Provision Language
Definitions
“Know-How Royalty Term” means
(i) with respect to the Sale of a Licensed Product which is the mono-valent pharmaceutical composition or preparation (in any and all dosage forms) containing the mono-valent vaccine candidate known as rVSV-EBOV (in any suspension buffer or any lyophilized version thereof) as the sole active ingredient and administered through any route of administration other than oral administration, on a Licensed Product- by- Licensed Product and country-by-country basis:
(a) if the first Sale of such Licensed Product in such country of Sale occurs when there is a Valid Claim Covering such Licensed Product in such country: the period beginning on the date of expiry of the last to expire Valid Claim Covering such Licensed Product in such country and ending five (5) years thereafter; or
(b) if the first Sale of such Licensed Product in such country of Sale occurs when there is no Valid Claim Covering the Licensed Product in such country: the period beginning on the date of first Sale of such Licensed Product in such country and ending five (5) years after the first Sale in such country.
(ii) with respect to the Sale of all other Licensed Product(s), on a Licensed Product -by- Licensed Product and country-by-country basis:
(a) if the first Sale of such Licensed Product in such country of Sale occurs when there is a Valid Claim Covering such Licensed Product in such country: the period beginning on the date of the last to expire Valid Claim Covering such Licensed Product in such country and ending five (5) years thereafter in such country; and
(b) if the first Sale of such Licensed Product in such country of Sale occurs when there is no Valid Claim Covering the Licensed Product in such country: the period beginning on the date of first Sale of such Licensed Product in such country and ending ten (10) years after the first Sale in such country.
“Patent Royalty Term” means, with respect to a given Licensed Product in a given country of Sale, the period, during the Term, prior to the date of expiry of the last to expire Valid Claim Covering such Licensed Product in such country of Sale.
“Sales Price” means the aggregate gross price paid by an arm’s length purchaser or lessee for any of the results of the exercise of the Licensed Rights sold or leased by the Company (or, to the extent the results of the exercise of the Licensed Rights sold or leased by the Company are subject to pricing set by the applicable regulatory authority in a given country in the Territory , then the price set by such regulatory authority for sales or leases in such country) for use in the Field of Use , less a fixed amount equal to [*] of the amount invoiced.
2.0 GRANT & RESERVATIONS
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2.6 Sub-Licensee Consideration. In addition to the royalties payable by the Affiliates and sub-licensees to Canada as contemplated in paragraph 2.5 (Sub-licensing Conditions), the Company shall also pay to Canada [*] paid by the Affiliates and sub-licensees to the Company in accordance with paragraph 5.4.
5.0 FEES AND ROYALTIES
5.1 Fees. The Company shall pay to Canada the following non-refundable lump sums but solely to the extent that such amounts were not previously paid to, or otherwise received by, Canada prior to the Execution Date of this amended and restated License Agreement: The Parties acknowledge and agree that all payments due pursuant to the version of the license agreement that immediately preceded this amended and restated License Agreement have been paid by the Company to Canada and that only payments due pursuant to this amended and restated License Agreement shall be due to Canada.
5.1.1 MILEPOST FEES [*] lump sum payable on the earlier of [*] or [*], whichever comes first; and
5.1.2 MILEPOST FEES [*] lump sum payable on [*].
5.2 Royalty Percentage Rate. During the Patent Royalty Term, the Company shall pay to Canada a royalty rate of [*] of the Sales Price of Licensed Products sold by the Company, its Affiliate(s) or sub-licensees.
5.2.1 The royalty rate shall be lowered to [*] if: a) an additional technology is required to Commercialize; and b) the additional technology is actually licensed by the Company (or its Affiliates or sub-licensees) from a third party and the latter actually charges royalties to the Company (or its Affiliates or sub-licensees) for such a license (as shown by documentation sufficient to establish the requirement and the actual license).
5.2.2 The rate shall be lowered to [*] if: a) two (2) or more additional technologies are required to Commercialize; and b) the additional technologies are actually licensed by the Company (or its Affiliates or sub-licensees) from one or more third parties and the latter actually charge royalties to the Company (or its Affiliates or sub-licensees) for such a license (as shown by documentation sufficient to establish the requirement and the actual license).
5.2.3 No amounts shall be owed to Canada under this paragraph 5.2 with respect to Sales of Licensed Products sold by the Company, its Affiliate(s) or sublicensees in (i) those countries (and their territories and possessions) in Africa and (ii) GAVI Eligible Countries (and their territories and possessions). As used herein, “GAVI Eligible Countries” means all countries which are deemed GAVI-eligible countries by the GAVI Alliance, as such GAVI-eligible countries may be added or deleted by the GAVI Alliance from time to time; provided that in no event shall China be included as a GAVI Eligible Country (it being understood countries that have ‘graduated’ from GAVI eligibility shall, following such ‘graduation’, no longer be included as GAVI Eligible Countries) and “GAVI Alliance” means the Global Alliance for Vaccines and Immunization (GAVI), an independent non-profit organization established under the laws of Switzerland, with the purpose of providing support for improvements of vaccinations and immunization in the poorest countries of the world.
5.3 Minimum Royalty. Notwithstanding any other provision of the License Agreement, the Company shall pay to Canada a minimum annual royalty of [*] payable on or before January 1st during each year of the License Agreement. Such amounts paid shall be creditable against royalties owed under clause 5.2 (Royalty Percentage Rate) and sub-license payments owed under clause 5.4 (Sub-Licensing Consideration) in the same year.
5.4 Sub-Licensing Consideration. The Company shall pay to Canada [*] paid by the sub-licensees to the Company as follows:
(i) with respect to the Sale of a Licensed Product which is the mono-valent pharmaceutical composition or preparation (in any and all dosage forms) containing the mono-valent vaccine candidate known as rVSV-EBOV (in any suspension buffer or any lyophilized version thereof), as the sole active ingredient and administered through any route of administration other than oral administration, on all Sales exceeding [*]; and
(ii) with respect to the Sale of all other Licensed Product(s), on a Licensed Product -by- Licensed Product basis, on all Sales exceeding [*].
Such payments shall be over and above the royalty rate paragraph 5.2 (Royalty Percentage Rate) (whether or not such consideration was directly, indirectly or derivatively paid or provided) including without limitation any equity. Notwithstanding the foregoing, any amounts payable to Canada under paragraph 5.2 with respect to Sales of Licensed Products by Merck, its affiliates or sublicensees may be deducted from the amount Company is obligated to pay Canada as sub-licensing consideration under this paragraph 5.4 (but for clarity, Company shall pay Canada [*] it receives from Merck in excess of the amount payable to Canada under paragraph 5.2).
5.5 Sub-Licensee’s Fees
5.5.1 COLLECTION AND ENFORCEMENT BY THE COMPANY. The Company shall ensure that royalties payable to Canada from Affiliates and sub-licensees shall be remitted directly to the Receiver General for Canada, at the address provided in Article 20.1 (Notice).The Company shall take any necessary actions (at the Company’s own cost) to collect, enforce and remit royalties or other consideration owing to Canada by the Affiliates and sub-licensees. Notwithstanding the foregoing, the Company’s sub-licensee Merck (and its affiliates and sub-licensees) shall not be required to make any direct payment to Canada. Any amounts payable under this License Agreement as a result of activities of the Company’s sub-licensee Merck (and Merck ’saffiliates, sub-licensees and Ordinary Course Sub-Licensees ) shall be paid by the Company to Canada.
5.5.2 SUB-LICENSEE’S ARREARS PAID BY THE COMPANY. If an Affiliate or sub-licensee has royalties or other consideration owing to Canada under a sub-license for a period in excess of thirty (30) days, then the Company shall pay to Canada that amount owing within the next fourteen (14) days immediately following the aforementioned thirty (30) days.
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5.9 Payment after Expiry of Patents. The Company shall continue paying the amounts as prescribed in this Article, notwithstanding any impeachment proceedings, or the expiry, expungement or other nullification of the Patents.
5.10 No Set-off. Notwithstanding any other provision of the License Agreement, any consideration payable to Canada by the Company under the License Agreement is unconditional and non-cancelable. Further, the Company shall not have the right of set-off, deduct or counter-claim against any such consideration.
5.11 Accounting Approach
5.11.1 GAAP. The Company shall use GAAP in the calculation of consideration owing to Canada. The Company may allow its sub-licensee Merck (and its affiliates and sub-licensees) to use United States GAAP in the calculation of consideration owing to Canada.
5.11.2 ACCRUAL. Royalties accrue on receipt of payment by the Company (or Affiliates or the sub-licensees) for the Licensed Rights.
5.11.3 INTEREST OF OVERDUE ACCOUNTS. In the event the Company fails to make any payment under the License Agreement when due and payable, then interest on any unpaid amount shall accrue at a rate of four (4)% above the base rate of the Bank of Montreal, Toronto, from time to time in force during the period of non-payment.
5.11.4 OTHER BASIS FOR PAYMENTS. If the Company receives any lump sum or other payments, royalties (including royalty payments received from third parties), or any other income or consideration for, or in respect of the Commercialization of the Licensed Rights , then the Company shall include such additional incomein calculating the Sales Price .
5.12 Know-How Royalty. During the Know-How Royalty Term, the Company shall pay to Canada royalties at [*] of the rates set out in sections 5.2 and 5.4 of the License Agreement.