Document:

Exhibit 10.12

 

COLLABORATION
AND LICENSE AGREEMENT

 

THIS COLLABORATION
AND LICENSE AGREEMENT (“Agreement”) is made and
entered into effective as of August 31, 2003 (the “Effective Date”), by
and among ONCOGENEX TECHNOLOGIES INC., having offices at Jack Bell Research
Centre, Rm 550, 2660 Oak Street, Vancouver, B.C., V6H 3Z6 (“OncoGenex”) and
ISIS PHARMACEUTICALS, INC., having principal offices at 2292 Faraday Avenue,
Carlsbad CA 92008 (“Isis”). OncoGenex and Isis each may be referred to herein
individually as a “Party,” or collectively as the “Parties.”

 

WHEREAS,
Isis and OncoGenex wish to collaborate in the identification of a lead
antisense compound targeted to inhibit both IGFBP-5 and IGFBP-2 simultaneously
(a bi-specific oligonucleotide), as well as lead antisense compounds targeted
to inhibit each of IGFBP-5 and IGFBP-2 separately, using Isis’ proprietary MOE
chemistry, on the terms set forth below;

 

NOW, THEREFORE,
the Parties do hereby agree as follows:

 

ARTICLE 1 -
DEFINITIONS

 

Capitalized terms used in this Agreement and
not otherwise defined herein have the meanings set forth in Appendix 1.

 

ARTICLE 2 - 

SCOPE OF COLLABORATION; COLLABORATION ACTIVITIES

 

Section 2.1            Scope
of Collaboration. The Parties initiated a collaboration prior to the
Effective Date to jointly identify antisense compounds targeted to inhibit
IGFBP-5 and IGFBP-2, both genes separately and together (the “Collaboration”),
according to the Project Plan attached hereto as Appendix 2.3.1 and made part
of this Agreement. Following the completion of the Project Plan, OncoGenex will
be solely responsible for the continued development and commercialization of
any Products subject to royalty and milestone payments to be paid to Isis as
set forth in this Agreement.

 

Section 2.2            Collaboration
Activities.

 

2.2.1       General.  The
Parties will use Commercially Reasonable Efforts to conduct their respective
responsibilities outlined in the Project Plan in accordance with this Agreement
and the Project Plan in good scientific manner, and in compliance in all
material respects with all Applicable Law, and will cooperate reasonably with
the other Party to achieve the goals of the Collaboration.

 

2.2.2       Collaboration Exclusivity.  During
the Term of this Agreement, neither Party will engage, on behalf of itself or
any other party, in the development or commercialization of antisense compounds
targeted to IGFBP-5 and/or IGFBP-2 other than as provided in this Agreement.
Notwithstanding the forgoing, OncoGenex retains 

 

*Certain information in this exhibit has been omitted as confidential,
as indicated by [***]. This information has been filed separately with the
Commission.

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the right to use, have used and to grant limited sublicenses to use
OncoGenex’s Product-Specific Technology Patents for research, scholarly and
other non-commercial purposes only, and such activities will not be interpreted
as a breach of this Agreement. Isis retains the right to use antisense
compounds targeted to IGFBP-5 and/or IGFBP-2 or to transfer such antisense
compounds to third parties for target validation purposes.

 

Section 2.3            Project
Plan.

 

2.3.1       Goals of Project Plan. The
Project Plan and the Parties’ responsibilities thereunder and the funding
thereof are set forth in Appendix 2.3.1.

 

2.3.2       Changes to Project Plan. Any
changes to the Project Plan will require the prior written approval of both
Parties, and if such changes require additional activities will include a
budget for such activities and a method of funding.

 

2.3.3       Selection of First
Antisense Oligonucleotide. From the antisense oligonucleotides generated
under the Project Plan, OncoGenex will select one antisense oligonucleotide
targeted to IGFBP-5 and/or IGFBP-2 for use in a Product to take into IND
enabling toxicology for purposes of evaluating such Product in human clinical
trials. OncoGenex may replace the selected antisense oligonucleotide with any
other antisense oligonucleotide generated under the Project Plan at any time,
and for no additional cost, upon written notice to Isis.

 

2.3.4       Selection of Additional
Antisense Oligonucleotides.  If, in addition to the antisense
oligonucleotide selected in Section 2.3.3, OncoGenex elects to select one
or more additional antisense oligonucleotides targeted to IGFBP-5 and/or IGFBP-2
generated under the Project Plan, for use in a Product to take into human
clinical trials beyond the first Phase II Clinical Trial, OncoGenex will so
notify Isis and will pay Isis the payment set forth in Section 4.2.

 

2.3.5       Responsibilities Following
Completion of the Project Plan. Following the completion of the Project
Plan, OncoGenex will be solely responsible for further development and
commercialization of the Product, including but not limited to:

 

(a)  Contracting
for the manufacturing of all drug needed for toxicology studies and clinical
trials, as described in Section 2.4.

 

(b)  Coordinating
all aspects of animal pharmacology and toxicology studies needed for IND
filing.

 

(c) 
Conducting clinical trials.

 

(d)  Negotiating any and all sublicensing
agreements with Third Parties for the ongoing development and/or marketing of
the Product.

 

If requested by OncoGenex in order to facilitate further development
and commercialization of the Product, the Parties will mutually agree to a
consulting 

 

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agreement under which Isis will provide consulting in addition to the
hours set forth in the Project Plan at a rate of [***] per hour.

 

Section 2.4            Manufacturing
of Product.

 

2.4.1       Isis will have the
first right to manufacture the Product, at mutually agreeable, commercially
reasonable terms and conditions, and pursuant to a supply agreement to be
agreed to by the Parties containing standard terms regarding quality control,
ordering, delivery, title and risk of loss, warranties and indemnification.

 

2.4.2       If Isis is unable or
unwilling to manufacture the Product, or if the Parties cannot reach agreement
on the terms and conditions within 60 days of a request for transfer pricing
quote by OncoGenex, OncoGenex may:

 

have the Product manufactured by a
manufacturer licensed under Isis’ proprietary manufacturing and analytical
technology; or

 

have the Product manufactured using a process
not covered by Isis’ proprietary manufacturing and analytical technology.

 

ARTICLE 3 - 

GRANT OF RIGHTS

 

Section 3.1            License
Grant for Collaboration Activities.

 

3.1.1       Isis
Grant. Subject to the terms and conditions of this Agreement, Isis hereby
grants to OncoGenex (a) an exclusive, worldwide license under the Isis
Product-Specific Technology Patents and the Joint Patents to any
Product-Specific Technology and (b) a non-exclusive, worldwide license
under the Isis Core Technology Patents, both licenses solely to develop, make,
have made, use, sell, offer for sale, have sold and import Products. The
licenses granted to OncoGenex are sublicensable only in connection with a
license of Products to a Third Party for the continued development and
commercialization of Products in accordance with the terms of this Agreement.

 

3.1.2       OncoGenex Grant. Subject
to the terms and conditions of this Agreement, OncoGenex hereby grants to Isis
a non-exclusive, non-transferable, limited license or sublicense, as the case
may be, under the OncoGenex Product-Specific Technology Patents, solely to
perform Isis’ responsibilities in the Project Plan.

 

3.1.3       Improvements. To the
extent that Isis has the right to license an Improvement, the Parties will
negotiate in good faith regarding the use of any such Improvement in Products. If
the Parties agree to terms under which such Improvement will be used in
Products, Isis will grant to OncoGenex a license under the Improvement solely
to develop, make, have made, use, sell, offer for sale, have sold and import
Products. The license granted hereunder will be sublicensable only in
connection with a license of Products to a Third Party for the continued
development and commercialization of Products in accordance with the terms of
this Agreement.

 

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ARTICLE 4
- 

FINANCIAL PROVISIONS

 

Section 4.1            Up-Front
Payment by OncoGenex.  Within 30 days of the Effective Date,
OncoGenex will pay an up-front license fee of [***] to Isis, payable in cash or
class B equity securities of OncoGenex, at OncoGenex’s discretion, provided that any class B equity
securities so issued to Isis will be issued at the same per-share price and
will be of the same class with the same rights and preferences as the class B
equity securities issued to new investors in OncoGenex in the class B equity
issue scheduled to be completed by OncoGenex within 30 days of the Effective
Date. In no event will Isis take equity in excess of 18% of all shares of
OncoGenex, Fully Diluted. Any remaining amounts will be paid in cash.

 

Section 4.2            Payment
for Additional Antisense Oligonucleotides.  If OncoGenex elects
to select an antisense oligonucleotide for use in an additional Product as set
forth in Section 2.4, OncoGenex will pay Isis an up-front fee of [***] for
each antisense oligonucleotide selected. Such up-front fee may be paid in cash
or equity securities of OncoGenex at OncoGenex’s discretion, provided that any equity securities so
issued to Isis will be issued at the same per-share price and will be of the
same class with the same rights and preferences as the equity securities issued
in OncoGenex’s most recent financing round. In no event will Isis take equity
in excess of 18% of all shares of OncoGenex, Fully Diluted. Any remaining
amounts will be paid in cash. In addition to the up-front fee, OncoGenex will
pay to Isis the milestone payments and royalty payments detailed in Article 4
hereof as and when such milestone payments and royalty payments are due for a
Product containing such antisense oligonucleotide. All milestone payments and
royalty payments for such Product will be in addition to all milestone payments
and royalty payments required to be made for any other Product being developed
or commercialized by OncoGenex.

 

Section 4.3            Milestone
Payments by OncoGenex.  OncoGenex will pay to Isis the relevant
milestone payment not more than thirty (30) days after achievement, by
OncoGenex or a sublicensee, of each of the applicable events in the first Major
Market country for each Product developed hereunder; provided however that no additional milestone payment shall
be due or owing when a Product meets the same milestone in an additional
country once that milestone payment has already been paid, and no additional
milestone payment shall be due or owing with respect to a Product which
replaces a Product for which such milestone payment has previously been made,
as follows:

 

	
  Event

  	
   

  	
  Payment

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  [***]

  	
   

  	
  [***]

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  [***]

  	
   

  	
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  [***]

  	
   

  	
  [***]

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  [***]

  	
   

  	
  [***]

  	
   

  

 

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Section 4.4            Royalty
Payments by OncoGenex.  In consideration of Isis’ collaborative
efforts and the licenses granted hereunder, OncoGenex will pay Isis a royalty
of [***] of Net Sales of the Product. OncoGenex will pay such royalties for the
Term of the Agreement.

 

Section 4.5            Third
Party Payments.  In addition to the royalty set forth in Section 4.4,
OncoGenex will pay to Isis a royalty of [***] of Net Sales of Product, pursuant
to a license agreement with [***] and a royalty of [***] of Net Sales of
Product pursuant to a license agreement with [***]. In the event that Isis
negotiates reduced royalties with these Third Party licensors, the royalties
due hereunder will still be paid to Isis. Notwithstanding the foregoing, the
Parties agree that if the Isis Patent Rights licensed by Isis from [***]  and/or [***] 
and sublicensed under this Agreement cease to have any Valid Claims
during the term of this Agreement, then OncoGenex will no longer be responsible
for paying the royalties flowing through to [***] and/or [***] as applicable,
and the total royalty payable will be reduced accordingly.

 

Section 4.6            Timing
of Royalty Payments.  The royalties will become due and payable within
60 days of each respective Royalty Due Date and shall be calculated in respect
of the Net Sales in the three (3) month period immediately preceding the
applicable Royalty Due Date.

 

Section 4.7            Payment
Method.  Any amounts due to a Party under this Agreement will be paid
in U.S. dollars, by wire transfer in immediately available funds to an account
designated by the receiving Party. Any payments or portions thereof due
hereunder which are not paid on the date such payments are due under this
Agreement will bear interest at a rate equal to the lesser of the prime rate as
published in The Wall Street Journal,
Eastern Edition, on the first day of each calendar quarter in which such
payments are overdue, plus two percent (2%), or the maximum rate permitted by
law, whichever is lower, calculated on the number of days such payment is
delinquent, compounded monthly.

 

Section 4.8            Currency;
Foreign Payments.  If any currency conversion will be required in
connection with any payment hereunder, such conversion will be made by using
the exchange rate for the purchase of U.S. dollars as published in The Wall Street Journal, Eastern Edition,
on the last business day of the calendar quarter to which such payments relate.
If at any time legal restrictions prevent the prompt remittance of any payments
in any jurisdiction, the applicable Party may notify the other and make such
payments by depositing the amount thereof in local currency in a bank account
or other depository in such country in the name of the receiving Party or its
designee, and such Party will have no further obligations under this Agreement
with respect thereto.

 

Section 4.9            Taxes.
 A Party may deduct from any amounts it is required to pay to the
other Party pursuant to this Agreement an amount equal to that withheld for or
due on account of any taxes (other than taxes imposed on or measured by net
income) or similar governmental charge imposed on the receiving Party by a
jurisdiction of the paying Party (“Withholding Taxes”). The paying Party will
provide the receiving Party a certificate evidencing payment of any Withholding
Taxes hereunder within 30 days of 

 

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such payment and will reasonably assist the receiving Party, at the
receiving Party’s expense, to obtain the benefit of any applicable tax treaty.

 

Section 4.10         Records
Retention; Audit.

 

4.10.1     Regulatory Records.  With
respect to the subject matter of this Agreement, each Party will maintain, or
cause to be maintained, records of its respective research, development,
manufacturing and commercialization activities, including all Regulatory
Documentation, in sufficient detail and in good scientific manner appropriate
for patent and regulatory purposes, which will be complete and accurate and
will fully and properly reflect all work done and results achieved in the
performance of such activities. All Regulatory Documentation will be retained
for a period as may be required by Applicable Law. Each Party will have the
right, during normal business hours and upon reasonable notice, to inspect and
copy any such records for the sole purpose of performing their obligations or
exercising their rights hereunder.

 

4.10.2     Record Retention.  Each
Party will maintain (and will ensure that its sublicensees will maintain)
complete and accurate books, records and accounts that fairly reflect (a) their
respective costs and expenses reimbursable or otherwise shared by the Parties
hereunder (collectively, the “Collaboration Expenses”) and (b) Net Sales
with respect to the Product, in each case in sufficient detail to confirm the
accuracy of any payments required hereunder and in accordance with GAAP, which
books, records and accounts will be retained by such party until the later of (i) 3
years after the end of the period to which such books, records and accounts
pertain, and (ii) the expiration of the applicable tax statute of
limitations (or any extensions thereof), or for such longer period as may be
required by Applicable Law.

 

4.10.3     Audit.  Each Party
will have the right to have an independent certified public accounting firm of
nationally recognized standing, reasonably acceptable to the audited Party,
have access during normal business hours, and upon reasonable prior written
notice, to such of the records of the other Party as may be reasonably
necessary to verify the accuracy of Collaboration Expenses or Net Sales, as
applicable, for any calendar quarter or calendar year ending not more than 24
months prior to the date of such request; provided,
however, that neither Party will have the right to conduct more than
one such audit in any Calendar Year except as provided below. The requesting
Party shall bear the cost of such audit unless the audit reveals a variance of
more than 5% from the reported results, in which case the audited Party shall
bear the cost of the audit. The requesting Party will have the right to audit
previous years, if such years have not been previously audited, if the audit
reveals a variance of more than 5% from the reported results. The requesting
Party will bear the cost of such previous year audits unless such audits reveal
a variance of more than 5%. The results of such accounting firm shall be final
and binding upon the Parties, absent manifest error.

 

4.10.4     Payment of Additional Amounts.
 If, based on the results of such audit, additional payments are owed
by the audited Party under this Agreement, the audited Party will make such
additional payments, with interest as set forth in Section 

 

6

 

4.7, within 60 days after the date on which such accounting firm’s
written report is delivered to such Party.

 

4.10.5     Confidentiality.  The
auditing Party will treat all information subject to review under this Section 4.10
in accordance with the confidentiality provisions of Article 5 and will
cause its accounting firm to enter into a reasonably acceptable confidentiality
agreement with the audited Party obligating such firm to maintain all such
financial information in confidence pursuant to such confidentiality agreement.

 

ARTICLE 5
- 

CONFIDENTIALITY

 

Section 5.1            Disclosure
and Use Restriction.  Except as expressly provided herein, the Parties
agree that, for the Term and for five (5) years thereafter, each Party
will keep completely confidential and will not publish, submit for publication
or otherwise disclose, and will not use for any purpose except for the purposes
contemplated by this Agreement, any Confidential Information received from the
other Party.

 

5.1.1       Authorized Disclosure.  Each
Party may disclose Confidential Information of the other Party to the extent
that such disclosure is:

 

(a)  made
in response to a valid order of a court of competent jurisdiction; provided, however, that such Party will
first have given notice to such other Party and given such other Party a
reasonable opportunity to quash such order and to obtain a protective order
requiring that the Confidential Information and documents that are the subject
of such order be held in confidence by such court or agency or, if disclosed,
be used only for the purposes for which the order was issued; and provided further that if a disclosure
order is not quashed or a protective order is not obtained, the Confidential
Information disclosed in response to such court or governmental order will be
limited to that information which is legally required to be disclosed in
response to such court or governmental order;

 

(b)  otherwise
required by law; provided, however,
that the disclosing Party will provide such other Party with notice of such
disclosure in advance thereof to the extent practicable;

 

(c)  made
by such Party to the Regulatory Authorities as necessary for the development or
commercialization of a Product in a country, or as required in connection with
any filing, application or request for Regulatory Approval; provided, however, that reasonable
measures will be taken to assure confidential treatment of such information;

 

(d)  made
by such Party, in connection with the performance of this Agreement, to
permitted sublicensees, licensors, directors, officers, employees, consultants,
representatives or agents, each of whom prior to disclosure must be bound by
obligations of confidentiality and non-use at least equivalent in scope to
those set forth in this Article 5; or

 

7

 

(e)  made
by such Party to existing or potential acquirers; existing or potential
pharmaceutical collaborators (to the extent contemplated hereunder); investment
bankers; existing or potential investors, merger candidates, partners, venture
capital firms or other financial institutions or investors for purposes of
obtaining financing; or, bona fide strategic potential partners; each of whom
prior to disclosure must be bound by obligations of confidentiality and non-use
at least equivalent in scope to those set forth in this Article 5.

 

Section 5.2            Press
Releases.  Press releases or other similar public communication by
either Party relating to this Agreement, unless relating solely to a Product
being developed by the Party making the communication, will be approved in
advance by the other Party, which approval will not be unreasonably withheld or
delayed, except for those communications required by Applicable Law,
disclosures of information for which consent has previously been obtained, and
information of a similar nature to that which has been previously disclosed
publicly with respect to this Agreement, each of which will not require advance
approval, but will be provided to the other Party as soon as practicable after
the release or communication thereof.

 

Section 5.3            Publications.
 The Parties acknowledge that scientific lead-time is a key element of
the value of the research and development activities under the Collaboration
and further agree that scientific publications must be strictly monitored to
prevent any adverse effect from premature publication or disclosure of results
of the research or development activities hereunder. At least 45 days prior to
submission of any material related to the research or development activities
hereunder for publication or presentation, the submitting Party will provide to
the other Party a draft of such material for its review and comment. The
receiving Party will provide any comments to the submitting Party within 30
days of receipt of such materials. No publication or presentation with respect
to the research or development activities hereunder will be made unless and
until the other Party’s comments on the proposed publication or presentation
have been addressed and changes have been received and agreed upon and any
information determined by the other Party to be Confidential Information has
been removed. If requested in writing by the other Party, the submitting Party
will withhold material from submission for publication or presentation for a
reasonable time to allow for the filing of a patent application or the taking
of such measures to establish and preserve proprietary rights in the
information in the material being submitted for publication or presentation. The
Parties recognize that it may not be practical under all circumstances to
comply with the above notice requirements for review of publications and presentations.
Each Party will reasonably review proposed publications and presentations
submitted by the other Party as promptly as possible and will not unreasonably
withhold its consent to such publications or presentations that have been
submitted for review with less than the required notice period.

 

8

 

ARTICLE 6
- 

INTELLECTUAL PROPERTY

 

Section 6.1            Intellectual
Property Ownership.

 

6.1.1       Ownership of Intellectual
Property.  Isis will own all inventions made (as determined under
United States patent laws) as part of the Collaboration solely by its employees
and agents, and all Patents claiming such inventions. OncoGenex will own all
inventions made (as determined under United States patent laws) as part of the Collaboration
solely by its employees and agents, and all Patents claiming such inventions. All
inventions made (as determined under United States patent laws) jointly by
employees or agents of Isis and employees or agents of OncoGenex (“Joint
Technology”), and all Patents claiming such inventions, will be owned jointly
by Isis and OncoGenex. During the Term of this Agreement, each Party shall
promptly disclose in writing to the other Party on an ongoing basis, and prior
to filing any Patent, any Joint Technology or Product-Specific Technology
invented as part of the Collaboration. In addition, promptly after executing
this Agreement, the Parties will each disclose to each other the current status
of all Product-Specific Technology Patents Controlled by such Party and
licensed under this Agreement.

 

6.1.2       Ownership of Regulatory
Documentation.  Unless and until Isis sends an Election Notice
pursuant to Article 9 of this Agreement, all Regulatory Documentation with
respect to a Product will be owned by OncoGenex, or its sublicensee, if
applicable. If OncoGenex discontinues development of such Product and Isis
sends an Election Notice in accordance with Section 9.2, all Regulatory
Documentation with respect to such Product will be transferred to Isis. In the
event that this Agreement terminates pursuant to Section 9.2, all
Regulatory Documentation will remain with the Party that first secured such
Regulatory Documentation.

 

Section 6.2            Prosecution
of Patents.

 

6.2.1       Solely Owned Patents.  With
the exception of Product-Specific Technology Patents, as set forth in 6.2.2,
each Party will have the sole right, at its cost and expense and at its sole
discretion, to obtain, prosecute and maintain throughout the world the any
Patents solely owned or Controlled by such Party.

 

6.2.2       Product-Specific Technology
Patents.  OncoGenex will have the sole right and at its sole
discretion, to obtain, prosecute and maintain throughout the world the
Product-Specific Technology Patents. OncoGenex shall reimburse Isis for all of
Isis’ reasonable out-of-pocket costs incurred prior to and after entering into
this Agreement to obtain, prosecute and maintain throughout the world, any
Product-Specific Technology Patents Controlled by Isis, provided however that OncoGenex will not
be required to make any such reimbursements for expenses incurred by Isis after
receipt of a Discontinuance Notice if, as and when OncoGenex issues such notice.
OncoGenex will keep Isis informed of all Isis Product Specific Technology
Patent applications and registrations to be filed by OncoGenex, and Isis shall
have the right to comment on such applications within the timeframes of the
patent filing process and deadlines. 

 

9

 

Notwithstanding the foregoing, if Isis is unilaterally developing and
commercializing the Product in accordance with Section 9.2, Isis will have
the first right, subject to compliance with any Third Party agreements
OncoGenex may have with respect to such Patents, to file, prosecute and
maintain any Product-Specific Technology Patents at its expense, provided that if Isis elects not to (a) pursue
the filing, prosecution or maintenance of an OncoGenex Product-Specific
Technology Patent in a particular country, or (b) take any other action
with respect to OncoGenex Product-Specific Technology in a particular country
that is necessary or reasonably useful to establish or preserve rights thereto,
then in each such case Isis will so notify OncoGenex promptly in writing and in
good time to enable OncoGenex to meet any deadlines by which an action must be
taken to establish or preserve any rights in such OncoGenex Product-Specific
Technology in such country, and OncoGenex will have the right, but not the
obligation, to pursue the filing or registration, or support the continued
prosecution or maintenance, of such OncoGenex Product-Specific Technology
Patents, at its expense in such country.

 

6.2.3       Filing of Joint Patents.  The
Parties will cooperate with one another with respect to the filing, prosecution
and maintenance of all Joint Patents. The Parties will designate one of the
Parties to be responsible for, and to initially bear the expense of, the
preparation, filing, prosecution, and maintenance of a Joint Patent, provided that the responsible Party will be
entitled to reimbursement by the other Party of an equal share of the
responsible Party’s expenses. The Parties agree that for all Joint Patents for
Product-Specific Technology, OncoGenex will be deemed to be the responsible
Party for the purposes of this Section 6.2.3, and will bear all expenses
for the preparation, filing, prosecution and maintenance of such Patents. With
the exception of Joint Patent to Product-Specific Technology, which will be as
set forth in Section 6.2.2, the responsible Party will consult with the
other Party as to the preparation, filing, prosecution, and maintenance of such
Joint Patent reasonably prior to any deadline or action with the U.S. Patent &
Trademark Office or any foreign patent office, and will furnish to the other Party
copies of all relevant documents reasonably in advance of such consultation.
For the life of the Joint Patents, the Parties will mutually agree upon all
Joint Patent filings. Notwithstanding the foregoing, if Isis is unilaterally
developing and commercializing the Product in accordance with Section 9.2,
Isis will have the first right to file, prosecute and maintain any Joint
Patents to Product-Specific Technology at its expense, provided that if Isis elects not (a) to
pursue the filing, prosecution or maintenance of such a Joint Patent in a
particular country, or (b) to take any other action with respect to such
Joint Patent in a particular country that is necessary or reasonably useful to
establish or preserve rights thereto, then in each such case Isis will so
notify OncoGenex promptly in writing and in good time to enable OncoGenex to
meet any deadlines by which an action must be taken to establish or preserve
any rights in such Joint Technology in such country, and OncoGenex will have
the right, but not the obligation, to pursue the filing or registration, or
support the continued prosecution or maintenance, of such Joint Patent, at its
expense in such country.

 

6.2.4       Cooperation.  Each
Party will cooperate reasonably in the preparation, filing, prosecution, and
maintenance of the other Party’s Patents, the Product-Specific Technology
Patents and the Joint Patents. Such cooperation includes (a) promptly
executing all papers and instruments and requiring employees to execute 

 

10

 

such papers and instruments as reasonable and appropriate so as to
enable such other Party, to file, prosecute, and maintain its Patents in any
country; and (b) promptly informing such other Party of matters that may
affect the preparation, filing, prosecution, or maintenance of any such
Patents.

 

Section 6.3            Enforcement
of Patents

 

6.3.1       Rights and Procedures.  If
Isis or OncoGenex determines that any Patent licensed hereunder is being
infringed by a Third Party’s activities and that such infringement could affect
the exercise by the Parties of their respective rights and obligations under
this Agreement, it will promptly notify the other Party in writing and provide
such other Party with any evidence of such infringement that is reasonably
available.

 

(a)           Joint Patents.  With
respect to infringement of a Joint Patent that is not a Product-Specific
Technology Patent, the Party responsible for filing, prosecution and
maintenance of such Joint Patent under Section 6.2.3 will have the first
right to bring and control any action or proceeding with respect to such Joint
Patent, and will bear all expenses thereof, and the other Party will have the
right, at its own expense, to be represented in any such action; provided, however, that if the Party with
the first right to bring and control actions and proceedings with respect to
such Joint Patent fails to bring an action or proceeding within ninety (90)
days following notice of such infringement, or earlier notifies the other Party
in writing of its intent not to take such steps, the other Party will have the
right to do so at its expense, and the first Party will have the right, at its
own expense, to be represented in any such action. Notwithstanding the
foregoing, if the infringement is likely to have a material adverse effect on
the development or commercialization of the Product, the Parties will meet to
determine whether to defend against such infringement based on the Joint
Patents, and if the Parties mutually agree to proceed in defending such
infringement based on the Joint Patents, the Parties will share (on a
pre-determined basis as agreed to by the Parties) in the reasonable costs
incurred relating to the removal of any such infringement.

 

(b)           Product-Specific
Technology Patents.  With respect to Product-Specific Technology
Patents, OncoGenex will have the first right, at OncoGenex’s expense, but not
the obligation, to remove such infringement. In the event that OncoGenex fails
to take commercially appropriate steps to remove any infringement of any such
Product-Specific Technology Patent within ninety (90) days following notice of
such infringement, or earlier notifies Isis in writing of its intent not to
take such steps, and such infringement is likely to have a material adverse effect
on the Product, Isis will have the right to do so at its expense, and OncoGenex
will have the right, at its own expense, to be represented in any such action.
If Isis is unilaterally developing and commercializing the Product pursuant to Section 9.2,
Isis will have the right, at Isis’s own expense, to remove infringement of the
Product-Specific Technology Patents.

 

(c)           Isis Patent Rights.  Except
as set forth in Sections 6.3.1(a) and(b) above, with respect to the
Isis Patent Rights, Isis will have the sole right, but not the obligation, at
its own expense, to remove such infringement using commercially 

 

11

 

appropriate steps, including the filing of an infringement suit or
taking other similar action. Notwithstanding the foregoing, if the infringement
is likely to have a material adverse effect on the development or
commercialization of the Product, the Parties will meet to determine whether to
abate such infringement based on the Isis Patent Rights, and if the Parties
mutually agree to abate such infringement based on the Isis Patent Rights, Isis
will remove the infringement using commercially appropriate steps, and the
Parties will share (on a pre-determined basis as agreed to by the Parties) in
the reasonable costs incurred relating to the removal of any such infringement.

 

(d)           Cooperation.  The
Party not enforcing the applicable Patent will provide reasonable assistance to
the other Party, including providing access to relevant documents and other
evidence, making its employees available at reasonable business hours, and
joining the action to the extent necessary to allow the enforcing Party to
maintain the action.

 

6.3.2       Recovery.  Any
amounts recovered by either or both Parties in connection with or as a result
of any action contemplated by Section 6.3.1, whether by settlement or
judgment, will first be used to reimburse the Parties for their reasonable
costs and expenses in making such recovery (which amounts will be allocated pro
rata if insufficient to cover the totality of such expenses), with any
remainder being retained by the Party currently developing or commercializing a
Product, provided that such remainder will be treated as Net Sales and
royalties will be owing in respect of such Net Sales pursuant to this
Agreement.

 

Section 6.4            Validity
and Enforceability of Parties’ Technology.  The Parties agree that
during the Term of this Agreement, and for 5 years thereafter, neither Party
will bring any action in a court of law, or otherwise challenge the validity or
enforceability of the other Party’s Technology licensed under this Agreement.

 

ARTICLE 7
- 

TERM AND TERMINATION

 

Section 7.1            Term.
 Unless earlier terminated in accordance with the provisions of this Article 7
or Section 9.2, the term of this Agreement (the “Term”) commences upon the
Effective Date and will continue until for so long as a Product is being
developed or commercialized.

 

Section 7.2            Termination
Upon Insolvency.  Either Party may terminate this Agreement if, at any
time, the other Party files in any court or agency pursuant to any statute or
regulation of any state, country or jurisdiction, a petition in bankruptcy or
insolvency or for reorganization or for an arrangement or for the appointment
of a receiver or trustee of that Party or of its assets, or if such other Party
proposes a written agreement of composition or extension of its debts, or if
such other Party will be served with an involuntary petition against it, filed
in any insolvency proceeding, and such petition will not be dismissed within 60
days after the filing thereof, or if such other Party will propose or be a
party to any dissolution or liquidation, or if such other Party will make an
assignment for the benefit of its creditors.

 

12

 

Section 7.3            Rights
in Bankruptcy.  All rights and licenses granted under or pursuant to
this Agreement by Isis or OncoGenex are, and will otherwise be deemed to be,
for purposes of Section 365(n) of the United States Bankruptcy Code, licenses
of rights to “intellectual property” as defined under Section 101 of the
United States Bankruptcy Code. The Parties agree that the Parties, as licensees
of such rights under this Agreement, will retain and may fully exercise all of
their rights and elections under the United States Bankruptcy Code. The Parties
further agree that, in the event of the commencement of a bankruptcy proceeding
by or against a Party under the United States Bankruptcy Code, the Party hereto
that is not a Party to such proceeding will be entitled to a complete duplicate
of (or complete access to, as appropriate) any such intellectual property and
all embodiments of such intellectual property, which, if not already in the
non-subject Party’s possession, will be promptly delivered to it (a) upon
any such commencement of a bankruptcy proceeding upon the non-subject Party’s
written request therefor, unless the Party subject to such proceeding elects to
continue to perform all of its obligations under this Agreement or (b) if
not delivered under clause (a) above, following the rejection of this
Agreement by or on behalf of the Party subject to such proceeding upon written
request therefor by the non-subject Party.

 

Section 7.4            Consequences
of Expiration or Termination.

 

7.4.1       Licenses.  Upon
expiration of the Term of this Agreement in accordance with Section 7.1 or
upon termination of this Agreement in its entirety by either Party pursuant to
this Article 7 or Section 9.2, and upon payment of all amounts owed
pursuant to this Agreement, the licenses granted by Isis to OncoGenex, and by
OncoGenex to Isis, hereunder will terminate.

 

7.4.2       Return of Information and
Materials.  Upon expiration of this Agreement pursuant to Section 7.1
or upon termination of this Agreement in its entirety by either Party pursuant
to this Article 7 or Section 9.2, each Party, at the request of the
other Party, will return all data, files, records and other materials in its
possession or control relating to such other Party’s Technology, or containing
or comprising such other Party’s Information and Inventions or other
Confidential Information and, in each case, to which the returning Party does
not retain rights hereunder (except one copy of which may be retained for
archival purposes).

 

Section 7.5            Accrued
Rights; Surviving Obligations.

 

7.5.1       Accrued Rights.  Termination
or expiration of this Agreement for any reason will be without prejudice to any
rights or financial compensation that will have accrued to the benefit of a
Party prior to such termination or expiration. Such termination or expiration
will not relieve a Party from obligations that are expressly indicated to
survive the termination or expiration of this Agreement.

 

7.5.2       Survival.  Articles
4, 5, 10, 11 and 12, and Sections 6.1, 
6.2.3, 6.2.4,  6.3.1(a), 6.3.1(d),
6.3.2, and 9.3 of this Agreement and this Section 7.5 will survive
expiration or termination of this Agreement for any reason.

 

13

 

ARTICLE 8 -

MATERIAL BREACH OF
THIS AGREEMENT

 

Section 8.1            Material
Breach.  Failure by a Party to comply with any of its material
obligations contained herein will entitle the Party not in default to give to
the defaulting Party notice specifying the nature of the material breach,
requiring the defaulting Party to make good or otherwise cure such default, and
stating its intention to trigger the provisions of Section 12.5 if such
default is not cured. If such default is not cured within 90 days after the
receipt of such notice (or, if such default cannot be cured within such 90-day
period, if the Party in default does not commence actions to cure such default
within such period and thereafter diligently continue such actions), the Party
not in default will be entitled, without prejudice to any of its other rights
conferred on it by this Agreement, to trigger the provisions of Section 12.5.;
provided, however, that in the
event of a good faith dispute with respect to the existence of a material
breach, the 90-day cure period will be stayed until such time as the dispute is
resolved pursuant to Section 12.5 hereof.

 

ARTICLE 9 -

DISCONTINUED
DEVELOPMENT BY ONCOGENEX

 

Section 9.1            Discontinued
Development. At any time during the Term of this Agreement, OncoGenex
may, upon written notice to Isis, elect to discontinue development of all
Products being developed hereunder (a “Discontinuance Notice”).

 

Section 9.2            Reversion
Rights.  Within 90 days of receipt by Isis of a Discontinuance Notice,
Isis may elect to unilaterally continue development of any antisense
oligonucleotide generated under the Project Plan by notice in writing to
OncoGenex (an “Election Notice”) that Isis is exercising its rights under this Section 9.2.
If OncoGenex has not received an Election Notice from Isis within such 90 day
period, Isis will be deemed to have declined to exercise its reversion rights,
and this Agreement will terminate. Upon receipt of an Election Notice,
OncoGenex will grant to Isis an exclusive, worldwide license or sublicense, as
the case may be, to all OncoGenex Product-Specific Technology Patents solely to
develop, make, have made, use, sell, offer for sale, have sold and import a
Product. The license granted hereunder will be sublicensable only in connection
with a license of a Product to a Third Party for the continued development and
commercialization of the Product in accordance with the terms of this
Agreement.

 

Section 9.3            Royalties
and Other Payments.  In consideration of OncoGenex collaborative
efforts and the licenses granted hereunder, Isis will pay to OncoGenex (a) all
royalty, milestone and other payments owing by OncoGenex to the University of
British Columbia in respect of the development and/or commercialization of a
Product, in respect of Product-Specific Technology Patents (for flow-through to
the University of British Columbia); plus (b) a royalty on Net Sales of
the Product at the applicable royalty rate noted in the following table, based
on the stage of development the Product at the time OncoGenex sent Isis the
Discontinuance Notice:

 

14

 

	
  Stage of development of the Product

  	
   

  	
  Royalty

  	
   

  
	
  IND Filed

  	
   

  	
  [***]

  	
   

  
	
  Dosing of first patient in a Phase II Clinical Trial

  	
   

  	
  [***]

  	
   

  
	
  Completion of a Phase II Clinical Trial with positive data sufficient
  to support a Pivotal Quality Clinical Trial.

  	
   

  	
  [***]

  	
   

  

 

Isis shall pay such royalties for the Term of the Agreement. All
royalties and other payments due hereby will be paid in accordance with the
provisions of Sections 4.6 through 4.10.

 

ARTICLE 10
- 

INDEMNIFICATION AND INSURANCE

 

Section 10.1         Indemnification
of Isis.  OncoGenex will indemnify Isis, and its respective directors,
officers, employees and agents, and defend and hold each of them harmless, from
and against any and all losses, damages, liabilities, costs and expenses
(including reasonable attorneys’ fees and expenses) but only to the extent
arising from or occuring as a result of any and all liability suits,
investigations, claims or demands by a Third Party (collectively, “Losses”)
arising from or occurring as a result of or in connection with (a) any
material breach by OncoGenex of this Agreement, (b) the gross negligence
or willful misconduct on the part of OncoGenex or its licensees or sublicensees
in performing any activity contemplated by this Agreement, or, , (c) the
manufacture, use, handling, storage, sale or other disposition of a Product
that is sold by OncoGenex, its Affiliates, agents or sublicensees; in each
case, except for those Losses for which Isis has an obligation to indemnify
OncoGenex pursuant to Section 10.2, as to which Losses each Party will
indemnify the other to the extent of their respective liability for the Losses,
or except as may be provided under a supply agreement under Section 2.4.

 

Section 10.2         Indemnification
of OncoGenex.  Isis will indemnify OncoGenex,  and its respective directors, officers,
employees and agents, and defend and save each of them harmless, from and
against any and all Losses arising from or occurring as a result of or in
connection with (a) any material breach by Isis of this Agreement, or (b) the
gross negligence or willful misconduct on the part of Isis or its licensees or
sublicensees in performing any activity contemplated by this Agreement, or, (c) the
manufacture, use, handling, storage, sale or other disposition of a Product
that is sold by Isis, its Affiliates, agents or sublicensees; in each case,
except for those Losses for which Isis has an obligation to indemnify OncoGenex
pursuant to Section 10.1, as to which Losses each Party will indemnify the
other to the extent of their respective liability for the Losses, or except as
may be provided under a supply agreement under Section 2.4.

 

Section 10.3         Indemnification
Procedure.

 

10.3.1     Notice of Claim.  The
indemnified Party will give the indemnifying Party prompt written notice (an “Indemnification
Claim Notice”) of any claim upon which such indemnified Party intends to base a
request for indemnification under Section 10.1 or Section 10.2, but
in no event will the indemnifying Party be liable 

 

15

 

for any losses that result from any delay in providing such notice. Each
Indemnification Claim Notice must contain a description of the claim and the
nature and amount of such loss (to the extent that the nature and amount of
such loss are known at such time). The indemnified Party will furnish promptly
to the indemnifying Party copies of all papers and official documents received
in respect of any claim or losses. All indemnification claims in respect of a
Party, its Affiliates or their respective directors, officers, employees and
agents (collectively, the “Indemnitees” and each an “Indemnitee”) will be made
solely by such Party to this Agreement (the “Indemnified Party”).

 

10.3.2     Third Party Claims.  The
obligations of an indemnifying Party under this Article 10 with respect to
losses arising from claims of any Third Party that are subject to
indemnification as provided for in Section 10.1 or 10.2 (a “Third Party
Claim”) will be governed by and be contingent upon the following additional
terms and conditions:

 

(a)           Control of Defense.  At
its option, the indemnifying Party may assume the defense of any Third Party
Claim by giving written notice to the Indemnified Party within 30 days after
the indemnifying Party’s receipt of an Indemnification Claim Notice. The
assumption of the defense of a Third Party Claim by the indemnifying Party will
not be construed as an acknowledgment that the indemnifying Party is liable to
indemnify any Indemnitee in respect of the Third Party Claim, nor will it
constitute a waiver by the indemnifying Party of any defenses it may assert
against any Indemnitee’s claim for indemnification. Upon assuming the defense
of a Third Party Claim, the indemnifying Party may appoint as lead counsel in
the defense of the Third Party Claim any legal counsel selected by the
indemnifying Party. In the event the indemnifying Party assumes the defense of
a Third Party Claim, the Indemnified Party will immediately deliver to the
indemnifying Party all original notices and documents (including court papers)
received by any Indemnitee in connection with the Third Party Claim. Should the
indemnifying Party assume the defense of a Third Party Claim, the indemnifying
Party will not be liable to the Indemnified Party or any other Indemnitee for
any legal expenses subsequently incurred by such Indemnified Party or other
Indemnitee in connection with the analysis, defense or settlement of the Third
Party Claim. In the event that it is ultimately determined that the
indemnifying Party is not obligated to indemnify, defend or hold harmless an
Indemnitee from and against the Third Party Claim, the Indemnified Party will
reimburse the indemnifying Party for any and all costs and expenses (including
attorneys’ fees and costs of suit) and any Losses incurred by the indemnifying
Party in its defense of the Third Party Claim with respect to such Indemnitee.

 

(b)           Right to Participate in
Defense.  Without limiting Section 10.3.2(a), any Indemnitee will
be entitled to participate in, but not control, the defense of such Third Party
Claim and to employ counsel of its choice for such purpose; provided, however, that such employment
will be at the Indemnitee’s own expense unless (i) the employment thereof
has been specifically authorized by the indemnifying Party in writing, or (ii) the
indemnifying Party has failed to assume the defense and employ counsel in
accordance with Section 10.3.2(a) (in which case the Indemnified
Party will control the defense).

 

16

 

(c)           Settlement.  With
respect to any Losses relating solely to the payment of money damages in
connection with a Third Party Claim and that will not result in the Indemnitee’s
becoming subject to injunctive or other relief or otherwise adversely affect the
business of the Indemnitee in any manner, and as to which the indemnifying
Party will have acknowledged in writing the obligation to indemnify the
Indemnitee hereunder, the indemnifying Party will have the sole right to
consent to the entry of any judgment, enter into any settlement or otherwise
dispose of such loss, on such terms as the indemnifying Party, in its sole
discretion, will deem appropriate. With respect to all other losses in
connection with Third Party Claims, where the indemnifying Party has assumed
the defense of the Third Party Claim in accordance with Section 10.3.2(a),
the indemnifying Party will have authority to consent to the entry of any
judgment, enter into any settlement or otherwise dispose of such loss provided
it obtains the prior written consent of the Indemnified Party (which consent
will not be unreasonably withheld or delayed). The indemnifying Party will not
be liable for any settlement or other disposition of a loss by an Indemnitee
that is reached without the written consent of the indemnifying Party. Regardless
of whether the indemnifying Party chooses to defend or prosecute any Third
Party Claim, no Indemnitee will admit any liability with respect to, or settle,
compromise or discharge, any Third Party Claim without the prior written
consent of the indemnifying Party.

 

(d)           Cooperation.  Regardless
of whether the indemnifying Party chooses to defend or prosecute any Third
Party Claim, the Indemnified Party will, and will cause each other Indemnitee
to, cooperate in the defense or prosecution thereof and will furnish such
records, information and testimony, provide such witnesses and attend such
conferences, discovery proceedings, hearings, trials and appeals as may be
reasonably requested in connection therewith. Such cooperation will include
access during normal business hours afforded to the indemnifying Party to, and
reasonable retention by the Indemnified Party of, records and information that
are reasonably relevant to such Third Party Claim, and making Indemnitees and other
employees and agents available on a mutually convenient basis to provide
additional information and explanation of any material provided hereunder, and
the indemnifying Party will reimburse the Indemnified Party for all its
reasonable out-of-pocket expenses in connection therewith.

 

(e)           Expenses.  Except
as provided above, the reasonable and verifiable costs and expenses, including
fees and disbursements of counsel, incurred by the Indemnified Party in
connection with any claim will be reimbursed on a calendar quarter basis by the
indemnifying Party, without prejudice to the indemnifying Party’s right to
contest the Indemnified Party’s right to indemnification and subject to refund
in the event the indemnifying Party is ultimately held not to be obligated to
indemnify the Indemnified Party.

 

Section 10.4         Insurance.
 Each Party will have and maintain such types and amounts of liability
insurance as is normal and customary in the industry generally for parties
similarly situated, and will upon request provide the other Party with a
certificate 

 

17

 

of insurance. Each party will promptly notify the other Party of any
material change in insurance coverage or lapse in coverage in that regard.

 

ARTICLE 11
- 

REPRESENTATIONS AND WARRANTIES

 

Section 11.1         Representations,
Warranties and Covenants.  Each Party hereby represents, warrants and
covenants to the other Party as of the Effective Date as follows:

 

11.1.1     Corporate Authority.  Such
Party (a) has the power and authority and the legal right to enter into
this Agreement and perform its obligations hereunder, and (b) has taken
all necessary action on its part required to authorize the execution and
delivery of this Agreement and the performance of its obligations hereunder. This
Agreement has been duly executed and delivered on behalf of such Party and
constitutes a legal, valid and binding obligation of such Party and is
enforceable against it in accordance with its terms subject to the effects of
bankruptcy, insolvency or other laws of general application affecting the
enforcement of creditor rights and judicial principles affecting the
availability of specific performance and general principles of equity, whether
enforceability is considered a proceeding at law or equity.

 

11.1.2     Litigation.  Such
Party is not aware of any pending or threatened litigation (and has not
received any communication) that alleges that such Party’s activities related
to this Agreement have violated, or that by conducting the activities as
contemplated herein such Party would violate, any of the intellectual property
rights of any other party.

 

11.1.3     Consents, Approvals, etc.  All
necessary consents, approvals and authorizations of all Regulatory Authorities
and other parties required to be obtained by such Party in connection with the
execution and delivery of this Agreement and the performance of its obligations
hereunder have been obtained.

 

11.1.4     Conflicts.  The
execution and delivery of this Agreement and the performance of such Party’s
obligations hereunder (a) do not conflict with or violate any requirement
of Applicable Law or any provision of the articles of incorporation, bylaws or
any similar instrument of such Party, as applicable, in any material way, and (b) do
not conflict with, violate, or breach or constitute a default or require any
consent not already obtained under, any contractual obligation or court or
administrative order by which such Party is bound.

 

11.1.5     Debarment.  No such
Party nor any of its Affiliates has been debarred or is subject to debarment
and neither such Party nor any of its Affiliates will use in any capacity, in
connection with the services to be performed under this Agreement, any party
who has been debarred pursuant to Section 306 of the Federal Food, Drug,
and Cosmetic Act, as amended, or who is the subject of a conviction described
in such section. Each Party will inform the other Party in writing immediately
if it or any party who is performing services hereunder is debarred or is the
subject of a conviction described in Section 306, or if any action, suit,
claim, investigation or legal or 

 

18

 

administrative proceeding is pending or, to such Party’s knowledge, is
threatened, relating to the debarment or conviction of such Party or any party
performing services hereunder.

 

Section 11.2         Additional
Representations and Warranties of Isis.  Isis represents and warrants
to OncoGenex that Isis is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, and has full corporate
power and authority and the legal right to own and operate its property and
assets and to carry on its business as it is now being conducted and as it is
contemplated to be conducted by this Agreement.

 

Section 11.3         Additional
Representations and Warranties of OncoGenex.  OncoGenex represents and
warrants to Isis that OncoGenex is a corporation duly organized, validly
existing and in good standing under the laws of Canada, and has full corporate
power and authority and the legal right to own and operate its property and
assets and to carry on its business as it is now being conducted and as it is
contemplated to be conducted by this Agreement.

 

Section 11.4         DISCLAIMER
OF WARRANTY.  EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN SECTIONS
11.1, 11.2 AND 11.3, ONCOGENEX AND ISIS MAKE NO REPRESENTATIONS AND GRANT NO
WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY
STATUTE OR OTHERWISE, AND ONCOGENEX AND ISIS EACH SPECIFICALLY DISCLAIM ANY
OTHER WARRANTIES, WHETHER WRITTEN OR ORAL, OR EXPRESS OR IMPLIED, INCLUDING ANY
WARRANTY OF QUALITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE
OR ANY WARRANTY AS TO THE VALIDITY OF ANY PATENTS OR THE NON-INFRINGEMENT OF
ANY INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

 

ARTICLE 12
- 

MISCELLANEOUS

 

Section 12.1         Force
Majeure.  Neither Party will be held liable or responsible to the
other Party or be deemed to have defaulted under or breached this Agreement for
failure or delay in fulfilling or performing any term of this Agreement when
such failure or delay is caused by or results from events beyond the reasonable
control of the non-performing Party, including fires, floods, embargoes,
shortages, epidemics, quarantines, war, acts of war (whether war be declared or
not), insurrections, riots, civil commotion, strikes, lockouts or other labor
disturbances, acts of God or acts, omissions or delays in acting by any
governmental authority. The non-performing Party will notify the other Party of
such force majeure within ten (10) days after such occurrence by giving
written notice to the other Party stating the nature of the event, its
anticipated duration, and any action being taken to avoid or minimize its
effect. The suspension of performance will be of no greater scope and no longer
duration than is necessary and the non-performing Party will use Commercially
Reasonable Efforts to remedy its inability to perform; provided, however, that in the event the
suspension of performance continues for 

 

19

 

one-hundred and eighty (180) days after the date of the occurrence, the
Parties will meet to discuss in good faith how to proceed in order to
accomplish the goals of the Collaboration outlined in this Agreement.

 

Section 12.2         Assignment. Without
the prior written consent of the other Party hereto, neither Party will sell,
transfer, assign, delegate, pledge or otherwise dispose of, whether
voluntarily, involuntarily, by operation of law or otherwise, this Agreement or
any of its rights or duties hereunder; provided,
however, that either Party hereto may assign or transfer this
Agreement or any of its rights or obligations hereunder without the consent of
the other Party to any Third Party with which it has merged or consolidated, or
to which it has transferred all or substantially all of its assets to which
this Agreement relates if in any such event the Third Party assignee or
surviving entity assumes in writing all of the assigning Party’s obligations
under this Agreement. Any purported assignment or transfer in violation of this
Section will be void ab initio and
of no force or effect.

 

Section 12.3         Severability. If
any provision of this Agreement is held to be illegal, invalid or unenforceable
by a court of competent jurisdiction, such adjudication shall not affect or
impair, in whole or in part, the validity, enforceability, or legality of any
remaining portions of this Agreement. All remaining portions shall remain in
full force and effect as if the original Agreement had been executed without
the invalidated, unenforceable or illegal part.

 

Section 12.4         Governing
Law. This Agreement will be governed by and construed in accordance
with the laws of Delaware without reference to any rules of conflicts of
laws.

 

Section 12.5         Dispute
Resolution.

 

12.5.1     General.  Any
dispute, controversy or claim arising from or related to this Agreement or the
breach thereof will first be referred to the attention of the Chief Executive
Officers of each of the Parties by notice in writing in accordance with the
terms of this Agreement. The Chief Executive Officers (or their respective
designees) will meet as soon as reasonably possible thereafter, and use their
good faith efforts to mutually agree upon the resolution of the dispute,
controversy or claim. If any dispute, controversy or claim is not resolved by
the Chief Executive Officers of the Parties (or their designees) within 30 days
after such dispute is referred to them, then either Party will have the right
to arbitrate such dispute in accordance with Section 12.5.2.

 

12.5.2     Arbitration.  If the
Parties do not fully settle any dispute, controversy or claim pursuant to Section 12.5.1
and a Party wishes to pursue the matter further, each such dispute, controversy
or claim will be finally resolved by binding arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association (“AAA”),
and judgment on the arbitration award may be entered in any court having
jurisdiction thereof. The arbitration will be conducted by a panel of three
persons experienced in the pharmaceutical or biotech business: within 30 days
after initiation of arbitration, each Party will select one person to act as
arbitrator and the two 

 

20

 

Party-selected arbitrators will select a third arbitrator within 30
days of their appointment. If the arbitrators selected by the Parties are
unable or fail to agree upon the third arbitrator, the third arbitrator will be
appointed by the AAA. No individual shall be appointed to arbitrate a dispute
pursuant to this Agreement unless he or she agrees in writing to be bound by
the provisions of this Section 12.5. The place of arbitration will be
Seattle, Washington. Either Party may apply to the arbitrators for interim
injunctive relief until the arbitration award is rendered or the controversy is
otherwise resolved.

 

12.5.3     Disputes Regarding Material
Breach.  If the Parties are in dispute as to whether one party is in
material breach of this Agreement, then the arbitrators will first determine if
material breach has in fact occurred, and if so, will grant the defaulting
Party the cure period provided pursuant to Section 8.1. If the material
breach is not cured within the time period provided pursuant to Section 8.1,
the arbitration will continue and the arbitrators will, as part of the same
arbitration, award damages to the non-defaulting Party.

 

12.5.4     Costs and Expenses.  Except
as expressly provided herein, each Party will bear its own costs and expenses
and attorneys’ fees and an equal share of the arbitrators’ and any
administrative fees of arbitration. Notwithstanding the foregoing, if a Party
has been found to be in material breach of this Agreement, the defaulting Party
will be responsible for both Parties’ costs and expenses (including the costs
of the arbitrators and any administrative fees of arbitration) and the
reasonable attorneys’ fees of the non-defaulting Party.

 

12.5.5     Procedure.  Except
to the extent necessary to confirm an award or as may be required by law,
neither a Party nor an arbitrator may disclose the existence, content, or
results of an arbitration without the prior written consent of both Parties. In
no event will an arbitration be initiated after the date when commencement of a
legal or equitable proceeding based on the dispute, controversy or claim would
be barred by the applicable Delaware statute of limitations.

 

12.5.6     Speedy Resolution.  The
Parties intend, and shall take all reasonable action as is necessary or
desirable to ensure, that there be a speedy resolution to any dispute which
becomes the subject of arbitration, and the arbitrators shall conduct the
arbitration so as to resolve the dispute as expeditiously as possible.

 

12.5.7     Awards.  The
arbitrators may award monetary damages and injunctive relief, but may not order
the granting or termination of licenses or assign rights to a Product to either
of the Parties. Monetary damages shall be in the form of off-set royalties or
otherwise, to account for the damages to the non-defaulting Party from the
breach, and to account for the defaulting Party’s contribution to the Product
in view of the breach. All awards shall be in writing and shall state reasons. Executed
copies of all awards shall be delivered by the arbitrators to the Parties as
soon as is reasonably possible. All awards of the arbitrators shall be final
and binding on the Parties, and there shall be no appeal of any such award
whatsoever. The Parties undertake to satisfy any award without delay.

 

21

 

Section 12.6         Notices. All
notices or other communications that are required or permitted hereunder will
be in writing and delivered personally with acknowledgement of receipt, sent by
facsimile (and promptly confirmed by personal delivery, registered or certified
mail or overnight courier as provided herein), sent by nationally-recognized
overnight courier or sent by registered or certified mail, postage prepaid,
return receipt requested, addressed as follows:

 

If to OncoGenex, to:

 

OncoGenex
Technologies Inc.

Jack Bell
Research Centre

Rm 550, 2660
Oak Street

Vancouver,
B.C., V6H 3Z6

Attention:
Scott D. Cormack, President

Facsimile:
604-736-3687

 

with a copy
to:

 

Doug Seppala

McCullough O’Connor
Irwin, Solicitors

1100 - 888
Dunsmuir Street

Vancouver,
B.C., Canada

V6C 3K4

fax:
604-687-7099

 

If to Isis, to:

 

Isis
Pharmaceuticals, Inc.

2292 Faraday
Avenue

Carlsbad,
California 92008

Attention:
Executive Vice President

Facsimile:
(760) 603-4650

 

with a copy
to:

 

Attention:  General Counsel

Facsimile:
(760) 268-4922

 

or to such other address as the Party to whom notice is to be given may
have furnished to the other Party in writing in accordance herewith. Any such
communication will be deemed to have been given (i) when delivered, if
personally delivered or sent by facsimile on a Business Day, (ii) on the
Business Day after dispatch, if sent by nationally-recognized overnight
courier, and (iii) on the third business day following the date of mailing,
if sent by mail. It is understood and agreed that this Section 12.6 is not
intended 

 

22

 

to govern the day-to-day business communications necessary between the
Parties in performing their duties, in due course, under the terms of this
Agreement.

 

Section 12.7         Entire
Agreement; Modifications. This Agreement sets forth and constitutes
the entire agreement and understanding between the Parties with respect to the
subject matter hereof and all prior agreements, understanding, promises and
representations, whether written or oral, with respect thereto are superseded
hereby. Each Party confirms that it is not relying on any representations or
warranties of the other Party except as specifically set forth herein. No
amendment, modification, release or discharge will be binding upon the Parties
unless in writing and duly executed by authorized representatives of both
Parties.

 

Section 12.8         Relationship
of the Parties. It is expressly agreed that the Parties will be independent
contractors of one another and that the relationship between the Parties will
not constitute a partnership, joint venture or agency. Neither Party will have
the authority to make any statements, representations or commitments of any
kind, or to take any action, which will be binding on the other, without the
prior written consent of the other to do so. All persons employed by a Party
will be employees of such Party and not of the other Party and all costs and
obligations incurred by reason of any such employment will be for the account
and expense of such Party.

 

Section 12.9         Waiver. Any
term or condition of this Agreement may be waived at any time by the Party that
is entitled to the benefit thereof, but no such waiver will be effective unless
set forth in a written instrument duly executed by or on behalf of the Party
waiving such term or condition. The waiver by either Party hereto of any right
hereunder or of the failure to perform or of a breach by the other Party will
not be deemed a waiver of any other right hereunder or of any other breach or
failure by said other Party whether of a similar nature or otherwise.

 

Section 12.10       Counterparts. This
Agreement may be executed in two (2) or more counterparts, each of which
will be deemed an original, but all of which together will constitute one and
the same instrument.

 

Section 12.11       No
Benefit to Third Parties. The representations, warranties, covenants and
agreements set forth in this Agreement are for the sole benefit of the Parties
hereto and their successors and permitted assigns, and they will not be
construed as conferring any rights on any other parties.

 

Section 12.12       Further
Assurance.  Each Party will duly execute and deliver, or cause to be
duly executed and delivered, such further instruments and do and cause to be
done such further acts and things, including the filing of such assignments,
agreements, documents and instruments, as may be necessary or as the other
Party may reasonably request in connection with this Agreement or to carry out
more effectively the provisions and purposes, or to better assure and confirm
unto such other Party its rights and remedies under this Agreement.

 

23

 

Section 12.13       References. Unless
otherwise specified, (a) references in this Agreement to any Article,
Section, Schedule or Exhibit will mean references to such Article,
Section, Schedule or Exhibit of this Agreement, (b) references
in any section to any clause are references to such clause of such section,
and (c) references to any agreement, instrument or other document in this
Agreement refer to such agreement, instrument or other document as originally
executed or, if subsequently varied, replaced or supplemented from time to
time, as so varied, replaced or supplemented and in effect at the relevant time
of reference thereto.

 

Section 12.14       Construction. Except
where the context otherwise requires, wherever used, the singular will include
the plural, the plural the singular, the use of any gender will be applicable
to all genders and the word “or” is used in the inclusive sense (and/or). The
captions of this Agreement are for convenience of reference only and in no way
define, describe, extend or limit the scope or intent of this Agreement or the
intent of any provision contained in this Agreement. The term “including” as
used herein will mean including, without limiting the generality of any
description preceding such term. The language of this Agreement will be deemed
to be the language mutually chosen by the Parties and no rule of strict
construction will be applied against either Party hereto. Appendices to this
Agreement, or added hereto according to the terms of this Agreement, are made
part of this Agreement.

 

24

 

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

 

	
  ONCOGENEX TECHNOLOGIES INC.

  	
   

  	
  ISIS PHARMACEUTICALS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Per:

  	
  /s/ Scott Cormack

  	
   

  	
   

  	
  Per: 

  	
  /s/ B. Lynne Parshall

  	
   

  
	
   

  	
   

  	
   

  
	
  Scott D. Cormack,

  	
   

  	
  B. Lynne Parshall

  
	
  President & CEO

  	
   

  	
  Executive Vice President and

  CFO

  
							

 

25

 

APPENDIX
1

 

Definitions

 

“Affiliate”
of a party means any other party that, directly or indirectly, through one or
more intermediaries, controls, is controlled by, or is under common control
with such first party. For purposes of this definition only, “control” and,
with correlative meanings, the terms “controlled by” and “under common control
with” will mean (a) the possession, directly or indirectly, of the power
to direct the management or policies of a party, whether through the ownership
of voting securities or by contract relating to voting rights or corporate
governance, and (b) the ownership, directly or indirectly, of more than
fifty percent (50%) of the voting securities or other ownership interest of a
party; provided that, if local
law restricts foreign ownership, control will be established by direct or
indirect ownership of the maximum ownership percentage that may, under such
local law, be owned by foreign interests.

 

“Applicable Law”
means the applicable laws, rules, and regulations, including any rules,
regulations, guidelines, or other requirements of the Regulatory Authorities,
that may be in effect from time to time.

 

“Business Day”
means any day, other than Saturday, Sunday or any statutory holiday in the
Province of British Columbia or the United States.

 

“Calendar Year” means
each successive period of 12 months commencing on January 1 and ending on December 31.

 

“Collaboration”
has the meaning set forth in Section 2.1.

 

“Collaboration
Expenses” has the meaning set forth in Section 4.10.2.

 

“Commercially
Reasonable Efforts” means, with respect to the
research, development, manufacture or commercialization of the Product, efforts
and resources commonly used in the biotechnology industry for products of
similar commercial potential at a similar stage in its lifecycle, taking into
consideration their safety and efficacy, cost to develop, priority in relation
to other products under development by the other Party, the competitiveness of
alternative products, proprietary position, the likelihood of regulatory
approval, profitability, and all other relevant factors.

 

“Confidential Information” means
all information and know-how and any tangible embodiments thereof provided by
or on behalf of one Party to the other Party either in connection with the
discussions and negotiations pertaining to this Agreement or in the course of
performing this Agreement, including data; knowledge; practices; processes;
ideas; research plans; engineering designs and drawings; research data;
manufacturing processes and techniques; scientific, manufacturing, marketing
and business plans; and financial and personnel matters relating to the
disclosing Party or to 

 

 

its present or future products, sales, suppliers, customers, employees,
investors or business. For purposes of this Agreement, notwithstanding the
Party that disclosed such information or know-how, all information or know-how
of OncoGenex shall be Confidential Information of OncoGenex, and all
information and know-how of Isis shall be Confidential Information of Isis.

 

Notwithstanding the foregoing, information or know-how of a Party shall
not be deemed Confidential Information for purposes of this Agreement if such
information or know-how:

 

(a)           was already known
to the receiving Party, other than under an obligation of confidentiality or
non-use, at the time of disclosure to such receiving Party;

 

(b)           was generally
available or known to parties reasonably skilled in the field to which such
information or know-how pertains, or was otherwise part of the public domain,
at the time of its disclosure to, or, with respect to know-how, discovery or
development by, such receiving Party;

 

(c)           became generally
available or known to parties reasonably skilled in the field to which such
information or know-how pertains, or otherwise became part of the public
domain, after its disclosure to such receiving Party through no fault of the
receiving Party;

 

(d)           was disclosed to
such receiving Party, other than under an obligation of confidentiality or
non-use, by a Third Party who had no obligation to the disclosing Party not to
disclose such information or know-how to others; or

 

(e)                                  was
independently discovered or developed prior to disclosure by such receiving
Party, as evidenced by their written records, without the use of Confidential
Information belonging to the disclosing Party.

 

Specific aspects or details of Confidential Information shall not be
deemed to be within the public domain or in the possession of a Party merely
because the Confidential Information is embraced by more general information in
the public domain or in the possession of such Party. Further, any combination
of Confidential Information shall not be considered to be in the public domain
or in the possession of a Party merely because individual elements of such
Confidential Information are in the public domain or in the possession of such
Party unless the combination and its principles are in the public domain or in
the possession of such Party.

 

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

 

“Discontinuance
Notice” has the meaning set forth in Section 9.1

 

“Election Notice”
has the meaning set forth in Section 9.2.

 

A-2

 

“FDA”
means the United States Food and Drug Administration and any successor agency
thereto.

 

“Fully Diluted Basis”
means that all options, warrants or other rights of
any kind to acquire shares and all securities convertible or exchangeable into
shares outstanding at that time shall be deemed to have been fully exercised,
converted or exchanged, as the case may be, and the shares issuable as a result
thereof shall be deemed to have been fully issued and to form part of the
holdings of the persons entitled to receive such shares.

 

“GAAP” means
generally accepted accounting principles of the United States consistently applied.

 

“IGFBP-2” means
the gene target Insulin-like Growth Factor Binding Protein 2.

 

“IGFBP-5” means
the gene target Insulin-like Growth Factor Binding Protein 5.

 

“Improvement”
means any patented invention within the scope of inventions claimed in the Isis
Core Technology Patents and necessary for the development or commercialization
of a Product, that is made or Controlled by Isis after the Effective Date of
this Agreement, but not including any Isis Product-Specific Technology Patents.

 

“IND”
means an investigational new drug application filed with the FDA or TPD for
authorization to commence human clinical trials, and its equivalent in other
countries or regulatory jurisdictions.

 

“Indemnification
Claim Notice, Indemnified Party and Indemnitee” have the
meanings set forth in Section 10.3.1.

 

“Isis Core Technology
Patents” means Patents Controlled by Isis on the
Effective Date that are necessary for the development and commercialization of
the Product, but not including the Isis Product-Specific Technology Patents, or
Patents Controlled by Isis that claim, and only to the extent that they claim,
methods of drug delivery or encapsulation.

 

“Isis
Patent Rights” means any Patents owned or Controlled by Isis.

 

“Joint Patents”
means all Patents that claim, and only to the extent that they claim, Joint
Technology.

 

“Joint Technology”
has the meaning set forth in Section 6.1.1.

 

“Losses”
has the meaning set forth in Section 10.1.

 

“Major Market”
means the United States, Canada, Japan, the Federal Republic of Germany,
France, Italy or the United Kingdom.

 

A-3

 

“NDA” means
a New Drug Application filed with the FDA after completion of clinical trials
to obtain marketing approval for commercial product in the United States or
equivalent application for regulatory approval in other Major Market countries.

 

“Net Sales”
means the gross invoice price of the Product sold by the Party having the right
to sell or have sold the Product pursuant to this Agreement, and/or sublicensees
of such Party, to a Third Party which is not a sublicensee of the selling party
(unless such sublicensee is the end user of the Product, in which case the
amount billed therefor shall be deemed to be the amount that would be billed to
a Third Party in an arm’s-length transaction) for sales of such Product to such
end users less the following items, as allocable to such Product (if not
previously deducted from the amount invoiced): (i) trade discounts,
credits or allowances, (ii) credits or allowances additionally granted
upon returns, rejections or recalls, (iii) freight, shipping and insurance
charges, (iv) taxes, duties or other governmental tariffs (other than
income taxes), and (v) government mandated rebates.

 

“Patents”
shall include (x) all U.S. patents and patent applications, (y) any
substitutions, divisions, continuations, continuations-in-part, reissues,
renewals, registrations, confirmations, re-examinations, extensions,
supplementary protection certificates and the like, and any provisional applications,
of any such patents or patent applications, and (z) any foreign or
international equivalent of any of the foregoing.

 

“Phase I
Clinical Trial” means the initial clinical testing of the Product in
humans (first-in-humans study) with the intention of gaining a preliminary
assessment of the safety of the Product.

 

“Phase II Clinical
Trial” means the clinical testing of the Product in
humans who are patients with a disease for which the Product is being tested,
involving not more than three dose escalation levels and occurring after at
least one Phase I Clinical Trial has been completed, with the intention of (i) determining
the optimal dose to use in a Pivotal Quality Clinical Trial, and (ii) gaining
a preliminary assessment of the efficacy of the Product in treating such
disease.

 

“Pivotal Quality
Clinical Trial” means a human clinical trial of the
Product designed to be of a size and statistical power to support an NDA filing
alone or in combination with other studies. If it is unclear whether or not a
study design will be sufficient to support an NDA filing (other than by virtue
of the uncertainty of efficacy data from that trial) the study will be deemed
to be a Pivotal Quality Clinical Trial on the initiation of activities to
support an NDA filing. Initiation of a Phase III clinical study will be deemed
to be initiation of a Pivotal Quality Clinical Trial.

 

“Product”
means a pharmaceutical preparation comprising any single antisense inhibitor
generated under the Project Plan which down regulates IGFBP-5 and/or IGFBP-2. After the Project Plan has been completed,
the Parties will append to this Agreement the specific sequence and chemistry
of each antisense inhibitor which constitutes the active pharmaceutical
ingredient in each Product.

 

A-4

 

“Product-Specific
Technology” means any discovery, device, process,
method of use, composition, or formulation, whether or not patented or
patentable, which is made or Controlled solely by Isis or OncoGenex, or jointly
by Isis and OncoGenex, prior to the Effective Date or during the Term of this
Agreement, and which relates only to the gene targets down regulated by a
Product.

 

“Product-Specific
Technology Patents” means all Patents that claim, and
only to the extent that they claim, Product-Specific Technology.

 

“Project
Plan” means the Parties’ initial development plan for Collaboration
Activities, as set forth in Section 2.3.

 

“Regulatory Approval”
means (a) in the United States, approval by the FDA of an NDA, or similar
application for marketing approval, and satisfaction of any related applicable
FDA registration and notification requirements (if any), and (b) in a
Major Market other than the United States, approval by regulatory authorities
having jurisdiction over such country of a single application or set of
applications comparable to an NDA and satisfaction of any related applicable
regulatory and notification requirements (if any).

 

“Regulatory Authority”
means any applicable government entities regulating or otherwise exercising
authority with respect to the development and commercialization of the Product.

 

“Regulatory
Documentation” means all applications, registrations,
licenses, authorizations and approvals (including all Regulatory Approvals),
all correspondence submitted to or received from Regulatory Authorities
(including minutes and official contact reports relating to any communications
with any Regulatory Authority), all supporting documents and all clinical
studies and tests, including the manufacturing batch records, relating to the
Product, and all data contained in any of the foregoing, including all
regulatory drug lists, advertising and promotion documents, adverse event files
and complaint files.

 

 “Royalty Due Dates”
means the last working days of March, June, September and December of
each and every year during which this Agreement remains in full force and
effect.

 

 “Technology” means
Isis Patent Rights, OncoGenex Product-Specific Technology Patents, Joint
Patents and/or the Joint Technology (including any Joint Product-Specific
Technology), as applicable.

 

“Term” has
the meaning set forth in Section 7.1.

 

“Third Party”
means any party other than Isis or OncoGenex.

 

“Third Party Claims”
has the meaning set forth in Section 10.3.2.

 

A-5

 

“TPD”
means the Therapeutics Products Directorate, Health Products and Food Branch,
Health Canada, and any successor agency thereto.

 

“Valid Claim”
means a claim which (i) in the case of any unexpired United States or
foreign patent, shall not have been donated to the public, disclaimed or held
invalid or unenforceable by a court of competent jurisdiction in an unappealed
or unappealable decision, or (ii) in the case of any United States or
foreign patent application, shall not have been permanently cancelled,
withdrawn, or abandoned.

 

“Withholding Taxes” has
the meaning set forth in Section 4.9.

 

A-6

 

APPENDIX
2.3.1

PROJECT
PLAN

 

[***]Exhibit 10.13

 

LICENSE AGREEMENT

 

BETWEEN:

 

THE
UNIVERSITY OF BRITISH COLUMBIA, a
corporation continued under the University
Act of British Columbia and having its administrative offices at
2075 Wesbrook Mall, in the City of Vancouver, in the Province of British
Columbia, V6T 1W5

 

(the “University”)

 

AND:

 

ONCOGENEX
TECHNOLOGIES INC., a corporation incorporated under the laws of
Canada, and having offices at Suite 400, 609 -14th Street N.W., in the
City of Calgary, in the Province of Alberta, T2N 2A1

 

(the “Licensee”)

 

WHEREAS:

 

A.                            The
University has been engaged in research during the course of which it has
invented, developed and/or acquired certain technology relating to antisense
oligonucleotide therapy for the treatment of prostate cancer and other cancers,
which research was undertaken by [***] in the Prostate Centre at the
University;

 

B.                            Dr. Martin
Gleave has agreed to waive any entitlement to receive any consideration
pursuant to the University’s Patent and Licensing Policy in connection with the
Technology and any University Improvements;

 

C.                            The
University is desirous of entering into this agreement (the “Agreement”) with the
objective of furthering society’s use of its advanced technology, and to
generate further research in a manner consistent with its status as a
non-profit, tax exempt educational institution; and

 

D.                            The
Licensee is desirous of the University granting an exclusive worldwide license
to the Licensee to use or cause to be used such technology to manufacture,
distribute, market, sell and/or license or sublicense products derived or
developed from such technology and to sell the same to the general public
during the term of this Agreement.

 

NOW THEREFORE THIS
AGREEMENT WITNESSETH that in consideration of the premises and of the mutual covenants
herein set forth, the parties hereto have covenanted and agreed as follows:

 

*Certain information in this
exhibit has been omitted as confidential, as indicated by [***]. This
information has been filed separately with the Commission.

TRPM-2 (UILO Nos. 98-083 and 00-095)

 

 

1.0                          DEFINITIONS:

 

1.1                           In this Agreement,
unless a contrary intention appears, the following words and phrases shall
mean:

 

(a)           “Accounting”:  an accounting statement setting out in detail
how the amount of Revenue was determined;

 

(b)           “Affiliated Company”
or “Affiliated Companies”:  two or more corporations where the
relationship between them is one in which one of them is a subsidiary of the
other, or both are subsidiaries of the same corporation, or fifty percent (50%)
or more of the voting shares of each of them is owned or controlled by the same
person, corporation or other legal entity;

 

(c)           “Confidential Information”:
any part of the Information which is designated by either party (the “Disclosing Party”) as
confidential, whether orally or in writing but excluding any part of the
Information:

 

(i)            possessed by the
receiving party prior to receipt from the Disclosing Party , other than through
prior disclosure by the Disclosing Party, as evidenced by the receiving party’s
business records;

 

(ii)           published or available
to the general public otherwise than through a breach of this Agreement;

 

(iii)          obtained by the
receiving party from a third party with a valid right to disclose it, provided
that said third party is not under a confidentiality obligation to the
Disclosing Party; or

 

(iv)          independently developed
by employees, agents or consultants of the receiving party who had no knowledge
of or access to the Disclosing Party’s Information as evidenced by the
receiving party’s business records;

 

(d)           “Date of Commencement”
or “Commencement Date”:  this Agreement will be deemed to have come
into force on the Date of Commencement which shall be the 1st day of November,
2001, and shall be read and construed accordingly;

 

(e)           “Effective Date of Termination”:  the date on which this Agreement is
terminated pursuant to Article 18;

 

(f)            “Improvements”:  collectively Licensee Improvements and
University Improvements;

 

(g)           “Information”:  any and all Technology and any and all
University Improvements, the terms and conditions of this Agreement and any and
all oral, written, electronic or other communications and other information
disclosed or provided by the parties including any and all analyses or
conclusions drawn or derived therefrom regarding this Agreement and information
developed or disclosed hereunder, or any party’s raw materials, processes,
formulations, analytical procedures, methodologies, products, samples and
specimens or functions;

 

(h)           “Licensee Improvements”:  improvements, variations, updates,
modifications, and enhancements made solely by the Licensee or any sublicensee
of the Licensee relating to the Technology at any time after the Commencement
Date;

 

2

 

(i)            “Product(s)”:  goods manufactured in connection with the use
of all or some of the Technology and/or any Improvements;

 

(j)            “Revenue”:  all revenues, receipts, monies, and the fair
market value of all other consideration directly or indirectly collected or
received whether by way of cash or credit or any barter, benefit, advantage, or
concession received by the Licensee, sublicensees or sub-sublicensees from the
marketing, manufacturing, licensing, 
sale or distribution of the Technology and any University Improvements
or Licensee Improvements, and/or any Products in any or all parts of the world
where the Licensee is permitted by law and this Agreement to market,
manufacture, license, sell or distribute the Technology and any University
Improvements or Licensee Improvements, and/or any Products, less the following
deductions to the extent included in the amounts invoiced and thereafter
actually allowed and taken:

 

(i)            [***]

 

(ii)           [***]

 

(iii)          taxes, duties and
customs on all sales of Products,

 

(iv)          [***]

 

(v)           [***]

 

Where any Revenue is
derived from a country other than Canada it shall be converted to the
equivalent in Canadian dollars on the date the Licensee is deemed to have
received such Revenue pursuant to the terms hereof at the rate of exchange set
by the Bank of Montreal for buying such currency.  The amount of Canadian dollars pursuant to
such conversion shall be included in the Revenue;

 

(k)           “Royalty Due Dates”:  the last working day of June and December of
each and every year during which this Agreement remains in full force and
effect;

 

(l)            “Technology”:  any and all knowledge, know-how and/or
technique or techniques invented, developed and/or acquired, prior to the Date
of Commencement by the University or the Licensee relating to, and including
the technology described in Schedule “A” hereto, as amended from time to time,
including, without limitation, all research, data, specifications,
instructions, manuals, papers or other materials of any nature whatsoever,
whether written or otherwise, relating to same; 

 

(m)          “UBC Trade-marks”:  any mark, trade-mark, service mark, logo,
insignia, seal, design, symbol or device used by the University in any manner
whatsoever;  and

 

(n)           “University Improvements”:  improvements, variations, updates,
modifications,  and enhancements made
solely by the University relating to the Technology after the Commencement
Date;

 

2.0                          PROPERTY RIGHTS IN AND TO
THE TECHNOLOGY:

 

2.1                           The parties hereto
hereby acknowledge and agree that the University owns any and all right, title
and interest in and to the Technology, as well as any and all University
Improvements.  The parties also hereby
acknowledge and agree that the Licensee [***] in and to the Licensee
Improvements.

 

3

 

2.2                           The Licensee shall, at
the request of the University, enter into such further agreements and execute
any and all documents as may be required to ensure that ownership of the
Technology and any University Improvements remains with the University.

 

2.3                           On the last working day
of June and December of each and every year during which this
Agreement remains in full force and effect, the Licensee shall deliver in
writing to the University the details of any and all Improvements which the
Licensee and any sublicensees of the Licensee have developed and/or acquired
during the previous six month period.

 

3.0                          GRANT OF LICENSE:

 

3.1                           In consideration of the
equity in the Licensee, the royalty payments reserved herein, and the covenants
on the part of the Licensee contained herein, the University hereby:

 

(a)           grants to the Licensee
an exclusive worldwide license to use and sublicense the Technology, any
University Improvements and Confidential Information on the terms and
conditions hereinafter set forth during the term of this Agreement;  and

 

(b)           grants to the Licensee
an exclusive worldwide license to use and sublicense to manufacture,
distribute, have distributed, sell and have sold, Products on the terms and
conditions hereinafter set forth during the term of this Agreement.

 

3.2                           The license granted
herein is personal to the Licensee and is not granted to any Affiliated Company
or Affiliated Companies.

 

3.3                           The Licensee shall not
cross-license the Technology or any University Improvements without the prior
written consent of the University, such consent not to be unreasonably
withheld.

 

3.4                           Notwithstanding Article 3.1
herein, the parties acknowledge and agree that the University may use the
Technology and any Improvements without charge in any manner whatsoever for
research, scholarly publication, educational or other non-commercial uses.

 

3.5                           Upon execution of this
Agreement, the University may register a financing statement with respect to
this Agreement under the provisions of the Personal
Property Security Act of British Columbia and/or under the
provisions of similar legislation in those jurisdictions in which the Licensee
carries on business and/or has its chief place of business.  All costs associated with the registrations
contemplated by this Article 3.5 shall be paid for by the Licensee.

 

3.6                           The Licensee shall give
written notice to the University if it is carrying on business and/or locates
its chief place of business in a jurisdiction outside British Columbia prior to
beginning business in that other jurisdiction.

 

3.7                           If the University has
registered one or more financing statements as set forth in Article 3.5,
the Licensee shall give written notice to the University of any and all changes
of jurisdiction within or outside of Canada in which it is carrying on business
and/or any and all changes in jurisdiction of its chief place of business
within or outside of Canada and shall file the appropriate documents in the
various provincial Personal Property Registries or similar registries within or
outside of Canada to document such changes in jurisdiction and furnish the
University with a copy of the verification with respect to each such filing
within 15 days after receipt of same. 
All costs associated with the registrations contemplated by this Article 3.7
shall be paid for by the Licensee.

 

4

 

4.0                          SUBLICENSING:

 

4.1                           The Licensee shall have
the right to grant sublicenses to Affiliated Companies and other third parties
with respect to the Technology and any University Improvements with the prior
written consent of the University, which consent shall not be unreasonably
refused.  The Licensee shall not be
obligated to obtain the University’s consent to the granting of a sublicense if
the proposed sublicensee has a market capitalization in excess of CAN.
$500,000,000 at the time of the granting of the sublicense, provided always
that such sublicense shall be in full compliance with the terms of this
Agreement.  The Licensee will furnish the
University with a copy of each sublicense granted within 30 days after
execution.  Such sublicenses will be
considered to be Confidential Information of the Licensee, and will be subject
to the Confidentiality provisions of Article10.

 

4.2                           Any sublicense granted
by the Licensee shall be personal to the sublicensee and shall not be
assignable without the prior written consent of the University, such consent
not to be unreasonably withheld.  Such
sublicenses shall contain covenants by the sublicensee to observe and perform
similar terms and conditions to those contained in this Agreement and in
particular the Licensee shall cause each sublicensee to indemnify the
University on the same terms and conditions as are contained in Article 9.1
of this Agreement.

 

4.3                           Prior to the beginning
of a sublicense agreement, the Licensee shall give written notice to the
University as to which jurisdictions the applicable sublicensee is carrying on
business in. Within five days of being aware of the same, the Licensee shall
provide written notice to the University if any sublicensee is carrying on
business in a jurisdiction outside of British Columbia.

 

4.4                           If the University has
registered one or more financing statements as set forth in Article 3.5,
the Licensee shall, if requested by the University, register a financing change
statement under the provisions of the Personal
Property Security Act of British Columbia and/or under the
provisions of similar legislation in those jurisdictions in which each
sublicensee carries on business or has its chief place of business in order to
add each sublicensee as an additional debtor to the registration referred to in
Article 3.5 forthwith upon execution of each sublicense, and shall furnish
the University with a copy of the verification statement with respect to each
such filing within 15 days after receipt of same.  All costs associated with the filings
contemplated by this Article 4.4 shall be paid for by the Licensee.  The Licensee shall give written notice to the
University of any and all changes of jurisdiction within or outside of Canada
in which each sublicensee is carrying on business and/or any and all changes in
jurisdiction of each sublicensee’s chief place of business and shall file the
appropriate documents in the various provincial Personal Property Registries or
similar registries within or outside of Canada to document such changes in
jurisdiction.

 

5.0                          ROYALTIES:

 

5.1                           In consideration of the
license granted hereunder, the Licensee shall pay to the University a royalty
comprised of [***] of the Revenue.

 

5.2                           The royalty shall become
due and payable within 30 days of each respective Royalty Due Date and shall be
calculated with respect to the Revenue in the three month period immediately
preceding the applicable Royalty Due Date. 

 

5.3                           All payments of
royalties made by the Licensee to the University hereunder shall be made in
Canadian dollars without any reduction or deduction of any nature or kind
whatsoever, except as may be prescribed by Canadian law.

 

5

 

5.4                           Products shall be deemed
to have been sold by the Licensee, a sublicensee or a sub-sublicensee and
included in the Revenue when invoiced, or if not invoiced, then when delivered,
shipped, or paid for, whichever is the first.

 

5.5                           Any transaction,
disposition, or other dealing involving the Technology or any part thereof
between the Licensee and another person that is not made at fair market value
shall be deemed to have been made at fair market value, and the fair market
value of that transaction, disposition, or other dealing shall be added to and
deemed part of the Revenue and shall be included in the calculation of
royalties under this Agreement.

 

6.0                          EQUITY AND ANNUAL LICENSE
MAINTENANCE FEE

 

6.1                           As part of the
consideration for the rights granted by the University to the Licensee
hereunder, the Licensee agrees to deliver to the University on execution of
this Agreement, and in lieu of an initial license fee, 350,000 Class “A”
Common Shares in the capital of the Licensee (the “UBC Shares”).

 

6.2                           The Licensee will use commercially
reasonable efforts to cause all of the UBC Shares to be issued free from any
pooling, escrow or other trading restrictions placed on such shares by the
Licensee or any regulatory authority having jurisdiction over the Licensee.  The Licensee acknowledges and agrees that the
University shall have the right to transfer any or all of the UBC Shares to a
company or society of which the University is the sole shareholder in the case
of a company or of which the University controls the membership, in the case of
a society and the Licensee shall take all steps or do such acts as may be
reasonably required to allow such transfer.

 

6.3                           The Licensee
acknowledges and agrees that it will comply with all applicable laws and
legislation with respect to the issuance of the UBC Shares.

 

6.4                           The UBC Shares shall be
deemed to be fully paid for by the University as of the date of issuance and
shall be the absolute property of the University.  Neither all nor any portion of the UBC Shares
shall be refundable to the Licensee under any circumstances.

 

6.5                           Until the Licensee
becomes a reporting issuer for equity securities under the Securities Act of British Columbia, or
under the applicable securities legislation in any other jurisdiction which has
jurisdiction over the issuance of securities by the Licensee, the Licensee
shall provide to the University:

 

(a)           Annual
financial statements:  Within 120 days after the end of each
fiscal year of the Licensee, audited financial statements of the Licensee
prepared by a reputable accounting firm;

 

(b)           Budget:                  At least 45 days prior
to the beginning of each fiscal year of the Licensee, an operating plan with
monthly and quarterly financial breakdowns for such fiscal year;

 

(c)           Minutes:                Minutes of all meetings
of the board of directors of the Licensee; 

 

(d)           Litigation:            A summary of any
litigation (pending, threatened or otherwise) or other proceedings against the
Licensee before any court, tribunal or administrative agency, promptly after
the Licensee becomes aware of same;

 

(e)           Material
Adverse Effect:     Notice of any default,
breach, acceleration, modification or cancellation of any agreement,
arrangement or other transaction or 

 

6

 

matter that may result in a material adverse effect to the Licensee ,
promptly after the Licensee becomes aware of same, and

 

(f)            Merger:                 Notice of the intention
to effect a change of control, sale of assets, reorganization, amalgamation,
consolidation, merger or an agreement to amalgamate, consolidate or merger the
Licensee with any entity, promptly after the Licensee becomes aware of same.

 

6.6                           Any shareholders’
agreement or other relevant transaction document entered into by the Licensee
and its other shareholders, shall include an agreement between the University
and such other shareholders of the Licensee, that prevents such shareholders
(each a “Selling
Shareholder”) from selling any shares in the capital stock of
the Licensee to any third party unless the UBC Shares are included at the
option of the University, in such sale, pro rata based on the total number of
shares owned by the Selling Shareholder and the University, and on the same
terms and conditions as those offered to the Selling Shareholder.

 

6.7                           Until the Licensee
becomes a reporting issuer for equity securities under the Securities Act of British Columbia, or
under the applicable securities legislation in any other jurisdiction which has
jurisdiction over the issuance of securities by the Licensee, the University
shall have the right to appoint a representative to hold observer status at all
meetings of the board of directors of the Licensee .  Such observer shall not have the right to
vote at any such directors meetings, but shall be entitled to receive notice
of, and attend such meetings.

 

6.8                           In further consideration
for the license granted hereunder, the Licensee shall pay to the University, in
addition to all other amounts due under this Agreement, an annual maintenance
fee of CAN. $2,000.00 payable on or before January 2 of each year during
which this Agreement remains in full force and effect, commencing on January 2,
2002 (the “Annual
Maintenance Fee”). 
Neither all nor any part of the Annual Maintenance Fee paid shall be
refundable to the Licensee under any circumstances.  The Annual Maintenance Fee is intended to
cover maintenance of this Agreement by the University, and shall be separate
and distinct from any royalties due to the University under this Agreement.

 

7.0                          PATENTS:

 

7.1                           The Licensee shall have
the right to identify any process, use or products arising out of the
Technology and any University Improvements that may be patentable and the
University shall, upon the request of the Licensee, take all reasonable steps
to apply for a patent in the name of the University provided that the Licensee
pays all costs of applying for, registering and maintaining the patent in those
jurisdictions in which the Licensee might designate that a patent is
required.  The University will consult
with the Licensee with respect to the choice of patent counsel. The Licensee
will be given an opportunity to review and provide input regarding the scope
and content of patent applications and to request countries for foreign
filings.  The University will keep the
Licensee advised as to all significant developments with respect to such
applications and will make reasonable efforts supply the Licensee with copies
of material documents received and filed in connection with the prosecution
thereof.

 

7.2                           On the issuance of a
patent in accordance with Article 7.1, the Licensee shall have the right
to become, and shall become, the licensee of the same all pursuant to the terms
contained herein.

 

7.3                           Within 30 days of
presentation of receipts and/or invoices by the University to the Licensee, the
Licensee will reimburse the University for all costs incurred to date with
respect to any and all patents relating to the Technology and any University
Improvements licensed hereunder, and 

 

7

 

with
respect to any and all maintenance fees for any and all patents relating to the
Technology and any University Improvements licensed hereunder.

 

7.4                           The Licensee shall not
contest the validity or scope of any and all patents relating to the Technology
and any University Improvements licensed hereunder.

 

7.5                           The Licensee will ensure
proper patent marking for all Technology, and any University Improvements
licensed hereunder and shall clearly mark the appropriate patent numbers on any
Products made using the Technology and any University Improvements or any
patented processes used to make such Products.

 

8.0                          DISCLAIMER OF WARRANTY:

 

8.1                           [***]

 

8.2                           [***]

 

8.3                           Subject to Article 8.1,
the University makes no representations, conditions or warranties, either
express or implied, with respect to the Technology or any University
Improvements or the Products.  Without
limiting the generality of the foregoing, the University specifically disclaims
any implied warranty, condition or representation that the Technology or any
University Improvements or the Products:

 

(a)           shall correspond with a
particular description;

 

(b)           are of merchantable
quality;

 

(c)           are fit for a particular
purpose; or

 

(d)           are durable for a
reasonable period of time.

 

The University shall not be liable for any
loss, whether direct, consequential, incidental or special, which the Licensee
suffers arising from any defect, error, fault or failure to perform with
respect to the Technology or any University Improvements or Products, even if
the University has been advised of the possibility of such defect, error, fault
or failure.  The Licensee acknowledges
that it has been advised by the University to undertake its own due diligence
with respect to the Technology and any University Improvements.

 

8.4                           The parties acknowledge
and agree that the International Sale of
Goods Contracts Convention Act and the United Nations Convention on
Contracts for the International Sale of Goods have no application to this
Agreement.

 

8.5                           Subject to Article 8.1,
nothing in this Agreement shall be construed as:

 

(a)           a warranty or
representation by the University as to title to the Technology and/or any
University Improvement or that anything made, used, sold or otherwise disposed
of under the license granted in this Agreement is or will be free from
infringement of patents, copyrights, trade-marks, industrial design or other
intellectual property rights;

 

(b)           an obligation by the
University to bring or prosecute or defend actions or suits against third
parties for infringement of patents, copyrights, trade-marks, industrial
designs or other intellectual property or contractual rights; or

 

8

 

(c)           the conferring by the
University of the right to use in advertising or publicity the name of the
University or the UBC Trade-marks.

 

8.6                           Notwithstanding Article 8.4,
in the event of an alleged infringement of the Technology or any University
Improvements or any right with respect to the Technology or any University
Improvements, the Licensee shall have, upon receiving the prior written consent
of the University, [***], the right to prosecute litigation designed to enjoin
infringers of the Technology or any University Improvements.  Provided that it has first granted its prior
written consent, the University agrees to co-operate to the extent of executing
all necessary documents and to vest in the Licensee the right to institute any
such suits, so long as all the direct and indirect costs and expenses of
bringing and conducting any such litigation or settlement shall be borne by the
Licensee and in such event all recoveries shall enure to the Licensee.

 

8.7                           If any complaint
alleging infringement or violation of any patent or other proprietary rights is
made against the Licensee or a sublicensee of the Licensee with respect to the
use of the Technology or any University Improvements or the manufacture, use or
sale of the Products, the following procedure shall be adopted:

 

(a)           the Licensee shall
promptly notify the University upon receipt of any such complaint and shall
keep the University fully informed of the actions and positions taken by the
complainant and taken or proposed to be taken by the Licensee on behalf of
itself or a sublicensee;

 

(b)           except as provided in Article 8.6(d),
all costs and expenses incurred by the Licensee or any sublicensee of the
Licensee in investigating, resisting, litigating and settling such a complaint,
including the payment of any award of damages and/or costs to any third party,
shall be paid by the Licensee or any sublicensee of the Licensee, as the case
may be;

 

(c)           no decision or action
concerning or governing any final disposition of the complaint shall be taken
without full consultation with and approval by the University, not to be
unreasonably withheld;

 

(d)           the University may elect
to participate formally in any litigation involving the complaint to the extent
that the court may permit, but any additional expenses generated by such formal
participation shall be paid by the University (subject to the possibility of
recovery of some or all of such additional expenses from the complainant);

 

(e)           notwithstanding Article 8.4,
if the complainant is willing to accept an offer of settlement and one of the
parties to this Agreement is willing to make or accept such offer and the other
is not, then the unwilling party shall conduct all further proceedings at its
own expense, and shall be responsible for the full amount of any damages,
costs, accounting of profits and settlement costs in excess of those provided
in such offer, but shall be entitled to retain unto itself the benefit of any
litigated or settled result entailing a lower payment of costs, damages,
accounting of profits and settlement costs than that provided in such offer;
and

 

(f)            the royalties payable
pursuant to this Agreement shall be paid by the Licensee to the University in
trust from the date the complaint is made until such time as a resolution of
the complaint has been finalized.  If the
complainant prevails in the complaint, then the royalties paid to the
University in trust pursuant to this Article shall be returned to the
Licensee, provided that the amount returned to the Licensee hereunder shall not
exceed the amount paid by the Licensee to the complainant in the settlement or
other disposition of the complaint.  If
the 

 

9

 

complainant
does not prevail in the complaint, then the University shall be entitled to
retain all royalties paid to it pursuant to this Article.

 

9.0                          INDEMNITY AND LIMITATION OF
LIABILITY:

 

9.1                           The Licensee hereby
indemnifies, holds harmless and defends the University, its Board of Governors,
officers, employees, faculty, students, invitees and agents against any and all
claims (including all legal fees and disbursements incurred in association
therewith) arising out of the exercise of any rights under this Agreement
including, without limiting the generality of the foregoing, against any
damages or losses, consequential or otherwise, arising from or out of the use
of the Technology or any University Improvements or Products licensed under
this Agreement by the Licensee or its sublicensees or their customers or
end-users howsoever the same may arise.

 

9.2                           Subject to Article 9.3,
the University’s total liability, whether under the express or implied terms of
this Agreement, in tort (including negligence), or at common law, for any loss
or damage suffered by the Licensee, whether direct, indirect or special, or any
other similar or like damage that may arise or does arise from any breaches of
this Agreement by the University, its Board of Governors, officers, employees,
faculty, students or agents, shall be limited to the amount CAN. $2,000, which
amount may (at the University’s option) be satisfied by the University
returning and transferring to the Licensee all of the UBC Shares in the
Licensee then owned by the University (notwithstanding the University may have
previously sold some of the UBC Shares).

 

9.3                           In no event shall the
University be liable for consequential or incidental damages arising from any
breach or breaches of this Agreement.

 

9.4                           No action, whether in
contract or tort (including negligence), or otherwise arising out of or in
connection with this Agreement, may be brought by the Licensee more than six
months after the Licensee has notice of the cause of action occurring.

 

10.0                        PUBLICATION AND
CONFIDENTIALITY:

 

10.1                         The Information shall be
developed, received and used by the Licensee solely in furtherance of the
purposes set forth in this Agreement subject to the terms and conditions set
forth in this Article 10.

 

10.2                         Subject to Article 10.6,
the parties shall keep and use all of the Confidential Information in
confidence and will not, without the other party’s prior written consent,
disclose any Confidential Information to any person or entity, except those
officers, employees, faculty, students and professional advisors who require
said Confidential Information in performing their obligations under this
Agreement.  The Licensee covenants and
agrees that it will initiate and maintain an appropriate internal program
limiting the internal distribution of the Confidential Information to only
those officers, employees and professional advisors who require said
Confidential Information in performing their obligations under this Agreement
and who have signed confidentiality and non-disclosure agreements in a form
approved by the Licensee’s Board of Directors. 
All Confidential Information must be marked in writing as Confidential
at the time of disclosure or within 30 days from receipt by the Licensee.

 

10.3                         The Licensee shall not
use, either directly or indirectly, any Confidential Information for any
purpose other than as set forth herein without the University’s prior written
consent.

 

10.4                         If the Licensee is
required by judicial or administrative process to disclose any or all of the
Confidential Information, the Licensee shall promptly notify the University and
allow the University reasonable time to oppose such process before disclosing
any Confidential Information.

 

10

 

10.5                         Notwithstanding any
termination or expiration of this Agreement, the obligations created in this Article 10
shall survive and be binding upon the Licensee, its successors and assigns.

 

10.6                         The University shall not
be restricted from presenting at symposia, national or regional professional
meetings, or from publishing in journals, or electronic media including the
internet, or other publications, accounts of its research, including abstracts,
relating to the Information, provided that with respect to Confidential
Information only, the Licensee shall have been furnished copies of the
disclosure proposed therefor at least 60 days in advance of the presentation or
submission date and does not within 30 days after delivery of the proposed disclosure
object to such presentation or submission. 
Any objection to a proposed presentation or publication shall specify
the portions of the presentation or publication considered objectionable (the “Objectionable Material”).  Upon receipt of notification from the
Licensee that any proposed publication or disclosure contains Objectionable
Material, the University and the Licensee shall work together to revise the
proposed publication or presentation to remove or alter the Objectionable
Material in a manner acceptable to the Licensee, in which case the Licensee
shall withdraw its objection.  If an
objection is made, disclosure of the Objectionable Material shall not be made
for a period of three months after the date the Licensee received the proposed
publication or presentation relating to the Objectionable Material.  The University shall co-operate in all
reasonable respects in making revisions to any proposed disclosures if
considered by the Licensee to contain Objectionable Material.  The University shall not be restricted from
publishing or presenting the proposed disclosure as long as the Objectionable
Material has been removed.  After the six
month period has elapsed the University shall be free to present and/or publish
the proposed publication or presentation whether or not it contains
Objectionable Material.

 

10.7                         The Licensee requires of
the University, and the University agrees insofar as it may be permitted to do
so at law, that this Agreement, and each part of it, is confidential and shall
not be disclosed to third parties, as the Licensee claims that such disclosure
would or could reveal commercial, scientific or technical information and would
significantly harm the Licensee’s competitive position and/or interfere with
the Licensee’s negotiations with prospective sublicensees.  Notwithstanding anything contained in this
Article, the parties hereto acknowledge and agree that the University and
Licensee each may identify the title of this Agreement, the parties to this
Agreement and the names of the inventors of the Technology and any
Improvements.

 

11.0                        PRODUCTION AND MARKETING:

 

11.1                         Notwithstanding Article 10.7,
the Licensee shall not use any of the UBC Trade-marks or make reference to the
University or its name in any advertising or publicity whatsoever, without the
prior written consent of the University, except as required by law.  Without limiting the generality of the
foregoing, the Licensee shall not issue a press release with respect to this
Agreement or any activity contemplated herein without the prior review and
approval of same by the University, except as required by law.  If the Licensee is required by law to act in
contravention of this Article, the Licensee shall provide the University with
sufficient advance notice in writing to permit the University to bring an
application or other proceeding to contest the requirement.

 

11.2                         The Licensee will not
register or use any trade-marks in association with the Products without the
prior written consent of the University.

 

11.3                         The Licensee represents
and warrants to the University that:

 

(a)           it intends to building,
develop and acquire the infrastructure, expertise and resources to develop and
commercialize the Technology and any Improvements;

 

11

 

(b)           it has or intends to
have prior to the execution of sublicensing agreements, the infrastructure,
expertise and resources to track and monitor on an ongoing basis performance
under the terms of each sublicense agreement entered into by the Licensee;

 

(c)           it has or intends to
have the expertise and resources to monitor on a world wide basis patent
infringement with respect to any patent relating to the Technology and any
Improvements licensed hereunder;  and

 

(d)           it has or intends to
have the expertise and resources to initiate and maintain an appropriate
program limiting the distribution of the Information, Technology, and any
Improvements and any related biological materials as set out in this Agreement
and to obtain the appropriate non-disclosure agreements from all persons who
may have access to the Technology, and any Improvements and related biological
materials.

 

11.4                         The Licensee shall use
commercially reasonable efforts to develop and exploit the Technology and any
Improvements and to promote, market and sell the Products and utilize the
Technology and any Improvements and to meet or cause to be met the market
demand for the Products and the utilization of the Technology and any
Improvements.  Without limiting the
generality of the foregoing, the Licensee shall:

 

(a)           [***]

 

(b)           [***]

 

(c)           [***]

 

(i)            [***]

 

(ii)           [***]

 

(d)           [***]

 

11.5                         If the University is of
the view that the Licensee is in breach of Article 11.4, the University
shall notify the Licensee and the parties hereto shall appoint a mutually
acceptable person as an independent evaluator (the “Evaluator”) to
conduct the evaluation set forth in Article 11.6.  Such Evaluator shall execute a non-disclosure
agreement acceptable to the Licensee prior to performing any of the duties
described in this Agreement.  If the
parties cannot agree on such an Evaluator, the appointing authority shall be
the British Columbia International Commercial Arbitration Centre.

 

11.6                         Unless the Parties
mutually agree otherwise, the following rules and procedures shall govern
the conduct of the parties and the Evaluator before and during the
investigation by the Evaluator:

 

(a)           within 30 days of the
appointment of the Evaluator each party shall provide to the Evaluator and the
other party copies of all documents, statements and records on which the party
intends to rely in presenting its position to the Evaluator;

 

(b)           within 45 days of the
appointment of the Evaluator the Licensee shall provide to the Evaluator and
the University a written summary of its position.  On receipt of the Licensee’s summary the
University shall have 15 days to prepare and submit to the 

 

12

 

Licensee
and the Evaluator its own summary in reply to the summary submitted by the
Licensee;

 

(c)           on receipt of the
documents, statements, records and summaries submitted by the parties the
Evaluator shall have 30 days within which to conduct such further inquiries as
he or she may deem necessary for the purpose of reviewing the efforts made by
the Licensee with respect to the promotion, marketing and sale of the Products
and the Technology and any Improvements in compliance with the requirements of Article 11.4.  For the purpose of conducting such an
inquiry, the Evaluator shall have the right to:

 

(i)            require either party to
disclose any further documents or records which the Evaluator considers to be
relevant;

 

(ii)           interview or question
either orally (or by way of written questions) one or more representatives of
either party on issues deemed to be relevant by the Evaluator;

 

(iii)          make an “on site” inspection of the Licensee’s
facilities;

 

(iv)          obtain if necessary, the
assistance of an independent expert to provide technical information with
respect to any area in which the Evaluator does not have a specific expertise;

 

(d)           On completion of the
Inquiry described in Article 11.6(c) the Evaluator shall within 15
days prepare a report setting out his or her findings and conclusions as to
whether or not the Licensee has committed a breach of Article 11.4.  If the Evaluator has determined that the
Licensee has committed a breach of Article 11.4, then the Evaluator shall
also set out in the report his or her conclusions as to whether such breach:

 

(i)            was substantially due to
external market conditions not within the control of the Licensee, or

 

(ii)           was substantially due to
the Licensee’s failure to use commercially reasonable efforts to comply with
the requirements of Article 11.4.

 

(e)           The report and
conclusions of the Evaluator shall be delivered to the Licensee and the
University, and shall be accepted by both parties as final and binding. 

 

11.7                         If the Evaluator
concludes:

 

(a)           pursuant to Article 11.6(d)(i) that
the Licensee’s breach was substantially due to external market conditions
beyond the control of the Licensee, then the University shall continue the
license granted hereunder as an exclusive license, but with all other terms and
conditions of this Agreement unchanged;

 

(b)           pursuant to Article 11.6(d)(ii) that
the Licensee’s breach was substantially due to the Licensee’s failure to use
commercially reasonable efforts then the University shall at its option have
the right to terminate this Agreement as provided in Article 18

 

(c)           pursuant to Article 11.6(d) that
the Licensee is not in breach of Article 11.4, then the University shall
not terminate this Agreement for breach of Article 11.4, nor shall it
change the nature of the license granted hereunder.

 

13

 

11.8                         [***]

 

12.0                        ACCOUNTING RECORDS:

 

12.1                         The Licensee shall
maintain at its principal place of business, or such other place as may be most
convenient, separate accounts and records of all Revenues, sublicenses and
Sublicensing Revenues, and all business done pursuant to this Agreement, such
accounts and records to be in sufficient detail to enable proper returns to be
made under this Agreement, and the Licensee shall cause its sublicensees to
keep similar accounts and records.

 

12.2                         The Licensee shall
deliver to the University on the date 30 days after each and every Royalty Due
Date, together with the royalty payable thereunder, the Accounting and a report
on all Sublicensing activity, including an accounting statement setting out in
detail how the amount of Sublicensing Revenue was determined and identifying
each sublicensee and the location of the business of each sublicensee.

 

12.3                         The calculation of
royalties shall be carried out in accordance with generally accepted Canadian
accounting principles (“GAAP”),
or the standards and principles adopted by the U.S. Financial Accounting
Standards Board (“FASB”)
applied on a consistent basis.

 

12.4                         The Licensee shall
retain the accounts and records referred to in Article 12.1 above for at
least six years after the date upon which they were made and shall permit any
duly authorized representative of the University to inspect such accounts and
records during normal business hours of the Licensee at the University’s
expense.  The Licensee shall furnish such
reasonable evidence as such representative will deem necessary to verify the
Accounting and will permit such representative to make copies of or extracts
from such accounts, records and agreements at the University’s expense.  If an inspection of the Licensee’s records by
the University shows an under-reporting or underpayment by the Licensee of any
amount to the University, in excess of 5% for any 12 month period, then the
Licensee shall reimburse the University for the cost of the inspection as well
as pay to the University any amount found due (including any late payment
charges or interest) within 30 days of notice by the University to the
Licensee.

 

12.5                         During the term of this
Agreement, and thereafter, the University shall use reasonable efforts to
ensure that all information provided to the University or its representatives
pursuant to this Article remains confidential and is treated as such by
the University.

 

13.0                        INSURANCE:

 

13.1                         Unless satisfactory
arrangements are made between the Licensee and the University with respect to a
self-insurance program or the requirement for insurance hereunder is waived by
the University sixty (60) days prior to the commencement of any human clinical
trials or other Product testing involving human subjects by the Licensee or any
sublicensee, then the Licensee shall procure and maintain, during the term of
this Agreement, the insurance outlined in Articles 13.2 and 13.3 and otherwise
comply with the insurance provisions contained in Articles 13.2 and 13.3.

 

13.2                         The Licensee shall give
written notice to the University:

 

(a)           sixty (60) days prior to
the commencement of any human clinical trials or other Product testing
involving human subjects by the Licensee or any sublicensee, (“Human Clinical Trials”)
and

 

(b)           Sixty (60) days prior to
the first sale of any Product by the Licensee or any sublicensee

 

14

 

of the terms and amount of the appropriate
public liability, product liability and errors and omissions insurance which it
has placed.   Such insurance shall in no
case be less than the insurance which a reasonable and prudent businessperson
carrying on a similar line of business would acquire.  This insurance shall be placed with a
reputable and financially secure insurance carrier, shall include the
University, its Board of Governors, faculty, officers, employees, students, and
agents as additional insureds, and shall provide primary coverage with respect
to the activities contemplated by this Agreement.  Such policy shall include severability of
interest and cross-liability clauses and shall provide that the policy shall
not be cancelled or materially altered except upon at least 30 days’ written
notice to the University.  The University
shall have the right to require reasonable amendments to the terms or the
amount of coverage contained in the policy. 
Failing the parties agreeing on the appropriate terms or the amount of
coverage, then the matter shall be determined by arbitration as provided for
herein.  The Licensee shall provide the
University with certificates of insurance evidencing such coverage 30 days
before commencement of Human Clinical Trials and 30 days prior to the sales of
any Product and the Licensee covenants not to start Human Clinical Trials, or
sell any Product before such certificate is provided and approved by the
University, or to sell any Product at any time unless the insurance outlined in
this Article 13.2 is in effect.

 

13.3                         The Licensee shall
require that each sublicensee under this Agreement shall procure and maintain,
during the term of the sublicense, public liability, product liability and
errors and omissions insurance in reasonable amounts, with a reputable and
financially secure insurance carrier. 
The Licensee shall use its best efforts to ensure that any and all such
policies of insurance required pursuant to this Article shall contain a
waiver of subrogation against the University, its Board of Governors, faculty,
officers, employees, students, and agents.

 

14.0                        ASSIGNMENT:

 

14.1                         The Licensee will not
assign, transfer, mortgage, charge or otherwise dispose of any or all of the
rights, duties or obligations granted to it under this Agreement without the
prior written consent of the University, not to be unreasonably withheld.

 

14.2                         The University shall
have the right to assign its rights under this Agreement to a company or
society of which it is the sole shareholder, in the case of a company, or of
which it controls the membership, in the case of a society.  In the event of such an assignment, the
Licensee will release, remise and forever discharge the University from any and
all obligations or covenants, provided however that such company or society, as
the case may be, executes a written agreement which provides that such company
or society shall assume all such obligations or covenants from the University
and that the Licensee shall retain all rights granted to the Licensee pursuant
to this Agreement.

 

15.0                        GOVERNING LAW AND
ARBITRATION:

 

15.1                         This Agreement shall be
governed by and construed in accordance with the laws of the Province of
British Columbia and the laws of Canada in force therein without regard to its
conflict of law rules.  All parties agree
that by executing this Agreement they have attorned to the jurisdiction of the
Supreme Court of British Columbia. 
Subject to Articles 15.2 and 15.3, the British Columbia Supreme Court
shall have exclusive jurisdiction over this Agreement.

 

15.2                         Except as provided in Article 11,
in the event of any dispute arising between the parties concerning this
Agreement, its enforceability or the interpretation thereof, the same shall be
settled by a single arbitrator appointed pursuant to the provisions of the Commercial Arbitration Act of British
Columbia, or any successor legislation then in force.  The place of arbitration shall be Vancouver,
British Columbia.  The language to be
used in the arbitration proceedings shall be English.

 

15

 

15.3                         Nothing in Article 15.2
shall prevent a party hereto from applying to a court of competent jurisdiction
for interim protection such as, by way of example, an interim injunction.

 

16.0                        NOTICES:

 

16.1                         All payments, reports
and notices or other documents that any of the parties hereto are required or
may desire to deliver to any other party hereto may be delivered only by personal
delivery or by registered or certified mail, telex or fax, all postage and
other charges prepaid, at the address for such party set forth below or at such
other address as any party may hereinafter designate in writing to the others.  Any notice personally delivered or sent by
telex or fax shall be deemed to have been given or received at the time of
delivery, telexing or faxing.  Any notice
mailed as aforesaid shall be deemed to have been received on the expiration of
five days after it is posted, provided that if there shall be at the time of
mailing or between the time of mailing and the actual receipt of the notice a
mail strike, slow down or labour dispute which might affect the delivery of the
notice by the mails, then the notice shall only be effected if actually
received.

 

If
to the University:             The Director

University - Industry
Liaison Office

University of British
Columbia

IRC 331 - 2194 Health
Sciences Mall

Vancouver, British
Columbia

V6T 1Z3

Telephone:            (604)822-8580

Fax:                         (604)822-8589

 

If to
the Licensee:                The President

OncoGenex
Technologies Inc.

Suite 400, 609 –
14th Street N.W.

Calgary, Alberta T2N
2A1

Telephone:            (403)-283-6051

 

Fax:                                                         (403)-283-6753

 

17.0                        TERM:

 

17.1         This Agreement and the
license granted hereunder shall terminate on the expiration of a term of 20
years from the Date of Commencement or the expiration of the last patent
obtained pursuant to Article 7 herein, whichever event shall last occur,
unless earlier terminated pursuant to Article 18 herein.

 

18.0                        TERMINATION:

 

18.1                         This Agreement shall
automatically and immediately terminate without notice to the Licensee if any
proceeding under the Bankruptcy and
Insolvency Act of Canada, or any other statute of similar purport,
is commenced by or against the Licensee.

 

18.2                         The University may, at
its option, terminate this Agreement immediately on the happening of any one or
more of the following events by delivering notice in writing to that effect to
the Licensee:

 

(a)           if the Licensee becomes
insolvent;

 

16

 

(b)           if any execution,
sequestration, or any other process of any court becomes enforceable against
the Licensee, or if any such process is levied on the rights under this
Agreement or upon any of the monies due to the University and is not released
or satisfied by the Licensee within 30 days thereafter; and/or

 

(c)           if any resolution is
passed or order made or other steps taken for the winding up, liquidation or
other termination of the existence of the Licensee.

 

18.3                         If any one or more of
the following events has occurred and the Licensee has not cured these events
within 30 days of receiving written notice from the University, the University
may, at its option, terminate this Agreement:

 

(a)           if the Licensee is more
than 30 days in arrears of royalties or other monies that are due to the
University under the terms of this Agreement;

 

(b)           if the Technology or any
Improvements becomes subject to any security interest, lien, charge or
encumbrance in favour of any third party claiming through the Licensee, without
the prior written consent of the University, not to be unreasonably withheld;

 

(c)           if the Licensee ceases
or threatens to cease to carry on its business;

 

(d)           if a controlling
interest in the Licensee passes to any person or persons other than those
having a controlling interest at the Date of Commencement, whether by reason of
purchase of shares or otherwise, without the prior written consent of the
University, such consent not to be withheld except as provided in Article 18.6;

 

(e)           if the composition of
the Board of Directors of the Licensee is changed without the prior written
consent of the University, such consent not to be withheld except as provided
in Article 18.6;

 

(f)            if the Licensee
undergoes a reorganization or any part of its business relating to this
Agreement is transferred to a subsidiary or associated company without the
prior written consent of the University, such consent not to be withheld except
as provided in Article 18.6;

 

(g)           if the Licensee commits
any breach of Articles [***];

 

(h)           if it is determined,
pursuant to Article 11.6, that the Licensee is in breach of Article 11.4;

 

(i)            if any sublicensee of
the Licensee is in breach of its sublicense agreement with the Licensee and the
Licensee does not cause such sublicensee to cure such default within 30 days of
receipt of written notice from the University requiring that the Licensee cause
such sublicensee to cure such default, or

 

(j)            if the Licensee is in
breach of any other agreement between the Licensee and the University which
breach has not been cured within the time provided for the curing of such
breach under the terms of such other agreement.

 

18.4                         The University shall not
withhold its consent pursuant to Article 18.3(d), 18.3(e) or 18.3(f) unless
the granting of such consent would result in the University having a
contractual relationship with an entity with whom the University is prohibited
from contracting with pursuant to its then existing policies.  

 

17

 

18.5                         Other than as set out in
Articles 18.1, 18.2 and 18.3, if either party shall be in default under or
shall fail to comply with the terms of this Agreement then the non-defaulting
party shall have the right to terminate this Agreement by written notice to the
other party to that effect if:

 

(a)           such default is
reasonably curable within 30 days after receipt of notice of such default and
such default or failure to comply is not cured within 30 days after receipt of
written notice thereof; or

 

(b)           such default is not
reasonably curable within 30 days after receipt of written notice thereof, and
such default or failure to comply is not cured within such further reasonable
period of time as may be necessary for the curing of such default or failure to
comply.

 

18.6                         If this Agreement is
terminated pursuant to Article 18.1, 18.2, 18.3 or 18.5, the Licensee
shall make royalty payments to the University in the manner specified in Article 5,
and the University may proceed to enforce payment of all outstanding royalties
or other monies owed to the University and to exercise any or all of the rights
and remedies contained herein or otherwise available to the University by law
or in equity, successively or concurrently, at the option of the University.  Upon any such termination of this Agreement,
the Licensee shall forthwith deliver up to the University all Technology and
any Improvements in its possession or control and shall have no further right
of any nature whatsoever in the Technology or any Improvements.  On the failure of the Licensee to so deliver
up the Technology and any Improvements, the University may immediately and
without notice enter the Licensee’s premises and take possession of the
Technology and any Improvements.  The
Licensee will pay all charges or expenses incurred by the University in the
enforcement of its rights or remedies against the Licensee including, without
limitation, the University’s legal fees and disbursements on an indemnity
basis.

 

18.7                         The Licensee shall cease
to use the Technology or any Improvements in any manner whatsoever or to
manufacture or sell the Products within five days from the Effective Date of
Termination.  The Licensee shall then
deliver or cause to be delivered to the University an accounting within 30 days
from the Effective Date of Termination. 
The accounting will specify, in or on such terms as the University may
in its sole discretion require, the inventory or stock of Products manufactured
and remaining unsold on the Effective Date of Termination.  The University will instruct that the unsold
Products be stored, destroyed or sold under its direction, provided this
Agreement was terminated pursuant to Article 18.2, 18.3 or 18.6.  Without limiting the generality of the
foregoing, if this Agreement was terminated pursuant to Article 18.1, the
unsold Products will not be sold by any party without the prior written consent
of the University.  The Licensee will
continue to make royalty payments to the University in the same manner
specified in Article 5 and 6 on all unsold Products that are sold in
accordance with this Article 18.8, notwithstanding anything contained in
or any exercise of rights by the University under Article 18.7 herein.

 

18.8                         Notwithstanding the
termination of this Agreement, Article 12 shall remain in full force and
effect until six years after:

 

(a)           all payments of royalty
required to be made by the Licensee to the University under this Agreement have
been made by the Licensee to the University; and

 

(b)           any other claim or
claims of any nature or kind whatsoever of the University against the Licensee
has been settled.

 

18.9                         [***]

 

(a)           [***]

 

18

 

(b)           [***]

 

(c)           [***]

 

[***]   

 

19.0                        MISCELLANEOUS COVENANTS OF
LICENSEE:

 

19.1                         The Licensee hereby
represents and warrants to the University that the Licensee is a corporation
duly organized, existing and in good standing under the laws of Canada and has
the power, authority and capacity to enter into this Agreement and to carry out
the transactions contemplated by this Agreement, all of which have been duly
and validly authorized by all requisite corporate proceedings.

 

19.2                         The Licensee represents
and warrants that it has the expertise necessary to handle the Technology and
any Improvements with care and without danger to the Licensee, its employees,
agents, or the public.  The Licensee
shall not accept delivery of the Technology or any Improvements until it has
requested and received from the University all necessary information and advice
to ensure that it is capable of handling the Technology and any Improvements in
a safe and prudent manner.

 

19.3                         The Licensee shall
comply with all laws, regulations and ordinances, whether Federal, State,
Provincial, County, Municipal or otherwise, with respect to the Technology and
any Improvements and/or this Agreement.

 

19.4                         The Licensee will
reimburse the University for its legal fees incurred in connection with the
preparation of this Agreement [***].  In
addition upon the presentation of itemized bills to the Licensee by the
University, the Licensee shall pay all reasonable legal expenses and costs
incurred by the University in respect of any consents and approvals required
from the University, including, but not limited to, expenses and costs in
respect of the University’s review of any sublicenses to be granted by the
Licensee.

 

19.5                         The Licensee shall pay
all taxes and any related interest or penalty howsoever designated and imposed
as a result of the existence or operation of this Agreement, including, but not
limited to, tax which the Licensee is required to withhold or deduct from
payments to the University.  The Licensee
will furnish to the University such evidence as may be required by Canadian
authorities to establish that any such tax has been paid.  The royalties specified in this Agreement are
exclusive of taxes.  If the University is
required to collect a tax to be paid by the Licensee or any of its
sublicensees, the Licensee shall pay such tax to the University on demand.

 

19.6                         The obligation of the
Licensee to make all payments hereunder will be absolute and unconditional and
will not, except as expressly set out in this Agreement, be affected by any
circumstance, including without limitation any set-off, compensation,
counterclaim, recoupment, defence or other right which the Licensee may have
against the University, or anyone else for any reason whatsoever.

 

19.7                         All amounts due and
owing to the University hereunder but not paid by the Licensee on the due date
thereof shall bear interest in Canadian dollars at the rate of [***] per
month.  Such interest shall accrue on the
balance of unpaid amounts from time to time outstanding from the date on which
portions of such amounts become due and owing until payment thereof in full.

 

19

 

20.0                        GENERAL:

 

20.1                         Upon 48 hours advance
notice, and at the University’s sole risk and expenses, the Licensee shall
permit any duly authorized representative of the University that has signed an
appropriate non-disclosure agreement with the Licensee to enter upon and into
any premises of the Licensee during normal business hours for the purpose of
inspecting the Products and the manner of their manufacture and generally of
ascertaining whether or not the provisions of this Agreement have been, are
being, or will be complied with by the Licensee.

 

20.2                         Nothing contained herein
shall be deemed or construed to create between the parties hereto a partnership
or joint venture.  No party shall have
the authority to act on behalf of any other party, or to commit any other party
in any manner or cause whatsoever or to use any other party’s name in any way
not specifically authorized by this Agreement. 
No party shall be liable for any act, omission, representation,
obligation or debt of any other party, even if informed of such act, omission,
representation, obligation or debt.

 

20.3                         Subject to the
limitations hereinbefore expressed, this Agreement shall enure to the benefit
of and be binding upon the parties and their respective successors and permitted
assigns.

 

20.4                         No condoning, excusing
or overlooking by any party of any default, breach or non-observance by any
other party at any time or times in respect of any covenants, provisos or
conditions of this Agreement shall operate as a waiver of such party’s rights
under this Agreement in respect of any continuing or subsequent default, breach
or non-observance, so as to defeat in any way the rights of such party in
respect of any such continuing or subsequent default or breach, and no waiver
shall be inferred from or implied by anything done or omitted by such party,
save only an express waiver in writing.

 

20.5                         No exercise of a
specific right or remedy by any party precludes it from or prejudices it in
exercising another right or pursuing another remedy or maintaining an action to
which it may otherwise be entitled either at law or in equity.

 

20.6                         Marginal headings as
used in this Agreement are for the convenience of reference only and do not
form a part of this Agreement and are not be used in the interpretation hereof.

 

20.7                         The terms and
provisions, covenants and conditions contained in this Agreement which by the
terms hereof require their performance by the parties hereto after the
expiration or termination of this Agreement shall be and remain in force
notwithstanding such expiration or other termination of this Agreement for any
reason whatsoever.

 

20.8                         If any Article, part,
section, clause, paragraph or subparagraph of this Agreement shall be held to
be indefinite, invalid, illegal or otherwise voidable or unenforceable, the
entire Agreement shall not fail on account thereof, and the balance of this
Agreement shall continue in full force and effect.

 

20.9                         The parties hereto each
acknowledge that the law firm of Richards Buell Sutton has acted solely for the
University in connection with this Agreement and that all other parties hereto
have been advised to seek independent legal advice.

 

20.10                       This Agreement sets
forth the entire understanding between the parties and no modifications hereof
shall be binding unless executed in writing by the parties hereto.

 

20.11                       Time shall be of the
essence of this Agreement.

 

20

 

20.12                       Whenever the singular or masculine
or neuter is used throughout this Agreement the same shall be construed as
meaning the plural or feminine or body corporate when the context or the
parties hereto may require.

 

IN WITNESS WHEREOF
the parties hereto have hereunto executed this Agreement on the 15th day of
November, 2001 but effective as of the Date of Commencement.

 

 

	
  SIGNED FOR AND ON BEHALF
  of

  	
  )

  	
   

  
	
  THE
  UNIVERSITY OF BRITISH COLUMBIA

  	
  )

  	
   

  
	
  by its duly authorized
  officers: 

  	
  )

  	
   

  
	
   

  	
  )

  	
   

  
	
   

  	
  )

  	
   

  
	
  /s/ Indira Samarasekera 

  	
  )

  	
  Indira V. Samarasekera,
  F.R.S.C. 

  
	
  Authorized Signatory 

  	
  )

  	
  Vice President Research

  
	
  /s/ Caroline Bruce 

  	
  )

  	
   

  
	
  Authorized Signatory

  	
  )

  	
   

  
	
   

  	
  )

  	
   

  
	
   

  	
  )

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  SIGNED FOR AND ON BEHALF
  of

  	
  )

  	
   

  
	
  ONCOGENEX
  TECHNOLOGIES INC.

  	
  )

  	
   

  
	
  by its duly authorized
  officers:

  	
  )

  	
   

  
	
   

  	
  )

  	
   

  
	
   

  	
  )

  	
   

  
	
  /s/ Scott Cormack

  	
  )

  	
   

  
	
  Authorized Signatory

  	
  )

  	
   

  
	
  Scott D. Cormack

  	
  )

  	
   

  
	
  President & CEO

  	
  )

  	
   

  

 

21

 

SCHEDULE “A”

 

DESCRIPTION
OF “TECHNOLOGY”

 

The following represents the intellectual
property and know-how that is to be licensed to the Licensee for development of
novel treatments of cancer as contemplated under this License Agreement:

 

1.             [***]

 

2.             And all
applications that may be filed based on the foregoing, including, without
limitation, all regular, divisional or continuation, in whole or in part,
applications based on the foregoing, and all applications corresponding to the
foregoing filed in countries other than the United States;  and

 

3.             Any and
all issued and unexpired re-issues, re-examinations, renewals or extensions
that may be based on any of the patents described above.

 

 

AMENDING AGREEMENT

 

This Agreement
is made as of August 30, 2006 (the “Effective
Date”).

 

Between:

 

THE UNIVERSITY OF BRITISH COLUMBIA,
a corporation continued under the University
Act of British Columbia and having its Industry Liaison offices at
#103 – 6190 Agronomy Road, Vancouver, British Columbia, V6T 1Z3

 

(the “University”)

 

- and -

 

ONCOGENEX TECHNOLOGIES INC.
a corporation incorporated under the laws of Canada, and having offices at Suite 400,
1001 West Broadway, Vancouver, British Columbia, V6H 4B1

 

(the “Licensee”)

 

WHEREAS:

 

A.            The University and the Licensee entered
into a license agreement with a Commencement Date of November 1, 2001 with
respect to TRPM-2 (“Clusterin License
Agreement”) pursuant to which the University granted the Licensee an
exclusive worldwide license to the Technology, as defined in the Clusterin
License Agreement;

 

B.            The University and the Licensee now wish to
amend the Clusterin License Agreement as set out below.

 

Now therefore,
in consideration of the premises and the mutual covenants contained in this
Amending Agreement, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto covenant and
agree with each other as follows:

 

1.             Article 6.6 is
hereby amended by adding the following to the end of it:

 

“The University consents to the termination of any shareholders
agreements to which the University and the Licensee may be party, upon the
Licensee becoming a reporting issuer under the Securities Act of British
Columbia.”

 

2.             Article 7.1 is
hereby deleted and the following substituted therefore:

 

“7.1        The Licensee shall have the right to identify
any process, use or products arising out of the Technology and any University
Improvements that may be patentable and may seek patent protection with respect
thereto, in which case the Licensee shall take all reasonable steps to apply
for a patent in the name of the University provided that the Licensee pays all
costs of applying for, registering and maintaining the patent 

 

 

in those
jurisdictions in which the Licensee might designate that a patent is required.
The choice of patent counsel will be mutually agreed upon between the
University and the Licensee. The University shall remain the client of such
patent counsel, however, the Licensee will provide direct instructions to the
patent counsel on all patent matters relating to the Technology including
filing, prosecution, management, maintenance, including renewals and term
extensions thereof, and the scope and content of patent applications and to
request countries for foreign filings. The Licensee will pay patent counsel for
all costs incurred with respect to any and all patents relating to the
Technology. The Licensee will supply or instruct the patent counsel to supply
the University with copies of all documents and correspondence received and
filed in connection with the prosecution of patents. The Licensee will keep the
University advised as to all material developments with respect to such
applications with sufficient time for the University to review and respond, and
generally not less than 30 days prior to an applicable patent deadline, unless
circumstances reasonably require the Licensee to act sooner to protect the
patents, in which case the Licensee may act sooner.   The University shall, as required and at the
Licensee’s cost for the University’s reasonable out-of-pocket expenses,
reasonably cooperate with the Licensee, its lawyers and agents in the filing,
prosecution, management and maintenance of the patents.”.

 

3.             The following is
added as Article 10.8:

 

“10.8       Notwithstanding
anything contained in this Article, the parties acknowledge and agree that the
Licensee may disclose Confidential Information to the extent that may be
required by applicable securities laws in connection with the public offering
of the Licensee’s securities and thereafter to comply with its disclosure
obligations as a public company. If required to make such disclosure by any
applicable securities laws, the Licensee shall inform the University in writing
by giving notice and will consider any reasonable comments the University may
have. Such notice shall be generally not less than 48 hours prior to public
disclosure unless a delay of 48 hours would violate applicable securities laws,
in which case notice shall be as soon as practicable.”

 

4.             Article 11.1 is
hereby deleted and the following substituted therefore:

 

“11.1       Notwithstanding
Article 10.7, the Licensee shall not use any of the UBC Trade-marks or
make reference to the University or its name in any advertising or publicity
whatsoever, without the prior written consent of the University, except as
required by law. If the Licensee is required by law to act in contravention of
this Article, the Licensee shall provide the University with sufficient advance
notice in writing to permit the University to bring an application or other
proceeding to contest the requirement.”.

 

5.             Article 11.2 is
hereby deleted.

 

6.             Article 11.4 is
hereby deleted and the following substituted therefore:

 

“11.4       The
Licensee shall use commercially reasonable efforts to develop and exploit the
Technology and any Improvements and to promote, market and sell 

 

2

 

the Products and utilize the Technology and any Improvements and to
meet or cause to be met the market demand for the Products and the utilization
of the Technology and any Improvements.”.

 

7.             The contact
information for delivery of notices in Article 16.0 is amended as follows:

 

If to the University:             The Managing Director

University – Industry Liaison Office

University of British Columbia

#103 - 6190 Agronomy Road

Vancouver, British Columbia

V6T 1Z3

Telephone: (604) 822-8580

Fax:           (604)
822-8589

 

If to the Licensee:                The President

OncoGenex Technologies Inc.

1001 West Broadway, Suite 400

Vancouver, British Columbia

V6H 4B1

Telephone:   (604) 736-3678

Fax:   (604) 736-3687

 

8.             Article 18.3 is
hereby amended by adding the following to the end of it as a separate
paragraph:

 

(a)               “Notwithstanding anything contained in
this Article 18, the failure to obtain the prior written consent of the
University to the events described in any of Articles 18.3(d), (e) or (f) shall
not entitle the University to terminate this Agreement if at the time of such
event the Licensee is a public company.”

 

9.             Article 18.7 is
hereby deleted and the following substituted therefore:

 

“The Licensee shall cease to use the Technology or any Improvements in
any manner whatsoever or to manufacture or sell the Products within five days
from the Effective Date of Termination. The Licensee shall then deliver or
cause to be delivered to the University an accounting within 30 days from the
Effective Date of Termination. The accounting will specify, in or on such terms
as the University may in its sole discretion require, the inventory or stock of
Products manufactured and remaining unsold on the Effective Date of
Termination. The University will instruct that the unsold Products be stored,
destroyed or sold under its direction, provided this Agreement was terminated
pursuant to Article 18.2, 18.3 or 18.5. Without limiting the generality of
the foregoing, if this Agreement was terminated pursuant to Article 18.1,
the unsold Products will not be sold by any party without the prior consent of
the University. The Licensee will continue to make royalty payments to the
University in the same manner 

 

3

 

specified in Article 5 and 6 on all unsold Products that are sold
in accordance with this Article 18.7, notwithstanding anything contained
in or any exercise of rights by the University under Article 18.6 herein.”

 

10.           The Clusterin License
Agreement as modified by this Agreement constitutes the entire agreement
between the parties relating to the subject matter hereof.

 

11.           Except as modified
herein, the University and the Licensee confirm that the Clusterin License
Agreement remains unmodified and in full force and effect.

 

This Agreement
may be executed by the parties in separate counterparts and by facsimile, each
of which such counterparts when so executed and delivered shall be deemed to
constitute one and the same instrument.

 

IN
WITNESS WHEREOF the parties have executed this
Agreement as of the date first above written.

 

	
  SIGNED FOR
  AND ON BEHALF OF

  	
   

  	
   

  
	
  THE UNIVERSITY OF BRITISH COLUMBIA

  	
   

  	
   

  
	
  by its duly
  authorized officers:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ J.P.
  Heale

  	
   

  	
  J.P. Heale, PhD,
  MBA

  
	
  Authorized
  Signatory

  	
   

  	
  Associate
  Director

  
	
   

  	
   

  	
  University-Industry
  Liaison Office

  
	
   

  	
   

  	
   

  
	
  Authorized
  Signatory

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  SIGNED FOR
  AND ON BEHALF OF

  	
   

  	
   

  
	
  ONCOGENEX TECHNOLOGIES INC.

  	
   

  	
   

  
	
  By its duly
  authorized officer:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Scott
  Cormack

  	
   

  	
   

  
	
  Authorized
  Signatory

  	
   

  	
   

  

 

4

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