Provision Language
Definitions
“Disease Information” means information generated by the Company or its research contractors related generally to diseases within Foundation Priority Areas, and shall specifically exclude the Platform Technology.
“Foundation Priority Areas” rotavirus, cholera, typhoid, Escherichia coli, shigella, hepatitis A & E, geohelminths, HIV/AIDS, malaria, pneumonia causing infectious diseases (including respiratory syncytial virus), tuberculosis, polio, meningitis, measles, diphtheria, tetanus, pertussis, influenza, Japanese encephalitis, dengue, African trypanosomiasis, visceralleishmaniasis, Guinea worm, onchocerciasis, lymphatic filariasis, cysticercosis, schistosomiasis, trachomoa, soil-transmitted helminthes, and humanpapillomavirus. The list of Foundation Priority Areas may be modified from time to time by mutual agreement between the Foundation and the Company.
1. Charitable Purposes and Use of Funds
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In addition, the Company agrees to use a minimum of $[**] specifically to fund the development of [**] protein and potential vaccines and therapeutics (the “[**] Program”) as outlined in Appendix 1, attached hereto, which may include vaccines and therapeutics under development by Foundation partners, to the extent mutually agreed by the Company, the Foundation and such partners. The scope of work for the [**] Program will be as specified in Appendix 1. Within [**] months following the delivery by the Foundation of each Tranche, the Company agrees to provide a report to the Foundation detailing the progress achieved to date on the [**] Program certifying as to the costs and expenses incurred by the Company for the [**] Program for such [**] month period (the “[**] Program Report”). The Company is not required to segregate the proceeds of the Foundation’s investment from other Company funds.
2. Global Access Commitments
The following paragraphs ensure satisfaction of the Global Access Objectives and represent the Company’s “Global Access Commitments”.
Subject to the provisions of this Letter Agreement, the Company will not grant to a third-party any rights to or enter into any arrangements with respect to, the Platform Technology that would prohibit, prevent or otherwise significantly restrict the Company (or any acquirer of the Platform Technology) from fulfilling these Global Access Commitments.
(a) Unfunded Development Programs:
Other than with respect to the [**] Program and the Future Development Programs (which are addressed in subsection (c)), the Company hereby grants to the Foundation non-exclusive, sub-licensable license rights to any antibodies and Disease Information requested by the Foundation that the Company or its research contractors discover in Foundation Priority Areas within the longer of twelve (12) months following the consummation of a Sale Transaction (as such term is defined below) and the three (3) year period following the payment of the last Tranche of the Foundation Investment, including, for the avoidance of doubt, but not limited to, the Visterra Influenza Antibody. The foregoing non-exclusive license may be used worldwide by or on behalf of the Foundation (or Foundation–funded entities) and their respective sublicensees, in connection with (i) research and development (ii) manufacture, and (iii) regulatory approval processes so long as the principal focus of such activities is to ensure satisfaction of the Global Access Objectives in Foundation Priority Areas. Any product that arises from or is subject to such research, development and manufacturing activities may only be sold or distributed by or on behalf of the Foundation (or Foundation-supported Entities or sublicensee) in Developing Countries in Foundation Priority Areas without any milestone payments, royalties or other monetary or non-monetary restrictions imposed. For the purposes of this Letter Agreement, a “Foundation-supported Entity” is a third party receiving funding from the Foundation, is collaborating with the Foundation, or both, for the purpose of accomplishing Global Access Objectives.
The Foundation will notify the Company in writing if it desires to receive Disease Information. The Company will provide such Disease Information promptly to the Foundation and in a form and format to be mutually agreed. In the event the Company reasonably determines, in its good faith judgment, that any such Disease Information is confidential information of the Company, it shall be eligible for protection as provided for in a confidentiality agreement to be negotiated between the Company and the Foundation.
The Company will notify the Foundation in writing of the Company’s (alone or through a third party) intended development or commercialization of antibodies in the Foundation Priority Areas (other than with respect to the [**] Program and the Future Development Programs, which are addressed in subsection (c)).
In the event that the Company (alone or through a third party) is developing and commercializing the same antibodies in the Developed World as the Foundation (alone or through a third party) is developing, the Foundation and the Company agree to notify each other of such activities and, to the extent feasible, coordinate all activities with each other to ensure no negative impact on the research, development and commercialization of such antibodies being undertaken by the other party in the Developed World or Developing Countries, as the case may be. Notwithstanding the foregoing, (i) each of the Company and the Foundation shall have ultimate decision-making authority over such development and commercialization activities but shall consider in good faith the views of the other party, and (ii) if the Company is developing and/or commercializing any such antibodies with a major biopharmaceutical company (defined as a company which, together with its affiliates, had annual revenues in excess of $[**] in its latest fiscal year), and such biopharmaceutical company, in good faith, believes that such activities would have a negative impact on its development and commercialization of such antibodies, the Company shall provide written notice to the Foundation, and the Foundation, the Company and such biopharmaceutical company shall meet to discuss the issues raised by the biopharmaceutical company and such parties shall develop, acting in good faith, a written plan to resolve such issues. For the purpose of clarity, the Company and the Foundation agree that the sale or distribution of such antibodies or vaccines, therapeutics or other products embodying such antibodies at low or zero price in Developing Countries is consistent with the Global Access Objectives and does not and will not negatively impact commercialization of such antibodies, provided that the Foundation exercises diligent efforts to prevent the sale and distribution in the Developed World of antibodies intended for sale and distribution in Developing Countries.
Notwithstanding the foregoing, in the event that the Company intends to enter into an agreement with a major biopharmaceutical company (as defined above), with a demonstrable corporate commitment to serving patients in Developing Countries and a clear written plan for achieving the Global Access Objectives, for the development and commercialization of products in one or more Foundation Priority Areas in a manner consistent with the Global Access Objectives, upon written request of the Company, the Foundation shall relinquish its non-exclusive rights in the applicable Foundation Priority Area(s). The Company shall provide the Foundation with the applicable provisions of the agreement with such third party relating to the Global Access Objectives and shall consider in good faith suggestions from the Foundation relating to such agreement. Moreover, the Company shall report (or cause such third party to report) to the Foundation on a semi-annual basis regarding the progress of the Company and such third party in connection with the Global Access Objectives in such Foundation Priority Area(s). If the Foundation believes that the Global Access Objectives are not being met, it shall provide notice to the Company, and the Foundation, the Company and such third party shall meet to discuss the issues raised by the Foundation and such parties shall develop, acting in good faith, a written plan to resolve such issues. The non-exclusive rights in the applicable Foundation Priority Area(s) specified in this section shall be considered to be in force in favor of the Foundation if and when the agreement between the Company and such major biopharmaceutical company is terminated.
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(c) [**] Program/Future Development Programs:
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(iv) Company Continues Program Activities Post-Election: In the event the Company (alone or through a third party) continues to develop or commercialize a product after the Rights-Grant Election, products arising out of such Program may be sold or distributed by or on behalf of the Foundation (or Foundation-supported Entities) worldwide in Foundation Priority Areas in a manner that furthers the Global Access Objectives. The Foundation hereby grants to the Company non-exclusive license rights (with rights to sublicense) to any product that arises from or is subject to such research, development and manufacturing activities by or on behalf of the Foundation (“Foundation Products”) for research, development, manufacturing, regulatory approval processes, sale and distribution world-wide without any milestone payments, royalties or other monetary or non-monetary restrictions imposed on theCompany (or any of its licensees or sublicensees) by the Foundation. In the event that the Company (alone or through a third party) is developing and commercializing the same product in the Developed World as that being sold or distributed by the Foundation in Developing Countries, the Foundation and the Company will, to the extent feasible, coordinate all activities with each other to ensure no negative impact on the research, development and commercialization of such Foundation Product by the Company or the Foundation in the Developed World or Developing Countries, respectively. For the purpose of clarity, the Company and the Foundation agree that the sale or distribution of such a product at low or zero prices in Developing Countries is consistent with the Global Access Objectives and would not negatively impact commercialization of such antibodies, provided that the Foundation exercises diligent efforts to prevent the sale and distribution in the Developed World of Foundation Products intended for sale and distribution in Developing Countries.In the event the Company discontinues Program activities to develop and commercialize the product or fails to exercise Reasonable Efforts to do so, the provisions of Sections 2(c)(iii) and (v) shall apply.
5. Required Reporting
In addition to any and all reports required to be delivered to the Foundation under the Investment Documents, the Company shall furnish, or cause to be furnished, to the Foundation the following reports and certifications:
a. Within ninety days after the end of the Company’s fiscal year during which the Foundation owns any shares in the Company, a certificate from the Company signed by an officer or director of the Company and substantially in the form attached to this Letter Agreement, certifying that the requirements of the Foundation Investment set forth in this Letter Agreement were met during the immediately preceding fiscal year, describing the use of the proceeds of the Foundation Investment and evaluating the Company’s progress toward achieving the Global Access Commitments and, if applicable for the period, the [**] Program Report;
b. Within ninety days after the end of the Company’s fiscal year during which the Foundation ceases to own any shares in the Company, a certificate from the Company signed by an officer or director of the Company and substantially in the form attached to this Letter Agreement, certifying that the requirements of the Foundation Investment set forth in this Letter Agreement were met during the term of the Foundation Investment, describing the use of the proceeds of the Foundation Investment and evaluating the Company’s progress toward achieving the Global Access Commitments and, if applicable for the period, the [**] Program Report;
c. Any other information respecting the operations, activities and financial condition of the Company as the Foundation may from time to time reasonably request to discharge any expenditure responsibility, within the meaning of Sections 4945(d)(4) and 4945(h) of the Code, of the Foundation with respect to the Foundation Investment, and to otherwise monitor the charitable benefits intended to be served by the Foundation Investment (which shall be at the Foundation’s expense); and
d. Full and complete financial reports of the type ordinarily required by commercial investors under similar circumstances, which requirement may be satisfied by the Company by delivery to the Foundation of the audits and reports specified in Section 6 of the Series A Stock Purchase Agreement (as it may be amended or restated). If the Company merges with, is acquired by or becomes a reporting company under the Securities Exchange Act of 1934, as amended, the filing of quarterly and annual reports with the S.E.C. shall be deemed to satisfy these financial reporting obligations. Notwithstanding the lead-in paragraph of Section 6.1 of the Series A Stock Purchase Agreement, so long as the Foundation owns any shares in the Company, the Company shall provide and deliver to the Foundation copies of the reports and audits specified in Section 6 of the Series A Stock Purchase Agreement.
All information included in the foregoing reports shall constitute the confidential information of the Company and shall be eligible for protection as provided for in a confidentiality agreement to be negotiated between the Company and the Foundation, subject to the right of the Foundation to disclose such information as may be required to satisfy its reporting requirements under the Code.
6. Access to Records
The Company shall maintain books and records adequate to provide the information ordinarily required by commercial investors under similar circumstances and provide the Foundation access to such books and records. Such reports shall be maintained for a minimum of four years after the Foundation Investment has terminated.
Amendment 2
1. The Letter Agreement is hereby amended by replacing in its entirety the third full paragraph on page four of the Letter Agreement with the following:
In the event the Company (alone or through a third party) is developing and commercializing the same antibodies in the Developed World as the Foundation (alone or through a third party) is developing, the Foundation and the Company agree to notify each other of such activities and, to the extent feasible, coordinate all activities with each other to ensure no negative impact on the research, development, and commercialization of such antibodies being undertaken by the other party in the Developed World or Developing Countries, as the case may be. Notwithstanding the foregoing, (i) each of the Company and the Foundation shall have ultimate decision-making authority over such development and commercialization activities but shall consider in good faith the views of the other party, and (ii) if the Company is developing and/or commercializing any such antibodies with a biopharmaceutical company, and such biopharmaceutical company, in good faith, believes that such activities would have a negative impact on its development and commercialization of such antibodies, the Company shall provide written notice to the Foundation, and the Foundation, the Company and such biopharmaceutical company shall meet to discuss the issues raised by the biopharmaceutical company and such parties shall develop, acting in good faith, a written plan to resolve such issues. For the purpose of clarity, the Company and the Foundation agree that the sale or distribution of such antibodies or vaccines, therapeutics or other products embodying such antibodies at low or zero price in Developing Countries is consistent with the Global Access Objectives and does not and will not negatively impact commercialization of such antibodies, provided that the Foundation exercises diligent efforts to prevent the sale and distribution in the Developed World of antibodies intended for sale and distribution in Developing Countries.
2. The Letter Agreement is hereby further amended by replacing in its entirety the paragraph which bridges page four and page five of the Letter Agreement with the following:
Notwithstanding the foregoing, in the event that the Company intends to enter into an agreement with a major biopharmaceutical company (defined as a company which, together with its affiliates, had annual revenues in excess of $[**] in its latest fiscal year; provided that such $[**] annual revenue requirement will not apply in the case of a biopharmaceutical company that intends to develop and commercialize a product for dengue fever with the Company), with a demonstrable corporate commitment to serving patients in Developing Countries and a clear written plan for achieving the Global Access Objectives, for the development and commercialization of products in one or more Foundation Priority Areas in a manner consistent with the Global Access Objectives, upon written request of the Company, the Foundation shall relinquish its non-exclusive rights in the applicable Foundation Priority Area(s). The Company shall provide the Foundation with the applicable provisions of the agreement with such third party relating to the Global Access Objectives and shall consider in good faith suggestions from the Foundation relating to such agreement. Moreover, the Company shall report (or cause such third party to report) to the Foundation on a [**] basis regarding the progress of the Company and such third party in connection with the Global Access Objectives in such Foundation Priority Area(s). If the Foundation believes that the Global Access Objectives are not being met, it shall provide notice to the Company, and the Foundation, the Company and such third party shall meet to discuss the issues raised by the Foundation and such parties shall develop, acting in good faith, a written plan to resolve such issues. The non- exclusive rights in the applicable Foundation Priority Area(s) specified in this section shall be considered to be in force in favor of the Foundation if and when the agreement between the Company and such major biopharmaceutical company is terminated.