§ 8 Term and Termination
§ 8.1 Term and Expiration. This Agreement shall become effective upon the Effective Date and, if not otherwise terminated earlier pursuant to this Article 8, shall expire on a Product-by-Product basis upon the expiration of the royalty payment obligations hereunder with respect to the applicable Product (the “Term”). This Agreement shall expire in its entirety (if not otherwise terminated earlier pursuant to this Article 8) on the date that this Agreement has expired with respect to all Products.
§ 8.2 Other Terminations
§ 8.2.1 Merck shall have the right to terminate this Agreement at any time in its sole discretion by giving [*] advance written notice to NewLink; provided, however, that such termination shall be effective immediately if Merck elects to terminate this Agreement for [*] (a “Safety Termination”). The Parties hereby acknowledge and agree that in the event that Merck delivers notice of termination to NewLink pursuant to this Section 8.2.1, but prior to such termination becoming effective, [*], then, notwithstanding [*] or anything to the contrary contained herein, [*].
§ 8.2.2 If at any time during the Term, a BLA has not been submitted for at least one (1) Product and Merck [*] for an Alternative Product, NewLink shall have the right to terminate this Agreement on [*] advance written notice to Merck with respect to all Products other than [*]; provided that such notification of NewLink’s exercise of its termination right under this Section 8.2.2 shall be provided within [*] for [*] Alternative Product. As used herein, “Alternate Product” shall mean [*].
§ 8.3 Termination for Cause
§ 8.3.1 Cause for Termination. This Agreement may be terminated at any time during the Term:
- upon written notice by NewLink if Merck is in material breach of (i) its Product Diligence Obligations pursuant to Section 3.5.1 by causes and reasons within its control or (ii) any obligation to make payments to NewLink hereunder, and has not cured such breach within [*] after written notice requesting cure of the breach (provided, however that such initial [*] cure period shall be extended for an additional [*] for so long as [*]; provided, however, in the event of a good faith dispute with respect to the existence of a material breach, the [*] cure period shall be tolled until such time as the dispute is resolved pursuant to Section 10.6; provided further, however, that it is agreed that termination pursuant to this Section 8.3.1(a) shall be on a Product-by-Product basis to which the breach relates and that NewLink cannot terminate this Agreement under this Section 8.3.1(a) with respect to the non-affected Products (and the effects of termination in Section 8.3.2 shall only apply with respect to such terminated Product); or
- by a Party upon the filing or institution of bankruptcy, reorganization, liquidation or receivership proceedings, or upon an assignment of a substantial portion of the assets for the benefit of creditors, by the other Party; provided, however, that in the case of any involuntary bankruptcy proceeding such right to terminate shall only become effective if the Party consents to the involuntary bankruptcy or such proceeding is not dismissed within [*] after the filing thereof (an “Insolvency Event”).
§ 8.3.2 Effect of Termination. Upon termination (but not expiration) of this Agreement for any reason (other than termination by Merck pursuant to Section 8.3.1(b)), all licenses and other rights granted hereunder shall terminate (except those that expressly survive as set forth in Section 8.4). In addition, in such case, [*] the following consequences shall apply; provided that if this Agreement is terminated only with respect to a particular Product or Product(s) the following shall apply solely with respect to such Product or Product(s):
- Terminated Products. Following termination NewLink may elect to receive (which election shall be made in writing to Merck within [*] following termination), and Merck hereby grants to NewLink, effective upon such election, [*]) to research, develop, import, use, make, have made, offer for sale and sell the Current Product (if this Agreement is terminated with respect to the Current Product) and any other Product [*], but excluding [*] (such Products, [*] “Terminated Products”), in each case, in the Field in the Territory. [*] Notwithstanding the provisions of this Section 8.3.2(a), the licenses in this Section 8.3.2(a) shall not be effective until such time as the Parties agree [*].
- Regulatory Documentation. Promptly following the effective date of such termination, Merck shall transfer and assign to NewLink all of its (and its Affiliates) material Regulatory Documentation and data relating solely and exclusively to any Terminated Products (provided, however, that if there is additional Regulatory Documentation or data in Merck’s (or its Affiliates) Control related to the Terminated Products that is necessary for NewLink to continue to Develop and Commercialize such Terminated Product, then at the written request of NewLink (which request shall be made within [*] following the effective date of termination), Merck shall use Commercially Reasonable Efforts to provide NewLink with access to such Regulatory Documentation and data (provided that Merck may redact any and all portions thereof not related to the Terminated Product)), in each case, to the extent [*].
- Transition Assistance. Merck shall, [*], provide the following transitional assistance upon request by NewLink:
ii. Merck shall, at NewLink’s request, provide to NewLink (including when available, in electronic format) a copy of the physical embodiment of all Merck Know-How that is directly related to any Terminated Product and licensed to NewLink pursuant to Section 8.3.2(a); provided that NewLink shall comply with the confidentiality and non-use provisions set forth in Article 4 with respect to such Merck Know-How, and NewLink shall only use such Merck Know-How in accordance with the licenses pursuant to Section 8.3.2(a).
iii. Merck shall [*] all inventory of Terminated Product in Merck’s (or its Affiliate’s) possession, and in connection therewith, [*].
iv. Merck shall [*] all inventory of Terminated Product in Merck’s (or its Affiliate’s) possession, and in connection therewith, [*].
v. Merck shall assign or transfer to NewLink any manufacturing agreement between Merck and a Third Party contract manufacturer with respect to such Terminated Product, to the extent assignable (and solely to the extent that such manufacturing agreement does not relate to any other products).
- Other Provisions. Notwithstanding the foregoing provisions of this Section 8.3.2, any [*] to provide [*] shall not [*]. All Regulatory Documentation, Know-How, data, information, correspondence and other items provided to NewLink pursuant to this Section 8.3.2 shall be provided [*], and shall [*]. NewLink shall provide reasonable assistance to Merck in connection with the transfer and delivery of the foregoing items.
- Wind-Down. Notwithstanding the foregoing provisions of this Section 8.3.2, the licenses granted to Merck pursuant to Section 3.1 and Section 3.2 shall survive for [*] following the effective date of termination in order for Merck (and its Affiliates, sublicensees and distributors), [*], during the [*] period immediately following the effective date of termination, to (i) finish or otherwise wind-down any ongoing Clinical Trials with respect to any Compounds or Products hereunder or transfer such Clinical Trials (where Merck is permitted to do so under Applicable Laws) to NewLink and (ii) finish any work-in-progress and sell any Products or Compounds remaining in inventory, in accordance with the terms of this Agreement; provided that, for clarity, [*] and; provided further, that such licenses shall be non-exclusive.
§ 8.3.3 Effect of Termination by Merck for Insolvency Event. In the event that this Agreement is terminated by Merck under Section 8.3.1(b) then the provisions of this Section 8.3.3 shall apply (and the provisions of Section 8.3.2 shall not apply). In the event that this Agreement is terminated due to the rejection of this Agreement by or on behalf of NewLink due to an Insolvency Event (including under Section 365 of the United States Bankruptcy Code (the “Code”), as applicable), all licenses and rights to licenses granted under or pursuant to this Agreement by NewLink to Merck are and shall otherwise be deemed to be (including for purposes of Section 365(n) of the Code, as applicable) licenses of rights to “intellectual property” (including as defined under Section 101(35A) of the Code, as applicable). The Parties agree that Merck, as a licensee of such rights under this Agreement, shall retain and may fully exercise all of its rights and elections under any applicable insolvency statute (including the Code), and that upon commencement of an Insolvency Event by or against NewLink, Merck shall be entitled to a complete duplicate of or complete access to (as Merck deems appropriate), any such intellectual property and all embodiments of such intellectual property. Such intellectual property and all embodiments thereof shall be promptly delivered to Merck (i) upon any such commencement of a bankruptcy proceeding upon written request therefore by Merck, unless NewLink elects to continue to perform all of its obligations under this Agreement or (ii) if not delivered under (i) above, upon the rejection of this Agreement by or on behalf of NewLink, then upon written request therefore. The provisions of this Section 8.3.3 shall be (1) without prejudice to any rights Merck may have arising under any applicable insolvency statute or other Applicable Law (including the Code, as applicable) and (2) effective only to the extent permitted by Applicable Law (including the Code, as applicable).