8-K
License Agreement
Under the License Agreement, Yale granted to the Company an exclusive license to a pending U.S. patent application, related applications and any patents that issue from or claim priority to any of the licensed applications. If the pending U.S. patent application were in the future to issue as a patent, it could potentially cover the use of the Company's product candidates mecamylamine hydrochloride and TC-5214, or other compounds classified as nicotinic antagonists, as an augmentation to other treatments for mood disorders. The Company has the right to grant sublicenses to any of the licensed patent rights.
Under the terms of the License Agreement, the Company paid Yale a non-refundable license initiation fee and reimbursed Yale for its prior expenses with respect to the filing and prosecution of the licensed patent rights. In addition, the Company agreed to assume responsibility for future expenses with respect to the filing, prosecution and maintenance of the licensed patent rights and to pay to Yale: (i) an issuance fee that is conditional upon the issuance from the licensed applications of a U.S. patent that meets specified conditions;
(ii) aggregate payments of up to $1,500,000 for each product subject to the license for which specified regulatory and first commercial sale milestones are achieved; (iii) low single digit royalties on any net sales of products subject to the license; and (iv) a percentage of certain amounts received from any sublicensee of the licensed patent rights if the sublicense is not combined with a license to other patent rights of the Company or with an agreement by the Company to collaborate with the sublicensee to discover, research, develop or commercialize compounds or products for therapeutic use.
The Company is required to use reasonable commercial efforts to develop at least one product subject to the license for commercialization in the United States. The Company may terminate the License Agreement upon 30 days written notice to Yale. Yale may terminate the License Agreement if the Company breaches the License Agreement and, if curable, does not cure the breach within a specified cure period, or if the Company notifies Yale that it has abandoned its intent to pursue the research, development or marketing of a product subject to the license. |
