An opt-out clause allows a party involved in a contract to withdraw from certain terms or the entire agreement without penalty, usually within a specified time frame. This clause provides flexibility and a means to avoid being bound by contractual obligations under specific conditions.
Milestone Payments; Opt-out Payment. The Collaboration Agreement provides for aggregate development, regulatory and commercial milestone payments from Takeda to the Company for Licensed Products of (i) up to $330 million if the Company does not exercise an Opt-out Right and remains in the 50:50 profit- and loss-sharing arrangement in the Profit-Share Territory; and (ii) up to $975 million if the Company exercises the Full Opt-out Right (as defined below). Milestone payments as to Licensed Products other than Rusfertide may be reduced in certain specified circumstances.
In addition to the milestone payments described above, in the event the Company exercises the Full Opt-out Right during the Initial Opt-out Period (as defined below), the Company will receive: (a) a $200 million payment following its exercise of the Full Opt-out Right, and (b) an additional $200 million payment following FDA approval of the New Drug Application for Rusfertide for polycythemia vera (together, the “Opt-out Payment”).
Opt-out Rights. The Company will have the right to opt-out entirely of profit- and loss-sharing in the Profit-Share Territory as to all Licensed Products (the “Full Opt-out Right”) during the 90-day period beginning 120 days after filing of a New Drug Application with the United States Food and Drug Administration for Rusfertide for Polycythemia Vera (the “Initial Opt-out Period”); and (ii) for convenience without receipt of the Opt-out Payment (generally following the Initial Opt-out Period). In addition, if the Company does not exercise the Full Opt-out Right, the Company may opt-out of profit- and loss-sharing in the Profit-Share Territory as to Licensed Products other than Rusfertide on a Licensed Product-by-Licensed Product basis (each, a “Partial Opt-out Right” and either the Full Opt-out Right or a Partial Opt-out right being an “Opt-out Right”). Following the Company’s exercise of an Opt-out Right, the Company has agreed to transition to Takeda applicable development and commercial activities, and Takeda has agreed to assume sole operational and financial responsibility for such activities.
On or before July 31, 2020, Minerva shall exercise its right to opt out of further joint Development of the Licensed Products, pursuant to Sections 3.10(g)(ii) and 11.5(a) of the License Agreement by sending to Janssen written notice of its decision to opt out in the form of the letter annexed hereto as Annex A (the “Opt-Out Notice”);
This opt-out shall be deemed to have occurred and be effective as of October 2, 2019 (the “Opt-Out Effective Date”), and the License Agreement is deemed to have been terminated as of the Opt-Out Effective Date.
Opting out What happens if you opt out: If you’re eligible to opt out of the transaction and do so, you will not receive the cash distribution and you will continue to hold the same number of shares that you currently hold. Your proportionate equity and voting interest in our company will increase by virtue of the consolidation of shares held by those shareholders who participate in the transaction. Process: If you’re a non-registered holder (i.e., you hold shares through a bank or broker), follow your bank or broker’s instructions if you’d like to opt out. You should contact your bank or broker if you have not received information regarding how to opt out. Registered shareholders should follow instructions sent to them by Computershare Trust Company of Canada, including depositing with Computershare a duly completed opt-out election and certification form prior to 5:00 p.m. (Eastern Daylight Time) on June 13, 2023. Deadline: Any opt-out elections should be completed by the deadline set by your bank/broker or Computershare (depending on whether you’re a non-registered or registered holder). If you’re not eligible to opt out of the transaction or are eligible to opt out but decide not to, no action is required to participate in the transaction.
Opting out: A U.S. shareholder who opts out of the transaction generally is not expected to be subject to U.S. federal income tax or Canadian federal income tax.
Protagonist Opt-Out Right. (a)Opt-Out Rights. Protagonist shall have the right (but not the obligation) upon written notice to Takeda to opt out from Protagonist’s participation in the Shared Development Costs, Shared Commercialization Costs and Shared Operating Profit (or Loss) under this Agreement (i) during the period beginning on the date that is one hundred twenty (120) days after the filing date of the Rusfertide NDA with the FDA and ending on the date that is ninety (90) days thereafter, subject to the extension specified in Section 8.3(x)(2) (the “Rusfertide Opt-Out Period”), for Rusfertide and all other Licensed Products, (ii) if Protagonist has not exercised the Rusfertide Opt-Out Right during the Rusfertide Opt-Out Period, during the Term after the expiration of the Rusfertide Opt-Out Period, or (iii) if a Rusfertide Failure occurs prior to the commencement of the Rusfertide Opt-Out Period, during the Term after such Rusfertide Failure (in which case such written notice may not be given by Protagonist earlier than [***]), and subject to the last sentence of Section 4.2(b), either (A) for Rusfertide and all other Licensed Products or (B) on a Licensed Product-by-Licensed Product basis where such Licensed Product is not Rusfertide (an opt-out under the foregoing clause (a)(i) or (a)(ii)(A), each a “Rusfertide Opt-Out Right”, and an opt-out under the foregoing clause (a)(ii)(B) a “Partial Opt-Out Right”).
Opt-Out Notice; Rusfertide Opt-Out Payment. Protagonist will provide Takeda a written notice within the Rusfertide Opt-Out Period stating whether or not Protagonist is exercising the Rusfertide Opt-Out Right within such period (the “Opt-Out Notice”); provided, however, that, if Protagonist does not provide any such written notice to Takeda prior to the Rusfertide Opt-Out Period expiring, then Protagonist will be deemed to have not exercised the Rusfertide Opt-Out Right within the Rusfertide Opt-Out Period. If Protagonist submits an Opt-Out Notice to Takeda within the Rusfertide Opt-Out Period stating that Protagonist is exercising the Rusfertide Opt-Out Right within such period, then Takeda will pay Protagonist the Rusfertide Opt-Out Payment set forth in and in accordance with Section 8.3. For clarity, Protagonist also shall have the right to exercise the Rusfertide Opt-Out Right at any time after the expiration of the Rusfertide Opt-Out Period by providing written notice thereof to Takeda, provided that, in such case, the Rusfertide Opt-Out Payment shall not be owed and payable by Takeda to Protagonist. For clarity, the Rusfertide Opt-Out Payment shall not be owed and payable by Takeda to Protagonist in connection with the exercise by Protagonist of any Partial Opt-Out Right at any time.
During the Opt-Out Wind-Down Period, the Parties will share the Shared Development Costs and Shared Commercialization Costs, as applicable, incurred by or on behalf of Protagonist and its Affiliates to conduct the Opt-Out Wind-Down Activities, in each case, to the extent consistent with the corresponding Shared Development Budget or Shared Commercialization Budget approved and included in such Joint Global Development Plan(s) or Joint Commercialization Plan(s) prior to such exercise date or updated versions of one or more of such plans or budgets approved by the JSC to account for the Opt-Out Wind-Down Period for the applicable Opt-Out Product(s) (collectively, the “Opt-Out Wind-Down Costs”). At Takeda’s request, after the end of the applicable Opt-Out Wind-Down Period, Protagonist will further assist Takeda, for no longer than an additional [***] from expiration date of such Opt-Out Wind-Down Period, with any remaining Opt-Out Wind-Down Activities, and Takeda will pay Protagonist for all undisputed [***] and [***] incurred by or on behalf of Protagonist and its Affiliates after such Opt-Out Wind-Down Period no later than [***] after receiving invoices from Protagonist for the same.
“Modification Period Opt Out Date” means the date requested by the Borrowers, and approved by the Lender following its receipt of a satisfactory Opt Out Compliance Certificate, on which the Modification Period Opt Out is effective.
Indication Exclusivity Opt-Out. At any time during the Indication Exclusivity Opt-Out Period, uniQure (or as the case may be, its successor in interest) may opt out of the exclusivity obligations under Section 11.1(d) with respect to a particular indication by written notice to BMS (such notice, the “Opt-Out Notice” and such indication, the “Opt-Out Indication”). uniQure may exercise such right to opt out up to [*]. Upon BMS’ receipt of the Opt-Out Notice (the “Opt-Out Exercise”), the following will apply:
Rights to Opt-Out. Opt-Out Points. On a Collaboration Product-by-Collaboration Product basis with respect to the Influenza Program and each Additional Pathogen Program, and on an Expanded Functional Genomics Target-by-Expanded Functional Genomics Target basis with respect to the Expanded Functional Genomics Program, each Party (whether the Lead Party or the Non-Lead Party, such Party, an “Opt-Out Party”) will have the one-time right to elect, pursuant to the procedures set forth in this Section 7.6 to cease funding its share of the Development Costs for a Collaboration Product (in the case of the Influenza Program and Additional Pathogen Programs), or all Collaboration Products directed to an Expanded Functional Genomics Target (in the case of Expanded Functional Genomics Program) in all indications (unless the Parties mutually agree otherwise) (each, an “Opt-Out Option”), as further provided in this Section 7.6. (a) With respect to each Collaboration Product in the Influenza Program or an Additional Pathogen Program, either Party may exercise its Opt-Out Option by providing the required written notice (an “Opt-Out Notice”) to the other Party on or prior to each of the following milestone events (collectively, the “Opt-Out Points”):
Exercise of Opt-Out Option. (a) Except with respect to the Target-Selection Opt-Out Option, either Party may exercise an Opt-Out Option by delivering an Opt-Out Notice at any time prior to, and no later than [***] following the receipt of the Development Summary by the JRDC with respect to the applicable Collaboration Product [***]. Except with respect to the Target-Selection Opt-Out Option, the Opt-Out Option shall be deemed to be exercised upon (i) [***], or (ii) [***] (such date in (i) or (ii), the “Opt-Out Effective Date”). (b) [***] may exercise the [***] by providing the Opt-Out Notice within [***] following the applicable [***], and the date of delivery of such Opt-Out Notice shall be deemed as the Opt-Out Effective Date with respect to such [***]. (c) If a Party exercises an Opt-Out Option with respect to a Collaboration Product (in the case of the Influenza Program or the Additional Pathogen Programs) or all Collaboration Products directed to an Expanded Functional Genomics Target (in the case of the Expanded Functional Genomics Program), in each case, in accordance with Section 7.6.3(a), or, where applicable, Section 7.6.3(b), then: (i) The Opt-Out Party shall be responsible for [***], in each case, [***]. (ii) Notwithstanding the foregoing, an Opt-Out Party delivering [***] shall not be liable for any [***]. For clarity, [***]. (iii) The Opt-Out Party shall also be responsible for [***]. (iv) if such exercised Opt-Out Option is with respect to an Expanded Functional Genomics Target (including, with respect to Vir, the Target-Selection Opt-Out Option) under the Expanded Functional Genomics Program, and at the time such Party opts out, [***], then unless the Parties mutually agree otherwise, exercise of such Opt-Out Option shall apply to [***]. Subject to the foregoing, after a Party exercises the Opt-Out Option with respect to an Expanded Functional Genomics Target, such Opt-Out Party shall have the right, either alone or via an Affiliate or partnering with a Third Party, to develop programs and exploit products and compounds directed to such Target outside the Collaboration provided that (A) such Party shall not use the Collaboration Screening Data to initiate or conduct such programs, and (B) [***]. (d) If a Party does not elect to exercise its Opt-Out Option at one of the above Opt-Out Points within the specified time periods in accordance with Section 7.6.3(a), or, where applicable, Section 7.6.3(b), it will be obligated to continue to fund all Development Costs for such Collaboration Product(s) in accordance with Section 11.4, until such time as the next Opt-Out Point becomes available, if any; [***] existing at the time the Opt-Out Notice or Early Opt-Out Notice is delivered.
If the Lead Party exercises its Opt-Out Option with respect to any Collaboration Product(s) pursuant to Section 7.6, and the Non-Lead Party elects to continue with the Development and Commercialization of such Collaboration Product(s) as Sole Development Product(s), then the Non-Lead Party shall notify the Lead Party in writing of such election, and thereafter shall be solely responsible for any Regulatory Filing or other regulatory activities with respect to such product. The Lead Party shall, upon reasonable request of the Non-Lead Party and to the extent permissible under applicable Law, transfer all regulatory documentation, including any Regulatory Filing or Regulatory Approval for such product Controlled by such Lead Party to the Non-Lead Party, and the Parties shall share the cost of such regulatory transfer in accordance with the profit-share percentages set forth in Section 11.5, as applicable. To the extent that such regulatory transfer is not permissible under applicable Law, the Parties shall discuss in good faith, and agree on a regulatory strategy to maintain such regulatory documentation for such Collaboration Product.
An Opt Out Clause is a provision in a contract that allows one or more parties to terminate or withdraw from the agreement under specific circumstances and conditions without breaching the contractual terms. This clause provides flexibility and an opportunity to exit the contract if certain conditions are unmet or situations change.
Opt Out Clauses should be considered in contracts when:
Writing an Opt Out Clause involves clearly stating:
Example:
“The [Party Name] may terminate this contract without penalty by providing written notice to [Other Party] at least 30 days prior to the intended termination date, in the event that [specific condition or event] occurs.”
Opt Out Clauses are commonly found in:
In each of these contexts, the clause serves to protect the interests of the parties and provide flexibility in the face of unforeseen changes or unmet expectations.
Dive deeper into the world of clauses and learn more about these other clauses that are used in real contracts.
The "Option to Extend Lease Term" clause grants the tenant the right to prolong their lease for an additional period, commonly under pre-established conditions negotiated at the signing of the original lease agreement. This clause often stipulates the notice period the tenant must adhere to and may outline the terms, such as rental rates or duration, applicable during the extension period.
An "Option to Renew" clause allows a contract to be extended beyond its original term under specified conditions, typically at the discretion of one or both parties. It typically outlines the process for renewal, including notification requirements and any changes to terms or pricing.
The "Option to Renew" clause in a contract grants one or both parties the right to extend the agreement's term under specified conditions before it expires. This clause typically outlines the notice period for exercising the option and any changes to terms, such as pricing, for the renewal period.
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