such Party becomes aware of any
alleged or threatened infringement of any Patent Rights or Know-How licensed
hereunder that could affect the development of any Licensed Product of which
such Party becomes aware, or (ii) either Party shall be individually named
as a defendant in a legal proceeding by a Third Party for infringement of a
patent because of the manufacture, use or sale of any Licensed Product, or
because of attempts to invalidate any patents or patent applications for which
it is responsible pursuant to this Article 6.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

17

 

(b)                               Initial Right to Enforce. 
Subject to Section 6.3(c) below and the applicable provisions
of the CAT Product License, Licentia Agreement and the XOMA Agreement, (i) Licensee
shall have the first right to initiate a suit or take other appropriate action
that it believes is reasonably required to protect (i.e., prevent or abate
actual or threatened infringement or misappropriation of) or otherwise enforce
the Patent Rights, Know-How and other intellectual property licensed to
Licensee under this Agreement.

 

(c)                                Step-In Right. 
Subject to the applicable provisions of the CAT Product License,
Licentia Agreement and the XOMA Agreement, if the Licensee fails to initiate a
suit or take other appropriate action that it has the initial right to initiate
or take pursuant to Section 6.3(b) above within [*****] after
becoming aware of the basis for such suit or action, then Dyax may, in its
discretion, provide the Licensee with written notice of such its intent to
initiate a suit or take other appropriate action to protect or otherwise
enforce the Patent Rights, Know-How and other intellectual property licensed to
Licensee under this Agreement.  If Dyax
provides such notice and the Licensee fails to initiate a suit or take such
other appropriate action within [*****] after receipt of such notice from Dyax,
then Dyax shall have the right to initiate a suit or take other appropriate
action that it believes is reasonably required to protect or otherwise enforce
the Patent Rights, Know-How and other intellectual property licensed to
Licensee under this Agreement. Notwithstanding the foregoing, if in any country
the law requires that any suit or other action be initiated and prosecuted by
the patentee, and consequently Licensee cannot be the initiating and
prosecuting party, Dyax shall, if Licensee so requests, initiate and prosecute
such suit or other action that Licensee believes appropriate. In that case,
Licensee would reimburse Dyax’ reasonable out-of-pocket expenses incurred in
initiating and prosecuting such suit or other action, as if Licensee was the
initiating party, as described in Section 6.3 (d) below.

 

(d)                               Conduct of Certain Actions; Costs.  The
Party initiating suit shall have the sole and exclusive right to select counsel
for any suit initiated by it pursuant to Section 6.3(b) or
6.3(c).  If required under applicable law
in order for the initiating Party to initiate and/or maintain such suit, the
other Party shall join as a party to the suit. 
Such other Party shall offer reasonable assistance to the initiating
Party in connection therewith at no charge to the initiating Party except for
reimbursement of reasonable out-of-pocket expenses incurred in rendering such
assistance.  The initiating Party shall
assume and pay all of its own out-of-pocket costs incurred in connection with
any litigation or proceedings initiated by it pursuant to Sections 6.3(b) and
6.3(c), including without limitation the fees and expenses of the counsel
selected by it.  The other Party shall
have the right to participate and be represented in any such suit by its own
counsel at its own expense.

 

(e)                                Recoveries.  With respect to any suit or
action referred to in Sections 6.3(b), any recovery obtained as a result of any
such proceeding, by settlement or otherwise, shall be applied in the following order
of priority:

 

(i)                                   first,
the Parties shall be reimbursed for all costs incurred in connection with such
proceeding paid by the Parties and not otherwise recovered; and

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

18

 

(ii)                                second,
any remainder shall be treated as if it were Net Sales of the applicable
Licensed Product, subject to the sales milestone and royalty provisions of Section 5.5
and 5.6.

 

ARTICLE 7

CONFIDENTIALITY  AND PUBLICITY

 

7.1                                 Confidential Information. 
During the term of this Agreement and for a period of [*****] after any
termination or expiration thereof, each Party agrees to keep in confidence and
not to disclose to any Third Party, or use for any purpose, except pursuant to,
and in order to carry out, the terms and objectives of this Agreement, any
Confidential Information of the other Party. 
As used herein, “Confidential Information” shall mean all trade
secrets or confidential or proprietary information designated as such in
writing by the disclosing Party, whether by letter or by the use of an
appropriate stamp or legend, prior to or at the time any such trade secret or
confidential or proprietary information is disclosed by the disclosing Party to
the receiving Party.  Notwithstanding the
foregoing, information which is orally or visually disclosed to the receiving
Party by the disclosing Party, or is disclosed in writing without an
appropriate letter, stamp or legend, shall constitute Confidential Information
if (i) it would be apparent to a reasonable person, familiar with the
disclosing Party’s business and the industry in which it operates, that such
information is of a confidential or proprietary nature, the maintenance of
which is important to the disclosing Party, or if (ii) the disclosing
Party, within [*****] after such disclosure, delivers to the receiving Party a
written document or documents describing such information and referencing the
place and date of such oral, visual or written disclosure and the names of the
employees or officers of the receiving Party to whom such disclosure was
made.  The restrictions on the disclosure
and use of Confidential Information set forth in the first sentence of this Section 7.1
shall not apply to any Confidential Information that:

 

(a)                                was known by the receiving Party prior to
disclosure by the disclosing Party hereunder (as evidenced by the receiving
Party’s written records);

 

(b)                               is or becomes part of the public domain
through no fault of the receiving Party;

 

(c)                                is disclosed to the receiving Party by a Third
Party having a legal right to make such a disclosure without violating any
confidentiality or non-use obligation that such Third Party has to the
disclosing Party; or

 

(d)                               is independently developed by the receiving
Party (as evidenced by the receiving Party’s written records).

 

Notwithstanding the obligations of confidentiality
and non-use set forth above, a receiving Party may provide Confidential
Information disclosed to it to (x) governmental or other Regulatory
Authorities in order to obtain, maintain or defend patents or to gain or
maintain approval to conduct clinical studies or to otherwise develop,
manufacture or commercialize a Licensed Product; provided, that such disclosure
shall be subject to the prior written consent of the Party whose Confidential
Information is intended to be disclosed (which consent shall not be
unreasonably withheld or delayed), and such Confidential Information shall be
disclosed only to the extent reasonably necessary to obtain, maintain or
defend  patents or authorizations, (y) the
extent required by applicable law, including without limitation by the rules or
regulations of the United States Securities and Exchange Commission or similar
regulatory agency in a country other than the United States or of any stock
exchange or listing entity, (z)

 

Confidential materials
omitted and filed separately with the Securities and Exchange Commission.  Asterisks denote such omission.

 

19

 

any bona fide actual or prospective underwriters,
investors, lenders or other financing sources or bona fide actual or
prospective collaborators or strategic partners who are obligated to keep such
information confidential, to the extent reasonably necessary to enable such
actual or prospective underwriters, investors, lenders or other financing
sources or collaborators to determine their interest in underwriting or making
an investment in, or otherwise providing financing to, or collaborating with
the receiving Party.  In addition, if
either Party is required to disclose Confidential Information of the other
Party by regulation, law or legal process, including without limitation by the rules or
regulations of the United States Securities and Exchange Commission or similar
regulatory agency in a country other than the United States or of any stock
exchange or listing entity, such Party shall provide prior notice of such
intended disclosure to such other Party if practicable under the circumstances
and shall disclose only such Confidential Information of such other Party as is
required to be disclosed. Licensee acknowledges and agrees that Dyax shall also
be permitted to disclose this Agreement in confidence to the extent reasonably
necessary to comply with Dyax’s obligations pursuant to the CAT Product
License, Licentia Agreement and XOMA Agreement.

 

7.2                                 Related Party, Employee,
Consultant and Advisor Obligations.  Each Party
agrees that it and its Affiliates shall provide or permit access to
Confidential Information received from the other Party only to the receiving
Party’s employees, consultants, advisors and permitted subcontractors who have
a need to know such Confidential Information to assist the receiving Party with
the development, manufacturing and commercialization of a Licensed Product and
the activities contemplated by this Agreement and who are subject to
obligations of confidentiality and non-use with respect to such Confidential
Information similar to the obligations of confidentiality and non-use of the
receiving Party pursuant to Section 7.1; provided, that Dyax and Licensee
shall each remain responsible for any failure by its Affiliates, and its
Affiliates’ respective employees, consultants, advisors and permitted
subcontractors, sublicensees and sub-distributors, to treat such Confidential
Information as required under Section 7.1 (as if such Affiliates,
employees, consultants, advisors and permitted subcontractors, sublicensees and
sub-distributors were Parties directly bound to the requirements of Section 7.1).

 

7.3                                 Injunctive Relief. 
The Parties acknowledge that money damages alone would not adequately
compensate the disclosing Party in the event of a breach by the receiving Party
of this Article 7, and that, in addition to all other remedies available
to the disclosing Party at law or in equity, it shall be entitled to seek
injunctive relief for the enforcement of its rights under this Article 7.

 

7.4                                 Liability. 
A Party shall be liable for a breach of the obligations of this Article 7
by an Affiliate, sublicensee, director, officer, employee, consultant or agent
of such party.

 

7.5                                 Return of Confidential
Information.  Upon termination of this Agreement, upon the
request of the disclosing Party, the receiving Party shall promptly return to
the disclosing Party or destroy the disclosing Party’s Confidential
Information, including all copies thereof, except to the extent that retention
of such Confidential Information is reasonably necessary for the receiving
Party to exploit any continuing rights it may have and/or to fulfill its
obligations contemplated hereby, including its obligations of non-disclosure
and non-use hereunder.  Any such destruction
requested by the disclosing Party shall be certified in writing to the
disclosing Party by an authorized officer of the receiving Party.  The return and/or destruction of such
Confidential Information as provided above shall not relieve the receiving Party
of its other obligations under this Agreement.

 

7.6                                 Publicity.  No public announcement or other disclosures
concerning the terms of this Agreement shall be made to a Third Party, whether
directly or indirectly, by either Party (except confidential disclosures to
those parties described in Section 7.1(b)) without first obtaining the
approval of the other Party and agreement upon the nature and text of such
announcement or disclosure except that: (a) a Party may disclose those
terms which it is

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

20

 

required by regulation or law
to disclose, provided that it takes advantage of all provisions to keep
confidential as many terms as possible; and (b) a Party desiring to make
such public announcement or other public disclosure shall obtain the consent of
the other Party to the proposed announcement or public disclosure prior to
public release.  Each Party agrees that
it shall cooperate fully with the other with respect to all disclosures
regarding this Agreement as required under the regulations of the U.S.  Securities and Exchange Commission,
applicable stock exchanges, NASDAQ and any other comparable foreign body
including requests for confidential information or proprietary information of
either Party included in any such disclosure. Licensee agrees that Dyax may
include Licensee on a list of Dyax licensees. 
Dyax agrees that Licensee, and its Sublicensees may state that they are
licensed under the rights hereunder.  The
Parties agree to release a mutually agreeable press release within two (2) days
of executing this Agreement.

 

7.7                                 Publication.  In the event that either
Party (the “Publishing Party”) wishes to publish, in oral or written
form, any Confidential Information of the other Party (the “Non-Publishing
Party”), such Party will promptly notify the Non-Publishing Party and
provide the Non-Publishing Party with a written copy of the proposed
publication prior to its submission for publication. At the Non-Publishing
Party’s request, the Publishing Party will delay publication in order to permit
the Non-Publishing Party to take the steps necessary to secure rights to any
intellectual property arising from the Publishing Party’s use of Confidential
Information, including the filing of one or more patent applications.  In no event will such delay exceed ninety
(90) days from the date the Non-Publishing Party receives a written copy of the
proposed publication.  If the Non-Publishing
Party makes such a request, the Publishing Party agrees to cooperate with the
Non-Publishing Party in securing such intellectual property rights using the
Non-Publishing Party’s choice of counsel and the Non-Publishing Party will bear
all costs of such filing.   No patent
application describing an invention resulting from the Publishing Party’s use
of Confidential Information will be filed or caused to be filed by the
Publishing Party without first notifying the Non-Publishing Party as described
above for proposed publications. Any publication or patent application will
acknowledge the Non-Publishing Party’s contribution.  No publication or patent application will
disclose any Confidential Information of a Party without the prior written
permission of that Party.

 

ARTICLE 8

REPRESENTATIONS AND WARRANTIES; CERTAIN COVENANTS

 

8.1                                 Exclusivity Covenant. During the term of this
Agreement, Licensee shall refrain from engaging in clinical development or
commercialization of [*****].

 

8.2                                 Representations of Authority. 
Dyax and Licensee each represents and warrants to the other Party that,
as of the Effective Date, it has full corporate right, power and authority to
enter into this Agreement and to perform its respective obligations under this
Agreement.

 

8.3                                 Consents. 
Dyax and Licensee each represents and warrants to the other Party that,
except for any regulatory approvals, pricing and/or reimbursement approvals,
manufacturing approvals and/or similar approvals necessary for the development,
manufacture or commercialization of any Licensed Product, 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 have been
obtained.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

21

 

8.4                                 No Conflict. 
Dyax and Licensee each represents and warrants to the other Party that,
notwithstanding anything to the contrary in this Agreement, the execution and
delivery of this Agreement by such Party, the performance of such Party’s
obligations hereunder and the licenses and sublicenses to be granted by such
Party pursuant to this Agreement (a) do not conflict with or violate any
requirement of any laws, rules or regulations existing as of the Effective
Date and applicable to such Party and (b) do not conflict with, violate,
breach or constitute a default under any contractual obligations of such Party
or any of its Affiliates existing as of the Effective Date.

 

8.5                                 Enforceability. 
Dyax and Licensee each represents and warrants to the other Party that,
as of the Effective Date, this Agreement is a legal and valid obligation
binding upon it and is enforceable against it in accordance with its terms,
except as such enforceability may be limited by applicable insolvency and other
applicable laws affecting creditors’ rights generally or by the availability of
equitable remedies.

 

8.6                                 [*****]

 

8.7                                 [*****]

 

8.8                                 No Warranties. 
EXCEPT AS OTHERWISE EXPRESSLY SET FORTH HEREIN, NEITHER PARTY MAKES ANY
REPRESENTATION OR EXTENDS ANY WARRANTIES OF ANY KIND, EITHER EXPRESS OR
IMPLIED, TO THE OTHER PARTY, AND EACH PARTY HEREBY DISCLAIMS ALL IMPLIED
WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND
NONINFRINGEMENT WITH RESPECT TO THE COMPOUND AND THE PRODUCT.  EACH PARTY HEREBY DISCLAIMS ANY
REPRESENTATION OR WARRANTY THAT THE DEVELOPMENT, MANUFACTURE AND
COMMERCIALIZATION OF THE PRODUCT PURSUANT TO THIS AGREEMENT WILL BE SUCCESSFUL.

 

8.9                                 Limitation of Liability. 
Neither Party shall have a right to or shall claim special, indirect or
consequential damages, including lost profits, for breach of this Agreement
against the other Party.  Except for
breaches by Dyax of the representations, warranties and covenants set forth in Section 8.6
and 8.7, remedies for breach of this Agreement shall be limited to claims for
amounts due hereunder or as otherwise provided in this Agreement, including
claims for indemnification as provided in Article 12 hereof.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

22

 

ARTICLE 9

INDEMNIFICATION

 

9.1                                 Indemnification.

 

(a)                                  By Licensee. Licensee will defend, indemnify and hold harmless
Dyax, its Affiliates and their respective directors, officers, employees and
agents (the “Dyax Indemnified Parties”) from and against all claims,
demands, liabilities, damages, penalties, fines, costs and expenses, including
reasonable attorneys’ and expert fees and costs, and costs or amounts paid to
settle (collectively, “Losses”), arising from or occurring as a result
of a Third Party’s claim (including any Third Party product liability or
infringement claim), action, suit, judgment or settlement to the extent such
Losses are due to or based upon:

 

(i)                                   the gross negligence,
recklessness, bad faith, intentional wrongful acts or omissions or violations
of applicable law or regulation by or of Licensee, its Related Parties,
wholesale distributors, contractors or their respective directors, officers,
employees or agents, including, without limitation, in connection with the
development, manufacture or commercialization of any Licensed Product by
Licensee, its Related Parties, wholesale distributors or contractors; or

 

(ii)                                the material breach by Licensee
of the terms of, or the material inaccuracy of any representation or warranty
made by it in, this Agreement; or

 

(iii)                             the development, manufacture or
commercialization of any Licensed Product by Licensee or its Related Parties,
wholesale distributors or contractors, except to the extent that such Losses
arise out of, and are allocable to, the gross negligence, recklessness, bad
faith, intentional wrongful acts, omissions or violations of law or breach of
this Agreement committed by the Dyax Indemnified Parties.

 

(b)                                 By Dyax. Dyax will defend, indemnify and
hold harmless Licensee, its Related Parties and their respective directors,
officers, employees and agents (the “Licensee Indemnified Parties”) from
and against all Losses arising from or occurring as a result of a Third Party’s
claim (including any Third Party product liability or infringement claim),
action, suit, judgment or settlement that is due to or based upon the material
breach by Dyax of the terms of, or the material inaccuracy of any
representation or warranty made by it in, this Agreement.

 

Confidential materials omitted and filed separately
with the Securities and Exchange Commission. 
Asterisks denote such omission.

 

23

 

(c)                                  Claims for Indemnification.

 

(i)                                   A
person entitled to indemnification under this Section 9.1 (an “Indemnified
Party”) shall give prompt written notification to the person from whom
indemnification is sought (the “Indemnifying Party”) of the commencement
of any action, suit or proceeding relating to a Third Party claim for which
indemnification may be sought or, if earlier, upon the assertion of any such
claim by a Third Party (it being understood and agreed, that the failure by an
Indemnified Party to give notice of a Third Party claim as provided in this Section 9.1
shall relieve the Indemnifying Party of its indemnification obligation under
this Agreement unless the Indemnified Party can demonstrate that such failure
to give notice has not resulted in any prejudice to the Indemnifying party. ).

 

(ii)                                Within
[*****] after receipt of such notification, the Indemnifying Party may, upon
written notice thereof to the Indemnified Party, assume control of the defense
of such action, suit, proceeding or claim with counsel of its choice.  If the Indemnifying Party does not assume
control of such defense, the Indemnified Party shall control such defense.

 

(iii)                             The
Party not controlling such defense may participate therein at its own expense;
provided, that if the Indemnifying Party assumes control of such defense and
the Indemnified Party reasonably concludes, based on advice from counsel, that
the Indemnifying Party and the Indemnified Party have conflicting interests
with respect to such action, suit, proceeding or claim, the Indemnifying Party
shall be responsible for the reasonable fees and expenses of counsel to the Indemnified
Party solely in connection therewith; provided further, however, that in no
event shall the Indemnifying Party be responsible for the fees and expenses of
more than one counsel in any one jurisdiction for all Indemnified Parties.

 

(iv)                            The
Party controlling such defense shall keep the other Party advised of the status
of such action, suit, proceeding or claim and the defense thereof and shall
consider reasonable recommendations made by the other Party with respect
thereto.

 

(v)                               The
Indemnified Party shall not agree to any settlement of such action, suit,
proceeding or claim without the prior written consent of the Indemnifying
Party, which shall not be unreasonably withheld.  The Indemnifying Party shall not agree to any
settlement of such action, suit, proceeding or claim or consent to any judgment
in respect thereof that does not include a complete and unconditional release
of the Indemnified Party from all liability with respect thereto or that
imposes any liability or obligation on the Indemnified Party without the prior
written consent of the Indemnified Party.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

24

 

ARTICLE 10

DISPUTE RESOLUTION

 

10.1                           Resolution by Executives.  Any
dispute, controversy or claim initiated by either Party arising out of, or
resulting from the breach or alleged breach by either Party of its obligations
under this Agreement (other than bona fide Third
Party actions or proceedings filed or instituted in an action or proceeding by
a Third Party against a Party to this Agreement), whether before or after
termination of this Agreement, shall be in the first instance referred to the
respective chief executive officers of the Parties.

 

10.2                           Arbitration.  If chief executive officers (or
their representatives, it being agreed that the chief executive officer of
either Party may designate a representative, provided such representative is
empowered with decision making in the dispute) 
of the Parties fail to resolve any dispute as provided in Section 10.1
within [*****], then such dispute shall be finally resolved by binding
arbitration as follows:

 

(a)                                  A Party may submit such dispute to arbitration
by notifying the other Party, in writing, of such dispute.  Within [*****] after receipt of such notice,
the Parties shall designate in writing a single arbitrator to resolve the
dispute; provided, however,
that if the Parties cannot agree on an arbitrator within such [*****] period,
the arbitrator shall be selected by the [*****] of the American Arbitration
Association (the “AAA”).  The
arbitrator shall be a lawyer or any other expert knowledgeable and experienced
in the subject matter of the dispute, and shall not be an Affiliate, employee,
consultant, officer, director or stockholder of either Party or of an Affiliate
of either Party.

 

(b)                                 Within [*****] after the designation of the
arbitrator, the arbitrator and the Parties shall meet, at which time the Parties
shall be required to set forth in writing all disputed issues and a proposed
ruling on the merits of each such issue.

 

(c)                                  The arbitrator shall set a date for a hearing,
which shall be no later than [*****] after the submission of written proposals
pursuant to Section 10.2(b), to discuss each of the issues identified by
the Parties.  The Parties shall have the
right to be represented by counsel. 
Except as provided herein, the arbitration shall be governed by the
Commercial Arbitration Rules of the AAA; provided,
however, that the Federal Rules of
Evidence shall apply with regard to the admissibility of evidence and the
arbitration shall be conducted by a single arbitrator.

 

(d)                                 The arbitrator shall use his or her best
efforts to rule on each disputed issue within [*****] after the completion
of the hearings described in this Section 10.2.  The determination of the arbitrator as to the
resolution of any dispute shall be binding and conclusive upon all
Parties.  All rulings of the arbitrator
shall be in writing and shall be delivered to the Parties.

 

(e)                                  The (i) attorneys’ fees of the Parties in
any arbitration, (ii) fees of the arbitrator and (iii) costs and
expenses of the arbitration shall be borne by the Parties as determined by the
arbitrator.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

25

 

(f)                                  Any arbitration pursuant to this Section 10.2
shall be conducted in [*****].  Any
arbitration award may be entered in and enforced by a court in accordance with Section 12.2.

 

(g)                                Nothing in this Section 10.2 shall be
construed as limiting in any way the right of a Party to seek injunctive relief
with respect to any actual or threatened breach of this Agreement from, or to
bring an action in aid of arbitration in, a court in accordance with Section 12.2.  Should any Party seek injunctive relief, then
for purposes of determining whether to grant such injunctive relief, the
dispute underlying the request for such injunctive relief may be heard by a
court in accordance with Section 12.2.

 

(h)                                The arbitrator shall not award damages
excluded pursuant to Section 8.8.

 

ARTICLE 11

TERM AND TERMINATION

 

11.1                           Term. 
This Agreement shall commence on the Effective Date and, unless earlier
terminated as provided in this Article 11, shall remain in effect until
the expiration of the last royalty obligation to Dyax pursuant to Section 5.7.  Upon expiration of the Agreement, Licensee
shall have a fully-paid up license.

 

11.2                           Termination Rights.

 

(a)                                  Termination for Convenience. 
Licensee shall have the right to terminate this Agreement at any time
after the Effective Date on [*****] prior written notice to Dyax
without any liability to Dyax in that respect (other than to perform
obligations which survive such termination in accordance with this Agreement)

 

(b)                                 Termination For Material Breach. 
Upon any material breach of this Agreement by a Party (the “Breaching
Party”), the other Party (the “Non-Breaching Party”) may terminate
this Agreement by providing [*****] prior written notice to the Breaching Party
in the case of a breach of a payment obligation and [*****] prior written
notice to the Breaching Party in the case of any other material breach.  The termination shall become effective at the
end of the notice period unless the Breaching Party cures such breach during
such notice period.  Notwithstanding the
foregoing, if such breach, by its nature, is incurable, the Non-Breaching Party
may terminate this Agreement immediately upon written notice to the Breaching
Party.

 

(c)                                  Termination for Bankruptcy.  A
Party may terminate this Agreement should the other Party commit an act of
bankruptcy, be declared bankrupt, voluntarily file or have filed against it a
petition for bankruptcy or reorganization unless such petition is dismissed
within [*****] of filing, enter into a procedure of winding up to dissolution,
or should a trustee or receiver be appointed for its business assets or
operations. All rights and licenses granted under or pursuant to this Agreement
are, and shall otherwise be deemed to be, for the purposes of Section 365(n) of
Title 11, U.S. Code (“Bankruptcy Code”) license rights to “intellectual
property” as defined under Section 101(60) of the Bankruptcy Code. The
Parties agree that any Party, as a licensee hereunder, shall retain and may
fully exercise all of its rights and elections under the Bankruptcy Code or any
relevant foreign equivalent thereof.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

26

 

(d)                                 Challenges of Patent Rights. 
In the event that Licensee or its Related Parties (i) commence or
participate in any action or proceeding (including, without limitation, any
patent opposition or re-examination proceeding), or otherwise assert in writing
any claim, challenging or denying the validity of any of the Patent Rights
licensed to the Licensee hereunder, or any claim thereof or (ii) actively
assist any other Person in bringing or prosecuting any action or proceeding
(including, without limitation, any patent opposition or re-examination
proceeding) challenging or denying the validity of any of such Patent Rights or
any claim thereof, Dyax will have the right to give notice to the Licensee
(which notice must be given, if at all, within sixty (60) days after Dyax first
learns of the foregoing) that the rights granted to Licensee under such Patent
Rights will terminate in [*****] following such notice, and, unless the
Licensee or its sublicense (as applicable) withdraws or causes to be withdrawn
all such challenge(s) within such [*****] period, such licenses will so
terminate.

 

11.3                           Consequences of Termination.

 

(a)                                  Termination by Dyax for Cause.   Without limiting any other legal or
equitable remedies that Dyax may have, if Dyax terminates this Agreement in
accordance with Sections 11.2(b) or (c), then:

 

(i)                                   if such termination occurs before
Licensee’s first filing with any Regulatory Authority of a protocol for a Phase
II Clinical Trial, then Licensee’s obligations under Section 8.1 shall
survive for a period of [*****] following such termination;

 

(ii)                                Licensee shall as promptly as
practicable transfer to Dyax or Dyax’s designee (A) possession and
ownership of all governmental or regulatory correspondence, conversation logs,
filings and approvals (including all Regulatory Approvals and pricing and
reimbursement approvals) relating to the development, manufacture or
commercialization of all Licensed Products, (B) copies of all data,
reports, records and materials in Licensee’s possession or control relating to
the development, manufacture or commercialization of all Licensed Products,
including all non-clinical and clinical data relating to any Licensed Products,
and (C) all records and materials in Licensee’s possession or control
containing Confidential Information of Dyax;

 

(iii)                             Licensee shall appoint Dyax as
Licensee’s agent for all Licensed Product-related matters involving Regulatory
Authorities until all Regulatory Approvals and other regulatory filings have
been transferred to Dyax or its designee;

 

(iv)                            if the effective date of
termination is after First Commercial Sale, then Licensee shall appoint Dyax as
its exclusive distributor of the Licensed Product and grant Dyax the right to
appoint sub-distributors, until such time as all Regulatory Approvals have been
transferred to Dyax or its designee;

 

(v)                               if Licensee or its Related
Parties are manufacturing Licensed Products, at Dyax’s option, supply the
Licensed Products to Dyax at cost plus [*****] or, if termination occurs after
the First Commercial Sale, on terms no less favorable than those on which
Licensee supplied the Licensed Products prior to such

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

27

 

termination to its distributors, until such time as
all Regulatory Approvals have been transferred to Dyax or its designee, and
Dyax has procured or developed its own source of Licensed Product supply,
provided that Dyax can demonstrate is has been diligently seeking an
alternative manufacturer and provided further that in any case Licensee’s
manufacture and supply obligation shall not continue for more than [*****] from
the date of termination of the Agreement;

 

(vi)                            if Dyax so requests, Licensee
shall transfer to Dyax any Third Party agreement relating to the development,
manufacture or commercialization of the Licensed Products to which Licensee is
a party, provided that such Third Party agreement permit such a transfer (and
Licensee hereby covenants to use commercially reasonable best efforts to ensure
that such Third Party Agreements do permit such a transfer); and

 

(vii)                         Licensee shall (A) assign
ownership of all Licensed Product IP that relates solely to the Licensed
Product to Dyax, free and clear of any liens or encumbrances and (B) grant
Dyax a non-exclusive right and license, with the right to grant sublicenses,
under all other Licensed Product IP for the sole purpose of o developing,
manufacturing and commercializing products containing DX-2240 throughout the
world. The license granted pursuant to this Section 11.3(a) shall be
royalty-free, fully-paid and perpetual, provided however that if Licensee
decides to no longer maintain any patent that is part of the Licensed Product
IP, Licensee shall notify Dyax thereof and Dyax shall have  [*****] to notify Licensee whether it is
interested to have the concerned patent(s) assigned to Dyax or not and if
Dyax fails to notify its interest Licensee shall not be obligated to maintain
the concerned patent and the license to Dyax shall be terminated as regards
such patent(s) . Licensee shall execute all documents and take all such
further actions as may be reasonably requested by Dyax in order to give effect
to the terms of this Section 11.3(a).

 

(b)                                 Termination by Licensee for Convenience. If Licensee terminates this Agreement in
accordance with Section 11.2(a), then the provisions of Section 11.3(a)(i)-(vii) shall
apply.  The licenses granted pursuant to
this Section 11.3(b) shall be royalty-free, fully-paid and perpetual;
provided, that if the effective date of termination occurs at any time after
the Regulatory Approval of a Licensed Product has been obtained from the FDA or
the EMEA or in Japan, then Dyax will be obligated to pay Licensee [*****] of
the sales milestones and royalties with respect to Net Sales specified in
Sections 5.5 and 5.6.  Licensee shall
execute all documents and take all such further actions as may be reasonably
requested by Dyax in order to give effect to the terms of this Section 11.3(b).

 

(c)                                  Termination by Licensee for Cause. 
Without limiting any other legal or equitable remedies that Licensee may
have, if Licensee terminates this Agreement in accordance with Sections 11.2(b) or
(c), all rights, licenses and sublicenses granted to Licensee
hereunder shall terminate and Licensee shall immediately cease any and all
activities relating to the
development, manufacture or commercialization of the Licensed Products; and shall, as directed by Dyax, return to Dyax or destroy all DX-2240 Know-How
and other Confidential

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

28

 

Information of Dyax in
Licensee’s possession. Licensee
shall execute all documents and take all such further actions as may be
reasonably requested by Dyax in order to give effect to the terms of this Section 11.3(c).  Notwithstanding the foregoing, if Licensee
terminates this Agreement in accordance with Section 11.2(b) because
Dyax has licensed or attempted to license to a Third Party the rights
exclusively licensed to Licensee under Section 2.1(a), then, without
limiting any other legal or equitable remedies that Licensee may have, all
rights granted to Licensee hereunder shall remain valid and unchanged, save
that no further milestone and/royalties shall be due to Dyax as from the
effective date of termination, the license being deemed to be converted into a
fully-paid up perpetual irrevocable license.

 

11.4                           Survival. 
In the event of any expiration or termination of this Agreement, (a) all
financial obligations under Article 5 owed as of the effective date of
such expiration or termination shall become immediately due and payable and (b) the
provisions contained in this Agreement that by their terms survive expiration
or termination of this Agreement, shall survive.  In addition, upon  expiration of this Agreement (but not in the
event of any termination of this Agreement pursuant to Section 11.2), the
licenses granted to Licensee in Sections 2.1 shall survive as perpetual, fully
paid-up, non-royalty-bearing licenses, and any exclusive license in such
Sections shall convert to a non exclusive license.

 

ARTICLE 12

MISCELLANEOUS

 

12.1                           Choice of Law. 
This Agreement shall be governed by and interpreted under, and any court
action in accordance with Section 12.2 shall apply, the laws of the
[*****] excluding: (a) its conflicts of laws principles; (b) the
United Nations Conventions on Contracts for the International Sale of Goods; (c) the
1974 Convention on the Limitation Period in the International Sale of Goods
(the “1974 Convention”); and (d) the Protocol amending the 1974
Convention, done at Vienna April 11, 1980.

 

12.2                           Submission to Jurisdiction. 
Each Party (a) submits to the exclusive jurisdiction of the state
and federal courts sitting in [*****], with respect to actions or proceedings
arising out of or relating to this Agreement in which a Party brings an action
in aid of arbitration, (b) agrees that all claims in respect of such
action or proceeding may be heard and determined only in any such court, and (c) agrees
not to bring any action or proceeding arising out of or relating to this
Agreement in any other court, other than an action or proceeding seeking
injunctive relief or brought to enforce an arbitration ruling issued pursuant
to Section 10.2 or an action related to intellectual property.  Each Party waives any defense of inconvenient
forum to the maintenance of any action or proceeding so brought.  Each Party may make service on the other
Party by sending or delivering a copy of the process to the Party to be served
at the address and in the manner provided for the giving of notices in Section 12.5.  Nothing in this Section 12.2, however,
shall affect the right of any Party to serve legal process in any other manner
permitted by law.

 

12.3                           Relationship of Parties. 
Nothing in this Agreement or in the course of business between Dyax and
Licensee shall make or constitute either Party a partner, employee, joint
venturer or agent of the other.  Neither
Party shall have any right or authority to commit or legally obligate or bind
the other in any way whatsoever including, without limitation, the making of
any agreement, representation or warranty.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

29

 

12.4                           Severability. 
Each Party hereby agrees that it does not intend to violate any public
policy, statutory or common laws, rules, regulations, treaty or decision of any
government agency or executive body thereof of any country or community or
association of countries.  Should one or
more provisions of this Agreement be or become invalid, the Parties hereto
shall substitute, by mutual consent, valid provisions for such invalid
provisions which valid provisions in their economic effect are sufficiently
similar to the invalid provisions that it can be reasonably assumed that the
Parties would have entered into this Agreement with such valid provisions.  In case such valid provisions cannot be
agreed upon, the invalidity of one or several provisions of this Agreement
shall not affect the validity of this Agreement as a whole, unless the invalid
provisions are of such essential importance to this Agreement that it is to be
reasonably assumed that the Parties would not have entered into this Agreement
without the invalid provisions.

 

12.5                           Notices.  All notices, requests, demands
and other communications required or permitted to be given pursuant to this
Agreement shall be in writing and shall be deemed to have been duly given upon
the date of receipt if delivered by hand, recognized international overnight
courier, confirmed facsimile transmission, or registered or certified mail,
return receipt requested, postage prepaid to the following addresses or
facsimile numbers:

 

	
   

  	
  If
  to Dyax:

  	
  Dyax
  Corp.

  
	
   

  	
   

  	
  300
  Technology Square

  
	
   

  	
   

  	
  Cambridge,
  MA 02139

  
	
   

  	
   

  	
  USA

  
	
   

  	
   

  	
  Attention:  Vice
  President, Business Development

  
	
   

  	
   

  	
  Attention:  Corporate
  Counsel, Legal Department

  
	
   

  	
   

  	
  Facsimile:  (617)
  225-7708

  
	
   

  	
   

  	
   

  
	
   

  	
  If to Licensee:

  	
  sanofi-aventis

  
	
   

  	
   

  	
  174 avenue de France

  
	
   

  	
   

  	
  75013 Paris

  
	
   

  	
   

  	
  France

  
	
   

  	
   

  	
  Attention:

  	
  Legal
  Operations

  
	
   

  	
   

  	
  Copy
  to:

  	
  License
  Administration

  
	
   

  	
   

  	
  Facsimile:

  	
  33
  1 53 77 46 43

  

 

Either
Party may change its designated address, contact person and facsimile number by
notice to the other Party in the manner provided in this Section.

 

12.6                           Captions. 
All captions herein are for convenience only and shall not be
interpreted as having any substantive meaning.

 

12.7                           Assignment; Successors.  This
Agreement may be assigned by Dyax without the prior written consent of
Licensee.  The performance of Licensee
hereunder is of a personal nature and, therefore, neither this Agreement nor
the rights granted to licensee under Section 2.1 may be assigned,
sublicensed (except as expressly provided under Section 2.2), or otherwise
transferred, whether voluntarily or by operation of law, by the Licensee
without the prior written consent of Dyax; provided, however, that Licensee
may, without such consent, assign its rights and obligations under this
Agreement (a) to any Affiliate, or (b) in connection with a merger,
consolidation or sale of substantially all of Licensee’s assets to an unrelated
Third Party; provided, however, that Licensee’s rights and obligations under
this Agreement shall be assumed by its successor in interest in any such
transaction and shall not

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

30

 

be transferred separate from all or substantially all
of its other business assets, including without limitation those business
assets that are the subject of this Agreement. 
Any permitted assignee shall assume all obligations of its assignor
under this Agreement.   Any purported
assignment in violation of this Section 12.7 shall be void.  Nothing herein is intended to prevent either
Party from sublicensing any of its rights in accordance with the terms of this
Agreement.

 

12.8                         Execution in Counterparts;
Facsimile Signatures.  This Agreement may be executed
in counterparts, each of which counterparts, when so executed and delivered,
shall be deemed to be an original, and all of which counterparts, taken
together, shall constitute one and the same instrument even if both Parties
have not executed the same counterpart. 
Signatures provided by facsimile transmission shall be deemed to be
original signatures.  Notwithstanding the
foregoing, promptly following the signature of this agreement by facsimile
transmission, the Parties shall arrange for original signatures to be
exchanged.

 

12.9                         Waiver.  The waiver
by either Party hereto of any right hereunder, or of the failure of the other
Party to perform, or of a breach by the other Party, shall not be deemed a
waiver of any other right hereunder or of any other breach or failure by such
other Party whether of a similar nature or otherwise

 

12.10                   Performance by Affiliates.  To
the extent that this Agreement imposes obligations on Affiliates of Dyax or
Licensee, such Party agrees to cause its Affiliates to perform such
obligations.  Furthermore, if and to the
extent that any Affiliate of Dyax or Licensee seeks to derive benefit from any
rights under this Agreement that have been extended through Dyax or Licensee to
such Affiliate, such Affiliate shall be subject to all the terms and conditions
set forth in this Agreement that are applicable to the Party through which such
rights are derived.

 

12.11                   Force Majeure. 
Neither Party shall be held liable to the other Party nor be deemed to
have defaulted under or breached the Agreement for failure or delay in
performing any obligation under this Agreement when such failure or delay is
caused by or results from causes beyond the reasonable control of the affected
Party including, but not limited to, embargoes, war, acts of war (whether war
be declared or not), insurrections, riots, civil commotions, strikes, lockouts
or other labor disturbances, fire, floods, or other acts of God, or acts, omissions
or delays in acting by any governmental authority or the other Party.  The affected Party shall notify the other
Party of such force majeure circumstances as soon as reasonably practical, and
shall promptly undertake all reasonable efforts to remove or remedy the force
majeure condition.

 

12.12                   Entire Agreement. 
This Agreement contains the entire understanding of the Parties with
respect to the subject matter hereof. 
All express or implied agreements and understandings, either oral or
written, heretofore made are superseded by this Agreement.   This Agreement may be amended, or any term
hereof modified, only by a written instrument duly executed by both Parties
hereto.  Each of the Parties hereby
acknowledges that this Agreement is the result of mutual negotiation and
therefore any ambiguity in their respective terms shall not be construed
against the drafting Party.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

31

 

IN
WITNESS WHEREOF, the undersigned have duly executed and delivered this
Agreement as a sealed instrument effective as of the date first above written.

 

 

	
  DYAX CORP.

  	
   

  	
  LICENSEE:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  SANOFI-AVENTIS

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Date:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  :

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title
  :

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Date
  :

  	
   

  
								

 

 

Confidential materials omitted and filed separately with the Securities
and Exchange Commission.  Asterisks
denote such omission.

 

32

 

APPENDIX A

 

LICENSED ANTIBODY DESCRIPTION

 

[*****]

 

Confidential materials omitted and filed
separately with the Securities and Exchange Commission.  Asterisks denote such omission.

 

 

APPENDIX B

 

TARGET DESCRIPTION

 

Tie-1

 

Human
Tyrosine Protein Kinase Receptor Tie1 Precursor

Swiss-Prot
Number: P35590

 

References
describing the Nominated Target:

 

Mol
Cell Biol. 1992 Apr;12(4):1698-707, A novel endothelial cell
surface receptor tyrosine kinase with extracellular epidermal growth factor
homology domains, Partanen J, Armstrong E, Makela TP, Korhonen J,
Sandberg M, Renkonen R, Knuutila S, Huebner K, Alitalo K.

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

 

 

APPENDIX C

 

CAT PRODUCT LICENSE

 

[As previously filed with the Commission]

 

Confidential materials omitted and filed separately with the Securities
and Exchange Commission.  Asterisks
denote such omission.

 

 

APPENDIX D

 

TRANSFERRED MATERIALS

 

[*****]

 

Confidential materials omitted and filed separately with the Securities
and Exchange Commission.  Asterisks
denote such omission.

 

 

APPENDIX E

 

DX-2240 PATENTS

 

[*****]

 

Confidential materials omitted and filed separately with the Securities
and Exchange Commission.  Asterisks
denote such omission.

 

 

APPENDIX F

 

LICENTIA AGREEMENT

 

[Collaboration
and License Agreement, dated October 31, 2001 by and among Dyax, Licentia
Limited and Kari Alitalo, as amended from time to time.]

 

Confidential materials omitted and filed separately with the Securities
and Exchange Commission.  Asterisks
denote such omission.

 

 

APPENDIX G

 

LONZA AGREEMENT

 

[Agreement,
dated March 10, 2005, by and between Dyax and Lonza Biologics PLC, as
amended to date.]

 

Confidential materials omitted and filed separately with the Securities
and Exchange Commission.  Asterisks
denote such omission.

 

 

APPENDIX H

 

XOMA AGREEMENT

 

[As previously filed with the Commission.]

 

Confidential materials omitted and filed separately with the Securities
and Exchange Commission.  Asterisks
denote such omission.

 

 

APPENDIX I

 

LIST OF REPORTS TO BE PROVIDED UNDER SECTION 5.1

 

[*****]

 

Confidential
materials omitted and filed separately with the Securities and Exchange
Commission.  Asterisks denote such
omission.

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