RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES 11 country and product/service-by-product/service basis for per year and variable payments up to $7.3 million depending so long as at least one valid claim of any patent sublicensed on the achievement of milestone events. We also agreed to pay from Adverum covers the manufacture, use or sale of a given running mid-single-digit royalties on future net sales. product/service in a given country. This license agreement has been amended in April 2017, under • Obligations of Adverum: which we will provide the M.I.T. with a written research and Adverum is responsible for and retains sole control over the development plan no later than July 1, 2018. prosecution, filing, maintenance and enforcement of all patents This license agreement shall remain in effect until the expiration licensed to us under the agreement. or abandonment of all issued patents and patent applications • Term and termination: under this license agreement, unless earlier terminated. We have the right to terminate this license agreement, for The license agreement will continue in full force and effect on a any reason, upon at least six months prior written notice to country-by-country basis until there are no remaining royalty M.I.T., and upon payment of all amounts due to M.I.T. under obligations in any country, at which time the agreement shall the agreement. M.I.T. has the right to terminate this license expire in such country, unless otherwise terminated by the agreement (i) immediately upon written notice if we cease to parties in accordance with the terms of the license agreement. carry on our business related to the agreement, or (ii) if we fail We may terminate the agreement at any time upon 90 days’ to pay any amounts due and payable within 30 days. prior written notice to Adverum, and Adverum may terminate the agreement in part or its entirety upon written notice to us if we assign the agreement in violation of its terms or fail to 11.5.2 OUR INTELLECTUAL PROPERTY ESTATE timely meet any of our specified development or milestones PATENTS achievement obligations. We strive to protect and enhance the proprietary technology, Upon the termination of the license agreement between inventions and improvements that are commercially important to Adverum and Regents, our license agreement with Adverum the development of our business, including seeking, maintaining wil l survive, provided that, among other things, we wil l be and defending certain patent rights licensed from third-parties. required to make any monetary payments that Adverum would We also rely on trade secrets and know-how, continuing have been required to make under its agreement with Regents technological innovation and in-licensing opportunities to develop, had it not been terminated. strengthen and maintain our proprietary position in the fields of allogeneic transfer, optogenetics, gene therapy and specific optics Massachusetts Institute of Technology and algorithms that may be important for the development of License Agreement for Patents Relating to GS030 our business. We additionally may rely on regulatory protection • Object: afforded through data exclusivity, market exclusivity and patent On January 6, 2016, we entered into a license agreement with term extensions where available. See Section 6.12, “Government the Massachusetts Institute of Technology, or M.I .T., upon Regulation” of this Registration Document. exercising an option right granted under the patent option Our future commercial success may depend, in part, on our ability agreement between M.I .T. and us, dated January 9, 2015. to obtain and maintain patent and other proprietary protection Under this license agreement, M.I.T. granted to us a royalty- for commercially important technologies, inventions and know- bearing, license to certain patent rights jointly owned by M.I.T. how related to our business; defend and enforce our in-licensed and the University of Alberta, for use of the ChrimsonR or patents and any patents that we may own in the future; preserve photoactivatable halorhodopsin protein (known as Jaws) gene the confidentiality of our trade secrets and proprietary know- expression sequences, in the retina for the prevention and how; and operate without infringing the patents and proprietary treatment of blindness in humans. The license is exclusive but rights of third-parties. Our ability to stop third-parties from subject to the rights of M.I.T., the University of Alberta and any making, using, selling, offering to sell or importing our products other non-profit research institute to practice under the patent may depend on the extent to which we have rights, either owned for research, teaching and educational purposes, the U.S. or in-licensed, under valid and enforceable patents, trade secrets government’s royalty-free, non-exclusive, non-transferable or other know-how that cover these activities. In some cases, license to practice the patent, and certain mandatory third- these rights may need to be enforced by third-party licensors. party sublicensing requirements. Our rights to intellectual property, whether in-licensed, owned • Financial obligations: or co-owned are generally directed to methods of treatment or Under the terms of this license agreement, we agreed to pay a prevention of clinical indications important for our development license issue fee of $45 K, license maintenance fees up to $100 K programs, al lotopic expression, mitochondrial trafficking, GENSIGHT BIOLOGICS – 2017 Registration Document– 137