EXHIBIT 10.13
PATENT LICENSE AGREEMENT
This Agreement (the "Agreement") is made and entered into this day of May
6, 2002, (the "Effective Date") by and between Aderis Pharmaceuticals Inc.,
having its principal office at 85 Main Street, Hopkinton, Massachusetts, USA
(hereinafter referred to as "Aderis"), and Can-Fite Biopharma Ltd, a corporation
duly organized under the laws of Israel and having its principal office at 10
Bareket St., Petah-Tikva, Israel (hereinafter referred to as "Can-Fite").
WITNESSETH
WHEREAS, Can-Fite has been granted a non-exclusive license under US patent
No. 5,773,423 and its counterpart European Patent No. 708,781 from The United
States Public Health Service within the Department of Health and Human Services
(hereinafter referred to as the "NIH") (the "NIH License") (the "NIH Patent(s)")
and is currently in final stages of converting its license under the NIH
Patent(s) into an exclusive license (the "NIH Exclusive License"); and
WHEREAS, Can-Fite is developing a variety of compounds, inter alia under
the NIH patent, whereas one of said compounds (IB-MECA or
N6-3-iodobenzyl-52-N-methylcarboxamidoadenosine as an active ingredient (the
"Active Ingredient" is that referred to by Can-Fite as CF101 (the "Drug")) and
the Drug is being developed by Can-Fite for use in the Licensed Field of Use as
defined in Appendix C; and
WHEREAS, in order to be able to use the Active Ingredient, Can-Fite needs
to be granted a license from Aderis under certain patents, listed in Appendix A
owned and held by Aderis (the "Aderis Patent(s)"), with regard to certain
compounds that fall within the scope of the Aderis Patent(s), as detailed in
Appendix B (the "Licensed Compound(s)") and for certain field of use as defined
in Appendix C (the "Licensed Field of Use"); and
WHEREAS, Aderis hereby represents and warrants that it is the sole owner of
the Aderis Patent(s), and has the right to grant a license to Can-Fite under the
Aderis Patent(s); and
WHEREAS, Can-Fite desires to obtain a license under the Aderis Patent to
the Licensed Compound(s) for the Licensed Field of Use and Aderis desires to
grant such a license to Can-Fite, according to the terms and conditions set
forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, the parties hereto agree as follows:
1. DEFINITIONS
1.1 "Aderis Patent(s)" shall mean the patents listed in Appendix A attached
hereto, and as far as encompassing the Licensed Compound(s), all divisions,
continuations, Reexaminations or Reissues of these patents as well as all other
patents owned by Aderis that encompass the Licensed Compound(s) within their
scope.
1.2 "Licensed Compound(s)" means one or more of the compounds listed in
Appendix B.
1.3 "Licensed Patent Rights" means the Aderis Patent(s) as far as
encompassing the Licensed Compound(s) as long as such patents have not expired
or not held to be invalid or unenforceable by an unappealed or unappealable
decision of a court of competent jurisdiction or administrative agency.
1.4 "Licensed Territory" means the countries in which the Aderis Patent(s)
are registered and as long as they are registered in these countries.
1.5 "Net Sales" means the total gross receipts for sales of Licensed
Compound(s) or drugs containing the Licensed Compound(s) by or on behalf of
Can-Fite or its sublicensees, less returns and allowances actually granted,
packing costs, insurance costs, freight out, taxes or excise duties imposed on
the transaction (if separately invoiced), and wholesaler and cash discounts in
amounts customary in the trade, in all cases after deduction of: (a) sales taxes
(including value added taxes) to the extent applicable to such sale and not
collected separate from the counter-party to the sale; and (b) credits or
allowances, if any, actually granted on account of price adjustments, recalls,
rejections or return of Licensed Products previously sold; and (c) freight and
insurance charges in CIF sales. No deductions shall be made for commissions paid
to individuals, whether they be with independent sales agencies or regularly
employed by Can-Fite, or sublicensees, and on its payroll, or for the cost of
collections.
1.6 "First Commercial Sale" means the initial transfer by or on behalf of
Can-Fite or its sublicensees of Licensed Products by or on behalf of Can-Fite or
its sublicensees in exchange for cash or some equivalent to which value can be
assigned for the purpose of determining Net Sales.
1.7 "Licensed Field of Use" means the fields of use identified in Appendix
C.
2. GRANT OF RIGHTS
2.1 Aderis hereby grants to Can-Fite and Can-Fite accepts, subject to the
terms and conditions of this Agreement, an exclusive license under the Aderis
Patent(s) in the Licensed Territory to make and have made, to use and have used,
and to sell and have sold any Licensed Compound(s) or drugs containing the
Licensed Compound(s) in the Licensed Fields of Use.
2.2 This Agreement confers no license or rights by implication, estoppel or
otherwise under the Aderis Patent(s) other than to the Licensed Compound(s) for
use within the Licensed Field of Use.
3. SUBLICENSING AND MARKETING
3.1 Can-Fite has the right under the Agreement to enter into sublicensing
agreements with respect to the Licensed Compound(s) under the Licensed Patent(s)
in the Licensed Fields of use or any other agreement for commercialization of
Licensed Compound(s) or drugs containing the Licensed Compound(s) in the
Licensed Field of Use.
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3.2 Aderis may submit to Can-Fite at any time a proposal for
commercialization of Licensed Compound(s) or drugs containing the Licensed
Compound(s) (the "Aderis Proposal"). Can-Fite will consider the Aderis Proposal
in good faith. It is agreed, however, that Can-Fite is under no obligation to
accept the Aderis Proposal and Can-Fite can have the sole, absolute and final
discretion, to accept, enter into negotiations or decline the Aderis Proposal.
3.3 Can-Fite and Aderis will convene for a periodical good faith
discussion, approximately every nine (9) months, on such time and in such manner
as shall be coordinated in good faith between the parties. Can-Fite will then
brief Aderis on its drug development activities relating to the Licensed
Compound(s). In such discussions Can-Fite shall not be obligated to disclose any
information with respect of which Can-Fite is bound by confidentiality
undertaking to an unaffiliated third party.
3.4 The right of Aderis to submit to Can-Fite the Aderis Proposal at any
time does not limit Can-Fite in any way from entering into a sublicensing
agreement with respect to the Licensed Compound(s) under the Licensed Patent(s)
in the Licensed Field of Use or any other agreement for commercialization of
Licensed Compound(s) or drugs containing the Licensed Compound(s) in the
Licensed Field of Use.
3.5 Can-Fite agrees that any sublicenses granted by it shall provide that
the obligations of Can-Fite to Aderis of Sections 4.1, 4.3-4.5 and 9 of this
Agreement shall be binding upon the sublicensee as if it were a party to this
Agreement. Can-Fite further agrees to include such provisions in all such
sublicense agreements.
3.6 Any sublicenses granted by Can-Fite shall provide for the termination
of the sublicense, or the conversion to a license directly between such
sublicensees and Aderis, at the option of the sublicensee, upon termination of
this Agreement under Section 10. Such conversion is subject to Aderis's prior
approval and contingent upon acceptance by the sublicensee of the remaining
provisions of this Agreement.
4. ROYALTIES
4.1 Can-Fite agrees to pay to Aderis an annual royalty as set forth in
Appendix D attached hereto (the "Royalty") in respect of sales made in a
Licensed Territory (irrespective of where the product was manufactured). The
Royalty due for a calendar year shall be paid until March 31 of the next
calendar year.
4.2 In addition to any payments of Royalties set forth above, Aderis will
receive two hundred forty-six thousand eight hundred fourteen (246,814) shares
in Can-Fite that represent 1% of the current share capital of Can-Fite (the
"Aderis Shares"). The Aderis Shares shall be issued to Aderis only immediately
after closing of the current Series B preferred financing of Can-Fite.
4.3 An Aderis Patent(s) licensed under this Agreement shall cease to fall
within the Licensed Patent Rights for the purpose of computing the Royalty in
any given country within the territory on the earliest of the dates that (a) the
patent expires or irrevocably lapses, or
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(b) the claim has been held to be invalid or unenforceable by an unappealed or
unappealable decision of a court of competent jurisdiction or administrative
agency.
4.4 On sales of Licensed Compound(s) or drugs containing the Licensed
Compound(s) by Can-Fite to sublicensees or on sales made in other than an
arm's-length transaction, the value of the Net Sales attributed under this
Section 5 to such a transaction shall be that which would have been received in
an arm's-length transaction, based on sales of like quantity and quality
products on or about the time of such transaction.
4.5 Can-Fite may elect to surrender its rights in any country of the
Licensed Territory under any Licensed Patent Rights upon ninety (90) days
written notice to Aderis and owe no payment obligation under this Section 4 for
patent-related expenses incurred in that country after ninety (90) days of the
effective date of such written notice.
5. PATENT PROSECUTION AND MAINTENANCE
5.1 Aderis agrees to take full and absolute responsibility for prosecution
and maintenance of the Aderis Patent(s).
5.2 Aderis undertakes to keep the Aderis Patent(s) in force for the maximal
duration of their term and, if applicable, to obtain the necessary patent term
extension.
6. RECORD KEEPING
6.1 Can-Fite agrees to keep accurate and correct records of Licensed
Compound(s) made, used, or sold under this Agreement appropriate to determine
the amount of Royalties due to Aderis. Such records shall be retained for at
least five (5) years following a given reporting period. They shall be available
during normal business hours for inspection at the expense of Aderis by an
accountant or other designated auditor selected by Aderis for the sole purpose
of verifying reports and payments hereunder. The accountant or auditor shall
only disclose to Aderis information relating to the accuracy of reports and
payments made under this Agreement. If an inspection shows an underreporting or
underpayment in excess of five percent (5%) for any twelve (12) month period,
then Can-Fite shall reimburse Aderis for the cost of the inspection at the time
Can-Fite pays the unreported royalties, including any late charges as required
by Section 8.5 of this Agreement. All payments required under this Section shall
be due within thirty (30) days of the date Aderis provides Can-Fite notice of
the payment due.
7. REPORTS ON SALES AND PAYMENTS
7.1 Can-Fite shall report to Aderis the date of the First Commercial Sale
in each country in the Licensed Territory within thirty (30) days of such
occurrence.
7.2 Can-Fite shall submit to Aderis within sixty (60) days after each
calendar year ending December 31 a royalty report setting forth for the
preceding one-year period the amount of the Licensed Compound(s) or drugs
containing the Licensed Compound(s) sold by or on behalf of Can-Fite in each
country within the Licensed Territory, the Net Sales, and the amount of royalty
accordingly due (the "Royalty Report"). With each such Royalty Report, Can-Fite
shall submit payment of the Royalties due, provided sublicense receipts from a
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sublicensee have been received, and if not received at that time, within thirty
(30) days after receipt of the sublicense receipts from the sublicensee. If no
Royalties are due to Aderis for any reporting period, the written report shall
so state. The Royalty Report shall be certified as correct by an authorized
officer of Can-Fite and shall include all necessary details to determine Net
Sales as defined under Section 1.6 to determine Royalties due under Section 4.
7.3 In the event of any sublicense, Can-Fite agrees to forward annually to
Aderis a copy of such reports received by Can-Fite from its sublicensees during
the preceding one-year period as shall be pertinent to a royalty accounting to
Aderis by Can-Fite for activities under the sublicense. However, the failure to
receive a report from the sublicensee shall not relieve Can-Fite of the
obligation to submit an annual report to Aderis.
7.4 Royalties due under Section 4 shall be paid in U.S. dollars. For
conversion of foreign currency to U.S. dollars, the conversion rate shall be the
New York foreign exchange rate quoted in The Wall Street Journal on the day that
the payment is due. Any loss of exchange, value, taxes, or other expenses
incurred in the transfer or conversion to U.S. dollars shall be paid entirely by
Can-Fite.
7.5 The payments set forth in this Agreement shall, if overdue, bear
interest until payment at a per annum rate of two percent (2%) above the prime
rate in effect at the Bank of New York on the due date. The payment of such
interest shall not foreclose Aderis from exercising any other rights it may have
as a consequence of the lateness of any payment.
7.6 All plans and reports required by this Section 7 and marked
"CONFIDENTIAL" by Can-Fite shall be treated by Aderis as Confidential
Information as defined herein.
8. INFRINGEMENT AND PATENT ENFORCEMENT
8.1 Aderis and Can-Fite agree to notify each other promptly of each
infringement or possible infringement, as well as any facts which may affect the
validity, scope or enforceability of the Licensed Patent Rights of which either
Party becomes aware.
8.2 Pursuant to this Agreement, Can-Fite may (a) bring suit in its own
name, at its own expense, and on its own behalf for infringement in the Licensed
Fields of use of presumably valid claims in the Licensed Patent Rights; (b) in
any such suit, enjoin infringement and collect for its use, damages, profits,
and awards of whatever nature recoverable for such infringement; and (c) settle
any claim or suit for infringement in the Licensed Fields of Use of the Licensed
Patent Rights. Can-Fite shall take no action to compel Aderis either to initiate
or to join in any such suit for patent infringement. Should Aderis be made a
party to any such suit, Can-Fite shall reimburse Aderis for any costs, expenses,
or fees which Aderis incurs as a result of such motion or other action,
including any and all costs incurred by Aderis in opposing any such motion or
other action. Upon Can-Fite's payment of all costs incurred by Aderis as a
result of Can-Fite's joinder motion or other action, these actions by Can-Fite
will not be considered a default in the performance of any material obligation
under this Agreement. In all cases, Can-Fite agrees to keep Aderis reasonably
apprised of the status and progress of any litigation.
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Before Can-Fite commences an infringement action, Can-Fite shall notify Aderis
and give careful consideration to the views of Aderis in deciding whether to
bring suit.
8.3 In any infringement action commenced under Section 9.2, the expenses,
including costs, fees, attorney fees, and disbursements, shall be paid by
Can-Fite. Up to fifty percent (50%) of such expenses will be credited against
the Royalties payable to Aderis under Section 5 under the Licensed Patent Rights
in the county in which such a suit is filed. In the event that fifty percent
(50%) of such expenses exceed the amount of Royalties payable by Can-Fite in any
calendar year, the expenses in excess may be carried over as a credit on the
same basis into succeeding calendar years. Any recovery made by Can-Fite,
through court judgment or settlement, first shall be applied to reimburse Aderis
for Royalties withheld as a credit against litigation expenses and then to
reimburse Can-Fite for its litigation expenses. Aderis will be entitled to 15%
of any remaining recoveries. To the extent that the NIH Patent(s) will also be
subject to such an infringement action then out of said expenses only 33% will
be credited against the Royalties payable to Aderis and if both the NIH
Patent(s) and the Aderis Patent(s) are found to be valid and infringed, and
after reimbursing the NIH and Aderis hereunder, Aderis will be entitled to 7.5%
of any remaining recovery.
8.4 Aderis shall cooperate fully with Can-Fite in connection with an
infringement action initiated under Section 9.2. Aderis agrees promptly to
provide access to all necessary documents and to render reasonable assistance in
response to a request by Can-Fite. In particular, the aforementioned in Section
9.2 notwithstanding, Aderis agrees that upon the occurrence of an infringement
in a jurisdiction in which an infringement suit cannot be brought by an
exclusive licensee, Aderis will provide its full assistance to enforce the
infringed patent rights including, without limitation, sending a Cease and
Desist letter and filing an infringement suit, all at Can-Fite's expense as
provided in Section 9.3.
9. INDEMNIFICATION
Can-Fite shall indemnify and hold Aderis, its employees, executive,
directors and consultants harmless from and against all liability, demands,
damages, expenses and losses, including but not limited to death, personal
injury, illness, or property damage in connection with or arising out of (a) the
use by or on behalf of Can-Fite, its sublicensees, directors, employees or third
parties of any Licensed Patent Rights, or (b) the design, manufacture,
distribution or use of any Licensed Compound(s) or drugs containing the Licensed
Compound(s), or materials, or other products or processes developed in
connection with or arising out of the Licensed Patent Rights. Can-Fite agrees to
maintain a liability insurance program consistent with sound business practice.
10. TERM, TERMINATION AND MODIFICATION OF RIGHTS
10.1 This Agreement is effective when signed by all parties and shall
extend to the expiration of the last to expire of the Aderis Patent(s) unless
sooner terminated as provided in this Section 10.
10.2 In the event that Can-Fite is in default in the performance of any
material obligations under this Agreement, and if the default has not been
remedied within ninety (90)
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days after the date of notice in writing of such default, Aderis may terminate
this Agreement immediately by written notice.
10.3 Can-Fite shall have a unilateral right to terminate this Agreement
and/or any licenses in any country of its choice by giving Aderis sixty (60)
days' written notice to that effect.
10.4 Within ninety (90) days of termination of this Agreement under this
Section 10 or expiration under Section 10.1, a final report shall be submitted
by Can-Fite. Any Royalty payments due to Aderis shall become immediately due and
payable upon termination or expiration. If terminated under this Section 10,
sublicensees may elect to convert their sublicenses to direct licenses with
Aderis pursuant to Section 3.3.
11. CONFIDENTIAL INFORMATION
11.1 For the purpose of this Agreement, "Confidential Information" shall
mean all information (and all tangible and intangible embodiments thereof),
which is disclosed by either Aderis or Can-Fite (the "Disclosing Party") to the
other party (the "Receiving Party") pursuant to this Agreement, and (i) (if
disclosed in writing or other tangible medium) is marked or identified as
confidential at the time of disclosure to the Receiving Party; or (ii) (if
otherwise disclosed, or if not so marked or identified) is identified as
confidential at the time of disclosure to the Receiving Party and is summarized
and identified as confidential in writing within thirty (30) days after such
disclosure, or (iii) whether or not marked or identified as confidential in the
manner set forth above, is information that the other party should reasonably
understand to be the confidential or proprietary information of the Disclosing
Party. Notwithstanding the foregoing, Confidential Information shall not include
information which, and only to the extent, the Receiving Party can establish by
written documents (a) has been publicly known prior to disclosure of such
information by the Disclosing Party to the Receiving Party, (b) has become
publicly known, without fault on the part of the Receiving Party, subsequent to
disclosure of such information by the Disclosing Party to the Receiving Party,
(c) has been received by the Receiving Party at any time from a source, other
than the Disclosing Party, rightfully having possession of and the right to
disclose such information free of confidentiality obligations to the Disclosing
Party, (d) the Receiving Party can demonstrate by written evidence has been
otherwise known by the Receiving Party free of confidentiality obligations to
the Disclosing Party prior to disclosure of such information by the Disclosing
Party to the Receiving Party, or (e) has been independently developed by
employees or others on behalf of the Receiving Party, as evidenced by written
documentation, without access to or use of such information disclosed by the
Disclosing Party to the Receiving Party.
11.2 During the term of this Agreement and for a period of three (3) years
following the expiration or earlier termination thereof, the Receiving Party
shall maintain in confidence the Confidential Information of the Disclosing
Party, shall use such Confidential Information only as explicitly set forth in
this Agreement, and shall not disclose, use or grant the use of the Confidential
Information of the Disclosing Party to any third party and may only disclose the
Confidential Information of the other on a need-to-know basis to such party's
directors, officers and employees, to the extent such disclosure is reasonably
necessary in connection with the Receiving Party's activities as expressly
authorized by this Agreement. The
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Receiving Party shall notify the Disclosing Party promptly upon discovery of any
unauthorized use or disclose of the Disclosing Party's Confidential Information.
11.3 The confidentiality obligations under this Section 12 shall not apply
to the extent that the Receiving Party is required to disclose information
applicable by law, regulation or other of a governmental agency or a court of
competent jurisdiction; provided, however, that to the extent practicable, the
Receiving Party (a) shall provide written notice thereof to the Disclosing Party
and consult with the Disclosing Party prior to such disclosure with respect
thereto, and (b) shall provide the Disclosing Party sufficient opportunity to
object to any such disclosure or to request confidential treatment thereof, and
provide reasonable assistance as requested in connection therewith.
12. GENERAL PROVISIONS
12.1 Neither Party may waive or release any of its rights or interests in
this Agreement except in writing. The failure of any party to assert a right
hereunder or to insist upon compliance with any term or condition of this
Agreement shall not constitute a waiver of that right by such party or excuse a
similar subsequent failure to perform any such term or condition by the other
party.
12.2 This Agreement constitutes the entire agreement between the Parties
relating to the subject matter of the Licensed Patent Rights, and all prior
negotiations, representations, agreements and understandings are merged into,
extinguished by, and completely expressed by this Agreement.
12.3 The provisions of this Agreement are severable, and in the event that
any provision of this Agreement shall be determined to be invalid or
unenforceable under any controlling body of law, such determination shall not in
any way affect the validity or enforceability of the remaining provisions of
this Agreement.
12.4 If either Party desires a modification of this Agreement, the Parties
shall, upon reasonable notice of the proposed modification by the Party desiring
the change, confer in good faith to determine the desirability of such
modification. No modification will be effective until a written amendment is
signed by the signatories to this Agreement or their designees.
12.5 The construction, validity, performance, and effect of this Agreement
shall be governed by law of the State of New York, USA and the parties hereby
agree to submit to the exclusive jurisdiction of the courts in New York.
12.6 All notices required or permitted by this Agreement shall be given by
prepaid, first class, registered or certified mail properly addressed to the
other Party at the address designated on the following Signature Page, or to
such other address as may be designated in writing by such other Party, and
shall be effective as of the date of the postmark of such notice.
12.7 This Agreement shall not be assigned by Can-Fite, except (a) with the
prior written consent of Aderis, such consent to be reasonably given; or (b) as
part of a sale or transfer of substantially the entire business of Can-Fite
relating to operations which concern this
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Agreement. Can-Fite shall notify Aderis within ten (10) days of any assignment
of this Agreement by Can-Fite.
12.8 By entering into this Agreement, Aderis does not directly or
indirectly endorse any product or service provided, or to be provided, by
Can-Fite whether directly or indirectly related to this Agreement. Can-Fit shall
not state or imply that this Agreement is an endorsement by Aderis or any Aderis
employee. Additionally, Can-Fite shall not use the names of Aderis or their
employees in any advertising, promotional, or sales literature without the prior
written consent of Aderis.
12.9 Performance and Diligence. Can-Fite or its sublicensee shall be solely
responsible for the development of, and obtaining regulatory approval for the
Licensed Compounds in the Licensed Field of Use in the Licensed Territory.
Can-Fite shall prepare a development plan that shall incorporate the elements
and timelines listed in Appendix E, and submit this plan to Aderis within 45
days of the effective date of this agreement. Can-Fite shall use its best
efforts to diligently prosecute this plan for the duration of this agreement.
This plan and the periods detailed in Appendix E may be subsequently modified by
mutual written agreement.
12.10 The parties agree to attempt to settle amicably any controversy or
claim arising under this Agreement or a breach of this Agreement. If such a
dispute cannot be resolved within 45 days of written notice, then either party
may request an arbitration proceeding as provided in Section 13.11.
12.11 Alternative Dispute Resolution. Any dispute, controversy or claim
arising out of or relating to the validity, construction, enforceability or
performance of this Agreement, including disputes relating to an alleged breach
or to termination of this Agreement and including any claim of inducement by
fraud or otherwise, but excluding any dispute, controversy or claim arising out
of or relating to the validity, enforceability, or infringement of any Aderis
Patent shall be settled by binding Alternative Dispute Resolution by Mediation
and Arbitration pursuant to JAMS/ENDISPUTE Rules A and C attached as Appendix F.
Aderis Pharmaceuticals, Inc. Can-Fite Biopharma Ltd.
By: /s/ Kenneth L. Rice, Jr. By: /s/ Ilan Cohn, Ph.D.
---------------------------- ---------------------------------
Kenneth L. Rice, Jr. Ilan Cohn, Ph.D.
Vice President and Chief Chief Executive Officer
Commercial Officer
Date: May 7, 2002 Date: May 7, 2002
---------------------------- ---------------------------------
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APPENDIX A - Aderis Patent(s)
Country Patent No. Expiration Date
RE 37,045
U.S.A. 5,310,731 10 May 2011
France 0191025 19 June 2005
Germany 3,576,345 19 June 2005
Italy 0191025 19 June 2005
United Kingdom 0191025 19 June 2005
APPENDIX B - Licensed Compound(s)
N-6 substituted-5/2/-(N-substituted carboxamide) adenosine derivatives as
defined in Claim 1 of US RE37,045 (US 5,310,731), wherein
R1 is monohalobenzyle, and the group R\\4\\R\\5\\CO- is CH\\3\\NHCO-
[graphic]
APPENDIX C - Licensed Field of Use
The Licensed Field of Use includes the following clinical indications:
Cancer
Protection of myelocytes and their derivatives
Stem cell mobilization (mobilization of blood progenitor
cells)
Anti-viral
Arthritis
APPENDIX D - Royalties
Can-Fite agrees to pay Aderis earned royalties on Net Sales of Licensed
Compound(s), drugs containing the Licensed Compound(s) or on practice of
Licensed Process by or on behalf of Can-Fite and it sublicensees, calculated on
an annual basis in each calendar year, graded as follows:
Royalties of 2.75% on an amount of annual Net Sales of Licensed
Compound(s), drugs containing the Licensed Compound(s) or on practice of
Licensed Process in the Licensed Territory of up to US$ twenty five million
(US$ 25,000,000);
Royalties of 2.25% on an amount of annual Net Sales of Licensed
Compound(s), drugs containing the Licensed Compound(s) or on practice of
Licensed Process in the Licensed Territory of up to US$ twenty five million
(US$ 25,000,000) and up to US$ one hundred million (US$ 100,000,000);
Royalties of 1.75% on an amount of annual Net Sales of Licensed
Compound(s), drugs containing the Licensed Compound(s) or on practice of
Licensed Process in the Licensed Territory exceeding US$ one hundred
million (US$ 100,000,000).
Can-Fite further agrees to pay Aderis 2% of any fees, milestone payments, or
other payments, exclusive of equity, that are received from sublicensees to this
agreement, with the exception of any payments received by Can-Fite that
constitute reasonable reimbursement of expenses, including fully burdened
expenses for research and development of the Licensed Compounds.
APPENDIX E - Performance and Diligence
Can-Fite shall, from the date of this Agreement:
1. Secure Series B preferred financing of not less than $2 million (US)
within 9 months.
2. File an IND with the US FDA and be free from clinical holds within 12
months.
3. Initiate Phase II clinical trials in a patient population in the Field
of Use within 12 months.
4. Initiate Phase II or Phase III clinical trials in the US within 3 years.
5. File for regulatory approval within a Licensed Territory within 6 years.