<PAGE>
As filed with the Securities and Exchange Commission on January 26, 2000.
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
January 26, 2000 (January 26, 2000)
MEDAREX, INC.
(Exact name of registrant as specified in its charter)
New Jersey 0-19312 22-2822175
(State of other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
707 State Road, #206, Princeton, NJ 08540
(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (908) 713-6001
1545 Route 22 East, Annandale, New Jersey 08801-0953
(Former address)
<PAGE>
MEDAREX, INC.
TABLE OF CONTENTS
FOR
CURRENT REPORT ON FORM 8-K
<TABLE>
<S> <C>
Item 5. Other Events................................. 3
Item 7. Financial Statements and Exhibits............ 4
Signature ............................................. 5
</TABLE>
<PAGE>
Item 5. Other Events.
This Current Report Form 8-K is being submitted in order to file certain
material contracts entered into by Medarex, Inc., and/or its wholly-owned
subsidiary, GenPharm International, Inc.
<PAGE>
Item 7. Financial Statements and Exhibits.
(c) Exhibits. The following materials are filed as exhibits to
this Current Report on Form 8-K:
Exhibit
Number Description of Exhibit
- ------- ----------------------
10.1 Evaluation and Commercialization Agreement effective as
of May 4, 1998 between Medarex, Inc., a Delaware
corporation (the "Company"), and ErythroMed, Inc.
(which subsequently changed its name to EluSys
Therapeutics Inc.).
10.2 Research and Commercialization Agreement dated as of
July 9, 1998 between GenPharm International, Inc.
("GenPharm"), a wholly-owned subsidiary of the Company,
the Company and Fibrogen Inc. and its wholly-owned
subsidiary, FibroPharma, Inc.
10.3 Evaluation, Research and Commercialization Agreement
effective as of January 11, 1999 among GenPharm, the
Company and Immunex Corporation, a Washington
corporation.
10.4 Amendment No. 1 effective January 1999 to the Research
and Commercialization Agreement dated as of February 9,
1998 among Schering AG, GenPharm and the Company.
10.5 Evaluation and Commercialization Agreement effective as
of February 24, 1999 between the Company and
Leukosite, Inc.
10.6 Collaboration and License Agreement dated as of March
29, 1999 between NeXstar Pharmaceuticals, Inc. and the
Company.
10.7 Research and Commercialization Agreement dated as of
August 2, 1999 between GenPharm and EOS Biotechnology,
Inc.
10.8 Research and Commercialization Agreement effective as
of September 21, 1999 among the Company, GenPharm and
Amgen Inc.
10.9 Agreement dated December 21, 1999 among the Company,
GenPharm and Immuno-Designed Molecules S.A.
10.10 Agreement on Essential Terms for Collaboration
effective as of December 27, 1999 among the Company,
GenPharm and Kirin Brewery Co., Ltd.
10.11 Binding Letter of Intent dated January 3, 2000
among the Company, GenPharm and Scil Biomedicals GmbH.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MEDAREX, INC.
Registrant
Date: January 26, 2000 By: /s/ Donald L. Drakeman
-------------------------------------
Donald L. Drakeman
President, Chief Executive Officer
and Director
<PAGE>
EXHIBIT INDEX
-------------
EXHIBIT PAGE
NUMBER DESCRIPTION NUMBER
- ------- ----------- ------
10.1 Evaluation and Commercialization Agreement effective as
of May 4, 1998 between Medarex, Inc., a Delaware
corporation (the "Company"), and ErythroMed, Inc.
(which subsequently changed its name to EluSys
Therapeutics Inc.).
10.2 Research and Commercialization Agreement dated as of
July 9, 1998 between GenPharm International, Inc.
("GenPharm"), a wholly-owned subsidiary of the Company,
the Company and Fibrogen Inc. and its wholly-owned
subsidiary, FibroPharma, Inc.
10.3 Evaluation, Research and Commercialization Agreement
effective as of January 11, 1999 among GenPharm, the
Company and Immunex Corporation, a Washington
corporation.
10.4 Amendment No. 1 effective January 1999 to the Research
and Commercialization Agreement dated as of February 9,
1998 among Schering AG, GenPharm and the Company.
10.5 Evaluation and Commercialization Agreement effective as
of February 24, 1999 between the Company and
Leukosite, Inc.
10.6 Collaboration and License Agreement dated as of March
29, 1999 between NeXstar Pharmaceuticals, Inc. and the
Company.
10.7 Research and Commercialization Agreement dated as of
August 2, 1999 between GenPharm and EOS Biotechnology,
Inc.
10.8 Research and Commercialization Agreement effective as
of September 21, 1999 among the Company, GenPharm and
Amgen Inc.
10.9 Agreement dated December 21, 1999 among the Company,
GenPharm and Immuno-Designed Molecules S.A.
10.10 Agreement on Essential Terms for Collaboration
effective as of December 27, 1999 among the Company,
GenPharm and Kirin Brewery Co., Ltd.
10.11 Binding Letter of Intent dated January 3, 2000
among the Company, GenPharm and Scil Biomedicals GmbH.
<PAGE>
Exhibit 10.1
------------
EVALUATION AND COMMERCIALIZATION AGREEMENT
THIS EVALUATION AND COMMERCIALIZATION AGREEMENT (the "Agreement"),
effective as of May 4, 1998 (the "Effective Date"), is entered by and between
Medarex, Inc., a New Jersey corporation, with a principal place of business at
1545 Route 22 East, Annandale, New Jersey 08801 ("Medarex"), and ErythroMed,
Inc. ("ErythroMed") with a principal place of business at c/o Athena Ventures,
LLC, 660 Madison Avenue, New York, NY 10021.
BACKGROUND
A. Medarex is the sole and exclusive owner of certain transgenic Mice
useful for the preparation of fully human monoclonal antibodies;
B. ErythroMed desires to use the Mice to evaluate their utility for the
development of fully human monoclonal antibodies to [*****] and Medarex is
wiling to provide Mice to ErythroMed for such evaluation, on the terms and
conditions herein;
C. ErythroMed wishes to acquire from Medarex an option to acquire a
commercial license for the use of such monoclonal antibodies to commercialize
Products (as defined below), on the terms and conditions herein; and
NOW, THEREFORE, Medarex and ErythroMed agree as follows:
1. DEFINITIONS
1.1 "Affiliate" shall mean any corporation or other entity which is
---------
directly controlling or controlled by ErythroMed. For the purpose of this
Agreement, "control" shall mean the direct ownership of fifty percent (50%) or
more of the outstanding shares or other voting rights of the subject entity to
elect directors.
1.2 "Antibody" shall mean a human monoclonal antibody with binding
--------
affinity for an Antigen derived by ErythroMed or its Affiliates or Sublicensees
from cells obtained from one or more of the Mice.
1.3 "Antigen" shall mean[*****]
-------
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
1.4 "Biological License Application "or "BLA" shall mean Biological
------------------------------- ---
License Application as defined in the U.S. Food, Drug and Cosmetic Act and the
regulations promulgated thereunder, and any corresponding foreign application,
registration or certification.
1.5 "Confidential Information" shall mean (i) any proprietary or
------------------------
confidential information or material in tangible form disclosed hereunder that
is marked as "Confidential" at the time it is delivered to the receiving party,
or (ii) proprietary or confidential information disclosed orally hereunder which
is identified as confidential or proprietary when disclosed and such disclosure
of confidential information is confirmed in writing within thirty (30) days by
the disclosing party.
1.6 "Control" shall mean possession of the ability to grant the licenses
-------
or sublicenses as provided for herein without violating the terms of any
agreement or other arrangement with any third party.
1.7 "Delivery Date" shall mean the date that Medarex first delivers
-------------
[*****] Mice to ErythroMed.
1.8 "Evaluation" shall mean the activities conducted by ErythroMed in the
----------
Evaluation Period in connection with its assessment of the usefulness of the
Mice to produce Antibodies.
1.9 "Evaluation Period" shall mean the period from the Delivery Date until
-----------------
[*****] after the Delivery Date.
1.10 External Valuation" shall mean the per share price established by the
------------------
most recent equity investment in ErythroMed by an independent third party in an
arm's length transaction in excess of [*****] provided, however, that if, at the
time of the event giving rise to such valuation, ErythroMed shall have publicly
traded Common Stock, the External Valuation shall be [*****] of the average bid
price of ErythroMed's Common Stock during the [*****] period preceding such
event giving rise to such valuation or, if such public market has not existed
through such [*****] period, then the public offering prices for such shares
occurring during such period. All such shares to be issued to Medarex while
ErythroMed has publicly traded Common Stock shall be fully paid, nonassessable,
registered and freely tradeable shares without restrictions.
1.11 "Medarex Technology" shall mean the Patent Rights and Know How.
------------------
1.11.1 "Know How" shall mean the Confidential Information and Mice
--------
owned or Controlled by Medarex and transferred to ErythroMed by Medarex
necessary and required for the exercise of the Patent Rights, including, without
limitation, technical data, protocols and methods and processes. For the
avoidance of doubt, the Know How does not include any Patent Rights.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-2-
<PAGE>
1.11.2 "Patent Rights" shall mean all United States and foreign
-------------
patents (including all reissues, extensions, substitutions, confirmations, re-
registrations, re-examinations, revalidations and patents of addition) and
patent applications (including, without limitation, all continuations,
continuations-in-part and divisions thereof) owned or Controlled by Medarex, in
each case, which claims an invention which is necessary and required for the use
of the Mice to prepare and use the Antibodies.
1.12 "IND" shall mean an Investigational New Drug application, as defined
---
in the U.S. Food, Drug and Cosmetic Act and the regulations promulgated
thereunder, or any corresponding foreign application, registration or
certification.
1.13 "Mice" shall mean immunizable sterile transgenic mice containing
----
unrearranged human immunoglobulin genes.
1.14 "Mice Materials" shall mean any parts or derivatives of the Mice,
--------------
including without limitation, cells, hybridomas Antibodies, genes, DNA sequences
or other biological materials derived directly or indirectly from the Mice.
1.15 "Net Sales" shall mean [*****]
---------
1.16 "ErythroMed" shall mean ErythroMed, Inc., a Delaware corporation.
----------
1.17 "Phase I", "Phase II"and "Phase III" shall mean Phase I (or Phase
------- -------- ---------
I/II), Phase II, and Phase III clinical trials, respectively, in each case as
prescribed by the U.S. Food and Drug Administration or a corresponding foreign
entity.
1.18 "Product" shall mean any product [*****]
-------
1.19 "Sublicensee" shall mean a third party to whom ErythroMed has
-----------
granted a license or sublicense to make, have made, import, use, sell, offer for
sale or otherwise exploit Products in the Territory. As used in this Agreement,
"Sublicensee" shall also include a third party to whom ErythroMed has granted
the right to distribute a Product.
1.20 "Territory" shall mean all countries of the world.
---------
2. (Deleted)
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-3-
<PAGE>
3. EVALUATION
3.1 Evaluation. In order to allow ErythroMed to utilize the Mice to
----------
prepare Antibodies against the Antigens for the purpose of determining whether
ErythroMed wishes to obtain a commercial license to use the Mice to develop and
commercialize Products, Medarex will provide Mice to ErythroMed for use during
the Evaluation Period pursuant to the terms of this Article 3.
3.2 Technology Access Fee. Within [*****] following the date that
---------------------
ErythroMed enters into a written agreement with [*****]
3.3 Provision of Mice. Medarex shall provide ErythroMed with up to [*****]
-----------------
Mice, with the first[*****] such mice being shipped within [*****] after the
Effective Date. If any such mice die of natural causes before commencement of
the immunization protocol or for any reason during the immunization protocol,
provided that their death was not due to ErythroMed's misfeasance or negligence,
they shall be replaced without cost by Medarex. Subsequent shipments of Mice
shall be in quantities and at times agreed by the parties. ErythroMed agrees
that the Mice will be used solely for the purpose of creating Antibodies for the
Evaluation and for no other purpose.
3.4 Ownership.
---------
3.4.1 Mice. Title to the Mice and Mice Materials shall at all times
----
remain with Medarex.
3.4.2 [*****]
3.4.3 Delivery. ErythroMed shall promptly deliver to Medarex any Mice
--------
Materials prepared or isolated by ErythroMed.
3.5 Limited Use. ErythroMed shall not breed Mice, use them for any
-----------
purpose other than the conduct of the Evaluation, or transfer them to any other
person or entity or to any place other than ErythroMed's facilities. ErythroMed
shall not make any effort, directly or indirectly, to reproduce or clone or
otherwise propagate the Mice by any means, sexual or asexual. In no event shall
ErythroMed transfer the Mice to any person or entity without the prior written
approval of Medarex.
3.6 Care in Use of Mice. It is understood and agreed that the Mice are
-------------------
experimental in nature and may have unknown characteristics and ErythroMed
therefore agrees to use prudence and reasonable care in the use, handling,
storage, transportation and disposition and containment of the Mice, and to
maintain and propagate the Mice under suitable containment conditions, in
compliance with all applicable national, state and local laws, regulations,
rules and ordinances.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-4-
<PAGE>
4. OPTION; COMMERCIAL LICENSE
4.1 Election. [*****] after the Delivery Date, ErythroMed may elect, with
--------
notice to Medarex, to: (i) terminate the Agreement pursuant to Section 15.4.1 or
(ii) enter into a commercial license pursuant to Section 4.2.
4.2 Option; License.
---------------
4.2.1 Option. During the Evaluation Period, ErythroMed shall have an
------
option to obtain an exclusive, worldwide commercial license as set forth in
Section 4.2.2 solely to use the Mice to develop Antibodies for use in the
development and commercialization of Products.
4.2.2 Commercial License. If ErythroMed elects to exercise its option
------------------
to acquire a commercial license, subject to the terms and conditions of this
Agreement, including without limitation, the timely payment of the license fee
due pursuant to Section 5.1, Medarex shall grant to ErythroMed the following
licenses:
(a) an exclusive, worldwide, non-transferable, royalty bearing
license under the Medarex Technology to use the Mice to make Antibodies, and
(b) an exclusive, worldwide, royalty bearing license under the
Medarex Technology, with the right to sublicense, to use such Antibodies to
make, have made, import, have imported, use, offer for sale and sell Products.
4.3 [*****]
4.4 Title. If ErythroMed acquires a commercial license pursuant to Section
-----
4.2.2, title to all Antibodies and cells capable of producing Antibodies
obtained by ErythroMed during the Evaluation Period and the term of such license
shall be vested in ErythroMed, subject to the license granted Medarex in Section
4.3 above.
4.5 Retained Rights; No Further Rights. Only the license granted pursuant
----------------------------------
to the express terms of this Agreement shall be of any legal force or effect. No
other license rights shall be granted or created by implication, estoppel or
otherwise. It is understood and agreed that Medarex shall retain rights to make,
have made, import, use, offer for sale, sell and otherwise commercialize the
Mice itself or with third parties for any uses.
4.6 Use of Mice. Any use of the Mice by ErythroMed or its Affiliates or
-----------
Sublicensees pursuant to a license granted pursuant to Section 4.2.2 shall be
subject to the provisions of Sections 3.4.3, 3.5 and 3.6.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-5-
<PAGE>
5. CONSIDERATION
5.1 License Fee. If ErythroMed acquires a commercial license from Medarex
-----------
pursuant to Section 4.2.2 above, ErythroMed shall pay to Medarex a license fee
of [*****]. Such amount shall be paid to Medarex on or before the earlier of
[*****]
5.2 Milestone Payments. Within thirty (30) days following the occurrence
------------------
of the relevant events specified below with respect to Products, ErythroMed
shall pay to Medarex the following amounts:
Milestones Amount
[*****]
5.3 Royalties.
---------
5.3.1 Royalty net sales. In partial consideration for the commercial
-----------------
license,ErythroMed shall pay to Medarex a royalty on aggregate Net Sales of
Products on a Product-by- Product basis, as follows:
Aggregate Net Sales Royalty Rate
------------------- ------------
[*****]
5.3.2 Royalty Term. The royalties due pursuant to Section 4.2 shall
------------
be payable on a country-by-country basis until [*****]
5.4 Registration Rights. Medarex shall be granted the same registration
-------------------
rights as are provided to the other holders of the common shares of ErythroMed.
5.5 Sublicensees. [*****]
------------
5.6 Third Party Payments. In addition to the foregoing, ErythroMed shall
--------------------
also make, or shall cause its Affiliates or Sublicensees to make, all payments
to third parties for any amounts that may be owed by Medarex or GenPharm
International and that are required as a result of the sale of any Products by
ErythroMed, Affiliates or Sublicensees. Any such payments by ErythroMed, or its
Affiliates or Sublicensees, shall not be deducted from any amounts due Medarex
hereunder, and notice of all such payments shall be given to Medarex at the time
made.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-6-
<PAGE>
6. PAYMENTS
6.1 Timing of Royalty Payments. All royalties due to Medarex shall be
--------------------------
paid within [*****]
6.2 Payment Method. All amounts due Medarex hereunder shall be paid in
--------------
U.S. dollars by wire transfer in immediately available funds to an account
designated by Medarex.
6.3 Currency; Foreign Payments. If any currency conversion shall be
--------------------------
required in connection with the payment of any royalties hereunder, such
conversion shall be made by using the exchange rate for the purchase of U.S.
dollars reported by the Chase Manhattan Bank on the last business day of the
calendar quarter to which such royalty payments relate. If at any time legal
restrictions prevent the prompt remittance of any royalties owed on Net Sales in
any jurisdiction, ErythroMed may notify Medarex and make such payments by
depositing the amount thereof in local currency in a bank account or other
depository in such country in the name of Medarex, and ErythroMed shall have no
further obligations under this Agreement with respect thereto.
6.4 Taxes. All royalty amounts required to be paid to Medarex pursuant to
-----
this Agreement may be paid with deduction for withholding for or on account of
any taxes (other than taxes imposed on or measured by net income) or similar
governmental charge imposed by a jurisdiction other than the United States
("Withholding Taxes"). At Medarex's request, ErythroMed shall provide Medarex a
certificate evidencing payment of any Withholding Taxes hereunder and shall
reasonably assist Medarex to obtain the benefit of any applicable tax treaty.
7. REPORTS AND RECORDS
7.1 Royalty Reports. ErythroMed shall deliver to Medarex within [*****]
---------------
after the end of the calendar quarter in which Products are sold a report
setting forth in reasonable detail the calculation of the royalties payable to
Medarex for such calendar quarter, including the Products sold in each country
by ErythroMed and its Sublicensees, the Net Sales thereof, and all amounts
received from Sublicensees for sales of Products. Such reports shall be
Confidential Information of ErythroMed subject to Article 10 herein.
7.2 Inspection of Books and Records. ErythroMed shall maintain accurate
-------------------------------
books and records which enable the calculation of royalties payable hereunder to
be verified. ErythroMed shall retain the books and records for each quarterly
period for [*****] after the submission of the corresponding report under
Section 7.1 hereof. [*****], upon [*****] prior notice to ErythroMed,
independent accountants selected by Medarex, may have access to ErythroMed's
books and records during ErythroMed's normal business hours to conduct a review
or audit, for the purpose of verifying the accuracy of ErythroMed's payments and
compliance with this Agreement. Any such
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-7-
<PAGE>
inspection or audit shall be at Medarex's expense, however, in the event an
inspection reveals underpayment of [*****] or more in any audit period,
ErythroMed shall pay the costs of the inspection [*****]
8. ANTIBODY SUPPLY
8.1 Hybridoma Development. Medarex will, at the request and expense of
---------------------
ErythroMed, develop up to one (1) hybridoma for ErythroMed for the production of
such Antibody for incorporation into Products. To allow the development of the
new ErythroMed identified hybridomas to commence, ErythroMed will delivery
hybridomas to Medarex at its convenience. Upon delivery of the hybridomas to
Medarex, ErythroMed will pay to Medarex [*****] for such development work until
completed. [*****]
8.2 Clinical Trial Materials.
------------------------
8.2.1 Manufacture by Medarex. [*****] All such Antibodies
----------------------
manufactured by or on behalf of Medarex for all such clinical trials will
conform to all pertinent FDA requirements relating to Good Manufacturing
Practices.
8.2.2 Quantity; Payments. As soon as reasonably practicable
------------------
following ErythroMed's request, Medarex will provide to ErythroMed [*****]
8.3 Manufacture of Commercial Supplies. [*****]
----------------------------------
9. DILIGENCE
9.1 [*****]
9.2 Reports to Medarex. During the term of this Agreement, ErythroMed
------------------
shall keep Medarex fully informed of its activities subject to this Agreement,
including without limitation, the commercialization of Products, and on January
31 of each year shall provide Medarex with a written report detailing such
events and activities. When the registration package requesting approval for
commercial sale of the Product (including approval for reimbursement by the
appropriate health insurance authorities as well as price approvals where
required) is first filed in the U.S., the European Union and Japan, and in each
case when approval is received therefor, ErythroMed will notify Medarex in
writing within [*****].
9.3 [*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-8-
<PAGE>
10. CONFIDENTIALITY
10.1 Confidential Information. Except as expressly provided herein, the
------------------------
parties agree that, for the term of this Agreement and for five (5) years
thereafter, the receiving party shall keep completely confidential and shall not
publish or otherwise disclose and shall not use for any purpose except for the
purposes contemplated by this Agreement any Confidential Information furnished
to it by the disclosing party hereto pursuant to this Agreement, except that to
the extent that it can be established by the receiving party by competent proof
that such Confidential Information:
(i) was already known to the receiving party, other than under an
obligation of confidentiality, at the time of disclosure;
(ii) was generally available to the public or otherwise part of the
public domain at the time of its disclosure to the receiving party;
(iii) became generally available to the public or otherwise part of
the public domain after its disclosure and other than through any act or
omission of the receiving party in breach of this Agreement;
(iv) was independently developed by the receiving party as
demonstrated by documented evidence prepared contemporaneously with such
independent development; or
(v) was subsequently lawfully disclosed to the receiving party by a
person other than a party hereto.
10.2 Permitted Use and Disclosures. Each party hereto may use or disclose
-----------------------------
information disclosed to it by the other party to the extent such use or
disclosure is reasonably necessary in complying with applicable governmental
regulations or otherwise submitting information to tax or other governmental
authorities, conducting clinical trials, or making a permitted sublicense or
otherwise exercising its rights hereunder, provided that if a party is required
to make any such disclosure of another party's confidential information, other
than pursuant to a confidentiality agreement, it will give reasonable advance
notice to the latter party of such disclosure and, save to the extent
inappropriate in the case of patent applications, will use its best efforts to
secure confidential treatment of such information prior to its disclosure
(whether through protective order or otherwise).
10.3 Public Disclosure Except as otherwise required by law, neither party
-----------------
shall issue a press release or make any other public disclosure of the terms of
this Agreement without the prior approval of such press release or public
disclosure. Each party shall submit any such press release or public disclosure
to the other party, and the receiving party shall have fifteen (15) days to
review and approve any such press release or public disclosure, which approval
shall not be unreasonably withheld. If the receiving party does not respond
within such fifteen (15) day period, the press release or public disclosure
shall be deemed approved. In addition, if a public disclosure is required by
law, including without limitation in a filing with the Securities and Exchange
Commission, the
-9-
<PAGE>
disclosing party shall provide copies of the disclosure reasonably in advance of
such filing or other disclosure for the nondisclosing party's prior review and
comment.
10.4 Confidential Terms. Except as expressly provided herein, each party
------------------
agrees not to disclose any terms of this Agreement to any third party without
the consent of the other party; provided, disclosures may be made as required by
securities or other applicable laws, or to actual or prospective investors or
corporate partners, or to a party's accountants, attorneys and other
professional advisors.
11. REPRESENTATIONS AND WARRANTIES
11.1 Medarex. Medarex represents and warrants that: (i) it is a
-------
corporation duly organized validly existing and in good standing under the laws
of the State of New Jersey; (ii) the execution, delivery and performance of this
Agreement have been duly authorized by all necessary corporate action on the
part of Medarex; (iii) it is the sole and exclusive owner of all right, title
and interest in the Mice; and (iv) it has the right to grant the rights and
licenses granted herein.
11.2 ErythroMed. ErythroMed represents and warrants that: (i) it is a
----------
corporation duly organized validly existing and in good standing under the laws
of the State of Delaware; and (ii) the execution, delivery and performance of
this Agreement have been duly authorized by all necessary corporate action on
the part of ErythroMed.
11.3 Disclaimer of Warranties. THE MICE ARE PROVIDED "AS IS", AND EXCEPT
------------------------
AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, MEDAREX AND ITS RESPECTIVE
AFFILIATES MAKE NO REPRESENTATIONS AND EXTEND NO WARRANTIES OR CONDITIONS OF ANY
KIND, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THE MICE, ANTIBODIES, OR
MEDAREX TECHNOLOGY, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF THE PATENT RIGHTS
LICENSED HEREUNDER, OR NONINFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF
THIRD PARTIES.
11.4 Disclaimer. Nothing in this Agreement is or shall be construed as:
----------
(a) A warranty or representation by Medarex as to the validity or
scope of any claim or patent within the Patent Rights;
(b) A warranty or representation that anything made, used, sold, or
otherwise disposed of under any license granted in this
Agreement is or will be free from infringement of any patent
rights or other intellectual property right of any third party;
(c) An obligation to bring or prosecute actions or suits against
third parties for infringement of any of the Patent Rights; or
-10-
<PAGE>
(d) Granting by implication, estoppel, or otherwise any licenses or
rights under patents or other rights of Medarex or third
parties, regardless of whether such patents or other rights are
dominant or subordinate to any patent with in the Patent
Rights.
12. INTELLECTUAL PROPERTY
12.1 [*****]
12.2 [*****]
12.3 [*****]
12.4 Infringement Claims. If the manufacture, importation, sale or use of
-------------------
the Product pursuant to this Agreement results in any claim, suit or proceeding
alleging patent infringement against Medarex or ErythroMed, such party shall
promptly notify the other party hereto. The defendant shall keep each other
party hereto reasonably informed of all material developments in connection with
any such claim, suit or proceeding.
13. DISPUTE RESOLUTION
13.1 Mediation. If a dispute arises out of or relates to this Agreement,
---------
or the breach thereof, and if said dispute cannot be settled through
negotiation, the parties agree first to try in good faith to settle the dispute
by mediation under the Commercial Mediation Rules of the American Arbitration
Association, before resorting to arbitration, litigation, or some other depute
resolution procedure.
13.2 Arbitration. Subject to Section 16.6, Medarex and ErythroMed agree
-----------
that any dispute or controversy arising out of, in relation to, or in connection
with this Agreement, or the validity, enforceability, construction, performance
or breach thereof, shall be settled by binding arbitration in New York, New
York, United States of America, under the then-current Rules of Commercial
Arbitration of the American Arbitration Association by one (1) arbitrator
appointed in accordance with such Rules. The arbitrators shall determine what
discovery will be permitted, based on the principle of limiting the cost and
time which the parties must expend on discovery; provided, the arbitrators shall
permit such discovery as they deem necessary to achieve an equitable resolution
of the dispute. The decision and/or award rendered by the arbitrator shall be
written, final and non-appealable and may be entered in any court of competent
jurisdiction. The parties agree that, any provision of applicable law
notwithstanding, they will not request, and the arbitrator shall have no
authority to award, punitive or exemplary damages against any party. The costs
of any arbitration,
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-11-
<PAGE>
including administrative fees and fees of the arbitrator, shall be shared
equally by the parties. Each party shall bear the cost of its own attorneys'
fees and expert fees.
14. INDEMNIFICATION
14.1 Medarex. Medarex shall indemnify, defend and hold harmless ErythroMed
-------
and its directors, officers and employees (each a "ErythroMed Indemnitee") from
and against any and all liabilities, damages, losses, costs or expenses
(including attorneys' and professional fees and other expenses of litigation
and/or arbitration) (a "Liability") resulting from a claim, suit or proceeding
made or brought by a third party against an ErythroMed Indemnitee arising from
or occurring as a result of any breach of the representations and warranties set
forth in Section 11.1, except to the extent caused by the negligence or willful
misconduct of ErythroMed,
14.2 ErythroMed. ErythroMed shall indemnify, defend and hold harmless
----------
Medarex and its directors, officers and employees (each a "Medarex Indemnitee")
from and against any and all liabilities, damages, losses, costs or expenses
(including attorneys' and professional fees and other expenses of litigation
and/or arbitration) (a "Liability") resulting from a claim, suit or proceeding
made or brought by a third party against a Medarex Indemnitee, arising from or
occurring as a result of (i) any breach of the representations and warranties
set forth in Section 11.2, (ii) the conduct of the Evaluation or the practice by
ErythroMed of any right granted herein, or (iii) any development, testing,
manufacture, importation, use, offer for sale, sale or other distribution of any
Product by ErythroMed or its Affiliates or Sublicensees (including, without
limitation, product liability claims), except in each case to the extent caused
by the negligence or willful misconduct of Medarex.
14.3 Procedure. In the event that any indemnitee intends to claim
---------
indemnification under this Article 14 it shall promptly notify the other party
(the "Indemnitor") in writing of such alleged Liability. The Indemnitor shall
have the sole right to control the defense and settlement thereof. The
Indemnities shall cooperate with the Indemnitor and its legal representatives in
the investigation of any action, claim or liability covered by this Article 14.
The Indemnitee shall not, except at its own cost, voluntarily make any payment
or incur any expense with respect to any claim or suit without the prior written
consent of the Indemnitor, which the Indemnitor shall not be required to give.
15. TERM AND TERMINATION
15.1 Term. The term of this Agreement shall commence on the Effective Date
----
Unless earlier terminated as provided in this Article 15, this Agreement shall
continue in full force and effect on a country-by-country and Product-by-Product
basis until there are no remaining royalty payment obligations in a country, at
which time the Agreement shall expire in its entirety in such country.[*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-12-
<PAGE>
15.2 Termination for Cause. Either party may terminate this Agreement in
---------------------
the event the other party has materially breached or defaulted in the
performance of any of its obligations hereunder, and such default has continued
for sixty (60) days after written notice thereof was provided to the breaching
party by the nonbreaching party. Any termination shall become effective at the
end of such sixty (60) day period unless the breaching Party has cured any such
breach or default prior to the expiration of the sixty (60) day period.
Notwithstanding the above, in the case of a failure to timely pay any amounts
due hereunder, the period for cure of any subsequent default following notice
thereof shall be [*****] and, unless payment is made within such period the
termination shall become effective at the end of such period.
15.3 Termination for Insolvency. If voluntary or involuntary proceeding by
--------------------------
or against a party are instituted in bankruptcy under any insolvency law, or a
receiver or custodian is appointed for such party, or proceedings are instituted
by or against such party for corporate reorganization or the dissolution of such
party, which proceedings, if involuntary, shall not have been dismissed within
sixty (60) days after the date of filing, or if such party makes an assignment
for the benefit of creditors, or substantially all of the assets of such party
are seized or attached and not released within sixty (60) days thereafter, the
other party may immediately terminate this Agreement effective upon notice of
such termination.
15.4 Permissive Termination.
----------------------
15.4.1 ErythroMed. ErythroMed may terminate this Agreement with
----------
thirty (30) days written notice to Medarex.
15.4.2 Medarex. In the event that ErythroMed fails to obtain a
-------
commercial license pursuant to Section 4.2 on or before the end of the
Evaluation Period, Medarex may terminate the Agreement with written notice.
15.5 Effect of Termination.
---------------------
(a) Accrued Rights and Obligations. Termination of this Agreement
------------------------------
for any reason shall not release any party hereto from any liability which, at
the time of such termination, has already accrued to the other party or which is
attributable to a period prior to such termination, nor preclude either party
from pursuing any rights and remedies it may have hereunder or at law or in
equity with respect to any breach of this Agreement. It is understood and agreed
that monetary damages may not be a sufficient remedy for any breach of this
Agreement and that the non-breaching party may be entitled to injunctive relief
as a remedy for any such breach.
(b) Return of Confidential Information. Upon any termination of
----------------------------------
this Agreement, ErythroMed and Medarex shall promptly return to the other party
all Confidential Information of the
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-13-
<PAGE>
other; provided counsel of each party may retain one (1) copy of such
Confidential Information for archival purposes and for ensuring compliance with
Article 10.
(c) Stock on Hand. In the event this Agreement is terminated for
-------------
any reason, ErythroMed shall have the right to sell or otherwise dispose of the
stock of any Product subject to this Agreement then on hand, subject to Articles
5, 6 and 7 until the first anniversary of the Effective Date of such
termination.
(d) Return of Mice and Mice Materials. Upon any termination of
---------------------------------
this Agreement, ErythroMed shall promptly return to Medarex, or destroy all
cultures of the Mice, and any Mice Materials, including, without limitation, all
Antibodies relating to such Product and other biological materials serviced from
Mice, and all cells capable of producing Antibodies relating to such Product,
and in the event of such destruction an officer of ErythroMed shall provide
Medarex with written certification thereof.
(e) Licenses. The license granted in Section 4.2 shall terminate
--------
upon any termination of this Agreement, and in such event, ErythroMed and its
Affiliates and Sublicensees shall cease all development and commercialization of
Products.
15.6 Survival. Sections 3.4, 4.3, 4.5, 15.5 and 15.6 and Articles 10, 11,
--------
12, 13, 14 and 16 of this Agreement shall survive termination of this Agreement
for any reason.
16. MISCELLANEOUS
16.1 Governing Law. This Agreement and any dispute, including without
-------------
limitation any arbitration, arising from the performance or breach hereof shall
be governed by and construed and enforced in accordance with the laws of the
state of New Jersey, without reference to conflicts of laws principles.
16.2 Independent Contractors. The relationship of the parties hereto is
-----------------------
that of independent contractors. The parties hereto are not deemed to be agents,
partners or joint venturers of the others for any purpose as a result of this
Agreement or the transactions contemplated thereby.
16.3 Assignment. This Agreement shall not be assignable by either party to
----------
any third party hereto without the written consent of the other party which
consent shall not be unreasonably withheld; except a party may assign this
Agreement, without such consent, to an entity that acquires all or substantially
all of the business or assets of such party to which this Agreement pertains,
whether by merger, reorganization, acquisition, sale or otherwise. This
Agreement shall be binding upon and inure to the benefit of the parties and
their successors and assigns.
16.4 Notices. All notices, requests and other communications hereunder
-------
shall be in writing and shall be personally delivered or sent by telecopy or
other electronic facsimile transmission or by registered or certified mail,
return receipt requested, postage prepaid, in each case to the
-14-
<PAGE>
respective address specified below, or such other address as may be specified in
writing to the other parties hereto:
If to Medarex: Medarex, Inc.
1545 Route 22 East
Annandale, New Jersey 08801
Attn.: President
If to ErythroMed: ErythroMed, Inc.
c/o Athena Ventures, L.L.C.
660 Madison Avenue
New York, NY 10021
Attn.: President
16.5 Force Majeure. Neither party shall lose any rights hereunder or be
-------------
liable to the other party for damages or losses (except for payment obligations)
on account of failure of performance by the defaulting party if the failure is
occasioned by war, strike, fire, Act of God, earthquake, flood, lockout,
embargo, governmental acts or orders or restrictions, failure of suppliers, or
any other reason where failure to perform is beyond the reasonable control and
not caused by the negligence, intentional conduct or misconduct of the
nonperforming party has exerted all reasonable efforts to avoid or remedy such
force majeure; provided, however, that in no event shall a party be required to
settle any labor dispute or disturbance.
16.6 Injunctive Relief. ErythroMed acknowledges that limitations and
-----------------
restrictions on its possession and use of Mice and Mice Materials hereunder are
necessary and reasonable to protect Medarex, and expressly agrees that monetary
damages would be inadequate to compensate Medarex for any violation by
ErythroMed of any such limitations or restrictions. The parties agree that any
such violation would cause irreparable injury to Medarex and agrees that without
resorting to prior mediation or arbitration, and, in addition to any other
remedies that may be available in law, in equity or otherwise, Medarex shall be
entitled to obtain temporary and permanent injunctive relief against any
threatened violation of such limitations or restrictions or the continuation of
any such violation in any court of competent jurisdiction, without the necessity
of proving actual damages or the posting of any bond.
16.7 Advice of Counsel. Medarex and ErythroMed have each consulted counsel
-----------------
of their choice regarding this Agreement, and each acknowledges and agrees that
this Agreement shall not be deemed to have been drafted by one party or another
and will be construed accordingly.
16.8 Compliance with Laws. Each party shall furnish to the other party any
--------------------
information requested or required by that party during the term of this
Agreement or any extensions hereof to enable that party to comply with the
requirements of any U.S. or foreign federal, state and/or government agency.
-15-
<PAGE>
16.9 Further Assurances. At any time or from time to time on and after the
------------------
date of this Agreement, either party shall at the request of the other party
hereto (i) deliver to the requesting party any records, data or other documents
consistent with the provisions of this Agreement, (ii) execute, and deliver or
cause to be delivered, all such consents, documents or further instruments of
transfer or license, and (iii) take or cause to be taken all such actions, as
the requesting party may reasonably deem necessary in order for the requesting
party to obtain the full benefits of this Agreement and the transactions
contemplated hereby.
16.10 Export Controls. ErythroMed agrees that it will take all actions
---------------
necessary to insure compliance with all U.S. laws, regulations, orders or other
restrictions on exports and further will not sell, license or reexport,
directly, or indirectly, the Product(s) to any person or entity for sale in any
country or territory, if, to the knowledge of ErythroMed based upon reasonable
inquiry, such sale, would cause the parties to be in violation of any such laws
or regulations now or hereafter in effect. ErythroMed agrees to secure from any
recipient of Product(s) adequate manually signed written assurances prior to
shipment from the United States as are required by the U.S. Export Regulations.
16.11 Severability. In the event that any provisions of this Agreement are
------------
determined to be invalid or unenforceable by a court of competent jurisdiction,
the remainder of the Agreement shall remain in full force and effect without
said provision. In such event, the parties shall in good faith negotiate a
substitute clause for any provision declared invalid or unenforceable, which
shall most nearly approximate the intent of the parties in entering this
Agreement.
16.12 Waiver. It is agreed that no waiver by either party hereto of any
------
breach or default of any of the covenants or agreements herein set forth shall
be deemed a waiver as to any subsequent and/or similar breach or default.
16.13 Complete Agreement. This Agreement, with its Exhibits, constitutes
------------------
the entire agreement, both written and oral, between the parties with respect to
the subject matter hereof, and that all prior agreements respecting the subject
matter hereof, either written or oral, expressed or implied, are merged and
canceled, and are null and void and of no effect. No amendment or change hereof
or addition hereto shall be effective or binding on either of the parties hereto
unless reduced to writing and duly executed on behalf of both parties.
16.14 Use of Name. Neither party shall use the name or trademarks of the
-----------
other party without the prior written consent of such other party.
16.15 Headings. The captions to the several Sections and Articles hereof
--------
are not a part of this Agreement, but are included merely for convenience of
reference only and shall not affect its meaning or interpretation.
16.16 Counterparts. This Agreement may be executed in two counterparts,
------------
each of which shall be deemed an original and which together shall constitute
one instrument.
-16-
<PAGE>
IN WITNESS WHEREOF, Medarex and ErythroMed have executed this Agreement by
their respective duly authorized representatives.
MEDAREX, INC. ERYTHROMED, INC.
By: /s/ Donald Drakeman By: /s/ Jeffrey Wolf
------------------------------- -------------------------------
Print Name: Donald Drakeman Print Name: Jeffrey Wolf
----------------------- -----------------------
Title: President Title: President
---------------------------- ----------------------------
-17-
<PAGE>
Exhibit 10.2
------------
CONFIDENTIAL
RESEARCH AND COMMERCIALIZATION AGREEMENT
THIS RESEARCH AND COMMERCIALIZATION AGREEMENT (the "Agreement"), effective
as of July 9, 1998, is entered by and between GenPharm International, Inc., a
wholly owned subsidiary of Medarex, Inc., and Medarex, Inc., a New Jersey
corporation, with a principal place of business at 1545 Route 22 East,
Annandale, New Jersey 08801 (together "Medarex"), and FibroGen, Inc. and its
wholly-owned subsidiary, FibroPharma, Inc., with a principal place of business
at 225 Gateway Boulevard, South San Francisco, California 94080 (together
"FibroGen").
BACKGROUND
A. Medarex is the sole and exclusive owner of certain transgenic Mice
useful for the preparation of fully human monoclonal antibodies;
B. FibroGen desires to have Medarex conduct research with the Mice for
the development of fully human monoclonal antibodies to certain Antigens (as
defined below) and to evaluate the utility of such antibodies as potential
therapeutics involved in fibrosis or fibroproliferative disease, and Medarex is
willing to conduct such Research, on the terms and conditions herein; and
C. FibroGen wishes to acquire from Medarex an option to acquire a
commercial license for the use of monoclonal antibodies with specificity for the
Antigens to commercialize Products (as defined below), on the terms and
conditions herein.
NOW, THEREFORE, Medarex and FibroGen agree as follows:
1. DEFINITIONS
1.1 "Affiliate" means any corporation or other entity which is directly or
---------
indirectly controlling, controlled by or under the common control with FibroGen.
For the purpose of this Agreement, "control" shall mean the direct or indirect
ownership of fifty percent (50%) or more of the outstanding shares or other
voting rights of the subject entity to elect directors, or if not meeting the
preceding, any entity owned or controlled by or owning or controlling at the
maximum control or ownership right permitted in the country where such entity
exists.
1.2 "Antibody" shall mean a human monoclonal antibody with binding
--------
affinity for an Antigen, which antibody is derived from cells obtained from one
or more of the Mice.
<PAGE>
1.3 "Antigen" shall mean each of [*****] antigens listed on Exhibit A
-------
hereto as such list may be revised from time to time by the mutual agreement of
the parties.
1.4 "Confidential Information" shall mean (i) any proprietary or
------------------------
confidential information or material in tangible form disclosed hereunder that
is marked as "Confidential" at the time it is delivered to the receiving party,
or (ii) proprietary or confidential information disclosed orally hereunder which
is identified as confidential or proprietary when disclosed and such disclosure
of confidential information is confirmed in writing within thirty (30) days by
the disclosing party.
1.5 "Control" or "Controlled" shall mean possession of the ability to
------- ----------
grant the licenses or sublicenses as provided for herein without violating the
terms of any agreement or other arrangement with any third party.
1.6 "Effective Date" means forty-five (45) days after the date of this
--------------
Agreement.
1.7 [*****]
1.8 "FibroGen Technology" shall mean all United States and foreign patents
-------------------
(including all reissues, extensions, substitutions, confirmations, re-
registrations, re-examinations, revalidations and patents of addition) and
patent applications (including, without limitation, all continuations,
continuations-in-part and divisions thereof) owned by FibroGen during the term
of the Agreement, in each case, which claims an invention which is necessary or
useful to make, use or sell Antibodies and/or Products.
1.9 "Medarex Fees" shall mean any commercial fee, milestone payment and
------------
[*****] any research support payment made by FibroGen to Medarex pursuant to
Sections 2.2, 4.1 and 4.2.
1.10 "Medarex Technology" shall mean the Patent Rights and Know How.
------------------
1.10.1 "Know How" shall mean the Confidential Information and Mice
--------
owned or Controlled by Medarex during the term of the Agreement and transferred
to FibroGen by Medarex necessary or useful for the exercise of the Patent
Rights, including, without limitation, technical data, protocols and methods and
processes. For the avoidance of doubt, the Know How does not include any Patent
Rights.
1.10.2 "Patent Rights" shall mean all United States and foreign
-------------
patents (including all reissues, extensions, substitutions, confirmations, re-
registrations, re-examinations, revalidations and patents of addition) and
patent applications (including, without limitation, all
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
continuations, continuations-in-part and divisions thereof) owned or Controlled
by Medarex during the term of the Agreement, in each case, which claims an
invention which is necessary or useful for the use of the Antibodies or the
hybridoma cell lines transferred hereunder to make, use or sell Products.
1.11 "Mice" shall mean immunizable transgenic mice containing unrearranged
----
human immunoglobulin genes.
1.12 "Mice Materials" shall mean any parts or derivatives of the Mice
--------------
prepared by Medarex in connection with the Research, including without
limitation, cells, hybridomas Antibodies, genes, DNA sequences or other
biological materials derived directly or indirectly from the Mice.
1.13 "Net Sales" shall mean [*****].
---------
1.14 "Phase I", "Phase II"and "Phase III" shall mean Phase I (or Phase
------- -------- ---------
I/II), Phase II, and Phase III clinical trials, respectively, in each case as
prescribed by the U.S. Food and Drug Administration or a corresponding foreign
entity.
1.15 "Product" shall mean any product for the treatment or diagnosis of
-------
human disease containing an Antibody provided by Medarex or produced from any
hybridoma provided by Medarex or a portion thereof.
1.16 "Research" shall mean the activities conducted by FibroGen and
--------
Medarex in the Research Period in connection with the development and assessment
of the usefulness and effectiveness of the Antibodies.
1.17 "Research Invention" shall mean any invention by Medarex or FibroGen
------------------
in connection with the performance of the Research.
1.18 "Research Period" shall mean the period from the Effective Date until
---------------
the earlier of (i) [*****], unless the Research Period is extended pursuant to
Section 2.6, [*****], or (ii) the termination of the Research or the Agreement.
1.19 "Sublicensee" shall mean a third party (except an Affiliate) to whom
-----------
FibroGen has granted a license or sublicense to make, have made, import, use,
sell, offer for sale or otherwise exploit Products in the Territory. As used in
this Agreement, "Sublicensee" shall also
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
include a third party (except an Affiliate) to whom FibroGen has granted the
right to distribute a Product.
1.20 "Sublicensee Revenues" shall mean [*****].
--------------------
1.21 "Territory" shall mean all countries of the world.
---------
2. RESEARCH
2.1 Research. Subject to the terms and conditions set forth herein,
--------
during the Research Period Medarex will immunize Mice with up to [*****]
Antigens selected by FibroGen to produce Antibodies for evaluation by FibroGen
for commercial development. FibroGen shall have the right to have immunizations
for up to [*****] Antigens conducted concurrently. FibroGen shall be entitled to
have Medarex immunize a total of [*****] Mice each year; provided, however, that
with respect to [*****] Antigens to be selected by FibroGen ("Special
Antigens"), Medarex shall immunize [*****] Mice for each of the Special
Antigens. In any year in which immunizations for a Special Antigen are
conducted, the number of Mice which Medarex is obligated to immunize Mice
against Antigens other than Special Antigens shall be reduced by [*****] Mice
for each Special Antigen for which immunizations are conducted in such year. For
the remaining Antigens with respect to which immunizations are conducted,
Medarex shall immunize a minimum of [*****] Mice with the applicable Antigen.
[*****] Medarex shall use reasonably diligent efforts to conduct the Research in
a professional manner and agrees to commit the personnel, facilities and other
resources necessary to perform its obligations under the Research and the work
plan attached hereto as Exhibit B; provided, however, it does not warrant that
the Research shall result in the preparation of any Antibody suitable for
development as a Product [*****].
2.2 Research Support. During the Research, FibroGen shall pay to Medarex
----------------
a quarterly research support payment of [*****]. The first payment shall be due
forty-five (45) days from the Effective Date, and subsequent payments shall be
due on the quarterly anniversary thereof unless [*****]; provided that Medarex
is not in breach of this Agreement. However, if FibroGen fails to make any
research support payment for any reason, Medarex shall have no obligation to
conduct any further Research activities.
2.3 Identification and Delivery of Antigens. FibroGen shall promptly
---------------------------------------
notify Medarex of each Antigen prior to immunization of the Mice in the Research
and deliver to Medarex a mutually agreed quantity of such Antigen in a
substantially pure form prior to the immunization.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
2.4 Delivery of Antibodies. Upon the preparation of an Antibody for each
----------------------
Antigen, Medarex shall deliver to FibroGen [*****] of such Antibody and a
hybridoma cell line producing such Antibody for evaluation by FibroGen.
2.5 Research License. Medarex hereby grants to FibroGen and its
----------------
Affiliates an [*****] license solely to use the Antibodies and hybridoma cell
lines producing such Antibodies prepared by Medarex in connection with the
Research for research and evaluation purposes; [*****].
2.6 Research Period.
---------------
2.6.1 [*****]
2.6.2 Extension. With notice to Medarex at least thirty (30) days
---------
prior to [*****], FibroGen may extend the term of the Research until [*****]
and, with notice to Medarex at least thirty (30) days prior to [*****], FibroGen
may further extend the term of the Research until [*****], and in each case,
FibroGen shall continue to make quarterly research support payments as provided
in Section 2.2. If FibroGen (i) extends the Research Period for [*****], and
(ii) exercises its option and acquires a commercial license pursuant to Section
3.1.2, then FibroGen shall [*****].
2.6.3 If No Extension; [*****]. If FibroGen fails to provide Medarex
------------------------
with notice at least thirty (30) days prior to [*****] that it will not extend
the Research for [*****], then before [*****], if FibroGen has exercised its
option and acquires a commercial license pursuant to Section 3.1.2, FibroGen
[*****].
2.6.4 [*****]
2.6.5 [*****]
2.7 Ownership.
---------
2.7.1 Mice. Except as provided in Section 3.3, title to the Mice and
----
Mice Materials shall at all times remain with Medarex.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
2.7.2 Intellectual Property.
---------------------
[*****]
2.7.3 [*****]
3. OPTION; COMMERCIAL LICENSE
3.1 Option; License.
---------------
3.1.1 Option. During the Research Period, FibroGen shall have an
------
option to obtain an exclusive (even as to Medarex), worldwide commercial license
as set forth in Section 3.1.2 solely to develop Antibodies for use in the
development and commercialization of Products. FibroGen may exercise such option
by notice to Medarex during the Research Period specifying [*****] to be covered
by the commercial license and concurrently paying to Medarex the applicable
license fee due pursuant to Section 4.1. If FibroGen has not previously
exercised its option to acquire a commercial license and achieves any milestone
subject to Section 4.2, then FibroGen shall be deemed to have exercised its
option to acquire a commercial license and shall pay to Medarex the commercial
license fee due pursuant to Section 4.1 within thirty (30) days of the
achievement of such milestone, in addition to the applicable milestone fee due
pursuant to Section 4.2.
3.1.2 Commercial License. Effective upon FibroGen's election to
------------------
acquire a commercial license, subject to the terms and conditions of this
Agreement, including without limitation, the payment of the license fee set
forth in Section 4.1, Medarex grants to FibroGen and its Affiliates the
following licenses:
(a) an exclusive, worldwide, non-transferable (except as set forth
in Section 14.3), royalty bearing license under the Medarex Technology with the
right to sublicense, to use hybridomas delivered by Medarex to FibroGen to make
or have made Antibodies, and
(b) an exclusive, worldwide, non-transferable (except as set forth
in Section 14.3), royalty bearing license under the Medarex Technology with the
right to sublicense, to use Antibodies made in the Research to make, have made,
import, have imported, use, offer for sale and sell Products.
During the term of the commercial licenses above, Medarex shall not grant
any third party a license under the Medarex Technology which covers Antigens to
which Antibodies have been made in the Research or Mice Materials developed in
connection with the Research.
3.2 [*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
3.3 Title. If FibroGen acquires a commercial license pursuant to Section
-----
3.1.2, title to all Antibodies and cells capable of producing Antibodies
obtained by FibroGen during the Research Period and the term of such license
shall be vested in FibroGen.
3.4 Regulatory Assistance. If FibroGen acquires a commercial license to a
---------------------
particular Antibody, at the written request of FibroGen, Medarex shall provide
any documentation necessary or appropriate for regulatory filings relating to
the origin or modification of the Antibodies or the hybridoma.
3.5 Retained Rights; No Further Rights. Only the license granted pursuant
----------------------------------
to the express terms of this Agreement shall be of any legal force or effect. No
other license rights shall be granted or created by implication, estoppel or
otherwise. It is understood and agreed that Medarex shall retain rights to make,
have made, import, use, offer for sale, sell and otherwise commercialize Mice
which have not been used for the Research or immunized with any Antigen, itself
or with third parties for any uses.
4. CONSIDERATION
4.1 Commercial License Fee. If FibroGen acquires a commercial license
----------------------
from Medarex pursuant to Section 3.1.2 above, FibroGen shall pay to Medarex a
license fee of [*****]. The applicable license fee shall be paid to Medarex
concurrently with FibroGen's notice of its exercise of its option.
4.2 Milestone Payments. Within thirty (30) days following the occurrence
------------------
of the relevant events specified below with respect to each Product which
contains one of the Antibodies licensed by FibroGen (under a research license or
a commercial license) and is intended to be used as a therapeutic, FibroGen
shall pay to Medarex the following amounts:
Milestones Amount
- ----------------------------------------------------------- ---------------
[*****]
4.3 Royalties and Sublicensee Revenues.
----------------------------------
4.3.1 Royalty on Net Sales and Sublicense Revenues.
---------------------------------------------
(a) In partial consideration for the commercial license, [*****]
(b) In addition to the above, in partial consideration for the
commercial license, [*****].
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
(c) In addition to the above, in partial consideration for the
commercial license, [*****].
(d) In addition to the foregoing, [*****].
(e) [*****]
4.3.2 [*****]
4.3.3 [*****]
4.3.4 Royalty Term. The royalties due pursuant to this Section 4.3
------------
shall be payable on a Product-by-Product and country-by-country basis in each
country as follows: [*****].
4.3.5 Trade Secrets. The parties acknowledge and agree that a
-------------
principal value contributed by Medarex is access to the Mice and Mice Materials
allowing accelerated time to market and enhanced probability of success, and
that Medarex may not own or control patents that cover the manufacture, sale or
use of a particular Product. FibroGen acknowledges and agrees that a principal
value FibroGen receives hereunder is in such access, and accordingly FibroGen
shall [*****] and pay the royalties at the rates specified in Sections 4.3.1(a),
(b) and (c) and 4.3.2 during the term as set forth in Section 4.3.4, regardless
of whether the applicable Product is covered by a patent application or patent
within the Medarex Technology or FibroGen Technology.
4.4 [*****]
5. PAYMENTS
5.1 Timing of Royalty Payments. All royalties due to Medarex shall be
paid [*****].
5.2 Payment Method. All amounts due Medarex hereunder shall be paid in
--------------
U.S. dollars by wire transfer in immediately available funds to an account
designated by Medarex.
5.3 Currency; Foreign Payments. If any currency conversion shall be
--------------------------
required in connection with the payment of any royalties hereunder, such
conversion shall be made by using the exchange rate for the purchase of U.S.
dollars reported by the Chase Manhattan Bank on the last business day of the
calendar quarter to which such royalty payments relate. If at any time legal
restrictions prevent the prompt remittance of any royalties owed on Net Sales in
any jurisdiction, FibroGen may notify Medarex and make such payments by
depositing the amount thereof in local currency in a bank account or other
depository in such country in the name of Medarex, and FibroGen shall have no
further obligations under this Agreement with respect thereto.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
5.4 Taxes. All royalty amounts required to be paid to Medarex pursuant
-----
to this Agreement may be paid with deduction for withholding for or on account
of any taxes (other than taxes imposed on or measured by net income) or similar
governmental charge imposed by a jurisdiction other than the United States
("Withholding Taxes"). At Medarex's request, FibroGen shall provide Medarex a
certificate evidencing payment of any Withholding Taxes hereunder and shall
reasonably assist Medarex to obtain the benefit of any applicable tax treaty.
6. REPORTS AND RECORDS
6.1 Royalty Reports. FibroGen shall deliver to Medarex within [*****] a
---------------
report setting forth in reasonable detail the calculation of the royalties
payable to Medarex for such calendar quarter, including the Products sold in
each country by FibroGen and its Sublicensees, the Net Sales thereof, and all
amounts received from Sublicensees for sales of Products. Such reports shall be
Confidential Information of FibroGen subject to Article 9 herein.
6.2 Inspection of Books and Records. FibroGen shall maintain accurate
-------------------------------
books and records which enable the calculation of royalties payable hereunder to
be verified. FibroGen shall retain the books and records for each quarterly
period for [*****] years after the submission of the corresponding report under
Section 5.1 hereof. Upon thirty (30) days prior notice to FibroGen, independent
accountants selected by Medarex, may have access to FibroGen's books and records
during FibroGen's normal business hours to conduct a review or audit, for the
purpose of verifying the accuracy of FibroGen's payments and compliance with
this Agreement. Any such inspection or audit shall be at Medarex's expense,
however, in the event an inspection reveals underpayment of [*****] or more in
any audit period, FibroGen shall pay the costs of the inspection [*****].
7. OTHER OBLIGATIONS
7.1 Reports to Medarex. During the term of this Agreement, FibroGen
------------------
shall keep Medarex reasonably informed of its activities subject to this
Agreement, including without limitation, the commercialization of Products, and
annually shall provide Medarex with a written report detailing such events and
activities. When the registration package requesting approval for commercial
sale of the Product is first filed in the U.S., the European Union and Japan,
and in each case when approval is received therefor, FibroGen will promptly
notify Medarex in writing.
7.2 Reports to FibroGen. During the term of this Agreement, Medarex
-------------------
shall keep FibroGen reasonably informed of [*****].
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
7.3 Regulatory Filings. FibroGen shall submit registration packages
------------------
requesting approval for commercial sale of the Product as soon as reasonably
practicable. FibroGen (or its designee) shall file and hold title to all
regulatory applications, approvals and supplements thereto. Medarex will
provide the necessary documentation for any regulatory filings relating to the
Mice, Antibodies and hybridoma cell line delivered to FibroGen and any other
assistance with respect to regulatory filings or agencies as may be reasonably
requested by FibroGen at FibroGen's expense.
7.4 Abandoned Products. FibroGen shall promptly notify Medarex should it
------------------
elect to abandon its rights to pursue commercialization of any Product in any
country. Such notice will effectuate FibroGen's voluntary abandonment of its
right hereunder to market the Product in such country; provided, the abandonment
of the Product in any particular country hereunder shall not be construed to be
a termination of this Agreement with respect to the other countries or Products.
8. CONFIDENTIALITY
8.1 Confidential Information. Except as expressly provided herein, the
------------------------
parties agree that, for the term of this Agreement and for five (5) years
thereafter, the receiving party shall keep completely confidential and shall not
publish or otherwise disclose and shall not use for any purpose except for the
purposes contemplated by this Agreement any Confidential Information furnished
to it by the disclosing party hereto pursuant to this Agreement, except that to
the extent that it can be established by the receiving party by competent proof
that such Confidential Information:
(i) was already known to the receiving party, other than
under an obligation of confidentiality, at the time of disclosure;
(ii) was generally available to the public or otherwise
part of the public domain at the time of its disclosure to the
receiving party;
(iii) became generally available to the public or otherwise
part of the public domain after its disclosure and other than through
any act or omission of the receiving party in breach of this
Agreement;
(iv) was independently developed by the receiving party as
demonstrated by documented evidence prepared contemporaneously with
such independent development; or
(v) was subsequently lawfully disclosed to the receiving
party by a person other than a party hereto.
<PAGE>
8.2 Permitted Use and Disclosures. Each party hereto may use or disclose
-----------------------------
information disclosed to it by the other party to the extent such use or
disclosure is reasonably necessary in complying with applicable governmental
regulations or otherwise submitting information to tax or other governmental
authorities, conducting clinical trials, or making a permitted sublicense or
otherwise exercising its rights hereunder, provided that if a party is required
to make any such disclosure of another party's confidential information, other
than pursuant to a confidentiality agreement, it will give reasonable advance
notice to the latter party of such disclosure and, save to the extent
inappropriate in the case of patent applications, will use its reasonable
efforts to secure confidential treatment of such information prior to its
disclosure (whether through protective orders or otherwise).
8.3 Public Disclosure. Except as otherwise required by law (without
-----------------
consideration of contractual obligations to third parties), neither party shall
issue a press release or make any other public disclosure of the terms of this
Agreement without the prior approval of such press release or public disclosure.
Each party shall submit any such press release or public disclosure to the other
party, and the receiving party shall promptly review such press release or
public disclosure, but in no event more than fifteen (15) days to review and
approve any such press release or public disclosure, which approval shall not be
unreasonably withheld. If the receiving party does not respond within such
fifteen (15) day period, the press release or public disclosure shall be deemed
approved. In addition, if a public disclosure is required by law, including
without limitation in a filing with the Securities and Exchange Commission, the
disclosing party shall provide copies of the disclosure reasonably in advance of
such filing or other disclosure for the nondisclosing party's prior review and
comment. Upon execution of this Agreement, the parties shall agree to a redacted
version of this Agreement to be used for any and all submissions permitted under
this Section unless otherwise agreed by the parties in writing or required to
comply with law.
8.4 Confidential Terms. Except as expressly provided herein, each party
------------------
agrees not to disclose any terms of this Agreement to any third party without
the consent of the other party; provided, with prior notice to the other party,
disclosures may be made as required by securities or other applicable laws, or
to a party's accountants, attorneys and other professional advisors.
9. REPRESENTATIONS AND WARRANTIES
9.1 Medarex. Medarex represents and warrants that: (i) it is a
-------
corporation duly organized validly existing and in good standing under the laws
of the State of New Jersey; (ii) the execution, delivery and performance of this
Agreement have been duly authorized by all necessary corporate action on the
part of Medarex; (iii) it is the sole and exclusive owner of all right, title
and interest in the Mice; (iv) it has the right to grant the rights and licenses
granted herein; [*****].
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
9.2 FibroGen. FibroGen represents and warrants that: (i) it is a
--------
corporation duly organized validly existing and in good standing under the laws
of the State of Delaware; and (ii) the execution, delivery and performance of
this Agreement have been duly authorized by all necessary corporate action on
the part of FibroGen.
9.3 Disclaimer of Warranties. THE MICE ARE PROVIDED "AS IS", AND EXCEPT
------------------------
AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, MEDAREX AND ITS RESPECTIVE
AFFILIATES MAKE NO REPRESENTATIONS AND EXTEND NO WARRANTIES OR CONDITIONS OF ANY
KIND, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THE MICE, ANTIBODIES, PRODUCTS
OR MEDAREX TECHNOLOGY, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF THE PATENT RIGHTS
LICENSED HEREUNDER, OR NONINFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF
THIRD PARTIES.
9.4 Disclaimer. Except as otherwise expressly set forth in this Agreement
----------
nothing in this Agreement is or shall be construed as:
(a) A warranty or representation by Medarex as to the validity or
scope of any claim or patent within the Patent Rights;
(b) A warranty or representation that anything made, used, sold,
or otherwise disposed of under any license granted in this Agreement is or will
be free from infringement of any patent rights or other intellectual property
right of any third party;
(c) An obligation to bring or prosecute actions or suits against
third parties for infringement of any of the Patent Rights; or
(d) Granting by implication, estoppel, or otherwise any licenses
or rights under patents or other rights of Medarex or third parties, regardless
of whether such patents or other rights are dominant or subordinate to any
patent within the Patent Rights.
9.5 [*****]
10. INTELLECTUAL PROPERTY
10.1 Patent Rights. [*****]
-------------
10.2 [*****]
10.3 [*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
10.4 Infringement Claims. If the manufacture, importation, sale or use of
-------------------
the Product pursuant to this Agreement results in any claim, suit or proceeding
alleging patent infringement against Medarex or FibroGen, such party shall
promptly notify the other party hereto, and if the notified party has an
obligation to indemnify the other party pursuant to Section 12.1 or 12.2, such
party shall have the right to control the defense of such claim, suit or
proceeding. The defendant shall keep the other party hereto reasonably informed
of all material developments in connection with any such claim, suit or
proceeding. [*****].
10.5 [*****].
10.6 [*****]
10.7 [*****]
10.8 [*****]
11. DISPUTE RESOLUTION
11.1 Mediation. If a dispute arises out of or relates to this Agreement,
---------
or the breach thereof, and if said dispute cannot be settled through
negotiation, the parties agree first to try in good faith to settle the dispute
by mediation under the Commercial Mediation Rules of the American Arbitration
Association, before resorting to arbitration, litigation, or some other dispute
resolution procedure.
12. INDEMNIFICATION
12.1 Medarex. Medarex shall indemnify, defend and hold harmless FibroGen
-------
and its directors, officers and employees (each a "FibroGen Indemnitee") from
and against any and all liabilities, damages, losses, costs or expenses
(including attorneys' and professional fees and other expenses of litigation
and/or arbitration) (a "Liability") resulting from a claim, suit or proceeding
made or brought by a third party against an FibroGen Indemnitee arising from or
occurring as a result of (i) any breach of the representations and warranties
set forth in Section 9.1, [*****], except to the extent caused by the negligence
or willful misconduct of FibroGen.
12.2 FibroGen. FibroGen shall indemnify, defend and hold harmless Medarex
--------
and its directors, officers and employees (each a "Medarex Indemnitee") from and
against any and all liabilities, damages, losses, costs or expenses (including
attorneys' and professional fees and other expenses of litigation and/or
arbitration) (a "Liability") resulting from a claim, suit or proceeding made or
brought by a third party against a Medarex Indemnitee, arising from or occurring
as a result of (i) any breach of the representations and warranties set forth in
Section 9.2, (ii) the conduct of the Research or the practice by FibroGen of any
right granted herein, or
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
(iii) any development, testing, manufacture, importation, use, offer for sale,
sale or other distribution of any Product by FibroGen or its Affiliates or
Sublicensees (including, without limitation, product liability claims), except
in each case, (a) to the extent caused by the negligence or willful misconduct
of Medarex, [*****].
12.3 Procedure. In the event that any Indemnitee intends to claim
---------
indemnification under this Article 12 it shall promptly notify the other party
(the "Indemnitor") in writing of such alleged Liability. The Indemnitor shall
have the sole right to control the defense and settlement thereof. The
Indemnitees shall cooperate with the Indemnitor and its legal representatives in
the investigation of any action, claim or liability covered by this Article 12.
The Indemnitee shall not, except at its own cost, voluntarily make any payment
or incur any expense with respect to any claim or suit without the prior written
consent of the Indemnitor, which the Indemnitor shall not be required to give.
13. TERM AND TERMINATION
13.1 Term. The term of this Agreement shall commence on the date hereof.
----
Unless earlier terminated as provided in this Article 13, this Agreement shall
continue in full force and effect on a country-by-country and Product-by-Product
basis until there are no remaining royalty payment obligations in a country, at
which time the Agreement shall expire in its entirety in such country.
13.2 Termination for Cause. Either party may terminate this Agreement in
---------------------
the event the other party has materially breached or defaulted in the
performance of any of its obligations hereunder, and such default has continued
for ninety (90) days after written notice thereof was provided to the breaching
party by the nonbreaching party. Any termination shall become effective at the
end of such ninety (90) day period unless the breaching party has cured any such
breach or default prior to the expiration of the ninety (90) day period.
Notwithstanding the above, in the case of a failure to timely pay any amounts
due hereunder, the period for cure of any subsequent default following notice
thereof shall be ten (10) days and, unless payment is made within such period
the termination shall become effective at the end of such period.
13.3 Termination for Insolvency. If voluntary or involuntary proceedings
--------------------------
by or against a party are instituted in bankruptcy under any insolvency law, or
a receiver or custodian is appointed for such party, or proceedings are
instituted by or against such party for corporate reorganization or the
dissolution of such party, which proceedings, if involuntary, shall not have
been dismissed within sixty (60) days after the date of filing, or if such party
makes an assignment for the benefit of creditors, or substantially all of the
assets of such party are seized or attached and not released within sixty (60)
days thereafter, the other party may immediately terminate this Agreement
effective upon notice of such termination.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
13.4 Permissive Termination.
13.4.1 FibroGen. FibroGen may terminate the Research and/or this
--------
Agreement with [*****] written notice to Medarex.
13.4.2 Medarex. In that event that FibroGen fails to obtain a
-------
commercial license pursuant to Section 3.1 on or before the end of the Research
Period, Medarex may terminate the Agreement with written notice to FibroGen.
13.5 Effect of Termination, Expiration or Completion of Research.
-----------------------------------------------------------
(a) Accrued Rights and Obligations. Termination of this Agreement
------------------------------
for any reason shall not release any party hereto from any liability which, at
the time of such termination, has already accrued to the other party or which is
attributable to a period prior to such termination nor preclude either party
from pursuing any rights and remedies it may have hereunder or at law or in
equity with respect to any breach of this Agreement. It is understood and agreed
that monetary damages may not be a sufficient remedy for any breach of this
Agreement and that the non-breaching party may be entitled to injunctive relief
as a remedy for any such breach.
(b) Return of Confidential Information. Upon any termination or
----------------------------------
expiration of this Agreement, FibroGen and Medarex shall promptly return to the
other party all Confidential Information of the other; provided counsel of each
party may retain one (1) copy of such Confidential Information for archival
purposes and for ensuring compliance with Article 8.
(c) Stock on Hand. In the event this Agreement is terminated for
-------------
any reason, FibroGen shall have the right to sell or otherwise dispose of the
stock of any Product subject to this Agreement then on hand, subject to Articles
5 and 6 until the first anniversary of the effective date of such termination.
(d) Return of Mice and Mice Materials. Upon any termination of
---------------------------------
this Agreement, FibroGen shall promptly return to Medarex, or destroy all
hybridomas provided by Medarex and all cells capable of producing Antibodies,
and in the event of such destruction an officer of FibroGen shall provide
Medarex with written certification thereof. [*****] Upon any termination or upon
completion of the Research and unless otherwise permitted by FibroGen, Medarex
shall [*****] return any quantities of Antigen not used in connection with the
Research to FibroGen.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
(e) Licenses. The option and license rights granted in Section
--------
3.1 shall terminate upon any termination of this Agreement, and in such event
FibroGen and its Affiliates and Sublicensees shall cease all development and
commercialization of Products.
(f) [*****]
13.6 Survival. Sections [*****] 2.7, [*****], 3.5, 13.5 and 13.6, and
--------
Articles 5, 6, 8, 9, 10, 11, 12 and 14 of this Agreement shall survive
termination of this Agreement for any reason.
14. MISCELLANEOUS
14.1 Governing Law. This Agreement and any dispute, including without
-------------
limitation any arbitration, arising from the performance or breach hereof shall
be governed by and construed and enforced in accordance with the laws of the
state of California, without reference to conflicts of laws principles.
14.2 Independent Contractors. The relationship of the parties hereto is
-----------------------
that of independent contractors. The parties hereto are not deemed to be agents,
partners or joint venturers of the others for any purpose as a result of this
Agreement or the transactions contemplated thereby.
14.3 Assignment. This Agreement shall not be assignable by FibroGen to any
----------
third party hereto without the written consent of Medarex which consent to a
partial or entire assignment shall not be unreasonably withheld; except FibroGen
may assign this Agreement, without such consent, to an entity that acquires all
or substantially all of its business or assets to which this Agreement pertains,
whether by merger, reorganization, acquisition, sale, or otherwise. [*****]
14.4 Notices. All notices, requests and other communications hereunder
-------
shall be in writing and shall be personally delivered or sent by telecopy or
other electronic facsimile transmission or by registered or certified mail,
return receipt requested, postage prepaid, in each case to the respective
address specified below, or such other address as may be specified in writing to
the other parties hereto:
If to Medarex or
GenPharm International: Medarex, Inc.
1545 Route 22 East
Annandale, NJ 08801
Attn: President
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
If to FibroGen: FibroGen, Inc.
225 Gateway Boulevard
South San Francisco, CA 94080
Attn: President
cc: Corporate Counsel
phone: (650) 866-7200
facsimile: (650) 866-7201
14.5 Force Majeure. Neither party shall lose any rights hereunder or be
-------------
liable to the other party for damages or losses (except for payment obligations)
on account of failure of performance by the defaulting party if the failure is
occasioned by war, strike, fire, Act of God, earthquake, flood, lockout,
embargo, governmental acts or orders or restrictions, failure of suppliers, or
any other reason where failure to perform is beyond the reasonable control and
not caused by the negligence, intentional conduct or misconduct of the
nonperforming party has exerted all reasonable efforts to avoid or remedy such
force majeure; provided, however, that in no event shall a party be required to
settle any labor dispute or disturbance.
14.6 Injunctive Relief. Each party acknowledges that limitations and
-----------------
restrictions on its possession and use of Mice, Mice Materials, Antibodies,
Antigens and Confidential Information hereunder are necessary and reasonable to
protect the other party, and expressly agrees that monetary damages would be
inadequate to compensate such party for any violation. The parties agree that
any such violation would cause irreparable injury to the other party and agrees
that without resorting to prior mediation or arbitration, and, in addition to
any other remedies that may be available in law, in equity or otherwise, the
injured party shall be entitled to obtain temporary and permanent injunctive
relief against any threatened violation of such limitations or restrictions or
the continuation of any such violation in any court of competent jurisdiction,
without the necessity of proving actual damages or the posting of any bond.
14.7 Advice of Counsel. Medarex and FibroGen have each consulted counsel
-----------------
of their choice regarding this Agreement, and each acknowledges and agrees that
this Agreement shall not be deemed to have been drafted by one party or another
and will be construed accordingly.
14.8 Compliance with Laws. Each party shall furnish to the other party any
--------------------
information requested or required by that party during the term of this
Agreement or any extensions hereof to enable that party to comply with the
requirements of any U.S. or foreign federal, state and/or government agency.
14.9 Further Assurances. At any time or from time to time on and after the
------------------
date of this Agreement, either party shall at the request of the other party
hereto (i) deliver to the requesting party any records, data or other documents
consistent with the provisions of this Agreement,
<PAGE>
(ii) execute, and deliver or cause to be delivered, all such consents, documents
or further instruments of transfer or license, and (iii) take or cause to be
taken all such actions, as the requesting party may reasonably deem necessary in
order for the requesting party to obtain the full benefits of this Agreement and
the transactions contemplated hereby.
14.10 Export Controls. FibroGen agrees that it will take all actions
---------------
necessary to insure compliance with all U.S. laws, regulations, orders or other
restrictions on exports and further will not sell, license or reexport,
directly, or indirectly, the Product(s) to any person or entity for sale in any
country or territory, if, to the knowledge of FibroGen based upon reasonable
inquiry, such sale, would cause the parties to be in violation of any such laws
or regulations in effect at the time of such sale. FibroGen agrees to secure
from any recipient of Product(s) adequate manually signed written assurances
prior to shipment from the United States as are required by the U.S. Export
Regulations.
14.11 Severability. In the event that any provisions of this Agreement are
------------
determined to be invalid or unenforceable by a court of competent jurisdiction,
the remainder of the Agreement shall remain in full force and effect without
said provision. In such event, the parties shall in good faith negotiate a
substitute clause for any provision declared invalid or unenforceable, which
shall most nearly approximate the intent of the parties in entering this
Agreement.
14.12 Waiver. It is agreed that no waiver by either party hereto of any
------
breach or default of any of the covenants or agreements herein set forth shall
be deemed a waiver as to any subsequent and/or similar breach or default.
14.13 Complete Agreement. This Agreement, with its Exhibits, constitutes
------------------
the entire agreement, both written and oral, between the parties with respect to
the subject matter hereof, and that all prior agreements respecting the subject
matter hereof, either written or oral, expressed or implied, are merged and
canceled, and are null and void and of no effect. No amendment or change hereof
or addition hereto shall be effective or binding on either of the parties hereto
unless reduced to writing and duly executed on behalf of both parties.
14.14 Use of Name. Neither party shall use the name or trademarks of the
-----------
other party without the prior written consent of such other party.
14.15 Headings. The captions to the several Sections and Articles hereof
--------
are not a part of this Agreement, but are included merely for convenience of
reference only and shall not affect its meaning or interpretation.
14.16 Counterparts. This Agreement may be executed in two counterparts,
------------
each of which shall be deemed an original and which together shall constitute
one instrument.
<PAGE>
IN WITNESS WHEREOF, Medarex and FibroGen have executed this Agreement by
their respective duly authorized representatives.
MEDAREX, INC. FIBROGEN, INC.
By: /s/ Michael Appelbaum By: /s/ Thomas B. Neff
--------------------- ------------------
Print Name: Michael Appelbaum Print Name: Thomas B. Neff
----------------- --------------
Title: Executive Vice President Title: Chief Executive Officer
------------------------ -----------------------
GENPHARM INTERNATIONAL, INC.
By: /s/ Michael Appelbaum
---------------------
Print Name: Michael Appelbaum
-----------------
Title: President and Chief Executive Office
------------------------------------
<PAGE>
EXHIBIT A
ANTIGENS
[*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
EXHIBIT B
[*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
Exhibit 10.3
------------
EVALUATION, RESEARCH AND COMMERCIALIZATION AGREEMENT
THIS EVALUATION, RESEARCH AND COMMERCIALIZATION AGREEMENT (the
"Agreement"), effective as of January 11, 1999 (the "Effective Date"), is
entered by and between GenPharm International, Inc., a wholly owned subsidiary
of Medarex, Inc., a New Jersey corporation, with a principal place of business
at 1545 Route 22 East, Annandale, New Jersey 08801 (together "Medarex"), and
Immunex Corporation, a Washington corporation, with a principal place of
business at 51 University St., Seattle, Washington 98101 ("Immunex").
BACKGROUND
A. Medarex is the sole and exclusive owner of certain transgenic Mice (as
defined below) useful for the preparation of fully human monoclonal
antibodies;
B. Immunex desires to use the Mice to evaluate their utility for the
development of fully human monoclonal antibodies against specific
antigens and Medarex is willing to provide Mice to Immunex for such
evaluation, on the terms and conditions herein;
C. Immunex wishes to acquire from Medarex an option to acquire non-
exclusive research and/or exclusive commercial licenses under the
Medarex Technology (as defined below) for the use of the Mice to
prepare and use monoclonal antibodies against Immunex Targets (as
defined below), and subject to the availability of such license rights
with regard to particular antigens, Medarex is willing to grant such
licenses, on the terms and conditions herein.
NOW, THEREFORE, Medarex and Immunex agree as follows:
1. DEFINITIONS
1.1 "Affiliate" shall mean any corporation or other entity which is
---------
directly or indirectly controlling, controlled by or under the common control
with Immunex or Medarex. For the purpose of this Agreement, "control" shall mean
the direct or indirect ownership of fifty percent (50%) or more of the
outstanding shares or other voting rights of the subject entity to elect
directors, or if not meeting the preceding, any entity owned or controlled by or
owning or controlling at the maximum control or ownership right permitted in the
country where such entity exists.
1.2 "Antibody" shall mean a human monoclonal antibody with binding
--------
affinity for an Antigen, obtained by Immunex or a Sublicensee through the use of
nucleic acid or cells derived from one or more of the Mice.
1.3 "Antigen" shall mean, as further specified in Article 3.1.1 hereof,
-------
any protein or carbohydrate and/or any fragment, peptide and/or epitope thereof,
used by Immunex to immunize Mice in connection with the Evaluation.
<PAGE>
1.4 "Approval" shall mean all approvals, licenses, registrations and
--------
authorizations of all governmental agencies in a country necessary for the
manufacture, use or sale of a Product in the applicable country.
1.5 "Biological License Application" or "BLA" shall mean Biological
------------------------------ ---
License Application as defined in the U.S. Food, Drug and Cosmetic Act and the
regulations promulgated thereunder, and any corresponding or equivalent foreign
application, registration or certification.
1.6 "Calendar Quarter" shall mean each three-month period commencing
----------------
January 1, April 1, July 1 and October 1 of each year during the term of this
Agreement.
1.7 "Calendar Year" shall mean each twelve-month period commencing January
-------------
I during the term of this Agreement.
1.8 "Confidential Information" shall mean, subject to the provisions of
------------------------
Article 9 hereof, (i) any proprietary or confidential information or material in
tangible form disclosed hereunder that is marked as "Confidential" at the time
it is delivered to the receiving party, or (ii) proprietary or confidential
information disclosed orally hereunder which is identified as confidential or
proprietary when disclosed and such disclosure of confidential information is
confirmed in writing within thirty (30) days by the disclosing party.
1.9 "Control" or "Controlled" shall mean possession of the ability to
------- ----------
grant the licenses provided for herein, without violating the terms of any
agreement or other arrangement with any third party.
1.10 "Evaluation" shall mean the immunization of Mice conducted by Immunex
----------
during the Evaluation Period in connection with its assessment of the usefulness
of the Mice to produce Antibodies.
1.11 "Evaluation Period" shall mean the period commencing on the Effective
-----------------
Date and continuing until the earlier of (i) [*****] of the Effective Date, or
if extended pursuant to Section 2. 10, each subsequent anniversary of the
Effective Date up to [*****] of the Effective Date, or (ii) the termination of
the Agreement.
1.12 [*****]
1.13 "Immunex Patent Rights" shall mean the Immunex Antibody Patent Rights,
---------------------
Immunex Target Patent Rights, and/or [*****].
1.13.1 "Immunex Antibody Patent Rights" shall mean any and all patent
------------------------------
and patent applications owned or Controlled by Immunex that claim any Antibody
with binding specificity for an Immunex Target.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-2-
<PAGE>
1.13.2 "Immunex Target Patent Rights" shall mean any and all patent
----------------------------
and patent applications owned or Controlled by Immunex that claim one or more
Immunex Targets.
1.13.3 [*****]
1.14 "Immunex Target" shall mean an Antigen selected by Immunex for
--------------
immunization of Medarex's HuMAb mice to generate human antibodies directed
against an Antigen, in each case, which Medarex has informed Immunex is
available for licensing pursuant to Section 3.1.2.
1.15 "IND" shall mean an Investigational New Drug application, as defined
---
in the U.S. Food, Drug and Cosmetic Act and the regulations promulgated
thereunder, or any corresponding or equivalent foreign application, registration
or certification.
1.16 "Medarex Technology" shall mean the Patent Rights and Know How.
------------------
1.16.1 "Know How" shall mean the Confidential Information and Mice
--------
owned or Controlled by Medarex as of the Effective Date and during the
Evaluation Period and transferred to Immunex by Medarex necessary for the
exercise of the Patent Rights, including, technical data, protocols and methods.
For the avoidance of doubt, the Know How does not include any Patent Rights.
1.16.2 "Patent Rights" shall mean all United States and foreign
-------------
patents (including all reissues, extensions, substitutions, re-examinations,
supplementary protection certificates and the like, and patents of addition) and
patent applications (including, without limitation, all continuations,
continuations-in-part and divisions thereof) owned or Controlled by Medarex and
during the Evaluation Period, in each case, which claims an invention which is
necessary for the use of the Mice to prepare the Antibodies or to develop,
produce, make, have made, import, have imported, use, offer for sale and sell
the Antibodies.
1.17 "Mice" shall mean immunizable transgenic mice containing unrearranged
----
human immunoglobulin genes.
1.18 "Mice Materials" shall mean any parts or derivatives of the Mice,
--------------
including without limitation, cells, hybridomas, Antibodies, genes, DNA
sequences or other biological materials derived directly or indirectly from the
Mice.
1.19 "MRC Agreement" shall mean that certain License Agreement entered by
-------------
the Medical Research Council, Institute of Animal Physiology and Genetics
Research of Babraham Hall and Marianne Bruggemann and GenPharm International,
Inc., effective October 1, 1993.
1.20 "Net Sales" shall mean [*****].
---------
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-3-
<PAGE>
1.21 "Phase I" shall mean, with respect to a Product, the period of product
-------
development commencing with enrollment of the first patient in a clinical trial
of such Product and ending upon commencement of Phase II (as defined herein),
where the clinical trial is sponsored by a Party or its Affiliates or
Sublicensees.
1.22 "Phase II" shall mean, with respect to a Product, the period of
--------
product development commencing with enrollment of the first patient in a
clinical trial designed to assess safety and efficacy of such Product, that is
not a Phase III (as defined herein) trial, and ending upon commencement of Phase
III, where the clinical trial is sponsored by a Party or its Affiliates or
Sublicensees.
1.23 "Phase III" shall mean, with respect to a Product, the period of
---------
product development commencing with enrollment of the first patient in a
placebo-controlled or otherwise appropriately controlled clinical trial that is
sized to demonstrate product efficacy, pivotal clinical trial, or other clinical
trial intended to demonstrate efficacy for registration of such Product, and
ending upon filing of a regulatory filing seeking approval to market such
Product, where the clinical trial is sponsored by a Party or its Affiliates or
Sublicensees.
1.24 "Product" shall mean any composition or formulation comprising one or
-------
more Antibodies, or a portion thereof, for the diagnosis, prophylaxis or
treatment of human disease.
1.25 "Research License Term" shall mean the period commencing on the date
---------------------
that Immunex gives notice to Medarex under Section 3.13 herein that Immunex
exercises its option to obtain a research license for the applicable Immunex
Target, and shall continue in effect, on an Immunex Target-by-Immunex Target
basis until the earlier of (i) [*****] after commencement, or if extended
pursuant to Section 2. 10, for [*****] thereafter up to a maximum of [*****]
after commencement, or (ii) the termination of the Agreement.
1.26 "Sublicensee" shall mean a third party to whom Immunex has granted a
-----------
license or sublicense, as the case may be, to make, have made, import, use,
sell, offer for sale or otherwise exploit Products in the Territory. As used in
this Agreement, "Sublicensee" shall also include a third party to whom Immunex
has granted the right to distribute a Product.
1.27 "Territory" shall mean all countries of the world.
---------
2. EVALUATION
2.1 Evaluation. Medarex will provide Mice to Immunex for use during the
----------
Evaluation Period to allow Immunex to immunize the Mice for the purpose of
determining whether Immunex wishes to obtain a research license and/or
commercial license with respect to one or more specific Antigens as provided in
Sections 4.1 or 4.2. Immunex agrees that during the Evaluation Period the Mice
will be used solely for the purpose of conducting the Evaluation and for no
other purpose.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-4-
<PAGE>
2.2 Provision of Mice. Each year during the Evaluation Period, Medarex
-----------------
shall provide Immunex, upon Immunex's request, with Mice as reasonably requested
by Immunex to perform the immunizations against Immunex Targets; provided,
Medarex shall not be obligated to provide more than [*****] Mice in any Calendar
Quarter during the Evaluation Period. If any Mice delivered by Medarex die of
natural causes before commencement of the relevant immunization protocol or for
any reason during the immunization protocol, they shall be replaced without cost
by Medarex, provided that their death was not due to Immunex's misfeasance or
negligence, or the mice were rendered unusable by a failure by Immunex to
commence immunization of the Mice within [*****].
2.3 Immunization. Immunex has the option to perform the immunizations,
------------
derive hybridomas and characterize the Antibodies. Immunex may request that
Medarex perform the immunizations and characterizations of the Antibodies, with
Immunex supplying all assays, for a fee of [*****] per Immunex Target.
2.4 Reasonable Efforts. In the event that Immunex requests Medarex to
------------------
perform immunizations Pursuant to Section 2.3, Medarex shall use reasonable
efforts to conduct requested immunizations and characterizations of the
Antibodies in a professional manner and agrees to commit the personnel,
facilities and other resources necessary to perform the immunizations; provided,
however, Medarex does not warrant that the evaluations shall result in the
preparation of any Antibody suitable for development as a Product.
2.5 Evaluation Support. To allow Immunex to obtain a pool of high-affinity
------------------
Antibodies against [*****] Immunex Targets for a period of [*****] years,
Immunex shall pay to Medarex a technology access fee of [*****] per year. The
first payment shall be due on the Effective Date, and subsequent payments shall
be due on each annual anniversary thereof during the Evaluation Period,
including any extension thereof pursuant to Section 2.10.
2.6 Ownership.
---------
2.6.1 Mice. Title to the Mice and, subject to the options and
----
licenses granted in Articles 3 and 4, the Mice Materials, shall at all times
remain with Medarex.
2.6.2 Property.
--------
(a) [*****]
(b) [*****]
2.7 Limited Use. Immunex shall only grant access to the Mice to those of
-----------
its employees who require such access for the performance of this Agreement;
[*****]. Immunex shall not breed Mice, use them for any purpose other than the
conduct of the Evaluation, or transfer them to any other person or entity or to
any place other than Immunex facilities. Immunex shall not make any
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-5-
<PAGE>
effort, directly or indirectly, to clone or otherwise reproduce the Mice by any
means, sexual or asexual. In no event shall Immunex transfer the Mice to any
person or entity without the prior written approval of Medarex.
2.8 Care in Use of Mice. It is understood and agreed that the Mice are
-------------------
experimental in nature and may have unknown characteristics and Immunex
therefore agrees to use prudence and reasonable care in the use, handling,
storage, transportation and disposition and containment of the Mice, and to
maintain the Mice under suitable containment conditions in compliance with all
applicable national, state and local laws, regulations, rules and ordinances.
2.9 Records. Immunex will prepare and maintain complete and accurate
-------
written records of all uses made of the Mice and the Mice Materials, and copies
of such records will be furnished to Medarex, upon Medarex's request, to the
extent such records are reasonably required under this Agreement; provided,
however, that Medarex shall maintain such records and the information contained
therein in strict confidence in accordance with Article 9 hereof, and shall not
use such records or information except to the extent permitted by this
Agreement.
2.10 Extension Period. [*****] During any extension period of the
----------------
Evaluation, the terms of this Agreement relating to the Evaluation and Immunex's
options to obtain research and commercial licenses shall remain in effect,
subject to the terms of this Agreement.
3. OPTIONS
3.1 Antigen Availability.
--------------------
3.1.1 Antigen Identification. At any time during (i) the Evaluation
----------------------
Period, or (ii) the term of the applicable research license for a particular
Antigen, Immunex may notify Medarex that it wishes to acquire a non-exclusive
research and/or exclusive commercial license to use Mice to prepare Antibodies
with respect to a particular Antigen identified by Immunex. Each Antigen shall
be a specific molecular target or biochemical entity, in the case of defined
proteins or polypeptides (including glyco- or lipo-proteins or carbohydrates),
and the parties shall agree on a written description of such Antigen.
3.1.2 Notice of Availability. [*****]
----------------------
3.1.3 License Fee. [*****]
-----------
3.1.4 Unavailability. In the event that Medarex notifies Immunex that
--------------
rights are not available with regard to a particular Antigen and provides
Immunex with the necessary written evidence therefor, Immunex shall have no
further license or other rights with regard to such Antigen unless otherwise
agreed in writing by the parties.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-6-
<PAGE>
3.2 Option for Research Licenses. [*****]
----------------------------
3.3 Option for Commercial Licenses. [*****]
------------------------------
3.4 Acknowledgment. It is understood that, subject to Section 3.1 above,
--------------
Immunex may, at its discretion, elect for each Antigen (i) to initially enter
into an non-exclusive research license prior to entering into an exclusive
commercial license, or (ii) to enter into a commercial license without
previously entering a research license with respect to such Antigen.
4. LICENSES
4.1 Research Licenses.
-----------------
4.1.1 Grant. If Immunex elects to exercise its option to acquire a
-----
research license with respect to a particular Antigen pursuant to Section 3.2,
subject to the terms and conditions of this Agreement, Medarex shall grant to
Immunex a non-exclusive, non-transferable, royalty-free license, under the
Medarex Technology to immunize the Mice to make Antibodies against such Antigen,
and to further evaluate the Antibodies generated during the Evaluation Period.
4.1.2 Research License Term.
---------------------
[*****]
4.1.3 Termination of Rights. [*****]
---------------------
4.2 Commercial License.
------------------
4.2.1 Grant. If Immunex elects to exercise its option to acquire a
-----
commercial license with respect to a particular Immunex Target pursuant to
Section 3.3, subject to the terms and conditions of this Agreement, Medarex
shall grant to Immunex the following licenses, on an Immunex Target-by-Immunex
Target basis:
(a) a worldwide, exclusive, non-transferable, royalty bearing
license, with the right to grant a sublicense to its Affiliates, under the
Medarex Technology to immunize the Mice to make Antibodies against such Immunex
Target, and
(b) a worldwide exclusive, royalty bearing license under the
Medarex Technology, with the right to sublicense, to make, have made, import,
have imported, use, offer for sale and sell Products containing Antibodies
against such Immunex Target.
4.2.2 Sublicenses. Except as expressly provided in Section 4.1.1 and
-----------
4.2.1(a), Immunex shall have no right to grant sublicenses to use the Mice, but
may grant sublicenses under
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-7-
<PAGE>
the Medarex Technology to the extent necessary to develop, make, have made,
import, use, offer for sale and sell Products; provided, prior to the execution
of any sublicense, Immunex shall provide Medarex with at least the following
information with respect to each potential Sublicensee: (i) the identity of the
Sublicensee; (ii) a description of the Product, and the rights being granted to
the Sublicensee; and (iii) the territory in which the Product will be sold. Each
sublicense granted by Immunex shall be consistent with all the terms and
conditions of this Agreement, and subordinate thereto, and Immunex shall remain
responsible to Medarex for the compliance of each such Sublicensee with the
financial and other obligations due under this Agreement.
4.3 Retained Rights; No Further Rights. Only the licenses granted pursuant
----------------------------------
to the express terms of this Agreement shall be of any legal force or effect. No
other license rights shall be granted or created by implication, estoppel or
otherwise. It is understood and agreed that Medarex shall retain rights to make,
have made, import, use, offer for sale, sell and otherwise commercialize the
Mice itself or with third parties for any uses, other than those for which
Immunex has been granted licenses under this Agreement.
4.4 Use of Mice. Any use of the Mice by Immunex or its Sublicensees
-----------
pursuant to a license granted pursuant to Section 4.1 or 4.2 shall be subject to
the provisions of Sections 2.6, 2.7, 2.8, and 2.9.
4.5 Patent Filings. [*****]
--------------
4.6 Medarex Options.
---------------
[*****]
4.7 Termination of Rights. Immunex may terminate the commercial license
---------------------
for any Immunex Target at any time with immediate effect by giving written
notice to Medarex. Following the termination of the applicable commercial
license Immunex shall have no further license rights under the Medarex
Technology with respect to the Immunex Target and Antibodies against such
Immunex Target subject to such commercial license.
4.8 Technical Assistance. In connection with any research or commercial
--------------------
license granted Immunex hereunder, Medarex shall, at Immunex's request, provide
reasonable agreed assistance to enable Immunex to practice the licenses granted
herein.
5. CONSIDERATION
5.1 Technology Access Fee. During the Evaluation Period, Immunex shall pay
---------------------
to Medarex a technology access fee of [*****] per year. The first payment shall
be due within ten (10) days following the Effective Date, and subsequent
payments
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-8-
<PAGE>
shall be due on the yearly anniversary thereof during the Evaluation Period,
including any extension thereof pursuant to Section 2.10.
5.2 Research License Fees.
---------------------
5.2.1 Initial Fee. [*****]
-----------
5.2.2 Extension Fee. [*****]
-------------
5.2.3 [*****]
5.3 Commercial License Fees.
-----------------------
5.3.1 Per Immunex Target. [*****]
------------------
5.3.2 Credit for Research License Extension Fee. [*****]
-----------------------------------------
5.4 [*****]
5.5 Milestone Payments.
------------------
5.5.1 Milestones. [*****]
----------
5.5.2 [*****]
5.5.3 Multiple Products to the Same Immunex Target. [*****]
--------------------------------------------
5.5.4 Reports. Within ten (10) business days of the occurrence of any
-------
event which would trigger a milestone payment according to this Section 5.5,
Immunex shall inform Medarex of such occurrence.
5.6 Royalties.
---------
5.6.1 Royalty on Net Sales. [*****]
--------------------
5.6.2 Royalty Term. [*****]
------------
5.6.3 Third Party Royalties. Immunex shall be responsible for the
---------------------
payment of any royalties, license fees and milestone and other payments due to
third parties under license agreements for intellectual property required to
make, have made, use, sell, offer for sale and import Products using the
licensed Medarex Technology. However, Medarex shall be responsible for the
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-9-
<PAGE>
payment to the Medical Research Council ("MRC") of any royalties due the MRC
pursuant to the License Agreement entered October 1, 1993 by the MRC and
GenPharrn International, Inc.
5.6.4 [*****]
6. PAYMENTS
6.1 Timing of Royalty Payments. All royalties due to Medarex shall be paid
--------------------------
within [*****] after the last day of the Calendar Quarter in which they accrue.
6.2 Payment Method. All amounts due Medarex hereunder shall be paid in
--------------
U.S. dollars by wire transfer in immediately available funds to an account
designated by Medarex.
6.3 Currency; Foreign Payments. If any currency conversion shall be
--------------------------
required in connection with the payment of any royalties hereunder, such
conversion shall be made by using the exchange rate for the purchase of U.S.
dollars reported by the Chase Manhattan Bank on the last business day of the
Calendar Quarter to which such royalty payments relate. If at any time legal
restrictions prevent the prompt remittance of any royalties owed on Net Sales in
any jurisdiction, Immunex may notify Medarex and make such payments by
depositing the amount thereof in local currency in a bank account or other
depository in such country in the name of Medarex, and Immunex shall have no
further obligations under this Agreement with respect thereto.
6.4 Taxes. All royalty amounts required to be paid to Medarex pursuant to
-----
this Agreement may be paid with deduction for withholding for or on account of
any taxes (other than taxes imposed on or measured by net income) or similar
governmental charge imposed by a jurisdiction other than the United States
("Withholding Taxes"). At Medarex's request, Immunex shall provide Medarex a
certificate evidencing payment of any Withholding Taxes hereunder and shall
reasonably assist Medarex to obtain the benefit of any applicable tax treaty.
7. REPORTS AND RECORDS
7.1 Royalty Reports. Immunex shall deliver to Medarex within [*****] after
---------------
the last day of each Calendar Quarter in which Products are sold a report
setting forth in reasonable detail the calculation of the royalties payable to
Medarex for such Calendar Quarter identifying, by country and Product, the
Products sold by Immunex and its Affiliates and Sublicensees, and the
calculation of Net Sales and royalties due to Medarex.
7.2 Inspection of Books and Records. Immunex and its Affiliates and
-------------------------------
Sublicensees shall maintain accurate books and records, which enable the
calculation of royalties payable hereunder to be verified. Immunex and its
Affiliates and Sublicensees shall retain the books and records for each
quarterly period for [*****] years after the submission of the corresponding
report under Section 6.1 hereof. Upon [*****] days prior notice to Immunex,
independent accountants selected
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-10-
<PAGE>
by Medarex and reasonably acceptable to Immunex, may have access to the books
and records of Immunex and its Affiliates and Sublicensees during normal
business hours to conduct a review or audit, solely, however, to the extent
necessary for the purpose of verifying the accuracy of Immunex's payments and
compliance with this Agreement. Any such inspection or audit shall be at
Medarex's expense; however, in the event an inspection reveals underpayment of
[*****] or more in any audit period, Immunex shall pay the costs of the
inspection [*****].
8. DILIGENCE
8.1 Reasonable Efforts. [*****]
------------------
8.1.1 [*****]
8.1.2 Notwithstanding the above, if within [*****] years after the
Effective Date, Immunex has not filed [*****], Medarex may require Immunex,
within [*****] of receipt of written notice from Medarex, to establish
Immunex's, its Affiliates, or Sublicensees use of Commercially Reasonable
Efforts in developing a Product. If within such [*****], Immunex fails to
establish such Commercially Reasonable Efforts to develop a Product, in
Medarex's reasonable opinion, then Immunex shall have until [*****]. If by
[*****], Immunex has not submitted [*****], all rights granted to Immunex
hereunder with respect to such Product (and corresponding Antibodies) shall
revert to Medarex.
8.2 Reports to Medarex. During the term of this Agreement, Immunex shall
------------------
keep Medarex informed of its development and commercialization activities
subject to this Agreement, and on January 31 of each year shall provide Medarex
with a written summary of such events and activities in the preceding year. When
the registration package requesting Approval for commercial sale of any Product
receives Approval in the U.S., Europe and Japan, Immunex will notify Medarex in
writing within [*****] days thereof.
8.3 Regulatory Filings. [*****]
------------------
9. CONFIDENTIALITY
9.1 Confidential Information. Except as expressly provided herein, the
------------------------
parties agree that for five (5) years after the disclosure of any Confidential
Information by one of the parties to the other hereto pursuant to this
Agreement, the receiving party shall keep completely confidential and shall not
publish or otherwise disclose and shall not use for any purpose except for the
purposes contemplated by this Agreement such Confidential Information, except
that to the extent that it can be established by the receiving party by
competent proof that such Confidential Information:
9.1.1 was already known to the receiving party, other than under an
obligation of confidentiality, at the time of disclosure;
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-11-
<PAGE>
9.1.2 was generally available to the public or otherwise part of the
public domain at the time of its disclosure to the receiving party;
9.1.3 became generally available to the public or otherwise part of
the public domain after its disclosure and other than through any act or
omission of the receiving party in breach of this Agreement;
9.1.4 was independently developed by the receiving party as
demonstrated by documented evidence prepared contemporaneously with such
independent development; or
9.1.5 was subsequently lawfully disclosed to the receiving party by a
person other than a party hereto.
9.2 Permitted Use and Disclosures. Each party hereto may use or disclose
-----------------------------
information disclosed to it by the other party to the extent such use or
disclosure is reasonably necessary in complying with applicable governmental
regulations or otherwise submitting information to tax or other governmental
authorities, conducting clinical trials, or making a permitted sublicense or
otherwise exercising its rights hereunder, provided that if a party is required
to make any such disclosure of another party's confidential information, other
than pursuant to a confidentiality agreement, it will give reasonable advance
notice to the latter party of such disclosure and, save to the extent
inappropriate in the case of patent applications, will use its best efforts to
secure confidential treatment of such information prior to its disclosure
(whether through protective orders or otherwise).
9.3 Public Disclosure. Except as otherwise required by law, neither party
-----------------
shall issue a press release or make any other public disclosure of the terms of
this Agreement without the prior approval of such press release or public
disclosure. Each party shall submit any such press release or public disclosure
to the other party, and the receiving party shall have [*****] to review and
approve any such press release or public disclosure, which approval shall not be
unreasonably withheld. If the receiving party does not respond within such
[*****] period, the press release or public disclosure shall be deemed approved.
In addition, if a public disclosure is required by law, including without
limitation in a filing with the Securities and Exchange Commission, the
disclosing party shall provide copies of the disclosure reasonably in advance of
such filing or other disclosure for the nondisclosing party's prior review and
comment.
9.4 Confidential Terms. Except as expressly provided herein, each party
------------------
agrees not to disclose any terms of this Agreement to any third party without
the consent of the other party; provided, disclosures may be made as required by
securities or other applicable laws, or on a strict need to know basis to actual
or prospective investors, or to a party's accountants, attorneys and other
professional advisors.
10. REPRESENTATIONS AND WARRANTIES
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-12-
<PAGE>
10.1 Medarex. Medarex represents and warrants that: (i) it is a
-------
corporation duly organized validly existing and in good standing under the laws
of the State of New Jersey; (ii) the execution, delivery and performance of this
Agreement have been duly authorized by all necessary corporate action on the
part of Medarex; (iii) it is the sole and exclusive owner of all right, title
and interest in the Mice; (iv) it has the right to grant the rights and licenses
granted herein; and (v) [*****].
10.2 Immunex. Immunex represents and warrants that: (i) it is a company
-------
duly organized validly existing and in good standing under the laws of the State
of Washington; and (ii) the execution, delivery and performance of this
Agreement have been duly authorized by all necessary corporate action on the
part of Immunex.
10.3 Disclaimer of Warranties. THE MICE ARE PROVIDED "AS IS", AND EXCEPT
------------------------
AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, MEDAREX MAKES NO
REPRESENTATIONS AND EXTENDS NO WARRANTIES OR CONDITIONS OF ANY KIND, EITHER
EXPRESS OR IMPLIED, WITH RESPECT TO THE MICE, MICE MATERIALS, ANTIBODIES, OR
MEDAREX TECHNOLOGY, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF THE PATENT RIGHTS
LICENSED HEREUNDER, OR NONINFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF
THIRD PARTIES.
10.4 Disclaimer. Nothing in this Agreement is or shall be construed as:
----------
10.4.1 A warranty or representation by Medarex as to the validity
or scope of any claim or patent within the Patent Rights;
10.4.2 [*****], a warranty or representation that anything made,
used, sold, or otherwise disposed of under any license granted in this Agreement
is or will be free from infringement of any patent rights or other intellectual
property right of any third party;
10.4.3 An obligation to bring or prosecute actions or suits against
third parties for infringement of any of the Patent Rights; or
10.4.4 Granting by implication, estoppel, or otherwise any licenses
or rights under patents or other rights of Medarex or third parties, regardless
of whether such patents or other rights are dominant or subordinate to any
patent within the Patent Rights.
10.5 [*****]
11. INTELLECTUAL PROPERTY
11.1 [*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-13-
<PAGE>
11.2 [*****]
11.3 [*****]
11.4 [*****]
11.5 Infringement Claims. If the manufacture, importation, sale or use of
-------------------
a Product pursuant to this Agreement results in any claim, suit or proceeding
alleging patent infringement against Medarex or Immunex, such party shall
promptly notify the other party hereto. The defendant shall keep each other
party hereto reasonably informed of all material developments in connection with
any such claim, suit or proceeding.
12. INDEMNIFICATION
12.1 Medarex. Medarex shall indemnify, defend and hold harmless Immunex
-------
and its directors, officers and employees (each a "Immunex Indemnitee") from and
against any and all liabilities, damages, losses, costs or expenses (including
attorneys' and professional fees and other expenses of litigation and/or
arbitration) (a "Liability") resulting from a claim, suit or proceeding made or
brought by a third party against an Immunex Indemnitee arising from or occurring
as a result of any breach of the representations and warranties set forth in
Section 10.1, except to the extent caused by the negligence or willful
misconduct of Immunex.
12.2 Immunex. Immunex shall indemnify, defend and hold harmless Medarex
-------
and its directors, officers and employees (each a "Medarex Indemnitee") from and
against any and all liabilities, damages, losses, costs or expenses (including
attorneys' and professional fees and other expenses of litigation and/or
arbitration) (a "Liability") resulting from a claim, suit or proceeding made or
brought by a third party against a Medarex Indemnitee, arising from or occurring
as a result of (i) any breach of the representations and warranties set forth in
Section 10.2, (ii) the use of the Mice, conduct of the Evaluation, research or
the practice by Immunex of any right granted herein, or (iii) any development,
testing, manufacture, importation, use, offer for sale, sale or other
distribution of any Product by Immunex or its Affiliates or Sublicensees
(including, without limitation, product liability claims), except in each case,
to the extent caused by the negligence or willful misconduct of Medarex.
12.3 Procedure. In the event that any Indemnitee intends to claim
---------
indemnification under this Article 12 it shall promptly notify the other party
(the "Indemnitor") in writing of such alleged Liability. The Indemnitor shall
have the sole right to control the defense and settlement thereof. The
Indemnitees shall cooperate with the Indemnitor and its legal representatives in
the investigation of any action, claim or liability covered by this Article 12.
The Indemnitee shall not, except at its own cost, voluntarily make any payment
or incur any expense with respect to any claim or suit without the prior written
consent of the Indemnitor, which the Indemnitor shall not be required to give.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-14-
<PAGE>
13. TERM AND TERMINATION
13.1 Term. The term of this Agreement shall commence on the Effective
----
Date. Unless earlier terminated as provided in this Article 13, this Agreement
shall continue in full force and effect on a country-by-country and Product-by-
Product basis until there are no remaining royalty payment obligations in a
country, at which time the Agreement shall expire in its entirety in such
country. [*****]
13.2 Termination for Cause. In the event one party has materially breached
---------------------
or defaulted in the performance of any of its obligations hereunder, and such
breach or default has continued for sixty (60) days after written notice thereof
was provided to the breaching or defaulting party by the non-breaching or non-
defaulting party, the other party may terminate this Agreement. Any termination
shall become effective at the end of such sixty (60) day period unless the
breaching or defaulting party has cured any such breach or default prior to the
expiration of the sixty (60) day period. Notwithstanding the above, in the case
of a failure to timely pay any amounts due hereunder, the period for cure of any
subsequent breach or default following notice thereof shall be ten (10) days
and, unless payment is made within such period the termination shall become
effective at the end of such period.
13.3 Termination for Insolvency. If voluntary or involuntary proceedings
--------------------------
by or against a party are instituted in bankruptcy under any insolvency law, or
a receiver or custodian is appointed for such party, or proceedings are
instituted by or against such party for corporate reorganization or the
dissolution of such party, which proceedings, if involuntary, shall not have
been dismissed within sixty (60) days after the date of filing, or if such party
makes an assignment for the benefit of creditors, or substantially all of the
assets of such party are seized or attached and not released within sixty (60)
days thereafter, the other party may immediately terminate this Agreement
effective upon notice of such termination.
13.4 Effect of Termination. For the avoidance of doubt, the following
---------------------
provisions of 13.4.1 through 13.4.5 apply to termination under Sections 13.2 and
13.3 above.
13.4.1 Accrued Rights and Obligations. Termination of this Agreement
------------------------------
for any reason shall not release any party hereto from any liability which, at
the time of such termination, has already accrued to the other party or which is
attributable to a period prior to such termination nor preclude either party
from pursuing any rights and remedies it may have hereunder or at law or in
equity with respect to any breach of, or default under, this Agreement. It is
understood and agreed that monetary damages may not be a sufficient remedy for
any breach of this Agreement and that the non-breaching party may be entitled to
injunctive relief as a remedy for any such breach.
13.4.2 Return of Confidential Information. Upon any termination of
----------------------------------
this Agreement, Immunex and Medarex shall promptly return to the other party all
Confidential Information of the
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-15-
<PAGE>
other; provided counsel of each party may retain one (1) copy of such
Confidential Information for archival purposes and for ensuring compliance with
Article 9.
13.4.3 Stock on Hand. In the event this Agreement is terminated for
-------------
any reason, Immunex shall have the right to sell or otherwise dispose of the
stock of any Product subject to this Agreement then on hand, subject to Articles
4, 5 and 6 until the first anniversary of the effective date of such
termination.
13.4.4 Return of Mice and Mice Materials. Upon any termination of
---------------------------------
this Agreement, Immunex shall promptly return to Medarex, or destroy all
cultures of the Mice, and any Mice Materials, including, without limitation, all
Antibodies and other biological materials derived from Mice, and all cells
capable of producing Antibodies, and in the event of such destruction an officer
of Immunex shall provide Medarex with written certification thereof.
13.4.5 Licenses. The license granted Immunex in this Agreement shall
--------
terminate upon any termination of this Agreement and in such event Immunex and
its Sublicensees shall cease all development and commercialization of Products.
Any license granted Medarex pursuant to Section 4.6 shall remain in effect
following any termination of this Agreement.
13.4.6 Survival. Sections 13.4 and 13.5, and Articles 6, 7, 9, 10,
--------
11, 12 and 14 of this Agreement shall survive termination of this Agreement for
any reason, except that Article 12 shall survive only with respect to
liabilities that arise from acts or circumstances that occurred prior to
termination.
14. MISCELLANEOUS
14.1 Governing Law. This Agreement and any dispute, including without
-------------
limitation any arbitration, arising from the performance or breach hereof shall
be governed by and construed and enforced in accordance with the laws of the
state of New Jersey, without reference to conflicts of laws principles.
14.2 Independent Contractors. The relationship of the parties hereto is
-----------------------
that of independent contractors. The parties hereto are not deemed to be agents,
partners or joint venturers of the others for any purpose as a result of this
Agreement or the transactions contemplated thereby.
14.3 Assignment. Immunex may not assign this Agreement to any third party
----------
without the written consent of Medarex, which consent shall not be unreasonably
withheld; provided Immunex may assign this Agreement, without Medarex's consent
(a) to its Affiliates, and (b) to an entity that acquires all or substantially
all of the business or assets of Immunex to which this Agreement pertains,
whether by merger, reorganization, acquisition, sale or otherwise. Medarex may
assign this Agreement.
14.4 Binding Effect. This Agreement shall be binding upon and inure to the
--------------
benefit of the parties and their successors and assigns.
-16-
<PAGE>
14.5 Notices. All notices, requests and other communications hereunder
-------
shall be in writing and shall be personally delivered or sent by telecopy or
other electronic facsimile transmission or by registered or certified mail,
return receipt requested, postage prepaid, in each case to the respective
address specified below, or such other address as may be specified in writing to
the other parties hereto:
If to Medarex: Medarex, Inc.
1545 Route 22 East
Annandale, New Jersey 08801
Attn: President
If to Immunex: Immunex Corporation
51 University St.
Seattle, Washington 98101
Attn: General Counsel
14.6 Force Majeure. Neither party shall lose any rights hereunder or be
-------------
liable to the other party for damages or losses (except for payment obligations)
on account of failure of performance by the defaulting party if the failure is
occasioned by war, strike, fire, Act of God, earthquake, flood, lockout,
embargo, governmental acts or orders or restrictions, failure of suppliers, or
any other reason where failure to perform is beyond the reasonable control and
not caused by the negligence, intentional conduct or misconduct of the
nonperforming party has exerted all reasonable efforts to avoid or remedy such
force majeure; provided, however, that in no event shall a party be required to
settle any labor dispute or disturbance.
14.7 Injunctive Relief. Immunex, acknowledges that limitations and
-----------------
restrictions on its possession and use of Mice and Mice Materials hereunder are
necessary and reasonable to protect Medarex, and expressly agrees that monetary
damages would be inadequate to compensate Medarex for any violation by Immunex
or Immunex of any such limitations or restrictions. The parties agree that any
such violation would cause irreparable injury to Medarex and agrees that without
resorting to prior mediation or arbitration, and, in addition to any other
remedies that may be available in law, in equity or otherwise, Medarex shall be
entitled to seek temporary and permanent injunctive relief against any
threatened violation of such limitations or restrictions or the continuation of
any such violation in any court of competent jurisdiction, without the necessity
of proving actual-damages or the posting of any bond.
14.8 Advice of Counsel. Medarex and Immunex have each consulted counsel of
-----------------
their choice regarding this Agreement, and each acknowledges and agrees that
this Agreement shall not be deemed to have been drafted by one party or another
and will be construed accordingly.
14.9 Compliance with Laws. Each party shall furnish to the other party any
--------------------
information requested or required by that party during the term of this
Agreement or any extensions hereof to enable that party to comply with the
requirements of any U.S. or foreign federal, state and/or government agency.
-17-
<PAGE>
14.10 Further Assurances. At any time or from time to time on and after the
------------------
date of this Agreement, either party shall at the request of the other party
hereto (i) deliver to the requesting party any records, data or other documents
consistent with the provisions of this Agreement, (ii) execute, and deliver or
cause to be delivered, all such consents, documents or further instruments of
transfer or license, and (iii) take or cause to be taken all such actions, as
the requesting party may reasonably deem necessary in order for the requesting
party to obtain the full benefits of this Agreement and the transactions
contemplated hereby.
14.11 Export Controls. Immunex agrees that it will take all actions
---------------
necessary to insure compliance with all U.S. laws, regulations, orders or other
restrictions on exports and further will not sell, license or reexport,
directly, or indirectly, the Product(s) to any person or entity for sale in any
country or territory, if, to the knowledge of Immunex based upon reasonable
inquiry, such sale, would cause the parties to be in violation of any such laws
or regulations now or hereafter in effect, Immunex agrees to secure from any
recipient of Product(s) adequate manually signed written assurances prior to
shipment from the United States as are required by the U.S. Export Regulations.
14.12 Severability. In the event that any provisions of this Agreement are
------------
determined to be invalid or unenforceable by a court of competent jurisdiction,
the remainder of the Agreement shall remain in full force and effect without
said provision. In such event, the parties shall in good faith negotiate a
substitute clause for any provision declared invalid or unenforceable, which
shall most nearly approximate the intent of the parties in entering this
Agreement.
14.13 Waiver. It is agreed that no waiver by either party hereto of any
------
breach or default of any of the covenants or agreements herein set forth shall
be deemed a waiver as to any subsequent and/or similar breach or default.
14.14 Complete Agreement. This Agreement, with its Exhibits, constitutes
------------------
the entire agreement, both written and oral, between the parties with respect to
the subject matter hereof, and that all prior agreements respecting the subject
matter hereof, either written or oral, expressed or implied, are merged and
canceled, and are null and void and of no effect. No amendment or change hereof
or addition hereto shall be effective or binding on either of the parties hereto
unless reduced to writing and duly executed on behalf of both parties.
14.15 Use of Name. Neither party shall use the name or trademarks of the
-----------
other party without the prior written consent of such other party.
14.16 Headings. The captions to the several Sections and Articles hereof
--------
are not a part of this Agreement, but are included merely for convenience of
reference only and shall not affect its meaning or interpretation.
14.17 Counterparts. This Agreement may be executed in two counterparts,
------------
each of which shall be deemed an original and which together shall constitute
one instrument.
-18-
<PAGE>
IN WITNESS WHEREOF, Medarex and Immunex have executed this Agreement by
their respective duly authorized representatives.
<TABLE>
<CAPTION>
MEDAREX, INC. IMMUNEX CORPORATION
<S> <C>
By: /s/ Lisa N. Drakeman By: /s/ Edward V. Fritzky
-------------------------------------- -------------------------------------------
Print Name: Lisa N. Drakeman, Ph.D. Print Name: Edward V. Fritzky
------------------------------ -----------------------------------
Title: Senior Vice President Title: Chairman and Chief Executive Officer
----------------------------------- ----------------------------------------
GENPHARM INTERNATIONAL, INC.
By: /s/ Lisa N. Drakeman Reviewed by Law Dept
---------------------------------------
Print Name: Lisa N. Drakeman By: SLM
------------------------------
Title: Senior Vice President Date: 1/11/99
-----------------------------------
</TABLE>
-19-
<PAGE>
Exhibit A
[*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-20-
<PAGE>
Exhibit 10.4
------------
Amendment No. 1 to Research and Commercialization Agreement
This Amendment No. 1 to Research and Commercialization Agreement (the
"Amendment") effective as of January ___, 1999, is entered into by and between
Schering AG ("Schering"), GenPharm International, Inc. and Medarex, Inc.
(collectively, "Medarex"), and amends that certain Research and
Commercialization Agreement entered into by Medarex and Schering effective as of
February 9, 1998 (the "Agreement").
1. All capitalized terms not defined in this Amendment shall have the meanings
given to them in the Agreement.
2. Section 1.3 shall be amended to read in its entirety as follows:
1.3 "Antigen" shall mean each of (i) [*****] as described in the Research
-------
Plan, (ii) any other antigen proposed by Schering and accepted by
Medarex pursuant to Section 2.1.3.
3. Section 1.16 shall be amended to read in its entirety as follows:
1.16 "Product" shall mean any product for the diagnosis or treatment of
-------
human disease containing an Antibody or a portion thereof. A Product
used for several indications is considered to be a single Product.
4. Sections 2.1.1, 2.3, 2.4 and 2.7.2 are amended to change each reference to
"the Antigen" to "each Antigen".
5. Section 2.1.2. shall be revised by the addition of the following new last
sentence:
Medarex may, at its sole discretion, with notice to Schering discontinue
any Research Program activities for which Schering is not providing full
research support pursuant to Section 2.2. Within [*****] of such notice,
Schering shall notify Medarex whether Schering wishes to provide research
funding pursuant to Section 2.2 for the activities which Medarex intends to
continue. Unless Schering timely notifies Medarex that Schering will
provide full research funding for such activities, Medarex shall have the
right to discontinue any or all of such activities.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
6. Section 2.1 shall be amended by the addition of the following new Section
2.1.3:
2.1.3 Selection of Antigens. During the Research Program, Schering
---------------------
may, with notice to Medarex, propose that one or more new antigens
become Antigens subject to this Agreement. In each case, Schering
shall notify Medarex of the identity of the proposed antigen and
[*****]. Within [*****] after its receipt of any such proposal
and information, Medarex shall notify Schering whether it will
accept the proposed antigen as an Antigen. It is understood and
agreed that Medarex shall have the right, at its sole discretion,
to accept or refuse to accept any such proposed antigen as an
Antigen. At such time as Medarex has accepted [*****] additional
Antigens pursuant to this Section 2.1.3, Schering shall have no
further right to propose additional Antigens, unless otherwise
expressly agreed in writing by the parties.
7. Section 2.5 shall be amended to read in its entirety as follows:
2.5 Research License. Medarex hereby grants to Schering the following
----------------
licenses: [*****] license to use the Antibodies prepared by Medarex
during the Research Period and for which Schering provided Research
support payments pursuant to Section 2.2 [*****] solely for
research and evaluation purposes, and [*****] license to use the
Antibodies with specificity against any Antigen prepared by Medarex
during the Research Period for which Schering did not provide
Research support payments pursuant to Section 2.2. solely for
research and evaluation purposes.
8. Section 3.1.1 shall be amended to read in its entirety as follows:
3.1.1 Option; Right of Negotiation.
----------------------------
(a) During the Evaluation Period, Schering shall have (i)
an exclusive option to obtain an exclusive (even as to Medarex),
worldwide commercial license as set forth in Section 3.2 solely to
develop Antibodies for which Schering provided Research support
payments pursuant to Section 2.2 for use in the development and
commercialization of Products, and (ii) a right of negotiation as
set forth in Section 3.1.1(b) below to obtain an exclusive (even as
to Medarex), worldwide commercial license as set forth in Section
3.2 solely to develop Antibodies for which Schering did not provide
Research support payments pursuant to Section 2.2 for use in the
development and commercialization of Products. Schering may
exercise such option by notice to Medarex during the foregoing
period specifying [*****] to be covered
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-2-
<PAGE>
by the commercial license, and concurrently paying to Medarex the
applicable license fee due pursuant to Section 4.1.
(b) During the Evaluation Period, Schering shall have a right of
negotiation to obtain a commercial license from Medarex with respect
to any Antibodies prepared by Medarex for which Schering did not
provide Research support payments to Medarex as follows: if during the
Evaluation Period, a third party notifies Medarex that such third
party wishes to acquire a commercial license to antibodies directed
against such Antigen, or Medarex wishes to commercialize antibodies
against such Antigen itself, Medarex shall notify Schering; however,
Medarex shall not be obligated to identify such party, whether Medarex
or a third party. If Schering has not notified Medarex within [*****]
days of such notice that Schering will enter a commercial license for
the Antibodies pursuant to Section 3.2 of this Agreement, then
Schering's right of negotiation shall terminate with respect to the
Antibodies and the related Antigen. In any such case, Medarex may
grant one or more third parties commercial licenses with respect to
antibodies specific for the applicable Antigen, or conduct
commercialization of such antibodies itself.
(c) Medarex shall not license, sell, transfer or use in any
manner any Antibodies arising out of the Research to any third party
except Schering. At Schering's request, Medarex shall destroy any
Antibodies, and related Mice Materials prepared by Medarex in the
Research. Notwithstanding the above, it is understood and agreed that
Medarex shall have no obligation to destroy any antibodies and related
Mice Materials for which Schering did not provide research support
payments pursuant to Section 2.2.
9. Section 3.2 shall be amended to read in its entirety as follows:
3.2 Commercial License. Effective upon Schering's election to acquire a
------------------
commercial license, subject to the terms and conditions of this
Agreement (including without limitation, the timely payment of the
license fee due pursuant to Section 4.1) Medarex shall grant to
Schering the following licenses, on an Antigen-by-Antigen basis:
3.2.1 an exclusive (even as to Medarex), worldwide, non-
transferable (except as set forth in Section 14.3), royalty
bearing license under the Medarex Technology with the right
to sublicense, to use hybridomas delivered by Medarex to
Schering to make or have made Antibodies, and
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-3-
<PAGE>
3.2.2 an exclusive (even as to Medarex), worldwide, non-
transferable (except as set forth in Section 14.3), royalty
bearing license under the Medarex Technology, with the right
to sublicense, to use Antibodies to make, have made, import,
have imported, use, offer for sale and sell Products.
10. Except as specifically modified or amended hereby, the Agreement shall
remain in full force and effect and, as modified or amended, is hereby
ratified, confirmed and approved. No provision of this Amendment may be
modified or amended except expressly in a writing signed by both parties
nor shall any terms be waived except expressly in a writing signed by the
party charged therewith. This Amendment shall be governed in accordance
with the laws of California, without reference to or application of
conflicts of laws principles.
11. Section 15.17 shall be added to read in its entirety as follows:
15.17 Affiliates. Each Party may perform its obligations hereunder
----------
personally or through one or more Affiliates, although each Party shall
nevertheless be solely responsible for the performance of its Affiliates.
Neither Party shall permit any of its Affiliates to commit any act
(including any act of omission) which such Party is prohibited hereunder
from committing directly.
IN WITNESS WHEREOF, each of the parties has executed this Amendment as of
the date indicated on this Amendment.
SCHERING AG MEDAREX, INC.
By: Prof. Dr. Guenter Stock By: /s/ Michael Appelbaum
------------------------------ ------------------------------
Name:_____________________________ Name: Michael Appelbaum
----------------------------
Title: /s/ G. Stock Title: Executive V.P.
---------------------------- ---------------------------
Member Executive Board of
Directors
Date: 22nd April 1999 Date: May 11, 1999
---------------------------- ----------------------------
SCHERING AG GENPHARM INTERNATIONAL, INC.
By: /s/J.F. Kapp By: /s/ Michael Appelbaum
------------------------------- ------------------------------
-4-
<PAGE>
Name: Dr. J-F. Kapp Name: Michael Appelbaum
----------------------------- ----------------------------
Title: Head of Strategic Business Title: President & C.O.O
---------------------------- ---------------------------
Unit Therapeutics
----------------------------
Date: 22nd April 1999 Date: May 11, 1999
----------------------------- ----------------------------
-5-
<PAGE>
Exhibit 10.5
------------
EVALUATION AND COMMERCIALIZATION AGREEMENT
THIS EVALUATION AND COMMERCIALIZATION AGREEMENT (the "Agreement"),
effective as of February 24, 1999 (the "Effective Date"), is entered by and
between GenPharm International, Inc., a wholly owned subsidiary of Medarex,
Inc., a New Jersey corporation, with a principal place of business at 1545 Route
22 East, Annandale, New Jersey 08801 ("Medarex"), and Leukosite, Inc., with a
principal place of business at 215 First Street, Cambridge, Massachusetts 02142
("Leukosite").
BACKGROUND
A. Medarex is the sole and exclusive owner of certain transgenic Mice
useful for the preparation of fully human monoclonal antibodies;
B. Leukosite desires to conduct research with the Mice to evaluate their
utility for the development of fully human monoclonal antibodies to
certain Antigens (as defined below), on the terms and conditions
herein; and
C. Leukosite wishes to acquire from Medarex an option to acquire a
commercial license for the use of monoclonal antibodies with
specificity for the Antigens to commercialize Products (as defined
below), on the terms and conditions herein.
NOW, THEREFORE, Medarex and Leukosite agree as follows:
1. DEFINITIONS.
1.1 "Affiliate" means any corporation or other entity which is directly or
---------
indirectly controlling, controlled by or under the common control with
Leukosite. For the purpose of this Agreement, "control" shall mean the direct or
indirect ownership of fifty percent (50%) or more of the outstanding shares or
other voting rights of the subject entity to elect directors, or if not meeting
the preceding, any entity owned or controlled by or owning or controlling at the
maximum control or ownership right permitted in the country where such entity
exists.
1.2 "Antibody" shall mean a human monoclonal antibody with binding
--------
affinity for an Antigen, which antibody is obtained through the use of nucleic
acid or cells derived from one or more of the Mice.
1.3 "Antigen" shall mean any antigen used by Leukosite to immunize Mice in
-------
connection with the Evaluation.
<PAGE>
1.4 "Approval" shall mean all approvals, licenses, registrations and
--------
authorizations of all governmental agencies in a country necessary for the
manufacture, use or sale of a Product in the applicable country.
1.5 "Biological License Application"or "BLA" shall mean Biological License
------------------------------ ---
Application as defined in the U.S. Food, Drug and Cosmetic Act and the
regulations promulgated thereunder, and any corresponding foreign application,
registration or certification.
1.6 "Confidential Information" shall mean (i) any proprietary or
------------------------
confidential information or material in tangible form disclosed hereunder that
is marked as "Confidential" at the time it is delivered to the receiving party,
or (ii) proprietary or confidential information disclosed orally hereunder which
is identified as confidential or proprietary when disclosed and such disclosure
of confidential information is confirmed in writing within thirty (30) days by
the disclosing party.
1.7 "Control" or "Controlled" shall mean possession of the ability to
------- ----------
grant the licenses or sublicenses as provided for herein without violating the
terms of any agreement or other arrangement with any third party.
1.8 "Evaluation" shall mean the immunization of Mice conducted by
----------
Leukosite in the Evaluation Period in connection with its assessment of the
usefulness of the Mice to produce Antibodies.
1.9 "Evaluation Period" shall mean the period commencing on the Effective
-----------------
Date and continuing until the earlier of (i) [*****] the Effective Date, unless
extended pursuant to Section 2.1.3, in which case the last day of the last
extension period, or (ii) the termination of the Agreement.
1.10 "IND" shall mean an Investigational New Drug application, as defined
---
in the U.S. Food, Drug and Cosmetic Act and the regulations promulgated
thereunder, or any corresponding foreign application, registration or
certification.
1.11 "Major Country" shall mean [*****].
-------------
1.12 "Medarex Technology" shall mean the Patent Rights and Know How.
------------------
1.12.1 "Know How" shall mean the Confidential Information and Mice
--------
owned or Controlled by Medarex during the term of the Agreement and transferred
to Leukosite by Medarex necessary for the exercise of the Patent Rights,
including, without limitation, technical data, protocols and methods and
processes. For the avoidance of doubt, the Know How does not include any Patent
Rights.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-2-
<PAGE>
1.12.2 "Patent Rights" shall mean all United States and foreign
-------------
patents (including all reissues, extensions, substitutions, confirmations, re-
registrations, re-examinations, revalidations and patents of addition) and
patent applications (including, without limitation, all continuations,
continuations-in-part and divisions thereof) owned or Controlled by Medarex
during the term of the Agreement, in each case, which claims an invention which
is necessary for the use of the Antibodies to make, use or sell Products.
1.13 "Mice" shall mean immunizable transgenic mice containing unrearranged
----
human immunoglobulin genes. "Mouse" shall mean one of the Mice.
-----
1.14 "Mice Materials" shall mean any parts or derivatives of the Mice
--------------
prepared by Medarex in connection with the Evaluation, including without
limitation, cells, hybridomas Antibodies, genes, DNA sequences or other
biological materials derived directly or indirectly from the Mice.
1.15 "Net Sales" shall mean [*****].
---------
1.16 "Phase I", "Phase II"and "Phase III" shall mean Phase I (or Phase
------- -------- ---------
I/II), Phase II, and Phase III clinical trials, respectively, in each case as
prescribed by the U.S. Food and Drug Administration or a corresponding foreign
entity.
1.17 "Product" shall mean any product for the diagnosis, prophylaxis or
-------
treatment of human disease containing one or more Antibodies, or a portion
thereof.
1.18 "Sublicensee" shall mean a third party to whom Leukosite has granted a
-----------
license or sublicense to make, have made, import, use, sell, offer for sale or
otherwise exploit Products in the Territory. As used in this Agreement,
"Sublicensee" shall also include a third party to whom Leukosite has granted the
right to distribute a Product.
1.19 [*****].
1.20 "Territory" shall mean all countries of the world.
---------
2. EVALUATION
2.1 Evaluation. Medarex will provide Mice to Leukosite for use during the
----------
Evaluation Period to allow Leukosite to immunize the Mice for the purpose of
determining whether Leukosite wishes to obtain a commercial license with respect
to one or more Antigens as provided in Section 3.3.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-3-
<PAGE>
2.1.1 Provision of Mice. Each year during the Evaluation Period,
-----------------
subject to Leukosite's payment of the applicable fees in Section 4. 1, Medarex
shall provide Leukosite with up to [*****] Mice per year. Medarex shall provide
Leukosite with approximately [*****] Mice per quarter. If any Mice delivered by
Medarex die of natural causes before commencement of the relevant immunization
protocol or for any reason during the immunization protocol, they shall be
replaced without cost by Medarex, provided that their death was not due to
Leukosite's misfeasance or negligence, or the mice are rendered unusable by a
failure by Leukosite to commence immunization of the Mice within three (3)
months of delivery. The first [*****] Mice shall be shipped to Leukosite within
[*****] after the Effective Date.
2.1.2 Evaluation License. Subject to the terms and conditions of this
------------------
Agreement, Medarex hereby grants to Leukosite an non-exclusive, non-transferable
license under the Medarex Technology to immunize the Mice with Antigens and use
the Mice solely for conducting the Evaluation during the Evaluation Period.
2.1.3 Extension of Evaluation Period. Leukosite will have the option
------------------------------
to extend the term of the Evaluation Period and Evaluation license beyond
[*****] the Effective Date for [*****] by providing Medarex notice at least
[*****] before the end of the then-current term of Evaluation Period and
concurrently paying to Medarex the applicable extension fee due pursuant to
Section 4.1.3. Subject to Section 8.3, Medarex shall be entitled to make a press
release announcing each such extension of the Evaluation Period following
receipt of Leukosite's notice of its wish to extend the Evaluation Period.
2.2 Ownership.
---------
2.2.1 Mice. Title to the Mice and, subject to the options and
----
licenses granted in Article 3, the Mice Materials, shall at all times remain
with Medarex.
2.2.2 Intellectual Property. Any invention made by Leukosite or its
---------------------
employees, consultants or agents in the course of activities in connection with
the Evaluation that relate to Mice or Mice Materials shall be owned by Medarex.
Leukosite shall promptly notify Medarex of any such invention, and cooperate
with Medarex, at Medarex's request and expense, in the preparation, filing,
prosecution, enforcement and defense of patent applications and patents relating
thereto. Inventions made by Leukosite or its employees, consultants or agents in
connection with the Evaluation which relate solely to the Antigens used to
immunize Mice shall be owned by Leukosite.
2.3 Limited Use. Leukosite agrees that the Mice will be used solely for
-----------
the purpose of conducting the Evaluation and for no other purpose. All Mice
shall be kept and used only at Leukosite's facilities. Leukosite shall not make
any effort, directly or indirectly, to breed, clone or
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-4-
<PAGE>
otherwise reproduce the Mice by any means, sexual or asexual. In no event shall
Leukosite transfer the Mice to any person or entity without the prior written
approval of Medarex.
2.4 Care in Use of Mice. It is understood and agreed that the Mice are
-------------------
experimental in nature and may have unknown characteristics and Leukosite
therefore agrees to use prudence and reasonable care in the use, handling,
storage, transportation and disposition and containment of the Mice, and to
maintain the Mice under suitable containment conditions in compliance with all
applicable national, state and local laws, regulations, rules and ordinances.
2.5 Records. Leukosite will prepare and maintain complete and accurate
-------
written records of all uses made of, and all persons allowed access to, the Mice
and the Mice Materials, and copies of such records will be furnished to Medarex
on a confidential basis, upon Medarex's request.
2.6 [*****].
3. OPTION; LICENSE RIGHTS
3.1 Option for Commercial Licenses. Subject to the availability of a
------------------------------
particular Antigen for exclusive licensing, during the term of the Evaluation
Period, Leukosite shall have an option to obtain exclusive commercial licenses,
in each case, to develop and commercialize Products based on Antibodies against
a specific Antigen for commercial use, as set forth below. Leukosite may
exercise its option with notice to Medarex as provided in Section 3.2 below.
3.2 Antigen Availability.
--------------------
3.2.1 Antigen Identification. At any time during the Evaluation
----------------------
Period, Leukosite may notify Medarex that it wishes to acquire an exclusive
commercial license to use Mice to prepare Antibodies with respect to a
particular Antigen identified by Leukosite. Each Antigen shall be a specific
molecular target or biochemical entity, and the parties shall agree on a written
description of such Antigen.
3.2.2 Notice of Availability; Notice Date. Within [*****] following
-----------------------------------
receipt of notice from Leukosite regarding its desire to obtain an exclusive
commercial license with regard to a particular Antigen, Medarex will notify
Leukosite whether the exclusive rights requested by Leukosite are available for
licensing to Leukosite. It is understood and agreed that an Antigen may not be
available for Leukosite for exclusive commercial use if Medarex is actively
engaged in discussions with a third party, or has previously granted a third
party an option, right of first refusal or other rights to use the Mice with
respect to such Antigen, or if Medarex has initiated an active program of
development or commercialization with respect to such Antigen or has an intent
to initiate an active program with regard to such Antigen.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-5-
<PAGE>
3.2.3 License Fee. If Medarex notifies Leukosite that a particular
-----------
Antigen is available for exclusive licensing by Leukosite, within [*****] of
Medarex's notice of such availability, Leukosite shall pay to Medarex the
initial commercial license fee, if any, due pursuant to Section 4.2 with respect
to such Antigen.
3.2.4 Unavailability. In the event that Medarex notifies Leukosite
--------------
that exclusive rights are not available with regard to a particular Antigen,
Leukosite shall have no further license or other rights with regard to
Antibodies generated against such Antigen unless otherwise agreed in writing by
the parties.
3.3 Commercial License.
------------------
3.3.1 Grant. If Leukosite elects to exercise its option to acquire a
-----
commercial license with respect to a particular Antigen which is available for
commercial licensing to Leukosite, subject to the terms and conditions of this
Agreement, Medarex shall grant to Leukosite the following licenses, on an
Antigen-by-Antigen basis:
(a) a worldwide, exclusive, non-transferable, royalty bearing
license under the Medarex Technology to immunize the Mice to make Antibodies
against such Antigen, and
(b) a worldwide exclusive, royalty bearing license under the
Medarex Technology, with the right to sublicense, to use such Antibodies against
such Antigen to make, have made, import, have imported, use, offer for sale and
sell Products.
3.3.2 Sublicenses. Leukosite shall have no right to grant sublicenses
-----------
to use the Mice, but may grant sublicenses under the Medarex Technology to the
extent necessary to develop, make, have made, import, use, offer for sale and
sell Products; provided, prior to the execution of any sublicense, Leukosite
shall provide Medarex with at least the following information with respect to
each potential Sublicensee: (i) the identity of the Sublicensee; (ii) a
description of the Product, and the rights being granted to the Sublicensee; and
(iii) the territory in which the Product will be sold. Each sublicense granted
by Leukosite shall be consistent with all the terms and conditions of this
Agreement, and subordinate thereto, and Leukosite shall remain responsible to
Medarex for the compliance of each such Sublicensee with the financial and other
obligations due under this Agreement.
3.4 Retained Rights; No Further Rights. Only the license granted pursuant
----------------------------------
to the express terms of this Agreement shall be of any legal force or effect. No
other license rights shall be granted or created by implication, estoppel or
otherwise. It is understood and agreed that Medarex shall retain rights to make,
have made, import, use, offer for sale, sell and otherwise commercialize the
Mice itself or with third parties for any uses.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-6-
<PAGE>
3.5 Use of Mice. Any use of the Mice by Leukosite or its Sublicensees
-----------
pursuant to a license granted pursuant to Section 3.3 shall be subject to the
provisions of Sections 2.3, 2.4 and 2.5.
3.6 No Patent Filings. Unless and until Leukosite acquires a commercial
-----------------
license pursuant to Section 3.3 to use the Mice and Mice Materials to prepare
Antibodies against a particular Antigen, Leukosite and its Affiliates shall not
file any patent applications disclosing or claiming the use of the Mice or any
Mice Materials with regard to such Antigen or any related antigen.
4. CONSIDERATION
4.1 Evaluation Fees.
---------------
4.1.1 Mouse Fee. Leukosite shall pay to Medarex [*****] per Mouse
---------
delivered to Leukosite for the conduct of the Evaluation. Leukosite shall pay
such Mice fees to Medarex with thirty (30) days following receipt of an invoice
therefore.
4.1.2 Extension Fee. If Leukosite elects to extend the Evaluation
-------------
Period pursuant to Section 2.1.3, it shall pay to Medarex [*****] concurrently
with its notice that Leukosite wishes to extend the Evaluation Period.
4.2 Commercial License Fee. [*****]. The [*****] commercial license fee
----------------------
shall be paid to Medarex in cash within [*****] of Medarex's notice to Leukosite
of the availability of the Antigen for exclusive licensing by Leukosite.
4.3 Milestone Payments. Within thirty (30) days following the occurrence
------------------
of the relevant events specified below with respect to each Product which
contains one of the Antibodies licensed by Leukosite, Leukosite shall pay to
Medarex the following amounts:
[*****]
4.4 Royalties.
----------
4.4.1 Royalty on Net Sales. In partial consideration for the
--------------------
commercial license, Leukosite shall pay to Medarex a royalty on annual Net Sales
of Products, on a Product-by-Product basis, as follows:
Annual Net Sales Royalty Rate
---------------- ------------
[*****] [*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-7-
<PAGE>
4.4.2 [*****].
4.4.3 Royalty Term. The royalties due pursuant to this Section 4.4
------------
shall be payable on a Product-by-Product and country-by-country basis in each
country, as follows: [*****].
4.5 [*****].
5. PAYMENTS
5.1 Timing of Royalty Payments. All royalties due to Medarex shall be
--------------------------
paid [*****].
5.2 Payment Method. All amounts due Medarex hereunder shall be paid in
--------------
U.S. dollars [*****].
5.3 Currency; Foreign Payments. If any currency conversion shall be
--------------------------
required in connection with the payment of any royalties hereunder, such
conversion shall be made by using the exchange rate for the purchase of U.S.
dollars reported by the Chase Manhattan Bank on the last business day of the
calendar quarter to which such royalty payments relate. If at any time legal
restrictions prevent the prompt remittance of any royalties owed on Net Sales in
any jurisdiction, Leukosite may notify Medarex and make such payments by
depositing the amount thereof in local currency in a bank account or other
depository in such country in the name of Medarex, and Leukosite shall have no
further obligations under this Agreement with respect thereto.
5.4 Taxes. All royalty amounts required to be paid to Medarex pursuant to
-----
this Agreement may be paid with deduction for withholding for or on account of
any taxes (other than taxes imposed on or measured by net income) or similar
governmental charge imposed by a jurisdiction other than the United States
("Withholding Taxes"). At Medarex's request, Leukosite shall provide Medarex a
certificate evidencing payment of any Withholding Taxes hereunder and shall
reasonably assist Medarex to obtain the benefit of any applicable tax treaty.
6. REPORTS AND RECORDS
6.1 Royalty Reports. Leukosite shall deliver to Medarex [*****] after the
---------------
end of each calendar quarter in which Products are sold a report setting forth
in reasonable detail the calculation of the royalties payable to Medarex for
such calendar quarter, including the Products sold in each country by Leukosite
and its Sublicensees, the Net Sales thereof, and all amounts received from
Sublicensees for sales of Products. Such reports shall be Confidential
Information of Leukosite subject to Article 9 herein.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-8-
<PAGE>
6.2 Inspection of Books and Records. Leukosite and its Affiliates and
-------------------------------
Sublicensees shall maintain accurate books and records which enable the
calculation of royalties payable hereunder to be verified. Leukosite and its
Affiliates and Sublicensees shall retain the books and records for each
quarterly period for [*****] years after the submission of the corresponding
report under Section 5.1 hereof. Upon [*****] days prior notice to Leukosite,
independent accountants selected by Medarex and reasonably acceptable to
Leukosite, may have access to Leukosite's and its Affiliates' and Sublicensees'
books and records during normal business hours to conduct a review or audit, for
the purpose of verifying the accuracy of Leukosite's payments and compliance
with this Agreement. Any independent accountant from any of the "Big Six"
accounting firms (or a successor thereof) shall be and is hereby agreed to be
acceptable to Leukosite. Any such inspection or audit shall be at Medarex's
expense, however, in the event an inspection reveals underpayment of [*****] or
more in any quarter, Leukosite shall pay the costs of the inspection [*****].
7. DILIGENCE
7.1 Reasonable Efforts. Leukosite shall use Commercially Reasonable
------------------
Efforts to achieve regulatory approvals for the sale of Products in countries
solely chosen by Leukosite in the Territory. The term "Commercially Reasonable
Efforts" shall with respect to a Product mean [*****].
7.1.1 Commencing as of the Effective Date, Leukosite shall use
Commercially Reasonable Efforts to develop, clinically test, manufacture and
commercialize Products. All costs of development, clinical testing,
manufacturing and commercialization shall be borne by Leukosite, its Affiliates
or Sublicensees. In the event that Leukosite at any point elects not to initiate
or continue developing a Product in any country in the Territory, Leukosite
shall notify Medarex of such abandonment; effective as of such notice, all
rights granted to Leukosite hereunder applicable to such Product in such country
shall revert to Medarex. Notwithstanding any other provision in this Agreement,
if within [*****] years after receiving a commercial license for a Product,
Leukosite has not [*****], Leukosite shall pay Medarex a fee of [*****] per year
for such Product until such time that Leukosite either [*****] or abandons
development of such Product, whichever occurs earlier. [*****].
7.1.2 Notwithstanding the above, if within [*****] years after the
Effective Date, Leukosite has not [*****], Medarex may require Leukosite, within
[*****] days of receipt of written notice from Medarex, to establish
Leukosite's, its Affiliates, or Sublicensees use of Commercially Reasonable
Efforts in developing such Product. If within such [*****] days, Leukosite fails
to establish such Commercially Reasonable Efforts to develop such Product, in
Medarex's reasonable opinion, then Leukosite shall have until [*****]. If by
[*****], Leukosite has not [*****], all rights granted to Leukosite hereunder
with respect to such Product (and corresponding Antibodies) shall revert to
Medarex.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-9-
<PAGE>
7.2 Reports to Medarex. During the term of this Agreement, Leukosite shall
------------------
keep Medarex informed of its development and commercialization activities
subject to this Agreement, and on January 31 of each year shall provide Medarex
with a written summary of such events and activities in the preceding year. When
the registration package requesting Approval for commercial sale of any Product
receives Approval in the U.S., Europe and Japan, Leukosite will notify Medarex
in writing within [*****] days thereof.
7.3 Reports to Medarex. During the term of this Agreement, Leukosite shall
------------------
keep Medarex fully informed of its activities subject to this Agreement,
including without limitation, the commercialization of Products, and on January
31 of each year shall provide Medarex with a written report detailing such
events and activities. When the registration package requesting approval for
commercial sale of the Product is first filed in the U.S., the European Union
and Japan, and in each case when approval is received therefor, Leukosite will
notify Medarex in writing within [*****] days.
7.4 Regulatory Filings. Leukosite shall submit registration packages
------------------
requesting approval for commercial sale of the Product as soon as reasonably
practicable. Leukosite (or its designee) shall file and hold title to all
regulatory applications, approvals and supplements thereto.
7.5 Abandoned Products. Leukosite shall promptly notify Medarex should it
------------------
elect to abandon its rights to pursue commercialization of any Product in any
country. Leukosite may voluntarily abandon its right hereunder to market the
Product [*****]. Such notice will effectuate Leukosite's voluntary abandonment
of its right hereunder to market the Product in such country; provided, the
abandonment of the Product in any particular country hereunder shall not be
construed to be a termination of this Agreement.
8. CONFIDENTIALITY
8.1 Confidential Information. Except as expressly provided herein, the
------------------------
parties agree that, for the term of this Agreement and for five (5) years
thereafter, the receiving party shall keep completely confidential and shall not
publish or otherwise disclose and shall not use for any purpose except for the
purposes contemplated by this Agreement any Confidential Information furnished
to it by the disclosing party hereto pursuant to this Agreement, except that to
the extent that it can be established by the receiving party by competent proof
that such Confidential Information:
(i) was already known to the receiving party, other
than under an obligation of confidentiality, at the time of disclosure;
(ii) was generally available to the public or otherwise
part of the public domain at the time of its disclosure to the receiving party;
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-10-
<PAGE>
(iii) became generally available to the public or
otherwise part of the public domain after its disclosure and other than through
any act or omission of the receiving party in breach of this Agreement;
(iv) was independently developed by the receiving
party as demonstrated by documented evidence prepared contemporaneously with
such independent development; or
(v) was subsequently lawfully disclosed to the
receiving party by a person other than a party hereto.
8.2 Permitted Use and Disclosures. Each party hereto may use or disclose
-----------------------------
information disclosed to it by the other party to the extent such use or
disclosure is reasonably necessary in complying with applicable governmental
regulations or otherwise submitting information to tax or other governmental
authorities, conducting clinical trials, or making a permitted sublicense or
otherwise exercising its rights hereunder, provided that if a party is required
to make any such disclosure of another party's confidential information, other
than pursuant to a confidentiality agreement, it will give reasonable advance
notice to the latter party of such disclosure and, save to the extent
inappropriate in the case of patent applications, will use its best efforts to
secure confidential treatment of such information prior to its disclosure
(whether through protective orders or otherwise).
8.3 Public Disclosure. Except as otherwise required by law, neither party
-----------------
shall issue a press release or make any other public disclosure of the terms of
this Agreement without the prior approval of such press release or public
disclosure. Each party shall submit any such press release or public disclosure
to the other party, and the receiving party shall have [*****] days to review
and approve any such press release or public disclosure, which approval shall
not be unreasonably withheld. If the receiving party does not respond within
such [*****] day period, the press release or public disclosure shall be deemed
approved. In addition, if a public disclosure is required by law, including
without limitation in a filing with the Securities and Exchange Commission, the
disclosing party shall provide copies of the disclosure reasonably in advance of
such filing or other disclosure for the nondisclosing party's prior review and
comment.
8.4 Confidential Terms. Except as expressly provided herein, each party
------------------
agrees not to disclose any terms of this Agreement to any third party without
the consent of the other party; provided, disclosures may be made as required by
securities or other applicable laws, or to actual or prospective investors or
corporate partners, or to a party's accountants, attorneys and other
professional advisors.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-11
<PAGE>
9. REPRESENTATIONS AND WARRANTIES
9.1 Medarex. Medarex represents and warrants that: (i) it is a
-------
corporation duly organized validly existing and in good standing under the laws
of the State of New Jersey; (ii) the execution, delivery and performance of this
Agreement have been duly authorized by all necessary corporate action on the
part of Medarex; (iii) it is the sole and exclusive owner of all right, title
and interest in the Mice; (iv) it has the right to grant the rights and licenses
granted herein; [*****].
9.2 Leukosite. Leukosite represents and warrants that: (i) it is a
---------
corporation duly organized validly existing and in good standing under the laws
of the State of Delaware; and (ii) the execution, delivery and performance of
this Agreement have been duly authorized by all necessary corporate action on
the part of Leukosite.
9.3 Disclaimer of Warranties. THE MICE ARE PROVIDED "AS IS", AND EXCEPT AS
------------------------
OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, MEDAREX AND ITS RESPECTIVE
AFFILIATES MAKE NO REPRESENTATIONS AND EXTEND NO WARRANTIES OR CONDITIONS OF
ANY KIND, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THE MICE, ANTIBODIES,
PRODUCTS OR MEDAREX TECHNOLOGY, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF THE PATENT RIGHTS
LICENSED HEREUNDER, OR NONINFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF
THIRD PARTIES.
9.4 Disclaimer. Nothing in this Agreement is or shall be construed as:
----------
9.4.1 A warranty or representation by Medarex as to the validity or
scope of any claim or patent within the Patent Rights;
9.4.2 A warranty or representation that anything made, used, sold, or
otherwise disposed of under any license granted in this Agreement is or will be
free from infringement of any patent rights or other intellectual property right
of any third party;
9.4.3 An obligation to bring or prosecute actions or suits against
third parties for infringement of any of the Patent Rights; or
9.4.4 Granting by implication, estoppel, or otherwise any licenses or
rights under patents or other rights of Medarex or third parties, regardless of
whether such patents or other rights are dominant or subordinate to any patent
within the Patent Rights.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-12-
<PAGE>
10. INTELLECTUAL PROPERTY
10.1 [*****].
10.1.1 [*****] Technology License. Leukosite hereby grants to
------------------
Medarex an exclusive, worldwide, royalty-free license to Leukosite's entire
right, title and interest in all patent applications, patents, know-how and
tangible materials (including, without limitation, hybridomas and antibodies)
relating to [*****] and/or their manufacture or use, conceived, reduced to
practice or otherwise developed in connection with the conduct of the
Cooperative Research Agreement entered by GenPharm International, Inc. and
Leukosite, Inc. effective January 1, 1995 (collectively, the "[*****]
Technology"). Leukosite retains this non-transferable right to use the [*****]
Technology for its own research purposes. Leukosite hereby represents and
warrants that, as of the Effective Date (i) Leukosite has not previously
licensed or assigned to any third party any right or interest in any portion or
aspect of the [*****] Technology, and will not do so during the term of this
Agreement, and (ii) Leukosite has not filed any patent application claiming any
[*****] and/or methods relating to their manufacture or use of [*****] which is
not included within the [*****] Technology.
10.1.2 Data. Medarex (or its designee) shall have access to and the
----
right to use and reference, without charge, all data owned or Controlled by
Leukosite relating to the [*****] Technology (collectively, the "Data"), and
Leukosite agrees to cooperate with Medarex to enable Medarex (or its designee)
to practice the foregoing rights.
10.1.3 Delivery. Within [*****] days following the Effective Date,
--------
Leukosite shall deliver to Medarex a list of all patent applications and patents
within the [*****] Technology, and all tangible materials within the [*****]
Technology, and all Data subject to Section 10.1.3.
10.2 Patent Rights. If Leukosite acquires a commercial license to a
-------------
particular Antigen, [*****].
10.3 Failure to Prosecute. [*****].
--------------------
10.4 Cooperation. [*****].
-----------
10.5 Infringement Claims. If the manufacture, importation, sale or use of
-------------------
the Product pursuant to this Agreement results in any claim, suit or proceeding
alleging patent infringement against Medarex or Leukosite, such party shall
promptly notify the other party hereto. The defendant shall keep each other
party hereto reasonably informed of all material developments in connection with
any such claim, suit or proceeding.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-13-
<PAGE>
11. DISPUTE RESOLUTION
11.1 Mediation. If a dispute arises out of or relates to this Agreement, or
---------
the breach thereof, and if said dispute cannot be settled through negotiation,
the parties agree first to try in good faith to settle the dispute by mediation
under the Commercial Mediation Rules of the American Arbitration Association,
before resorting to arbitration, litigation, or some other dispute resolution
procedure.
11.2 Arbitration. Subject to Sections 11.1 and 14.6, Medarex and Leukosite
-----------
agree that any dispute or controversy arising out of, in relation to, or in
connection with this Agreement, or the validity, enforceability, construction,
performance or breach thereof, shall be settled by binding arbitration in New
York, New York, United States of America, under the then-current Rules of
Commercial Arbitration of the American Arbitration Association by one (1)
arbitrator appointed in accordance with such Rules. The arbitrators shall
determine what discovery will be permitted, based on the principle of limiting
the cost and time which the parties must expend on discovery; provided, the
arbitrators shall permit such discovery as they deem necessary to achieve an
equitable resolution of the dispute. The decision and/or award rendered by the
arbitrator shall be written, final and non appealable and may be entered in any
court of competent jurisdiction. The parties agree that, any provision of
applicable law notwithstanding, they will not request, and the arbitrator shall
have no authority to award, punitive or exemplary damages against any party. The
costs of any arbitration, including administrative fees and fees of the
arbitrator, shall be shared equally by the parties. Each party shall bear the
cost of its own attorneys' fees and expert fees.
12. INDEMNIFICATION
12.1 Medarex. Medarex shall indemnify, defend and hold harmless Leukosite
-------
and its directors, officers and employees (each a "Leukosite Indemnitee") from
and against any and all liabilities, damages, losses, costs or expenses
(including attorneys' and professional fees and other expenses of litigation
and/or arbitration) (a "Liability") resulting from a claim, suit or proceeding
made or brought by a third party against a Leukosite Indemnitee arising from or
occurring as a result of any breach of the representations and warranties set
forth in Section 9.1, except to the extent caused by the negligence or willful
misconduct of Leukosite.
12.2 Leukosite. Leukosite shall indemnify, defend and hold harmless Medarex
---------
and its directors, officers and employees (each a "Medarex Indemnitee") from and
against any and all liabilities, damages, losses, costs or expenses (including
attorneys' and professional fees and other expenses of litigation and/or
arbitration) (a "Liability") resulting from a claim, suit or proceeding made or
brought by a third party against a Medarex Indemnitee, arising from or occurring
as a result of (i) any breach of the representations and warranties set forth in
Section 9.2, (ii) the conduct of the Evaluation or the practice by Leukosite of
any right granted herein, or (iii) any development, testing, manufacture,
importation, use, offer for sale, sale or other distribution of any Product by
Leukosite or its Affiliates Sublicensees (including, without limitation, product
liability claims), except in each case to the extent caused by the negligence or
willful misconduct of Medarex.
-14-
<PAGE>
12.3 Procedure. In the event that any Indemnitee intends to claim
---------
indemnification under this Article 12 it shall promptly notify the other party
(the "Indemnitor") in writing of such alleged Liability. The Indemnitor shall
have the sole right to control the defense and settlement thereof. The
Indemnitees shall cooperate with the Indemnitor and its legal representatives in
the investigation of any action, claim or liability covered by this Article 12.
The Indemnitee shall not, except at its own cost, voluntarily make any payment
or incur any expense with respect to any claim or suit without the prior written
consent of the Indemnitor, which the Indemnitor shall not be required to give.
13. TERM AND TERMINATION
13.1 Term. The term of this Agreement shall commence on the Effective Date.
----
Unless earlier terminated as provided in this Article 13, this Agreement shall
continue in full force and effect on a country-by-country and Product-by-Product
basis until there are no remaining royalty payment obligations in a country, at
which time the Agreement shall expire in its entirety in such country.
13.2 Termination for Cause. Either party may terminate this Agreement in
---------------------
the event the other party has materially breached or defaulted in the
performance of any of its obligations hereunder, and such default has continued
for sixty (60) days after written notice thereof was provided to the breaching
party by the nonbreaching party. Any termination shall become effective at the
end of such sixty (60) day period unless the breaching party has cured any such
breach or default prior to the expiration of the sixty (60) day period.
Notwithstanding the above, in the case of a failure to timely pay any amounts
due hereunder, the period for cure of any subsequent default following notice
thereof shall be ten (10) days and, unless payment is made within such period
the termination shall become effective at the end of such period.
13.3 Termination for Insolvency. If voluntary or involuntary proceedings by
--------------------------
or against a party are instituted in bankruptcy under any insolvency law, or a
receiver or custodian is appointed for such party, or proceedings are instituted
by or against such party for corporate reorganization or the dissolution of such
party, which proceedings, if involuntary, shall not have been dismissed within
sixty (60) days after the date of filing, or if such party makes an assignment
for the benefit of creditors, or substantially all of the assets of such party
are seized or attached and not released within sixty (60) days thereafter, the
other party may immediately terminate this Agreement effective upon notice of
such termination.
13.4 Permissive Termination.
----------------------
13.4.1 Leukosite. Leukosite may terminate the Evaluation Program and
---------
this Agreement with [*****] days written notice to Medarex.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-15-
<PAGE>
13.4.2 Medarex. In the event that Leukosite fails to obtain a
-------
commercial license pursuant to Section 3.2 on or before the end of the
Evaluation Period, Medarex may terminate the Agreement with written notice to
Leukosite.
13.5 Effect of Termination.
---------------------
13.5.1 Accrued Rights and Obligations. Termination of this Agreement
------------------------------
for any reason shall not release any party hereto from any liability which, at
the time of such termination, has already accrued to the other party or which is
attributable to a period prior to such termination nor preclude either party
from pursuing any rights and remedies it may have hereunder or at law or in
equity with respect to any breach of this Agreement. It is understood and agreed
that monetary damages may not be a sufficient remedy for any breach of this
Agreement and that the non-breaching party may be entitled to injunctive relief
as a remedy for any such breach.
13.5.2 Return of Confidential Information. Upon any termination of
----------------------------------
this Agreement, Leukosite and Medarex shall promptly return to the other party
all Confidential Information of the other; provided counsel of each party may
retain one (1) copy of such Confidential Information solely for archival
purposes and for ensuring compliance with Article 8.
13.5.3 Stock on Hand. In the event this Agreement is terminated for
-------------
any reason, Leukosite shall have the right to sell or otherwise dispose of the
stock of any Product subject to this Agreement then on hand, subject to Articles
4, 5 and 6 until the first anniversary of the effective date of such
termination.
13.5.4 Return of Mice and Mice Materials. Upon any termination of this
---------------------------------
Agreement, Leukosite shall promptly return to Medarex all Mice, or destroy all
materials derived from the Mice, including without limitation, all Antibodies,
hybridomas, all cells capable of producing Antibodies and other biological
materials, and an officer of Leukosite shall provide Medarex with written
certification thereof.
13.5.5 Licenses. The option and license rights granted in Sections
--------
3.1, 3.2 and 3.3 shall terminate upon any termination of this Agreement, and in
such event Leukosite and its Affiliates and Sublicensees shall immediately cease
all development and commercialization of Products.
13.6 Survival. Sections 2.2, 2.5, 3.4, 3.6, 13.5 and 13.6, and Articles 6,
--------
8, 9, 10, 11, 12 and 14 of this Agreement shall survive termination of this
Agreement for any reason.
14. MISCELLANEOUS
14.1 Governing Law. This Agreement and any dispute, including without
-------------
limitation any arbitration, arising from the performance or breach hereof shall
be governed by and construed and
-16-
<PAGE>
enforced in accordance with the laws of the state of New Jersey, without
reference to conflicts of laws principles.
14.2 Independent Contractors. The relationship of the parties hereto is
-----------------------
that of independent contractors. The parties hereto are not deemed to be agents,
partners or joint venturers of the others for any purpose as a result of this
Agreement or the transactions contemplated thereby.
14.3 Assignment. This Agreement shall not be assignable by Leukosite to
----------
any third party hereto without the written consent of Medarex which consent
shall not be unreasonably withheld; except Leukosite may assign this Agreement,
without such consent, to an entity that acquires all or substantially all of its
business or assets to which this Agreement pertains, whether by merger,
reorganization, acquisition, sale or otherwise. Medarex may assign this
Agreement. This Agreement shall be binding upon and inure to the benefit of the
parties and their successors and assigns.
14.4 Notices. All notices, requests and other communications hereunder
-------
shall be in writing and shall be personally delivered or sent by telecopy or
other electronic facsimile transmission or by registered or certified mail,
return receipt requested, postage prepaid, in each case to the respective
address specified below, or such other address as may be specified in writing to
the other parties hereto:
If to Medarex: Medarex, Inc.
1545 Route 22 East
Annandale, New Jersey 08801
Attn: President
If to Leukosite: Leukosite, Inc.
215 First Street
Cambridge, Massachusetts 02142
Attn: ______________________
14.5 Force Majeure. Neither party shall lose any rights hereunder or be
-------------
liable to the other party for damages or losses (except for payment obligations)
on account of failure of performance by the defaulting party if the failure is
occasioned by war, strike, fire, Act of God, earthquake, flood, lockout,
embargo, governmental acts or orders or restrictions, failure of suppliers, or
any other reason where failure to perform is beyond the reasonable control and
not caused by the negligence, intentional conduct or misconduct of the
nonperforming party has exerted all reasonable efforts to avoid or remedy such
force majeure; provided, however, that in no event shall a party be required to
settle any labor dispute or disturbance.
14.6 Injunctive Relief. Leukosite acknowledges that limitations and
-----------------
restrictions on its possession and use of Mice and Mice Materials hereunder are
necessary and reasonable to protect Medarex, and expressly agrees that monetary
damages would be inadequate to compensate Medarex for any violation by Leukosite
or Leukosite of any such limitations or restrictions. The parties agree
-17-
<PAGE>
that any such violation would cause irreparable injury to Medarex and agrees
that without resorting to prior mediation or arbitration, and, in addition to
any other remedies that may be available in law, in equity or otherwise, either
party shall be entitled to obtain temporary and permanent injunctive relief
against any threatened violation of such limitations or restrictions or the
continuation of any such violation in any court of competent jurisdiction,
without the necessity of proving actual damages or the posting of any bond.
14.7 Advice of Counsel. Medarex and Leukosite have each consulted counsel
-----------------
of their choice regarding this Agreement, and each acknowledges and agrees that
this Agreement shall not be deemed to have been drafted by one party or another
and will be construed accordingly.
14.8 Compliance with Laws. Each party shall furnish to the other party any
--------------------
information requested or required by that party during the term of this
Agreement or any extensions hereof to enable that party to comply with the
requirements of any U.S. or foreign federal, state and/or government agency.
14.9 Further Assurances. At any time or from time to time on and after the
------------------
date of this Agreement, either party shall at the request of the other party
hereto (i) deliver to the requesting party any records, data or other documents
consistent with the provisions of this Agreement, (ii) execute, and deliver or
cause to be delivered, all such consents, documents or further instruments of
transfer or license, and (iii) take or cause to be taken all such actions, as
the requesting party may reasonably deem necessary in order for the requesting
party to obtain the full benefits of this Agreement and the transactions
contemplated hereby.
14.10 Export Controls. Leukosite agrees that it will take all actions
---------------
necessary to insure compliance with all U.S. laws, regulations, orders or other
restrictions on exports and further will not sell, license or reexport,
directly, or indirectly, the Product(s) to any person or entity for sale in any
country or territory, if, to the knowledge of Leukosite based upon reasonable
inquiry, such sale, would cause the parties to be in violation of any such laws
or regulations now or hereafter in effect. Leukosite agrees to secure from any
recipient of Product(s) adequate manually signed written assurances prior to
shipment from the United States as are required by the U.S. Export Regulations.
14.11 Severability. In the event that any provisions of this Agreement are
------------
determined to be invalid or unenforceable by a court of competent jurisdiction,
the remainder of the Agreement shall remain in full force and effect without
said provision. In such event, the parties shall in good faith negotiate a
substitute clause for any provision declared invalid or unenforceable, which
shall most nearly approximate the intent of the parties in entering this
Agreement.
14.12 Waiver. It is agreed that no waiver by either party hereto of any
------
breach or default of any of the covenants or agreements herein set forth shall
be deemed a waiver as to any subsequent and/or similar breach or default.
-18-
<PAGE>
14.13 Complete Agreement. This Agreement, with its Exhibits, constitutes
------------------
the entire agreement, both written and oral, between the parties with respect
to the subject matter hereof, and that all prior agreements respecting the
subject matter hereof, either written or oral, expressed or implied, are merged
and canceled, and are null and void and of no effect. No amendment or change
hereof or addition hereto shall be effective or binding on either of the parties
hereto unless reduced to writing and duly executed on behalf of both parties.
14.14 Use of Name. Neither party shall use the name or trademarks of the
-----------
other party without the prior written consent of such other party.
14.15 Headings. The captions to the several Sections and Articles hereof
--------
are not a part of this Agreement, but are included merely for convenience of
reference only and shall not affect its meaning or interpretation.
14.16 Counterparts. This Agreement may be executed in two counterparts,
------------
each of which shall be deemed an original and which together shall constitute
one instrument.
IN WITNESS WHEREOF, Medarex and Leukosite have executed this Agreement by
their respective duly authorized representatives.
MEDAREX, INC. LEUKOSITE, INC.
By: /s/ Michael Appelbaum By: /s/ A. Lawlor
-------------------------------- --------------------------------
Print Name: Michael Appelbaum Print Name: A. Lawlor
------------------------ ------------------------
Title: Executive V.P. Title: V.P.
----------------------------- -----------------------------
-19-
<PAGE>
Exhibit 10.6
------------
COLLABORATION AND LICENSE AGREEMENT
This Collaboration and License Agreement (the "Agreement") dated as of
March 29/th/, 1999, is by and between NEXSTAR PHARMACEUTICALS, INC. ("NeXstar"),
having an address of 2860 Wilderness Place, Boulder Colorado 80301 and MEDAREX,
INC. ("Medarex") having an address of 1545 Route 22 East, Annandale, New Jersey
08801.
WHEREAS NeXstar entered into the Regents Option which included an option to
negotiate an exclusive license for the Invention, namely Blockade of T
Lymphocyte Down-Regulation Associated with CTLA-4 Signaling;
WHEREAS exercise of the Regents Option requires NeXstar to engage in
certain activities, including:
(1) Notice to Regents of its election to exercise the Regents Option
before March 31, 1999;
(2) Submission of an acceptable Commercialization Plan to Regents before
March 31, 1999;
(3) Reimbursement for outstanding past patent costs to Regents; and
(4) Execution of the Regents License no later than four months following
NeXstar's exercise of the Regents Option;
WHEREAS Medarex possesses expertise in developing drugs for therapeutic
uses, particularly the development of antibody drugs;
WHEREAS NeXstar and Medarex wish to collaborate on the development and
commercialization of the Invention with therapeutic agents comprised of
antibodies, and possibly Aptamers and small molecules;
WHEREAS Medarex wishes to obtain and NeXstar wishes to grant to Medarex a
sublicense under the Regents License to the Invention for exclusive use with
antibodies for all human therapeutic uses permitted by the Regents License;
WHEREAS NeXstar may pursue development of a CTLA-4 Aptamer and Medarex may
wish to obtain and NeXstar wishes to grant to Medarex an option to negotiate an
option to license the CTLA-4 Aptamer from NeXstar; and
1
<PAGE>
WHEREAS NeXstar may initiate or Medarex may request NeXstar to initiate a
Small Molecule Program, and Medarex and NeXstar may then negotiate terms to
license the small molecule coming out of the Small Molecule Program.
NOW THEREFORE, in consideration of the mutual covenants contained in this
Agreement and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:
1. DEFINITIONS
-----------
1.1 Defined Terms - In this Agreement, unless the context otherwise requires:
-------------
(a) "Antibody Sublicense" means the sublicense granted under subparagraph
3.1(a).
(b) "Affiliate" means any corporation, company, partnership, joint venture
and/or firm which controls, is controlled by or is under common
control with NeXstar or Medarex. For purpose of this subparagraph
1.1(b), "control" means:
(i) In the case of corporate entities, direct or indirect ownership
of at least 50% of the stock or shares entitled to vote for the
election of directors, and
(ii) In the case of non-corporate entities, direct or indirect
ownership of at least 50% of the equity interest with the power
to direct the management and policies of such non-corporate
entities.
(c) "Aptamer License Option" means the exclusive option which the parties
may negotiate pursuant to the Aptamer Option. If negotiated between
the parties pursuant to the Aptamer Option, the Aptamer License Option
will be an exclusive option by NeXstar to Medarex to license a CTLA-4
Aptamer successfully developed by NeXstar.
(d) "Aptamer Option" means the exclusive option granted by NeXstar to
Medarex pursuant to paragraph 4.1 to negotiate the terms of the
Aptamer License Option.
(e) "Aptamers" means non-naturally occurring nucleic acid ligands having a
specific binding affinity for a target molecule. For the purpose of
this Agreement, the target molecule is CTLA-4 and the Aptamers are
capable of the Blockade of T Lymphocyte Down-Regulation Associated
with CTLA-4 Signaling.
(f) "Commercialization Plan" means a written plan prepared by Medarex with
assistance from NeXstar pertaining to the development and
commercialization of a CTLA-4 antibody containing at least the
following criteria:
2
<PAGE>
[*****]
A copy of the Commercialization Plan is attached as Exhibit A to this
Agreement.
(g) "Commercially Reasonable Efforts"[*****]
(h) "Confidential Information" shall mean:
(i) Any proprietary or confidential information or material in
tangible form, including but not limited to scientific, technical
and/or commercial information and materials and trade secrets,
disclosed under this Agreement by NeXstar and/or Medarex that is
marked as "Confidential" at the time it is delivered to the
Recipient, or
(ii) Proprietary or confidential information disclosed orally under
this Agreement by NeXstar and/or Medarex which is identified as
confidential or proprietary when disclosed.
(i) "CTLA-4 Aptamer" means an Aptamer to CTLA-4 (including without
limitation, truncates, point mutations and chimeras of the Aptamers)
developed by NeXstar.
(j) "Disclosing Party" means either NeXstar or Medarex, whichever is
disclosing Confidential Information in the particular circumstance.
(k) "Effective Date" means the effective date of this Agreement, set forth
in the first paragraph of this Agreement.
(l) "Evolutionary Chemistry Technology" includes all NeXstar technology
necessary or useful for the generation of starting libraries for the
Evolutionary Chemistry process or necessary or useful for the
generation, development and commercialization of compounds generated
and identified through the Evolutionary Chemistry process in
accordance with the invention described in U.S. Patent No. 5,732,289.
Evolutionary Chemistry Technology includes, but is not limited to:
(i) The patents and patent applications listed in Exhibit B to this
Agreement,
(ii) Any patents and patent applications which may be filed and which
relate to the generation of starting libraries for the
Evolutionary Chemistry process or which relate to the generation,
development and commercialization of
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURTIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
3
<PAGE>
compounds generated and identified through the Evolutionary
Chemistry process,
(iii) Any and all continuations, continuations-in-part, divisionals,
reissues or re-examinations of or to the patents and patent
applications listed at clauses (i) and (ii) which have been or
may be filed and which relate to the generation of starting
libraries for the Evolutionary Chemistry process or which relate
to the generation, development and commercialization of
compounds generated and identified through the Evolutionary
Chemistry process, and
(iv) All corresponding foreign applications and patents which have
been or may be filed and which relate to the generation of
starting libraries for the Evolutionary Chemistry process or
which relate to the generation, development and
commercialization of compounds generated and identified through
the Evolutionary Chemistry process.
(m) "Infringement" means any patent infringement of the Licensed Patents
by a product in the Sublicensed Field of Use.
(n) "Infringement Notice" means the prompt written notice from one party
to the other if one party becomes aware of an Infringement.
(o) "Invention" means the inventions described in "Blockade of T-
Lymphocyte Down-Regulation Associated with CTLA-4 Signaling" as
described in Regents' Case No. B96-002.
(p) [*****]
(q) "Licensed Method" means any method or process that is covered by the
Licensed Patent Rights, or any method or process the use or practice
of which would constitute an infringement of any pending claims (were
they to issue) to issued claims within the Licensed Patent Rights.
(r) "Licensed Patent Rights" shall have the same meaning as Regents Patent
Rights under the Regents Option, namely:
(i) The U.S. Continuation-in-Part application entitled "Blockade of
T Lymphocyte Down-Regulation Associated with CTLA-4 Signaling,"
serial number 08/566,853 (U.C. Case No.: B96-002-2) filed on
December 4, 1995,
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURTIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
4
<PAGE>
by Drs. James P. Allison, Dana R. Leach and Matthew Krummel of
the University of California at Berkeley and assigned to
Regents, that claims priority to Serial Number 08/506,666 (U.C.
Case No.: B96-002-1, now abandoned) filed on July 25, 1995,
(ii) The U.S.. Continuation-in-Part application entitled, "Blockade
of T Lymphocyte Down-Regulation Associated with CTLA-4
Signaling," serial number 08/646,605 (U.C. Case No.: B96-002-3)
filed May 8, 1996, by Drs. James P. Allison, Dana R. Leach and
Matthew Krummel of the University of California at Berkeley and
assigned to Regents and issued as U.S. Patent No. 5,811,097,
that is a CIP of Serial Number 08/566,853, which is a U.S. CIP
of 08/506,666,
(iii) The U.S. Continuation-in-Part application entitled, "Blockade of
T Lymphocyte Down-Regulation Associated with CTLA-4 Signaling,"
serial number 08/760,288 (U.C. Case No.: B96-002-4) filed
December 4, 1996, by Drs. James P. Allison, Dana R. Leach and
Matthew Krummel of the University of California at Berkeley and
assigned to Regents,
(iv) PCT International Patent application, Serial Number US96/19375
filed on December 4, 1996, by Drs. James P. Allison, Dana R.
Leach and Matthew Krummel and assigned to Regents (U.C. Case No.
B93-002/PCT) that claims the convention priority benefits of:
U.S. Patent Application Serial No. 08/566,853 dating from the
U.S. filing date of December 4, 1995, and U.S. Patent
Application Serial No. 08/646,605 dating from the U.S. filing
date of May 8, 1996, and
(v) All other international patents and patent applications, and/or
any divisions, continuations, reissues and claims in
continuations-in-part that are (a) entitled to the priority
filing date of Serial Numbers 08/506,666, 08,566,853, 08/646,605
or 08/760,288 and (b) are claimed or described in Serial Numbers
08/506,666, 08/566,853, 08/646,605 or 08/760,288.
(s) "Litigation" means a proceeding in respect of an Infringement,
including, without limitation, a proceeding before the United States
Patent and Trademark Office, the European Patent Office or other
regulatory body or litigation in a court of law.
(t) "Medarex Confidential Information" means Confidential Information,
whether belonging to Regents or Medarex, disclosed to NeXstar by or on
behalf of Medarex.
(u) "NDA" shall have the same definition as is included in the Regents
License. If no such definition is provided, NDA shall mean a New Drug
Application filed with the United States Food and Drug Administration.
5
<PAGE>
(v) "Net Sales" shall have the same definition with regard to Sublicensed
Products under this Agreement as with regard to Licensed Products
under the Regents License. If no such definition is provided, "Net
Sales" shall mean the invoiced sales price of Sublicensed Products
billed to unaffiliated customers, less:
(i) Actual credited allowances and/or charge-backs for returned
product,
(ii) Quantity and other trade discounts actually allowed and taken,
(iii) Sales, value-added and other direct taxes incurred,
(iv) Customs duties and surcharges and other governmental charges
incurred in connection with the exportation or importation of
any Sublicensed Product, and
(v) Legally mandated rebates.
(w) "NeXstar Confidential Information" means Confidential Information,
whether belonging to Regents or NeXstar, disclosed to Medarex by or on
behalf of NeXstar.
(x) "NeXstar's Option Legal Fees" means fees paid to outside legal counsel
by NeXstar of [*****] related to the execution of the Regents Option
and evaluation of the Licensed Patent Rights under the Regents Option.
(y) "Option Fee" means the [*****] fee paid by NeXstar to Regents upon
signing of the Regents Option.
(z) "Publication" means any proposed publication, press release or other
such public disclosure, written or oral:
(i) Of the terms of this Agreement, or
(ii) Concerning, relating to or derived from Confidential Information
of the other party or use of any Confidential Information of the
other party.
(aa) "Recipient" means either NeXstar or Medarex, whichever is receiving
Confidential Information in the particular circumstance.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURTIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
6
<PAGE>
(bb) "Regents" means the Regents of the University of California, a
California corporation whose legal address is 300 Lakeside Drive,
Oakland, California 94612-3550, acting through its Office of
Technology Licensing, of the University of California, Berkeley, 2150
Shattuck Avenue, Suite 510, Berkeley, California 97420-1620.
(cc) "Regents Foreign Patent Costs" means the costs incurred by Regents in
pursuing PCT applications for the Invention and patent prosecution in
those countries outside the United States designated by NeXstar under
the Regents License, and after the date of execution of the Regents
License, as requested in writing by Medarex.
(dd) "Regents License" means a license agreement to be negotiated from
Regents to NeXstar under the Licensed Patent Rights, pursuant to the
Regent's Option, granting to NeXstar the right to sublicense to
Medarex the rights set forth in this Agreement, including, without
limitation, the grant of the Antibody Sublicense in subparagraph
3.1(a).
(ee) "Regents Option" means the agreement titled Option to Negotiate an
Exclusive License between NeXstar Pharmaceuticals, Inc. and the
Regents of the University of California for Blockade of T Lymphocyte
Down-Regulation Associated with CTLA-4 Signaling effective April 1,
1998 and expiring March 31, 1999.
(ff) "Regents Past Patent Costs" means costs incurred by Regents and paid
by NeXstar to Regents under the Regents Option for filing, prosecution
and maintenance of the Licensed Patent Rights.
(gg) "Related Patent Costs" means all costs, excluding previously
reimbursed Regents Past Patent Costs, or Regents Foreign Patent Costs,
incurred by Regents prior to or during the term of the Regents License
associated with preparing, filing, protecting and maintaining the
Licensed Patent Rights.
(hh) [*****]
(ii) "Sublicensed Field of Use" means use of the Sublicensed Products that
are antibodies (including without limitation, bispecific antibodies,
single chain antibodies and/or immunoconjugated antibodies) for all
human therapeutic uses permitted by the Regents License.
(jj) "Sublicensed Products" means within the Sublicensed Field of Use:
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURTIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
7
<PAGE>
(i) Any product produced using a Licensed Method, or for use in the
practice of a Licensed Method,
(ii) Any method, process, material or product the manufacture, use or
sale of which would be an infringement of any pending claim
(were it to issue) or issued claim of the Licensed Patent
Rights, or
(iii) Any material, method, process or product, or part thereof, that:
(A) Is covered by a valid claim of any issued, unexpired patent
within Licensed Patent Rights. A claim within the Licensed
Patent Rights shall be presumed to be valid unless and until
it has been held to be invalid by a final judgment of a
court of competent jurisdiction from which no appeal can be
or is taken, or
(B) Is covered by any claim being prosecuted in a pending
application directed to the Invention (were it to issue).
(kk) "Sublicensed Territory" means wherever Regents has Licensed Patent
Rights.
(ll) "Sub-licensee" means a third party, including any Medarex Affiliate,
to which Medarex has granted a further sublicense to make, have made,
use, offer for sale and import under the rights granted under
paragraph 3.1 of this Agreement.
(mm) "Term" shall have the meaning set forth in paragraph 9.1.
1.2 Additional Definitions - Any words defined elsewhere in this Argument shall
----------------------
have the particular meaning assigned thereto.
2. CONTINGENCY - Except as specified in this Section 2, the terms, conditions,
-----------
and obligations set forth in this Agreement are contingent upon NeXstar and
Regents executing the Regents License. In conjunction with negotiating the
Regents License (unless NeXstar is prohibited in the course of the
negotiations), NeXstar shall provide Medarex with copies of proposed drafts
of the Regents License so that Medarex may comment upon and assist NeXstar
in the negotiation of the Regents License. In the event that NeXstar and
Regents fail to enter into the Regents License on or before August 1, 1999
(or such later date as may be acceptable to Medarex) or in the event that
the executed Regents License is not reasonably acceptable to Medarex, this
Agreement shall be null and void except with regard to the obligations of
confidentiality set forth in Section 10. Provided that the form of the
Regents License is reasonably acceptable to Medarex, Medarex will
acknowledge this acceptability in writing prior to execution by NeXstar of
the Regents License.
8
<PAGE>
3. ANTIBODY SUBLICENSE
-------------------
3.1 Grant Of Sublicense and License
-------------------------------
(a) Sublicense under Regents License - Subject to the government rights
described in the Regents License and the provisions of subparagraph
3.1(d), NeXstar grants to Medarex a worldwide, exclusive sublicense
under the Regents License to make, have made, use, sell, offer for
sale and import the Sublicensed Products in the Sublicensed Field of
Use and the Sublicensed Territory for the life of the last to expire
patent under the Licensed Patent Rights.
(b) Mouse Hybridoma License - Subject to the provisions of subparagraph
3.1(d), NeXstar grants to Medarex:
(i) A worldwide, exclusive license to use and propagate NeXstar's
Mouse Hybridoma No. 147.1.33 to make antibodies, and
(ii) A worldwide, exclusive license to make, have made, use, sell,
offer for sale and import Sublicensed Products containing
antibodies produced from NeXstar's Mouse Hybridoma No. 147.1.33
in the Sublicensed Field of Use and the Sublicensed Territory.
(c) Delivery - If NeXstar has not already done so prior to the Effective
Date, within five days of the Effective Date, NeXstar shall deliver to
Medarex the NeXstar Mouse Hybridoma No. 147.1.33 and all NeXstar
technical information relating to the NeXstar Mouse Hybridoma No.
147.1.33.
(d) Retention of Research Rights - Notwithstanding subparagraphs 3.1(a)
and (b) above, the exclusive worldwide sublicenses granted by NeXstar
to Medarex under subparagraphs 3.1(a) and (b) shall be subject to a
right (non-transferable except pursuant to paragraphs 14.4 and 14.5)
retained by NeXstar to use Mouse Hybridoma No. 147.1.33 and the murine
antibody produced by Mouse Hybridoma No. 147.1.33 in the Sublicensed
Field of Use in the Sublicensed Territory solely for internal non-
commercial research purposes.
3.2 Further Sublicenses - Provided further sublicensing is permitted by the
-------------------
Regents License, Medarex shall have the right to grant further sublicenses
of any of the rights granted under subparagraphs 3.1(a) and (b), subject to
the following terms and conditions:
(a) Medarex Still Liable - Notwithstanding any sublicense granted by
Medarex under this Agreement, Medarex shall remain liable for the
performance of all duties and obligations contained in this Agreement.
9
<PAGE>
(b) Notice - Medarex shall promptly provide NeXstar and the Regents with
a copy of each sublicense issued (such copy shall be treated as
Medarex Confidential Information and shall not be disclosed to any
third party except as permitted by the provisions of Section 10 of
this Agreement).
(c) Payments - Medarex shall collect and guarantee payment of all payments
due NeXstar and Regents from Sub-licensees.
(d) Reports - Medarex shall summarize and deliver all reports due NeXstar
and Regents from Sub-licensees.
(e) Termination
(i) Termination of sublicenses under this Agreement shall be
governed by the provisions of the Regents License with respect
to termination of sublicenses. In the absence of provisions in
the Regents License with respect to termination of sublicenses,
the provisions of clause (ii) shall apply.
(ii) Upon termination of this Agreement for any reason, all
sublicenses granted by Medarex in accordance with this Agreement
will remain subject to the terms of such sublicenses in effect,
and shall be assigned to and assumed by NeXstar except that
sublicenses which are in a state of material breach as yet
uncured by the Sub-licensee shall not be assigned to and assumed
by NeXstar. NeXstar shall not be bound by any duties and
obligations beyond the duties and obligations assumed by NeXstar
in this Agreement.
3.3 Payments and Royalties
----------------------
(a) Reimbursement to NeXstar - Within ten days following the execution of
the Regents License in a form reasonably acceptable to Medarex,
Medarex shall reimburse NeXstar's out of pocket costs associated with
the performance of the terms of the Regents Option in an amount not to
exceed [*****]. These out of pocket costs shall be limited to:
(i) The [*****] Option Fee under the Regents Option,
(ii) Up to [*****] in Regents Past Patent Costs,
(iii) [*****] in Regents Foreign Patent Costs, and
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURTIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
10
<PAGE>
(iv) [*****] in NeXstar's Option Legal Fees.
(b) Flow Through License Payments - Medarex shall pay to NeXstar the
amounts set out below in this subparagraph (b) required to be paid by
NeXstar to Regents under the Regents License. Provided that NeXstar
has given Medarex at least ten days advance notice of the date that
each payment is due, Medarex shall make the payment to NeXstar at the
time these payments are to be paid by NeXstar to Regents (so that
there is no out of pocket expense to NeXstar for these payments).
(i) All Related Patent Costs,
(ii) A non-refundable license fee of [*****] at the time of execution
of the Regents License in a form reasonably acceptable to
Medarex,
(iii) Milestone payments as follows:
[******]
(c) [*****]
(d) Royalty Rates - Medarex shall pay NeXstar a [*****] royalty on Net
Sales of all Sublicensed Products. Royalties shall be calculated and
paid quarterly and shall be due within 60 days following the end of
each calendar quarter (or such shorter period of time as is set out in
the Regents License). NeXstar shall be responsible for payment to
Regents of royalties owing under the Regents License.
(e) Offsets and Deductions - With respect to running royalties due NeXstar
under this Agreement, to the extent that the Regents License contains
provisions entitling NeXstar to credit any amounts toward royalties or
other payment due Regents or allows any offset against amounts due
Regents with respect to payments made to third parties, Medarex shall
be entitled to equivalent credits and offsets against amounts due to
NeXstar, provided, regardless of any credits or offsets available to
Medarex, in no event shall Medarex pay to NeXstar a royalty of less
than a [*****] royalty on Net Sales of all Sublicensed Products.
(f) Penalties - Failure of Medarex to make the payments set out in
subparagraphs (b), (c) and (d) above may subject Medarex to penalties
specified under the Regents License for failure to make these
payments.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURTIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
11
<PAGE>
3.4 Commercially Reasonable Efforts - Medarex shall use Commercially Reasonable
-------------------------------
Efforts in meeting the criteria set forth in the Commercialization Plan
attached as Exhibit A, the terms of which are incorporated into this
Agreement.
4. CTLA-4 APTAMER OPTION
---------------------
4.1 Aptamer Option - NeXstar grants the Aptamer Option to Medarex. The Aptamer
--------------
Option will expire at 11:59 p.m. Mountain Standard Time on that date which
is four months after the date of signing of the Regents License. Medarex
may exercise the Aptamer Option by written notice to NeXstar, specifying
that Medarex wishes to exercise the Aptamer Option and the terms proposed
by Medarex for the Aptamer License Option. If Medarex gives notice of
exercise of the Aptamer Option, the parties shall immediately meet and use
good faith efforts to mutually agree within the four month period of the
Aptamer Option to the terms of the Aptamer License Option. The parties
agree that any license to the CTLA-4 Aptamer will include, but not be
limited to, an up-front sublicense fee, milestones, royalties, reporting
and record keeping provisions and due diligence development and
commercialization provisions.
4.2 Failure to License
------------------
(a) Third Party Negotiations - If Medarex exercises the Aptamer Option but
the parties (both acting reasonably) do not agree before expiry of the
four month Aptamer Option period on reasonable terms for a license to
the CTLA-4 Aptamer, then NeXstar shall be free (subject to the
provisions of subparagraph (b) below) to negotiate with a third party
for a license to the CTLA-4 Aptamer.
(b) Second Right In Favor of Medarex - NeXstar agrees that it will not
license the CTLA-4 Aptamer to a third party on terms substantially
more favorable than the terms discussed with Medarex under paragraph
4.1 without giving Medarex an opportunity to license the CTLA-4
Aptamer on the more favorable terms. NeXstar shall give written
notice of the more favorable terms for a license to the CTLA-4 Aptamer
to Medarex. Medarex shall have ten days from this written notice to
exercise this second right (Medarex must give written notice to
NeXstar within this ten day period in order to exercise this right).
This second right shall only be a "yes/no" right, with no right to
negotiate terms. If Medarex does agree to license the CTLA-4 Aptamer
pursuant to the second right contained in this subparagraph (b), then
NeXstar and Medarex shall promptly enter into a license for the CTLA-4
Aptamer on the more favorable terms. If Medarex does not agree to
license the CTLA-4 Aptamer pursuant to the second right contained in
this subparagraph (b), then NeXstar shall be free to license or
otherwise exploit the CTLA-4 Aptamer as
12
<PAGE>
NeXstar determines in its sole discretion, without further
consultation with or obligation to Medarex.
5. SMALL MOLECULE OPTION
---------------------
5.1 NeXstar Undertaking - If during the Term NeXstar undertakes a Small
-------------------
Molecule Pro-ram, NeXstar shall promptly notify Medarex in writing.
Medarex shall then have an option for a period of six months from the date
of such notice from NeXstar to participate in the Small Molecule Program
under terms to be agreed by the parties under paragraph 5.3 below. Medarex
may exercise its option by written notice to NeXstar.
5.2 Medarex Request
---------------
(a) Right to Request a Small Molecule Program - Subject to the provisions
of subparagraph (b) below, Medarex shall have the right, beginning one
year from the Effective Date and extending for a period of two years,
to request that NeXstar undertake the Small Molecule Program. In this
situation, upon the parties reaching agreement on the terms of
participation in the Small Molecule Program under paragraph 5.3 below,
NeXstar shall undertake the Small Molecule Program.
(b) Provisio to Request - NeXstar's obligation to undertake a Small
Molecule Program upon request by Medarex under subparagraph (a) is
contingent upon NeXstar still owning and exploiting at least part of
the Evolutionary Chemistry Technology at the time of the request from
Medarex. If NeXstar does not own or is not exploiting at least part of
the Evolutionary Chemistry Technology at the time of the request from
Medarex, NeXstar shall have no obligation to undertake the Small
Molecule Program.
(c) Acknowledgment/Covenant - Medarex acknowledges that NeXstar shall have
an absolute right to use, dispose of or otherwise deal with its
Evolutionary Chemistry Technology as it sees fit, in its sole
discretion. NeXstar covenants and agrees, however, that if NeXstar
sells or otherwise disposes of its Evolutionary Chemistry Technology,
NeXstar will not also grant a sublicense under the Regents License to
Sublicensed Products that are small molecule therapeutics identified
using the Evolutionary Chemistry Technology to the acquiring party
without Medarex's prior written consent, such consent not to be
unreasonably withheld or delayed.
5.3 Terms of Participation - If Medarex exercises its option under paragraph
----------------------
5.1 or if Medarex requests that NeXstar undertake the Small Molecule
Program under paragraph 5.2 (subject to the provisions of subparagraph
5.2(b)), the parties shall meet and use good faith efforts to mutually
agree to the terms under which NeXstar and Medarex will participate in the
Small Molecule Program, such terms to include, but not being limited to,
research funding, an up-front sublicense fee, milestones, royalties,
reporting, and record keeping provisions
13
<PAGE>
and due diligence development and commercialization provisions. If the
parties can not agree within a six month period (commencing at the time of
exercise by Medarex of its option under paragraph 5.1 or at the time
Medarex requests NeXstar to undertake the Small Molecule Program under
paragraph 5.2 (subject to the provisions of subparagraph 5.2 (b)), as the
case may be) on reasonable terms under which NeXstar and Medarex will
participate in the Small Molecule Program, the unresolved matters or
matters in dispute shall be submitted to mediation pursuant to paragraph
13.1.
5.4 Failure to License - If:
------------------
(a) No Program - Medarex does not exercise its option under paragraph 5.1
and Medarex does not request that NeXstar undertake the Small Molecule
Program under paragraph 5.2; or
(b) Failure to Reach Agreement on Terms - Medarex exercises its option
under paragraph 5.1 or Medarex requests that NeXstar undertake the
Small Molecule Program under paragraph 5.2, but the parties can not
agree within the six month period on reasonable terms under which
NeXstar and Medarex will participate in the Small Molecule Program
(and mediation does not assist the parties to reach terms upon which
they will work together);
then, subject to the provisions of paragraph 5.5, NeXstar shall be free to
negotiate with a third party to collaborate on the Small Molecule Program.
5.5 Second Right In Favor of Medarex - NeXstar agrees that it will not
--------------------------------
collaborate with a third party on the Small Molecule Program on terms
substantially more favorable than the terms discussed with Medarex under
paragraph 5.3 without giving Medarex an opportunity to participate in the
Small Molecule Program on the more favorable terms. NeXstar shall give
written notice of the more favorable terms for the Small Molecule Program
to Medarex. Medarex shall have ten days from this written notice to
exercise this second right (Medarex must give written notice to NeXstar
within this ten day period in order to exercise this right). This second
right shall only be a "yes/no" right, with no right to negotiate terms. If
Medarex does agree to participate in the Small Molecule Program pursuant to
the second right contained in this paragraph 5.5, then NeXstar and Medarex
shall promptly enter into an agreement for the Small Molecule Program on
the more favorable terms. If Medarex does not agree to participate in the
Small Molecule Program pursuant to the second right contained in this
paragraph 5.5, then NeXstar shall be free to collaborate, license or
otherwise pursue and exploit the Small Molecule Program as NeXstar
determines in its sole discretion, without further consultation with or
obligation to Medarex.
5.6 Additional Right to Sublicense - Subject to the provisions of paragraphs
------------------------------
5.7 and 5.8, if:
14
<PAGE>
(a) No Access to Evolutionary Chemistry Technology - NeXstar has sold or
otherwise disposed of the Evolutionary Chemistry Technology, or is no
longer exploiting at least part of the Evolutionary Chemistry
Technology;
(b) Medarex Has Small Molecule Opportunity - Medarex has an opportunity to
pursue commercial development of a small molecule therapeutic to CTLA-
4 using the Invention (as evidenced by agreed upon terms in writing);
and
(c) Medarex Given Notice - Medarex has given written notice to NeXstar of
Medarex's small molecule opportunity and that Medarex wishes to obtain
an additional sublicense under the Regents License for Sublicensed
Products that are small molecule therapeutics;
then the parties shall meet and use good faith efforts to negotiate the
terms of an additional sublicense under the Regents License for Sublicensed
Products that are small molecule therapeutics. If the parties (both acting
reasonably) do not reach agreement on the terms of this additional
sublicense within three months of the notice from Medarex under
subparagraph (c), the parties may submit the unresolved matters or matters
in dispute to mediation pursuant to paragraph 13.1. If the parties (both
acting reasonably):
(i) Do not reach agreement on the terms of this additional
sublicense within three months of the notice from Medarex under
subparagraph (c), or
(ii) Do not reach agreement as set out in clause (i) and proceed to
mediation, but still do not reach agreement on the terms of this
additional sublicense, the parties shall have no further rights
or obligations to each other under this paragraph 5.6.
5.7 First Exception to the Additional Right to Sublicense - The provisions of
-----------------------------------------------------
paragraph 5.6 are subject to the following provisions. If:
(a) No Access to Evolutionary Chemistry Technology - NeXstar has sold or
otherwise disposed of the Evolutionary Chemistry Technology, or is no
longer exploiting at least part of the Evolutionary Chemistry
Technology;
(b) NeXstar Has Small Molecule Opportunity - NeXstar has an opportunity to
grant a sublicense under the Regents License to a third party for
Sublicensed Products that are small molecule therapeutics (as
evidenced by agreed upon terms in writing); and
(c) NeXstar Given Notice - NeXstar has given written notice to Medarex of
NeXstar's small molecule therapeutic sublicense opportunity and that
NeXstar wishes to grant this sublicense;
15
<PAGE>
then, unless within three months from the date of the written notice from
NeXstar to Medarex as set out in subparagraph (c), Medarex gives written
notice to NeXstar that:
(i) Medarex has an opportunity to pursue commercial development of a
small molecule therapeutic to CTLA-4 using the Invention (as
evidenced by agreed upon terms in writing), and
(ii) Medarex agrees to the same sublicense terms as NeXstar has
negotiated with a third party (as evidenced by the agreed upon
terms in writing as set out at subparagraph (b)),
NeXstar shall be free to enter into the sublicense under the Regents
License (as described in subparagraph (b) above) with the third party for
Sublicensed Products that are small molecule therapeutics and Medarex shall
have no further rights under paragraph 5.6. If Medarex gives written notice
to NeXstar as set out in clauses (i) and (ii) above, NeXstar and Medarex
shall enter into a sublicense under the Regents License for Sublicensed
Products that are small molecule therapeutics. NeXstar covenants and agrees
that it will not actively seek out sub-licensees under the Regents License
for Sublicensed Products that are small molecule therapeutics.
5.8 Second Exception to the Additional Right to Sublicense - The provisions of
------------------------------------------------------
paragraph 5.6 are subject to the following provisions. If:
(a) No Access to Evolutionary Chemistry Technology - NeXstar has sold or
otherwise disposed of the Evolutionary Chemistry Technology, or is no
longer exploiting the Evolutionary Chemistry Technology; and
(b) NeXstar Intends to Pursue its Own Small Molecule Program - NeXstar
intends to pursue a small molecule program to CTLA-4 using the
Invention itself;
NeXstar shall give written notice of its intention to pursue its own small
molecule program to CTLA-4 using the Invention and NeXstar shall thereafter
be free to pursue its own small molecule program to CTLA-4 using the
Invention and Medarex shall have no further rights under paragraph 5.6.
6. REIMBURSEMENT OF PATENT COSTS
-----------------------------
(a) Aptamer Option - If.-
(i) Medarex does not exercise the Aptamer Option under paragraph 4.
1, or
(ii) Medarex exercises the Aptamer Option under paragraph 4.1 but
does not acquire a license to the CTLA-4 Aptamer,
16
<PAGE>
then NeXstar shall reimburse Medarex for [*****] of Regents Past Patent
Costs, Regents Foreign Patent Costs and Related Patent Costs paid by
Medarex up to such date. NeXstar shall pay this amount to Medarex within 30
days of the last to occur of:
(A) Expiry of the Aptamer Option, or
(B) Expiry of the Aptamer License Option.
(b) Small Molecule Program - If:
(i) Within three and a half years from the Effective Date a Small
Molecule Program is not undertaken by NeXstar (either on its own
undertaking as set out in paragraph 5.1 or at Medarex's request
as set out in paragraph 5.2), or
(ii) A Small Molecule Program is undertaken by NeXstar and Medarex
does not exercise its option under paragraph 5.1,
then NeXstar shall reimburse Medarex for Regents Past Patent Costs, Regents
Foreign Patent Costs and Related Patent Costs paid by Medarex up to such
date in accordance with the following schedule:
(A) If Medarex was reimbursed pursuant to subparagraph 6(a), NeXstar shall
reimburse Medarex for [*****] of Regents Past Patent Costs, Regents
Foreign Patent Costs and Related Patent Costs paid by Medarex to date
(for a total reimbursement of [*****], or
(B) If Medarex was not reimbursed pursuant to subparagraph 6(a), NeXstar
shall reimburse Medarex for [*****] of Regents Past Patent Costs,
Regents Foreign Patent Costs and Related Patent Costs paid by Medarex
to date.
Unless the parties have gone to mediation to attempt to resolve matters in
dispute, NeXstar shall pay this amount to Medarex within 30 days of expiry
of the six month period (to negotiate the terms of participation in the
Small Molecule Program).
7. REPORTS - During the Term, Medarex shall have the following reporting
-------
obligations to NeXstar with regard to the Antibody Sublicense under Section
3:
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
17
<PAGE>
(a) Regents Reports - Medarex shall provide to NeXstar all reports
required under the Regents License as specified in writing by NeXstar.
(b) Other Reports - Unless a substantially equivalent report is required
under subparagraph 7(a), Medarex shall provide the following reports
to NeXstar:
(i) Semiannual Progress Reports - Until the first commercial sale of
---------------------------
any Sublicensed Product(s) under this Agreement, Medarex shall
submit semiannual progress reports to NeXstar, such reports to
set out Medarex's progress with development of any Sublicensed
Product(s) in the past six months. These semiannual reports shall
be delivered to NeXstar within 60 days of the end of each six-
month period, the first six-month period commencing on the
Effective Date.
(ii) Royalty Reports - After the first commercial sale of any
---------------
Sublicensed Product(s) under this Agreement, and for the
remainder of the Term, Medarex shall submit quarterly payment
reports to NeXstar (within 60 days of the end of the calendar
quarter, at the same time as the royalty payment for the
quarter). The reports shall include, but not be limited to:
(A) An accounting of worldwide Net Sales on a country-by-country
basis,
(B) The sales price for all Sublicensed Product(s) sold in the
currency of sale and in United States dollars (and the exchange
rates used in determining the amount of United States dollars),
and
(C) An accounting of the calculation of Net Sales (in United States
dollars) and the royalty amounts owing to NeXstar pursuant to
subparagraph 3.3(d) (in United States dollars), including, if
applicable, the exchange rates used in determining amounts owing
in United States dollars.
8. RECORD KEEPING
--------------
8.1 Written Records - Medarex shall maintain such records as required under the
---------------
Regents License as specified in writing by NeXstar. In the absence of such
records requirements, Medarex shall keep written records with respect to
its activities under this Agreement in accordance with generally accepted
accounting practices, sufficient to ascertain and verify the accuracy and
completeness of the accounting and the amounts owing pursuant to this
Agreement. Medarex shall preserve these written records for a period of at
least three years after their creation.
8.2 Audits - Medarex shall permit audits by Regents as required under the
------
Regents License and as specified in writing by NeXstar. In addition, not
more than once per year during the Term,
18
<PAGE>
Medarex shall permit independent auditors (chosen by NeXstar and reasonably
acceptable to Medarex) to inspect, copy and abstract books, records and
accounts and to talk to finance, sales and other relevant Medarex employees
as may be reasonably necessary to determine the completeness and accuracy
of the reports and payments made or required to be made under this
Agreement. NeXstar shall give reasonable notice to Medarex of its request
for an audit pursuant to this provision, and the audit shall be conducted
during normal business hours. NeXstar shall be responsible for the cost of
this audit except as set out below. If the audit indicates that Medarex
underpaid NeXstar by [*****], Medarex will pay the cost of the audit. If
the audit determines that additional payments were owed during a period,
Medarex shall pay the additional amount to NeXstar within 45 days of the
date of the delivery of the audit report. The parties acknowledge and agree
that the confidentiality provisions of Section 10 of this Agreement shall
apply to audits conducted pursuant to this provision and NeXstar shall
ensure that its auditors (including all audit-personnel working on the
audit) are bound by the confidentiality provisions of Section 10.
9. TERM AND TERMINATION
--------------------
9.1 Term - The term of this Agreement shall commence on the Effective Date.
Unless earlier terminated as provided in this Section 9, this Agreement
shall continue in full force and effect on a country-by-country and
Sublicensed Product-by-Sublicensed Product basis until there are no
remaining royalty payment obligations in a country. Once there are no
remaining royalty payment obligations in a country, the Agreement shall
expire in its entirety in such country on that day which is 61 days after
the end of the quarter in which the royalty obligations expired.
9.2 Early Termination - This Agreement (including the Antibody Sublicense, the
-----------------
Aptamer Option and any other option, right of first refusal, sublicense or
license granted under Sections 4 or 5) may be terminated prior to expiry of
the Term in any of the circumstances set out in this paragraph 9.2.
(a) Bankruptcy, Etc. - If either party becomes bankrupt or insolvent,
petitions any judicial body under any bankruptcy or insolvency laws,
or has any proceeding commenced against it for insolvency, bankruptcy
or liquidation, the other party may terminate this Agreement by
providing ten days written notice to the bankrupt or insolvent party.
(b) Medarex Termination - Medarex shall have the same rights of
termination under this Agreement as are granted to NeXstar under the
Regents License.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
19
<PAGE>
(c) NeXstar Termination (Regents License) - If Regents terminates Regents
License, then, unless the Regents License provides for the survival of
sublicenses granted by NeXstar, NeXstar shall have the right to
terminate this Agreement concurrently with the termination of the
Regents License by Regents.
(d) NeXstar Termination (Abandonment) - In addition to NeXstar's right of
termination set out in subparagraph (c), NeXstar will have the right
to terminate this Agreement if Medarex abandons its development and/or
commercialization efforts with respect to the Sublicensed Products.
For the purposes of this provision, Medarex will be considered to have
abandoned its development and/or commercialization efforts if it has
not carried out any development or commercialization activities on the
Sublicensed Products for 12 consecutive months. If NeXstar wishes to
terminate this Agreement pursuant to this provision, NeXstar shall
give 45 days notice in writing to Medarex of NeXstar's intention to
terminate. Medarex shall have the opportunity to cure the breach
within the 45 day period to avoid termination of this Agreement.
(e) NeXstar Termination (Default) - Subject to subparagraphs (a), (c) and
(d) above, NeXstar will have the right to terminate this Agreement
only in the event of material breach by Medarex of any of its material
obligations under this Agreement by providing 45 days notice in
writing to Medarex. Medarex shall have the opportunity to cure the
breach within the 45 day period to avoid termination of this
Agreement.
9.3 Effect of Early Termination - In any of the situations set out in paragraph
---------------------------
9.2, this Agreement shall end as of the effective date of the termination
and, except as set out below, Medarex shall have no further right to
develop, make, have made, use, sell, have sold, offer for sale, import or
otherwise dispose of any Sublicensed Product. Notwithstanding early
termination of this Agreement, Medarex, its Affiliates and its Sub-
licensees shall be permitted for a [*****] following the effective date of
the termination to sell off their existing inventory of Sublicensed
Products produced pursuant to this Agreement. Early termination of this
Agreement pursuant to paragraph 9.2 shall not affect any rights or
obligations accrued prior to the effective date of the termination,
including, without limitation:
(a) Sublicenses - The sublicense provisions of paragraph 3.2 shall survive
for the term of the sublicenses then in effect;
(b) Termination - The termination provisions of paragraphs 9.3 and 9.4
shall survive for a period of five years after the effective date of
the termination;
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
20
<PAGE>
(c) Confidentiality and Publication - The confidentiality and publication
provisions of Section 10 shall survive for a period of five years
after the effective date of the termination;
(d) Liability/Indemnification - The liability and indemnity provisions of
paragraphs 12.4, 12.5, 12.6 and 12.7 shall survive for a period of
five years after the effective date of the termination;
(e) Dispute Resolution - The dispute resolution provisions of Section 13
shall survive for a period of five years after the effective date of
the termination; and
(f) Miscellaneous - The miscellaneous provisions of Section 14 shall
survive for a period of five years after the effective date of the
termination.
9.4 Expiry of the Term - The following, provisions will survive termination of
------------------
this Agreement at expiry of the Term:
(a) Termination - The termination provisions of paragraphs 9.3 and 9.4
shall survive for a period of five years from the time of expiry of
the Term;
(b) Confidentiality and Publication - The confidentiality and publication
provisions of Section 10 shall survive for a period of five years from
the time of expiry of the Term;
(c) Liability/Indemnification - The liability and indemnity provisions of
paragraphs 12.4, 12.5, 12.6 and 12.7 shall survive for a period of
five years from the time of expiry of the Term;
(d) Dispute Resolution - The dispute resolution provisions of Section 13
shall survive for a period of five years from the time of expiry of
the Term; and
(e) Miscellaneous - The miscellaneous provisions of Section 14 shall
survive for a period of five years from the time of expiry of the
Term.
9.5 March In - NeXstar shall use reasonable commercial efforts to meet its
--------
obligations under the Regents License. In any event, NeXstar shall not
terminate or enter into any modification of the Regents License if such
modification or termination would affect the rights of Medarex under this
Agreement, without the prior written consent of Medarex, such consent not
to be unreasonably withheld or delayed. NeXstar shall notify Medarex within
ten business days if NeXstar receives any notice from Regents that:
21
<PAGE>
(a) Default - Regents believes that NeXstar is in default or breach of the
Regents License; or
(b) Modification - Regents intends to modify NeXstar's rights under the
Regents License (e.g., by converting NeXstar's exclusive rights under
the Regents License to non-exclusive rights).
In the event NeXstar fails to meet any obligation under the Regents License
causing Regents to threaten termination of the Regents License, NeXstar
shall use reasonable efforts to cure its breach, or in the alternative, to
assign its rights under the Regents License to Medarex.
10. CONFIDENTIALITY AND PUBLICATION
-------------------------------
10.1 Compliance - Medarex shall adhere to the confidentiality and publication
----------
provisions of the Regents License as specified in writing by NeXstar.
Medarex further agrees to the terms regarding confidentiality and
publication set forth in paragraphs 10.2 - 10.7 below, except to the extent
such terms are less restrictive than those of the Regents License.
10.2 Exclusions -The confidentiality obligations of this Section 10 shall not
----------
extend to information which:
(a) Public Domain - Is now or later made known to the public through no
default by the Recipient of its obligations under this Agreement;
(b) Prior Knowledge - The Recipient can show (by written records) was in
its possession prior to disclosure by the Disclosing Party;
(c) Received from a Third Party - Is received by the Recipient from a
third party not under an obligation of secrecy to the Disclosing
Party; or
(d) Independent Development - Was independently developed by the Recipient
without reference to the Confidential Information of the other as
demonstrated by documented evidence prepared contemporaneously with
the independent development.
10.3 Obligation of Confidentiality - The NeXstar Confidential Information is
-----------------------------
considered by NeXstar and the Medarex Confidential Information is
considered by Medarex to be proprietary and confidential. Each of NeXstar
and Medarex agrees to hold in confidence and not disclose to any third
parties any of the other's Confidential Information without the prior
written consent of the other. Each of NeXstar and Medarex agrees to use the
same degree of care (and in any event not less than reasonable care) to
safeguard the confidentiality of the other's Confidential Information that
it uses to protect its own Confidential Information. Each of NeXstar and
Medarex agrees to limit access to the other's Confidential Information to
its
22
<PAGE>
employees and outside professional advisors who have a need to know and who
are bound by confidentiality obligations, and to advise such persons of the
Recipient's obligations under this Section.
10.4 Use of Confidential Information - Each of NeXstar and Medarex agrees only
-------------------------------
to use the other's Confidential Information for the purposes of this
Agreement.
10.5 Publication - Any proposed Publication shall be provided by the Recipient
-----------
to the Disclosing Party 30 days prior to submission for Publication. The
Disclosing Party shall review the proposed Publication and shall inform the
Recipient (within this 30-day period of time) as to whether or not it
consents to the proposed Publication. Contributions by the Disclosing Party
shall be acknowledged in any Publication. In the event that the Disclosing
Party determines that the proposed Publication contains patentable subject
matter which the Disclosing Party wishes to protect, the Disclosing Party
may request that the recipient delay publication for an additional 30 days
for the purpose of allowing the Disclosing Party to pursue patent
protection. In any event, Publication shall only occur with the consent of
the Disclosing Party, which consent will not be unreasonably withheld.
10.6 Permitted Disclosures - Nothing in this Section 10 is intended to prohibit
---------------------
either party from:
(a) Regulatory - Disclosing information to a government regulatory agency
as required for securing applicable regulatory approvals;
(b) Clinical Trials - Disclosing relevant information to investigators or
other third parties as required for the conduct of clinical trials;
(c) Sublicenses - Disclosing information to a Sub-licensee, provided the
Sub-licensee is bound by confidentiality provisions substantially
similar to the confidentiality provisions contained in this Agreement;
or
(d) Required by Law - Disclosing factual information or data relating to
this Agreement which is required by law to be disclosed. Without
limiting the generality of the foregoing, it is acknowledged and
agreed by the parties that NeXstar may be required to file this
Agreement with the U.S. Securities and Exchange Commission in
connection with its reporting obligations. If requested in writing by
Medarex, NeXstar shall seek confidential treatment for provisions of
this Agreement as requested in writing by Medarex.
10.7 Press Releases - Nothing in this Section 10 (including, without limitation,
--------------
the 30 day Publication approval provision) is intended to prohibit either
party from releasing press releases with respect to this Agreement.
However, the parties agree to the following provisions with respect to the
release of press releases in connection with this Agreement:
23
<PAGE>
(a) First Press Release - The parties agree to the release of a press
release immediately after the signing of the Regents License, such
press release to be either joint or separate, but in any event to be
approved by both parties prior to release (such approval not to be
unreasonably withheld or delayed).
(b) Additional Press Releases - Either party may mention the fact of this
Agreement and previously disclosed details of this Agreement in
further press releases without the prior written approval of the
other.
11. PATENT PROSECUTION, MAINTENANCE AND ENFORCEMENT
-----------------------------------------------
11.1 Prosecution and Maintenance
---------------------------
(a) Regents' Responsibility - Regents shall be responsible for the
prosecution and maintenance of the Licensed Patent Rights using
counsel of Regents' choice (reasonably acceptable to Medarex, provided
this right of input is included in the Regents License or is otherwise
authorized by Regents). Regents shall provide NeXstar and NeXstar
shall provide Medarex with copies of all relevant documentation so
that Medarex may be informed and apprised of the continuing
prosecution, and Medarex may provide to NeXstar substantive comment
and input thereon (if permitted by the Regents License, Regents shall
provide this documentation directly to Medarex). At Medarex's request,
NeXstar will forward Medarex's comments and input on to Regents.
Medarex shall treat this documentation as NeXstar Confidential
Information under this Agreement.
(b) Reasonable Efforts - NeXstar shall use all reasonable efforts to
compel Regents to amend any patent application to include claims
reasonably requested by Medarex to protect the products and/or
processes contemplated to be sold under this Agreement if such claims
would constitute Licensed Patent Rights. In the event that NeXstar is
unable to compel Regents to amend a patent application to Medarex's
reasonable satisfaction, provided a right of direct input from Medarex
is permitted by the Regents License, Medarex shall have the right to
provide substantive comment and input directly to Regents.
(c) Foreign Patent Protection - Regents is responsible for foreign patent
protection of the Licensed Patent Rights and Regents shall obtain
patent protection on any invention sublicensed under this Agreement in
foreign countries if available and if NeXstar so desires. NeXstar
shall advise Medarex of all notices from Regents of requirements to
nationalize PCT applications. At Medarex's written request, NeXstar
shall promptly notify Regents of Medarex's decision to obtain foreign
patents, this notice specifying the countries desired. The absence of
such a notice from Medarex to NeXstar shall be considered an election
not to secure foreign rights in the countries not included in the
required notice.
24
<PAGE>
(d) Costs of Foreign Patent Protection - The preparation, filing,
prosecuting and maintenance of all foreign patent applications filed
at Medarex's request, as well as the maintenance of all resulting
foreign patents, shall be at the sole expense of Medarex and shall
constitute Related Patent Costs. Such patents shall be held in the
name of Regents and shall be obtained using counsel of Regents' choice
(reasonably acceptable to Medarex, provided this right of input is
included in the Regents License or is otherwise authorized by
Regents).
(e) Other Countries - NeXstar shall have the right to request that Regents
file, at NeXstar's expense, or Regents may file patent applications at
its own expense, in any country in which Medarex has not elected to
secure patent rights, and such applications and resultant patents
shall not be subject to this Agreement.
(f) Reimbursement Obligations - Medarex's obligation to reimburse NeXstar
for costs specified in this paragraph 11.1 shall continue for so long
as this Agreement remains in effect; provided, however, that Medarex
may elect to terminate its obligations with respect to any given
patent application or patent in any country upon four months written
notice to NeXstar. NeXstar shall have 30 days from receipt of this
patent termination notice to notify Medarex in writing that NeXstar is
assuming such obligations or notify Regents in writing of Medarex's
election. In either event, Medarex's obligation to make such payments
shall cease and its license with regard to such patent application or
patent in that country shall terminate at expiry of the four month
notice period. NeXstar and/or Regents may continue prosecution and/or
maintenance of such application(s) or patent(s) at its sole discretion
and expense. Medarex shall have no further right or licenses under any
patents or applications for which Medarex provides patent termination
notice and for which NeXstar or Regents assume responsibility for
costs.
(g) Periodic Statements - NeXstar shall provide Medarex with periodic
statements from Regents showing the amounts of Related Patent Costs to
be reimbursed to Regents under this paragraph 11.1. Medarex shall
tender payment to NeXstar within 20 days of the date of such
statements.
(h) Cooperation - In addition to all of the specific provisions set out in
this paragraph 11. 1, the parties agree that they will work together
and cooperate with respect to prosecution and maintenance of the
Licensed Patent Rights to ensure reasonable input of Medarex is
included in the prosecution and maintenance of the Licensed Patent
Rights.
11.2 Infringement
------------
(a) Notice - Each of NeXstar and Medarex agrees that during the Term it
will promptly give the other an Infringement Notice if it becomes
aware of any Infringement.
25
<PAGE>
[*****]
12. REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION
-----------------------------------------------
12.1 NeXstar's Representations - NeXstar represents and warrants to Medarex as
-------------------------
follows:
(a) Incorporation and Organization - NeXstar is a corporation duly
incorporated and organized, validly existing and in good standing
under the laws of the State of Delaware.
(b) Corporate Power - NeXstar has all requisite corporate power and
capacity to own its property and assets and to carry on its business
as now being conducted by it and as presently contemplated to be
conducted by it.
(c) Authority - NeXstar has due and sufficient right and authority and has
taken all action required to enter into this Agreement on the terms
and conditions set forth in this Agreement and to carry out the terms
of this Agreement, including the granting of the Antibody Sublicense
in Section 3, the granting of the Aptamer Option and Aptamer License
Option in Section 4 and the granting of the option to participate in
the Small Molecule Program in Section 5.
(d) Valid Obligation - This Agreement constitutes a valid obligation of
NeXstar, legally binding on it and enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency, moratorium,
reorganization or similar laws from time to time in effect affecting
creditors' rights generally.
(e) No Conflicting Agreements - NeXstar is not under any obligation
(contractual or otherwise) to any third party that conflicts with or
is inconsistent with the provisions of this Agreement or impedes
NeXstar's ability to carry out its obligations under this Agreement.
(f) No Blocking Patents/Rights - NeXstar will not enforce or assist any
third party in enforcing against Medarex or its Affiliates or any Sub-
licensee or any purchaser of Sublicensed Products any patent or other
rights owned or controlled by NeXstar which are necessary or useful
for the practice of the Licensed Patent Rights.
(g) Related Patents/Rights - In the event that any patent or other rights
of NeXstar arise which are dominant or subordinate to any patent
within the Licensed Patent Rights,
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
26
<PAGE>
NeXstar shall grant Medarex an option to obtain a nonexclusive license
to such related patent or other intellectual property rights and the
parties shall immediately meet and use good faith efforts to mutually
agree to the terms of the Medarex license to the related patent or
other rights.
12.2 No Representation - NeXstar makes no representation or warranty whatsoever
-----------------
that:
(a) Validity - Any patents or patent applications licensed or sublicensed
under this Agreement are valid; or
(b) Infringement - The exercise of the rights or sublicense granted to
Medarex under this Agreement will not infringe any patents of third
parties.
12.3 Medarex's Representations - Medarex represents and warrants to NeXstar as
-------------------------
follows:
(a) Incorporation and Organization - Medarex is a corporation duly
incorporated and organized, validly existing and in good standing
under the laws of the State of New Jersey.
(b) Corporate Power - Medarex has all requisite corporate power and
capacity to own its property and assets and to carry on its business
as now being conducted by it and as presently contemplated to be
conducted by it.
(c) Authority - Medarex has due and sufficient right and authority and has
taken all action required to enter into this Agreement on the terms
and conditions set forth in this Agreement and to carry out the terms
of this Agreement.
(d) Valid Obligations - This Agreement constitutes a valid obligation of
Medarex, legally binding on it and enforceable in accordance with its
term, subject to applicable bankruptcy, insolvency, moratorium,
reorganization or laws from time to time in effect affecting
creditors' rights generally.
(e) No Conflicting Agreements - Medarex is not under any obligation
(contractual or otherwise) to any third party that conflicts with or
is inconsistent with the provisions of this Agreement or impedes
Medarex's ability to carry out its obligations under this Agreement.
(f) Compliance with Laws - The development, making, sale, use or import of
any products licensed under this Agreement, including, without
limitation, Sublicensed Products, by Medarex under this Agreement
shall be in compliance with all laws, regulations and necessary
governmental permits and approvals of the applicable jurisdiction.
27
<PAGE>
12.4 No Liability for NeXstar - Subject to the provisions of paragraph 12.5,
Medarex acknowledges and agrees that NeXstar will not be liable to Medarex,
successors or assigns of Medarex, or to any third party with respect to:
(a) Sublicensed Products - Any claim arising from the development, making,
sale, use or import of Sublicensed Products; or
(b) Other Damages - Any claim for loss of profits, loss or interruption of
business, or for indirect, special or consequential damages of any
kind.
12.5 NeXstar Indemnification - NeXstar will be liable for the performance of its
-----------------------
obligations under this Agreement and for the veracity of its
representations and warranties contained in this Agreement. If the
representations and warranties made by NeXstar are not true and accurate,
NeXstar shall indemnify and hold harmless Medarex and its officers,
directors, employees and agents against any liability, claim, loss, cost or
expense (including direct, consequential and punitive damages and
reasonable attorney's fees) incurred as a result.
12.6 No Liability for Medarex - Subject to the provisions of paragraph 12.7,
------------------------
NeXstar acknowledges and agrees that Medarex will not be liable to NeXstar
or successors or assigns of NeXstar with respect to any claim by NeXstar
for loss of profits, loss or interruption of business, or for indirect,
special or consequential damages of any kind.
12.7 Medarex Indemnification - Medarex agrees to defend, protect, indemnify and
-----------------------
hold harmless NeXstar and its officers, directors, employees and agents
against any liability, claim, loss, cost or expense (including direct,
consequential and punitive damages and reasonable attorney's fees) arising:
(a) Third Party Claims - From any third party claim arising out of the
development, making, sale, use or import of Sublicensed Products, by
or on behalf of Medarex; and
(b) Breach of Representations - If any of the representations and
warranties made by Medarex under this Agreement are not true and
accurate.
Medarex further agrees to reimburse NeXstar for any costs NeXstar incurs
for any indemnification obligation to Regents under the Regents License.
The indemnity set out in this paragraph shall not apply to any liability,
claim, loss, cost or expense that arises out of the gross negligence or
willful misconduct of NeXstar or to any liability, claim, loss, cost or
expense that arises out of a material breach by NeXstar of its
representations and warranties contained in this Agreement or the Regents
License.
28
<PAGE>
12.8 Insurance - To the extent required by the Regents License, Medarex, at its
sole cost and expense, shall insure its activities in connection with the
work under this Agreement and obtain, keep in force and maintain insurance
or an equivalent program of self insurance.
13. DISPUTE RESOLUTION
------------------
13.1 Mediation - Before commencing any arbitration with respect to any dispute
---------
arising out of or relating to this Agreement, or any alleged breach of this
Agreement (such arbitration to be conducted pursuant to paragraph 13.2),
the parties agree to seek mediation with respect to any unresolved matter
or matter in dispute arising out of or relating to this Agreement, or any
alleged breach of this Agreement, such mediation to by conducted pursuant
to the Mediation Rules of the American Arbitration Association.
13.2 Arbitration - Any dispute arising out of or relating to this Agreement, or
-----------
any alleged breach of this Agreement, shall be settled by binding
arbitration in accordance with the then-current Arbitration Rules of the
American Arbitration Association by one arbitrator appointed in accordance
with the Arbitration Rules, except as modified by this Section 13. The
arbitrator shall determine what discovery will be permitted, based on the
principle of limiting the cost and time which the parties must expend on
discovery; provided, the arbitrator shall permit such discovery as he/she
deems necessary to achieve an equitable resolution of the dispute. The
arbitration proceeding shall be conducted in the English language in San
Francisco, California, unless the parties agree to conduct the arbitration
in another location.
13.3 Arbitration Decision - The arbitration decision shall be binding and not
--------------------
appealable to any court in any jurisdiction. The prevailing party may enter
the arbitration decision in any court having competent jurisdiction.
14. MISCELLANEOUS
14.1 Regents- License
----------------
(a) NeXstar to Remain Liable - Certain of the rights sublicensed by
NeXstar to Medarex under this Agreement are subject to the provisions
of the Regents License. As required by the Regents License, NeXstar
hereby acknowledges to Medarex that it remains responsible for its
obligations under the Regents License, including, without limitation,
obligations relating to payment of ongoing Related Patent Costs,
handling of Regents' confidential information, payment of royalties,
reporting, warranties and indemnity. To the extent not expressly
addressed in this Agreement, Medarex agrees to use reasonable efforts
to assist NeXstar in meeting those obligations.
(b) Necessary Amendments - Subject to Medarex's right not to approve the
form of the Regents License (Section 2), the parties agree that if any
provision of the Regents
29
<PAGE>
License is substantially inconsistent with the provisions of this
Agreement, the parties will meet and negotiate and make such
reasonable amendments to this Agreement as both parties agree are
necessary to make this Agreement consistent with the provisions of the
Regents License.
(c) Government Rights - If the Regents License is subject to all of the
terms and conditions of Public Law 96-517, as amended, the parties
agree that this Agreement will similarly be subject to all of the
terms and conditions of Public Law 96-517, as amended, and the parties
agree to take all action necessary on their part as licensee or sub-
licensee, as the case may be, under the Regents License to enable
Regents to satisfy Regents' obligations under the Regents License
relating to the Invention.
14.2 Currency - The parties agree that, unless otherwise indicated, all dollar
--------
amounts referred to in this Agreement are in United States funds.
14.3 Further Assurances - The parties agree to execute such further documents
------------------
and do such further acts as may be necessary to implement and carry out the
intent of this Agreement.
14.4 Inurement - The parties agree that in all situations, including, without
---------
limitation, in the case of a takeover or merger of either party, this
Agreement shall inure to the benefit of and be binding upon each of them,
their successors and permitted assigns and all of their employees and
agents.
14.5 Assignment
----------
(a) Acquisition of NeXstar by Gilead - Medarex agrees that this Agreement
and the rights, duties and obligations of NeXstar under this Agreement
will become an obligation of and agreement with Gilead Sciences, Inc.
upon completion of the merger of NeXstar and Gilead Sciences, Inc. and
that the transfer/assumption of this Agreement as a result of the
NeXstar/Gilead Sciences, Inc. merger does not require the consent of
Medarex.
(b) Research Technologies Acquiring Entity - Medarex agrees that NeXstar
may assign this Agreement and the rights, duties and obligations of
NeXstar under this Agreement without Medarex's consent to any
Affiliate, or to any entity that acquires all or substantially all of
the business or assets of NeXstar to which this Agreement pertains,
whether by merger, reorganization, acquisition, sale or otherwise.
(c) Medarex Acquiring Entity - NeXstar agrees that Medarex may assign this
Agreement and the rights, duties and obligations of Medarex under this
Agreement without NeXstar's consent to any Affiliate, or to any entity
that acquires all or substantially all of the business or assets of
Medarex to which this Agreement pertains, whether by merger,
reorganization, acquisition, sale or otherwise.
30
<PAGE>
(d) General - Except the sublicensing provisions of paragraph 3.2 and
except as set out at paragraph 14.4 and subparagraphs 14.5(a), (b)
and (c), the parties agree that this Agreement and the rights, duties
and obligations of the parties under this Agreement shall not be
assigned by either of them without the prior written consent of the
other, and any attempt to assign the rights, duties or obligations
without this consent will be of no effect.
14.6 Notice - The parties agree that any notice required to be given under this
------
Agreement shall be in writing and shall be delivered personally or by
facsimile transmission to the addresses set forth on page 1 of this
Agreement to the attention of the following persons:
(a) If to NeXstar - Attn.: Dr. Larry Gold, Chief Scientific Officer, Fax
No. (303) 546-7603, with a copy to Associate General Counsel, Fax No.
303-546-7856; and
(b) If to Medarex - Attn.: Michael Appelbaum, VP and CFO, Fax No. (908)
713-6002, with a copy to Corporate Counsel, Fax No. (908) 713-6002;
(C) or to such other addresses and persons as may from time to time be
identified in writing by the parties in accordance with this
paragraph 14.6. Any notice delivered personally shall be deemed to
have been given and received at the time of delivery. Any notice
delivered by facsimile transmission shall be deemed to have been
given and received on the next business day following the date of
transmission.
14.7 Severance - The parties agree that if a provision of this Agreement is
---------
wholly or partially invalid, the Agreement shall be interpreted as if the
invalid provision had not been a part.
14.8 Governing Law - The parties agree that this Agreement shall be governed by
-------------
and construed in accordance with the laws of the State of California.
14.9 Recitals/Schedules - The parties agree that the recitals and schedules to
------------------
this Agreement and all other instruments supplementary to this Agreement
are incorporated into this Agreement and form an integral part of this
Agreement.
14.10 Entire Agreement - The parties agree that the provisions contained in this
----------------
Agreement constitute the entire agreement between the parties with respect
to the subject matter and supersede all previous communications,
representations and agreements (whether verbal or written) between the
parties with respect to the subject matter hereof, including, without
limitation:
(a) CDA - The Confidential Information Agreement between the parties
dated February, 1998, as amended October 22, 1998;
31
<PAGE>
(b) MTA - The Material Transfer Agreement between the parties dated
September, 1998; and
(c) Letter - The letter dated December 17, 1998, from Celia Courchene of
NeXstar to Michael Appelbaum of Medarex.
To the extent there is any conflict between the provisions of this
Agreement and any other document, the provisions of this Agreement shall
govern the interpretation of this Agreement.
14.11 Captions - The parties agree that the captions appearing in this Agreement
--------
have been inserted for reference and as a matter of convenience and in no
way define, limit or enlarge the scope or meaning, of this Agreement or
any provision.
14.12 Amendment - Any amendment to this Agreement shall only be effective if the
---------
amendment is in writing and is signed by NeXstar and by Medarex.
14.13 Counterparts - This Agreement may be executed in facsimile counterparts,
------------
each of which shall be deemed to be an original and both of which together
shall constitute one and the same Agreement.
IN WITNESS WHEREOF the parties have executed this Agreement as of the day
and year first written above.
NEXSTAR PHAMACEUTICALS, INC. MEDAREX, INC.
By: /s/ Larry Gold By: /s/ Michael Appelbaum
--------------------------------------- ----------------------------
Title: Chairman & Chief Scientific Officer Title: Executive V.P
----------------------------------- -------------------------
32
<PAGE>
LIST OF EXHIBITS
----------------
Exhibit A - Commercialization Plan
Exhibit B - Evolutionary Chemistry Patents and Patent Applications
33
<PAGE>
EXHIBIT A
---------
COMMERCIALIZATION PLAN
(See Attached)
[*****]
*****REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
34
<PAGE>
EXHIBIT B
---------
EVOLUTIONARY CHEMISTRY PATENTS AND PATENT APPLICATIONS
<TABLE>
<CAPTION>
Docket No. Title
U.S. Serial No. U.S. Filing Date U.S. Patent No. Issue Date
<S> <C> <C> <C> <C>
NEX22 Parallel SELEX
=====
08/309,245 09/20/94 5,723,289 03/03/98
NEX22/D1 Parallel SELEX
========
08/463,101 06/05/95 5,789,160 08/04/98
[*****]
NEX22/D3 Parallel SELEX
========
08/462,389 06/05/95 5,723,592 03/03/98
[*****]
NEX22/CIP Parallel SELEX
=========
08/618,700 03/20/96 5,858,660 01/12/99
[*****]
NEX52 Method for the Cyclotrimerization of Alkynes in Aqueous Solutions
=====
08/619,228 03/20/96 5,659,069 08/19/97
NEX52/D1 Method for the Cyclotrimerization of Alkynes in Aqueous Solutions
========
08/816,588 03/13/97 5,760,266 06/02/98
NEX52/D2 Method for the Cyclotrimerization of Alkynes in Aqueous Solutions
========
08/816,709 03/13/97
NEX08 Method for Palladium Catalyzed Carbon-Carbon Coupling and Products
=====
08/076,735 06/14/93 5,428,149 06/27/95
</TABLE>
*****REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
35
<PAGE>
EXHIBIT B, continued
EVOLUTIONARY CHEMISTRY PATENTS AND PATENT APPLICATIONS
<TABLE>
<CAPTION>
Docket No. Title
U.S. Serial No. U.S. Filing Date U.S. Patent No. Issue Date
<S> <C> <C> <C> <C>
NEX08/D1 Method for Palladium Catalyzed Carbon-Carbon Coupling and Products
=========
08/407,893 03/21/95 5,633,361 05/27/97
NEX08/D2 5-Modified Pyrimidines From Palladium Catalyzed Carbon-Carbon Coupling
========
08/423,395 04/19/95 5,591,843 01/07/97
NEX24 Purine Nucleoside Modifications by Palladium Catalyzed Methods
=====
08/347,600 12/01/94 5,580,972 12/03/96
NEX24/C Purine Nucleoside Modifications by Palladium Catalyzed Methods and
=======
Oligonucleotides Containing Same as amended
08/441,881 05/16/95 5,783,679 07/21/98
NEX35-1 Palladium Catalyzed Nucleoside Modifications Methods Using Nucleophiles
=======
and Carbon Monoxide
08/458,421 06/02/95 5,719,273 02/17/98
</TABLE>
[*****]
*****REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
36
<PAGE>
Exhibit 10.7
------------
RESEARCH AND COMMERCIALIZATION AGREEMENT
THIS RESEARCH AND COMMERCIALIZATION AGREEMENT (the "Agreement"), effective
as of August 2, 1999 (the "Effective Date"), is entered by and between GenPharm
International, Inc., a wholly owned subsidiary of Medarex, Inc., a New Jersey
corporation, with a principal place of business at 1545 Route 22 East,
Annandale, New Jersey 08801 ("Medarex"), and EOS Biotechnology, Inc., a Delaware
corporation, with a principal place of business at 225A Gateway Boulevard, South
San Francisco, California 94080 ("EOS").
BACKGROUND
Medarex is the sole and exclusive owner of certain transgenic Mice useful
for the preparation of fully human monoclonal antibodies;
EOS desires to conduct research with the Mice to evaluate their utility for
the development of fully human monoclonal antibodies to certain Antigens (as
defined below), on the terms and conditions herein; and
EOS wishes to acquire from Medarex an option to acquire a commercial
license for the use of monoclonal antibodies with specificity for the Antigens
to commercialize Products (as defined below), on the terms and conditions
herein.
NOW, THEREFORE, Medarex and EOS agree as follows:
1. DEFINITIONS
1.1 "Affiliate" means any corporation or other entity which is directly
---------
or indirectly controlling, controlled by or under the common control with EOS.
For the purpose of this Agreement, "control" shall mean the direct or indirect
ownership of fifty percent (50%) or more of the outstanding shares or other
voting rights of the subject entity to elect directors, or if not meeting the
preceding, any entity owned or controlled by or owning or controlling at the
maximum control or ownership right permitted in the country where such entity
exists.
1.2 [*****]
1.3 "[*****]"
-------
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
1.4 "Antibody" shall mean a human monoclonal antibody with binding
--------
affinity for an Antigen, which antibody is obtained by Medarex on behalf of EOS
or by EOS through the use of nucleic acid or cells derived from one or more of
the Mice.
1.5 "Antigen" shall mean any antigen provided by EOS to Medarex pursuant
-------
to Section 2.4 and used by Medarex to immunize Mice in connection with the
Immunization.
1.6 "Approval" shall mean the approvals, licenses, registrations and
--------
authorizations of all governmental agencies in a country necessary for the
manufacture, use or sale of a Product in the applicable country.
1.7 "Biological License Application" or "BLA" shall mean Biological
------------------------------ ---
License Application as defined in the U.S. Food, Drug and Cosmetic Act and the
regulations promulgated thereunder, and any corresponding foreign application,
registration or certification.
1.8 "Commercially Reasonable Efforts" shall mean with respect to a
-------------------------------
Product, efforts and resources equivalent to those employed by EOS to develop,
manufacture or market its other products of similar market potential, taking
into account the proprietary position of the Product, the likelihood of
regulatory approval (including considerations of safety and efficacy of the
Product given the regulatory authority and structure involved, and the potential
profitability of the Product.
1.9 "Confidential Information" shall mean (i) any proprietary or
------------------------
confidential information or material in tangible form disclosed hereunder that
is marked as "Confidential" at the time it is delivered to the receiving party,
or (ii) proprietary or confidential information disclosed orally hereunder which
is identified as confidential or proprietary when disclosed and such disclosure
of confidential information is confirmed in writing within thirty (30) days by
the disclosing party.
1.10 "Control" or "Controlled" shall mean possession of the ability to
------- ----------
grant the licenses or sublicenses as provided for herein without violating the
terms of any agreement or other arrangement with any third party.
1.11 "Evaluation" shall mean the activities conducted by EOS during the
----------
Evaluation Period for the applicable Antibody to determine whether EOS wishes to
obtain a commercial license thereto.
1.12 "Evaluation Period" shall mean, with respect to a particular
-----------------
Antibody, the period commencing on the date the applicable Antibody is shipped
to EOS and continuing until the
-2-
<PAGE>
earlier of (i) [*****] after the shipment date, unless extended pursuant to
Section 3.3.2, in which case the last day of the last extension period, or (ii)
the termination of the Agreement.
1.13 "IND" shall mean an Investigational New Drug application, as defined
---
in the U.S. Food, Drug and Cosmetic Act and the regulations promulgated
thereunder, or any corresponding foreign application, registration or
certification.
1.14 "Medarex Technology" shall mean the Patent Rights and Know How.
------------------
1.14.1 "Know How" shall mean the Confidential Information and Mice
--------
Materials owned or Controlled by Medarex during the term of the Agreement and
transferred to EOS by Medarex necessary for the exercise of the Patent Rights,
including, without limitation, biological materials, technical data, protocols
and methods and processes. For the avoidance of doubt, the Know How does not
include any Patent Rights.
1.14.2 "Patent Rights" shall mean all United States and foreign
-------------
patents (including all reissues, extensions, substitutions, confirmations, re-
registrations, re-examinations, revalidations and patents of addition) and
patent applications (including, without limitation, all continuations,
continuations-in-part and divisions thereof) owned or Controlled by Medarex
during the term of the Agreement, in each case, which claims an invention which
is necessary for the use of the Antibodies to make, use or sell Products.
1.15 "Mice" shall mean immunizable transgenic mice containing unrearranged
----
human immunoglobulin genes. "Mouse" shall mean one of the Mice.
1.16 "Mice Materials" shall mean any parts or derivatives of the Mice
--------------
prepared by Medarex in connection with the Immunization, including without
limitation, cells, hybridomas Antibodies, genes, DNA sequences or other
biological materials derived directly or indirectly from the Mice.
1.17 "MRC Agreement" shall mean that certain License Agreement entered by
-------------
the Medical Immunization Council, Institute of Animal Physiology and Genetics
Immunization of Babraham Hall and Marianne Bruggemann and GenPharm
International, Inc., effective October 1, 1993, as amended.
1.18 "Net Sales" shall mean [*****]
---------
1.19 [*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-3-
<PAGE>
1.20 "Phase I", "Phase II" and "Phase III" shall mean Phase I (or Phase
------- -------- ---------
I/II), Phase II, and Phase III clinical trials, respectively, in each case as
prescribed by the U.S. Food and Drug Administration or a corresponding foreign
entity.
1.21 "Product" shall mean any product for the diagnosis, prophylaxis or
-------
treatment of human disease containing one or more Antibodies, or a portion
thereof.
1.22 "Sublicensee" shall mean a third party to whom EOS has granted a
-----------
license or sublicense to make, have made, import, use, sell, offer for sale or
otherwise exploit Products in the Territory. As used in this Agreement,
"Sublicensee" shall also include a third party to whom EOS has granted the right
to distribute a Product.
1.23 "Territory" shall mean all countries of the world.
---------
2. IMMUNIZATION
2.1 Immunizations. Subject to the terms and conditions set forth in this
-------------
Article 2, Medarex will immunize Mice with the Antigens during the Evaluation
Period to produce Antibodies for evaluation by EOS for commercial development.
2.2 Reasonable Efforts. Medarex shall use reasonable efforts to conduct
------------------
the immunizations in a professional manner as promptly as reasonably possible
and agrees to commit the personnel, facilities and other resources necessary to
perform the immunizations in order to prepare Antibodies which meet the criteria
listed in Appendix A; provided, however, it does not warrant that the
immunizations shall result in the preparation of any Antibody suitable for
development as a Product. If Medarex is unable to prepare an Antibody for a
particular Antigen during the [*****] period that EOS is paying immunization
funding to Medarex for such Antigen, then Medarex shall have no obligation to
conduct any further immunizations with respect to such Antigen, and shall have
no liability to EOS hereunder for such inability to produce such Antibodies.
2.3 Immunization Fees. For the conduct of immunizations, EOS shall pay to
-----------------
Medarex an immunization fee of [*****]
2.4 Delivery of Antigens; License. EOS shall deliver to Medarex a
-----------------------------
mutually agreed quantity of each Antigen in a substantially pure form for the
immunization of the Mice. EOS hereby grants to Medarex a non-exclusive license,
non-transferable license under all intellectual property owned or Controlled by
EOS to use the Antigens solely for conducting immunizations of the Mice on
behalf of EOS.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-4-
<PAGE>
2.5 [*****]
2.6 [*****]
2.7 [*****]
3. EVALUATION
3.1 Delivery of Antibodies. Upon the preparation of an Antibody for an
----------------------
Antigen, Medarex shall deliver to EOS [*****] of purified (as defined in
Appendix A hereto) Antibody for evaluation by EOS.
3.2 Evaluation License. On an Antigen-by-Antigen basis, commencing on the
------------------
delivery of the first Antibodies to such Antigen to EOS, Medarex shall grant to
EOS a non-exclusive, non-transferable license during the applicable Evaluation
Period to use the Antibodies prepared by Medarex against such Antigen solely for
the purpose of evaluating whether EOS wishes to acquire a commercial license to
such Antibodies.
3.3 Evaluation Period.
-----------------
3.3.1 [*****] Period. The Evaluation Period for Antibodies
-------
specific for a particular Antigen shall commence on the date that Medarex ships
the first Antibodies to such Antigen to EOS and terminate [*****]
3.3.2 Extension of Evaluation Period. EOS will have the option to
------------------------------
extend the term of the Evaluation Period for Antibodies to a particular Antigen
and the corresponding evaluation license, for [*****] Antigen, by providing
Medarex notice [*****] before the end of the applicable Evaluation Period and
concurrently paying to Medarex the extension fee due pursuant to Section 5.2.
Medarex shall be entitled to make a press release announcing each such extension
of the Evaluation Period following receipt of EOS' notice of its wish to extend
the Evaluation Period.
3.4 [*****]
3.5 Return of Mouse Materials. Within two (2) months after expiration or
-------------------------
termination of the Evaluation Period for a particular Antibody, unless EOS
acquires a commercial license to such Antibody as provided in Section 4.3 below,
EOS will return to Medarex all Antibodies and other Mouse Materials delivered to
EOS, and all materials derived by EOS from such Mice
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-5-
<PAGE>
Materials for destruction by Medarex and an officer of EOS shall certify in
writing that all such materials have been returned to Medarex.
3.6 Permissive Termination. EOS may terminate the Evaluation Period with
----------------------
respect to any Antigen and this Agreement [*****] written notice to Medarex.
Should EOS terminate the Evaluation Period for all Antigens provided to Medarex
without incurring any payment obligations to Medarex as specified in Sections
5.3, 5.4 or 5.5, this Agreement will terminate and all remaining Antigen(s) will
be returned to EOS at its request.
4. OPTION; LICENSE RIGHTS
4.1 Option for Commercial Licenses. Subject to the availability of a
------------------------------
particular Antigen for exclusive licensing, during the term of the Evaluation
Period or extension thereof subject to Section 3.3.2, EOS shall have an option
to obtain exclusive commercial licenses, in each case, to develop and
commercialize Products based on Antibodies against a specific Antigen(s) for
commercial use, as set forth below. EOS may exercise its option with notice to
Medarex, subject to the terms of Section 4.2 below.
4.2 Antigen Availability.
--------------------
4.2.1 Antigen Identification. At any time during the Evaluation
----------------------
Period, or extension thereof pursuant to Section 3.3.2, EOS may notify Medarex
that it wishes to acquire an exclusive commercial license to use Mice to prepare
Antibodies with respect to a particular Antigen identified by EOS. Each Antigen
shall be a specific molecular target or biochemical entity, and the parties
shall agree on a written description of such Antigen.
4.2.2 Notice of Availability; Notice Date. [*****]
-----------------------------------
4.2.3 License Fee. [*****]
-----------
4.2.4 Unavailability. In the event that Medarex notifies EOS that
--------------
exclusive rights are not available with regard to a particular Antigen, EOS
shall have no further license or other rights with regard to Antibodies
generated against such Antigen unless otherwise agreed in writing by the
parties.
4.2.5 [*****]
4.3 Commercial License.
------------------
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-6-
<PAGE>
4.3.1 Grant. If EOS elects to exercise its option to acquire a
-----
commercial license with respect to a particular Antigen which is available for
commercial licensing to EOS, subject to the terms and conditions of this
Agreement, Medarex shall grant to EOS, on an Antigen-by-Antigen basis, a
worldwide exclusive (even as to Medarex), royalty bearing license under the
Medarex Technology, with the right to sublicense, to use such Antibodies against
such Antigen to make, have made, import, have imported, use, offer for sale and
sell Products.
4.3.2 Sublicenses. EOS may grant sublicenses under the Medarex
-----------
Technology to the extent necessary to develop, make, have made, import, use,
offer for sale and sell Products (but shall have no right to grant any
sublicense to use the Mice); provided, within ten (10) days of the date such
sublicense is executed, EOS shall provide Medarex with at least the following
information with respect to each potential Sublicensee: (i) the identity of the
Sublicensee; (ii) a description of the Product, and the rights being granted to
the Sublicensee; and (iii) the territory in which the Product will be sold. Each
sublicense granted by EOS shall be consistent with all the terms and conditions
of this Agreement, and subordinate thereto, and EOS shall remain responsible to
Medarex for the compliance of each such Sublicensee with the financial and other
obligations due under this Agreement.
4.4 Delivery of Hybridomas. If EOS acquires a commercial license for a
----------------------
particular Antibody, Medarex shall deliver to EOS a hybridoma cell line
producing such Antibody.
4.5 Retained Rights; No Further Rights. Only the license granted pursuant
----------------------------------
the express terms of this Agreement shall be of any legal force or effect. No
other license rights shall be granted or created by implication, estoppel or
otherwise. It is understood and agreed that Medarex shall retain rights to make,
have made, import, use, offer for sale, sell and otherwise commercialize the
Mice itself or with third parties for any uses.
4.6 No Patent Filings. Unless and until EOS acquires a commercial license
-----------------
pursuant to Section 4.3 with respect to Antibodies against a particular Antigen,
EOS and its Affiliates shall not file any patent applications disclosing or
claiming the use of the Mice or any Mice Materials with regard to such Antigen
or any related antigen or antibodies.
4.7 Limitation on Licensing. EOS may not (i) sublicense to a third party
-----------------------
any intellectual property [*****] or (ii) agree not to sue any third party for
the practice of any intellectual property [*****] unless, in each case, EOS has
acquired a commercial license from Medarex with respect to the applicable
Antibody relating to such intellectual property.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-7-
<PAGE>
5. CONSIDERATION
5.1 Immunization Fee. EOS shall pay to Medarex an immunization fee of
----------------
[*****]. The first payment shall be due [*****] following the provision of the
Antigen to Medarex, and subsequent payments shall be due [*****]. Such
payments shall be non-refundable, and shall be non-creditable against other
amounts due Medarex under this Agreement.
5.2 Evaluation Period Extension Fee. If EOS elects to extend the
-------------------------------
Evaluation Period for Antibodies to a particular Antigen pursuant to Section
3.3.2, EOS shall pay to Medarex [*****] per Antigen, concurrently with its
notice that EOS wishes to extend the Evaluation Period for such Antigen.
5.3 Commercial License Fee.
----------------------
5.3.1 Amount. If EOS wishes to acquire a commercial license from
------
Medarex pursuant to Section 4.3 above with respect to Antibodies to a particular
Antigen, concurrently with EOS' notice to Medarex of its exercise of its option,
EOS shall, [*****]. The commercial license fee [*****] on the later of (i) the
expiration [*****] or (ii) [*****] following the delivery to EOS for evaluation
of Antibodies meeting the applicable criteria established pursuant to Section
2.2.
5.3.2 Credit for Evaluation Period Extension Fee. If EOS has
------------------------------------------
previously obtained a research license for the Antigen and has extended the
Evaluation Period beyond the [*****] period pursuant to Section 3.3.2, and the
commercial license is obtained during the extension period of that evaluation
license, then the extension fees will be pro-rated based on the remainder of the
Evaluation Period with respect to the applicable Antigen, and the pro rata
amount of such extension fee shall be credited against the commercial license
fee.
5.4 Milestone Payments.
------------------
5.4.1 [*****]
5.4.2 Milestones [*****]. Within thirty (30) days following the
-----------
occurrence of the relevant events specified below with respect to each Product
[*****], EOS shall pay to Medarex the amounts specified below:
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-8-
<PAGE>
5.4.3 [*****]
5.4.4 Milestone and Additional Payments [*****], with respect to
----------------------------------
each Product EOS agrees to pay to Medarex milestone payments at the identical
times and in the identical amounts set forth in Section 5.4.2 and to make to
Medarex additional payments [*****].
5.4.5 [*****]
5.4.6 [*****]
5.5 Royalties.
---------
5.5.1 Royalty on Net Sales by EOS or its Affiliates. In partial
---------------------------------------------
consideration for the commercial license, EOS shall pay to Medarex a royalty on
annual Net Sales of Products sold by EOS and its Affiliates, on a Product-by-
Product basis, as follows:
Annual Worldwide Net Sales Royalty Rate
-------------------------- ------------
[*****]
5.5.2 [*****]
5.5.3 Royalty Term. The royalties due pursuant to this Section 5.5
------------
shall be payable on a country-by-country and Product-by-Product basis until the
date which [*****]
5.5.4 Third Party Royalties. Medarex shall be responsible for the
---------------------
payment to the Medical Research Council ("MRC") of any royalties due the MRC
pursuant to the MRC Agreement; provided, in the event that EOS obtains a direct
license from the Medical Research Council with respect to the intellectual
property subject to the MRC License, all royalties paid to the MRC under such a
license with respect to Products shall be creditable against royalties due
Medarex under Section 5.5.1, on a Product-by-Product basis. Except with respect
to the MRC Agreement, EOS shall be responsible for the payment of any royalties,
license fees and milestone and other payments due to third parties under license
agreements for intellectual property required to practice the licensed Medarex
Technology.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-9-
<PAGE>
6. PAYMENTS
6.1 Timing of Royalty Payments. All royalties due to Medarex shall be
--------------------------
paid [*****]
6.2 Payment Method. All amounts due Medarex hereunder shall be paid in
--------------
U.S. dollars by wire transfer in immediately available funds to an account
designated by Medarex. Any payments or portions thereof due hereunder which are
not paid on the date such payments are due under this Agreement shall bear
interest at a rate equal to the lesser of prime rate as reported by the Chase
Manhattan Bank, New York, plus [*****], or the maximum rate permitted by law,
calculated on the number of days such payment is delinquent, compounded monthly.
This Section 6.2 shall in no way limit any other remedies available to Medarex.
6.3 Currency; Foreign Payments. If any currency conversion shall be
--------------------------
required in connection with the payment of any royalties hereunder, such
conversion shall be made by using the exchange rate for the purchase of U.S.
dollars reported by the Chase Manhattan Bank, New York, New York (or its
successor in interest) on the last business day of the calendar quarter to which
such royalty payments relate. If at any time legal restrictions prevent the
prompt remittance of any royalties owed on Net Sales in any jurisdiction, EOS
may notify Medarex and make such payments by depositing the amount thereof in
local currency in a bank account or other depository in such country in the name
of Medarex, and EOS shall have no further obligations under this Agreement with
respect thereto.
6.4 Taxes. All royalty amounts required to be paid to Medarex pursuant to
-----
this Agreement may be paid with deduction for withholding for or on account of
any taxes (other than taxes imposed on or measured by net income) or similar
governmental charge imposed by a jurisdiction other than the United States
("Withholding Taxes"). At Medarex's request, EOS shall provide Medarex a
certificate evidencing payment of any Withholding Taxes hereunder and shall
reasonably assist Medarex, at Medarex's expense, to obtain the benefit of any
applicable tax treaty.
7. REPORTS AND RECORDS
7.1 Royalty Reports. EOS shall deliver to Medarex [*****] days after the
---------------
end of each calendar quarter in which Products are sold a report setting forth
in reasonable detail the calculation of the royalties payable to Medarex for
such calendar quarter, including the Products sold in each country by EOS and
its Sublicensees, the Net Sales thereof, and all amounts received from
Sublicensees for sales of Products. Such reports shall be Confidential
Information of EOS subject to Article 9 herein.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-10-
<PAGE>
7.2 Inspection of Books and Records. EOS and its Affiliates and
-------------------------------
Sublicensees shall maintain accurate books and records which enable the
calculation of royalties payable hereunder to be verified. EOS and its
Affiliates and Sublicensees shall retain the books and records for each
quarterly period for [*****] years after the submission of the corresponding
report under Section 7.1 hereof. Upon [*****] days prior notice to EOS,
independent accountants selected by Medarex and reasonably acceptable to EOS,
may have access to EOS' and its Affiliates' and Sublicensees' books and records
during normal business hours to conduct a review or audit, for the purpose of
verifying the accuracy of EOS' payments in compliance with this Agreement. Any
independent accountant from any of the "Big Five" accounting firms (or a
successor thereof) shall be and is hereby agreed to be acceptable to EOS. Any
such inspection or audit shall be at Medarex's expense, however, in the event an
inspection reveals underpayment of [*****] or more in any quarter, EOS shall pay
the costs of the inspection [*****]
8. DILIGENCE
8.1 Commercially Reasonable Efforts. Commencing as of the Effective Date,
-------------------------------
EOS shall use Commercially Reasonable Efforts to develop, clinically test,
achieve regulatory approvals for the sale of Products, manufacture and
commercialize Products worldwide. All costs of development, clinical testing,
manufacturing and commercialization shall be borne by EOS, its Affiliates or
Sublicensees. In the event that EOS at any point elects not to initiate or
continue developing a Product, EOS shall notify Medarex of such abandonment;
effective as of such notice, subject to Section 8.4 all rights granted to EOS
hereunder applicable to such Antibody shall revert to Medarex. Notwithstanding
any other provision in this Agreement, if within [*****] years after receiving a
commercial license for a Product, EOS has not filed a IND for such Product, EOS
shall pay Medarex a fee of [*****] per year for such Product until such time
that EOS either files an IND for such Product or abandons development of such
Product, whichever occurs earlier. [*****]
8.2 Lack of Diligence. Notwithstanding the above, if within [*****] years
-----------------
after the Effective Date EOS has not [*****], Medarex may require EOS, within
[*****] days of receipt of written notice from Medarex, to establish by written
records that EOS and/or its Affiliates or Sublicensee have used Commercially
Reasonable Efforts in developing such Product. If within such [*****] days, EOS
fails to establish such Commercially Reasonable Efforts to develop Product, in
Medarex's reasonable opinion, then EOS shall have until [*****] . If by [*****],
EOS has not submitted an IND for a Product, all rights granted to EOS hereunder
with respect to such Product (and corresponding Antibodies) shall revert to
Medarex.
8.3 Reports to Medarex. During the term of this Agreement, EOS shall keep
------------------
Medarex fully informed of its development and commercialization activities
subject to this Agreement,
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-11-
<PAGE>
and on January 31 of each year shall provide Medarex with a written report
detailing such events and activities in the preceding year. When the
registration package requesting Approval for commercial sale of any Product
receives Approval in each of the U.S., the first country in the European Union
and Japan, EOS will notify Medarex in writing within [*****] days.
8.4 Abandoned Products. EOS shall promptly notify Medarex should it
------------------
elect to abandon its rights to pursue commercialization of any Product. EOS may
voluntarily abandon its right hereunder to market the Product, upon [*****].
Such notice will effectuate EOS' voluntary abandonment of its right hereunder to
market the Product in such country; provided, the abandonment of the Product in
any particular country hereunder shall not be construed to be an abandonment of
EOS' right to market the Product or a termination of this Agreement. [*****]
9. CONFIDENTIALITY
9.1 Confidential Information. Except as expressly provided herein, the
------------------------
parties agree that, for the term of this Agreement and for five (5) years
thereafter, the receiving party shall keep completely confidential and shall not
publish or otherwise disclose and shall not use for any purpose except for the
purposes contemplated by this Agreement any Confidential Information furnished
to it by the disclosing party hereto pursuant to this Agreement, except that to
the extent that it can be established by the receiving party by competent proof
that such Confidential Information:
(a) was already known to the receiving party, other than under an
obligation of confidentiality, at the time of disclosure;
(b) was generally available to the public or otherwise part of the public
domain at the time of its disclosure to the receiving party;
(c) became generally available to the public or otherwise part of the
public domain after its disclosure and other than through any act or omission of
the receiving party in breach of this Agreement;
(d) was independently developed by the receiving party as demonstrated by
documented evidence prepared contemporaneously with such independent
development; or
(e) was subsequently lawfully disclosed to the receiving party by a
person other than a party hereto.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
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<PAGE>
9.2 Permitted Use and Disclosures. Each party hereto may use or disclose
-----------------------------
information disclosed to it by the other party to the extent such use or
disclosure is reasonably necessary in complying with applicable governmental
regulations or otherwise submitting information to tax or other governmental
authorities, conducting clinical trials, or making a permitted sublicense,
provided that if a party is required to make any such disclosure of another
party's confidential information, other than pursuant to a confidentiality
agreement, it will give reasonable advance notice to the latter party of such
disclosure and, save to the extent inappropriate in the case of patent
applications, will use its best efforts to secure confidential treatment of such
information prior to its disclosure (whether through protective orders or
otherwise).
9.3 Public Disclosure. Except as otherwise required by law, neither party
-----------------
shall issue a press release or make any other disclosure of the terms of this
Agreement or any aspect of the research conducted pursuant to this Agreement
without the prior approval of such press release or disclosure by the other
party hereto. Each party shall submit any such press release or disclosure to
the other party, and the receiving party shall have five (5) days to review and
approve any such press release or disclosure, which approval shall not be
unreasonably withheld. If the receiving party does not respond within such five
(5) day period, the press release or disclosure shall be deemed approved. In
addition, if a public disclosure is required by law, including without
limitation in a filing with the Securities and Exchange Commission, the
disclosing party shall provide copies of the disclosure reasonably in advance of
such filing or other disclosure for the nondisclosing party's prior review and
comment.
9.4 Confidential Terms. Except as expressly provided herein, each party
------------------
agrees not to disclose any terms of this Agreement or any aspect of the research
conducted pursuant to this Agreement to any third party without the consent of
the other party; provided, either party shall have the right to disclose the
material terms of this Agreement under strictures of confidentiality to [*****].
10. REPRESENTATIONS AND WARRANTIES
10.1 Medarex. Medarex represents and warrants that: (i) it is a
-------
corporation duly organized validly existing and in good standing under the laws
of the State of New Jersey; (ii) the execution, delivery and performance of this
Agreement have been duly authorized by all necessary corporate action on the
part of Medarex; (iii) it is the sole and exclusive owner of all right, title
and interest in the Mice; and (iv) it has the right to grant the rights and
licenses granted herein.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-13-
<PAGE>
10.2 EOS. EOS represents and warrants that: (i) it is a corporation duly
---
organized validly existing and in good standing under the laws of the State of
Delaware; and (ii) the execution, delivery and performance of this Agreement
have been duly authorized by all necessary corporate action on the part of EOS.
10.3 Disclaimer of Warranties. THE MICE MATERIALS ARE PROVIDED TO EOS "AS
------------------------
IS", AND EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, MEDAREX AND
ITS RESPECTIVE AFFILIATES MAKE NO REPRESENTATIONS AND EXTEND NO WARRANTIES OR
CONDITIONS OF ANY KIND, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THE MICE,
ANTIBODIES, PRODUCTS OR MEDAREX TECHNOLOGY, INCLUDING, BUT NOT LIMITED TO,
WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF THE
PATENT RIGHTS LICENSED HEREUNDER, OR NONINFRINGEMENT OF THE INTELLECTUAL
PROPERTY RIGHTS OF THIRD PARTIES.
10.4 Disclaimer. Nothing in this Agreement is or shall be construed as:
----------
10.4.1 A warranty or representation by Medarex as to the validity
or scope of any claim or patent within the Patent Rights;
10.4.2. A warranty or representation that anything made, used, sold,
or otherwise disposed of under any license granted in this Agreement is or will
be free from infringement of any patent rights or other intellectual property
right of any third party;
10.4.3 An obligation to bring or prosecute actions or suits against
third parties for infringement of any of the Patent Rights; or
10.4.4 Granting by implication, estoppel, or otherwise any licenses
or rights under patents or other rights of Medarex, EOS or third parties,
regardless of whether such patents or other rights are dominant or subordinate
to any patent within the Patent Rights.
11. INTELLECTUAL PROPERTY
11.1 Medarex Technology. [*****]
------------------
11.2 [*****]
11.3 Failure to Prosecute. [*****]
--------------------
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-14-
<PAGE>
11.4 Cooperation. [*****]
-----------
11.5 Notice. Subject to their confidential obligations to third parties,
------
the parties further agree that if either party becomes aware of any issued
patent owned by a third party that may be infringed by such party in the
performance of the obligations under this Agreement, it will notify the other
party; provided, neither party shall be obligated to make any disclosure which
could result in a waiver of the attorney-client privilege.
11.6 Infringement Claims. If the manufacture, importation, sale or use of
-------------------
the Product pursuant to this Agreement results in any claim, suit or proceeding
alleging patent infringement against Medarex or EOS, such party shall promptly
notify the other party hereto. The defendant shall keep each other party hereto
reasonably informed of all material developments in connection with any such
claim, suit or proceeding.
12. DISPUTE RESOLUTION
12.1 Mediation. If a dispute arises out of or relates to this Agreement,
---------
or the breach thereof, and if said dispute cannot be settled through
negotiation, the parties agree first to try in good faith to settle the dispute
by mediation under the Commercial Mediation Rules of the American Arbitration
Association, before resorting to arbitration, litigation, or some other dispute
resolution procedure.
12.2 Arbitration. Subject to Sections 12.1 and 15.6, Medarex and EOS
-----------
agree that any dispute or controversy arising out of, in relation to, or in
connection with this Agreement, or the validity, enforceability, construction,
performance or breach thereof, shall be settled by binding arbitration in San
Francisco, California, United States of America, under the then-current Rules of
Commercial Arbitration of the American Arbitration Association by one (1)
arbitrator appointed in accordance with such Rules. The arbitrators shall
determine what discovery will be permitted, based on the principle of limiting
the cost and time which the parties must expend on discovery; provided, the
arbitrators shall permit such discovery as they deem necessary to achieve an
equitable resolution of the dispute. The decision and/or award rendered by the
arbitrator shall be written, final and non-appealable and may be entered in any
court of competent jurisdiction. The parties agree that, any provision of
applicable law notwithstanding, they will not request, and the arbitrator shall
have no authority to award, punitive or exemplary damages against any party. The
costs of any arbitration, including administrative fees and fees of the
arbitrator, shall be shared equally by the parties. Each party shall bear the
cost of its own attorneys' fees and expert fees.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-15-
<PAGE>
13. INDEMNIFICATION
13.1 Medarex. Medarex shall indemnify, defend and hold harmless EOS and
-------
its directors, officers and employees (each an "EOS Indemnitee") from and
against any and all liabilities, damages, losses, costs or expenses (including
attorneys' and professional fees and other expenses of litigation and/or
arbitration) (each a "Liability") resulting from a claim, suit or proceeding
made or brought by a third party against an EOS Indemnitee arising from or
occurring as a result of (i) any breach of the representations and warranties
set forth in Section 10.1, (ii) the performance by Medarex of its obligations
hereunder, [*****]
13.2 EOS. EOS shall indemnify, defend and hold harmless Medarex and its
---
directors, officers and employees (each a "Medarex Indemnitee") from and against
any and all liabilities, damages, losses, costs or expenses (including
attorneys' and professional fees and other expenses of litigation and/or
arbitration) (each a "Liability") resulting from a claim, suit or proceeding
made or brought by a third party against a Medarex Indemnitee, arising from or
occurring as a result of (i) any breach of the representations and warranties
set forth in Section 10.2, (ii) the practice by EOS of any right granted herein,
or (iii) any development, testing, manufacture, importation, use, offer for
sale, sale or other distribution of any Product by EOS or its Affiliates or
Sublicensees (including, without limitation, product liability and patent
infringement claims), except in each case to the extent caused by the negligence
or willful misconduct of Medarex.
13.3 Procedure. In the event that any Indemnitee intends to claim
---------
indemnification under this Article 13 it shall promptly notify the other party
(the "Indemnitor") in writing of such alleged Liability. The Indemnitor shall
have the sole right to control the defense and settlement thereof. The
Indemnitees shall cooperate with the Indemnitor and its legal representatives in
the investigation of any action, claim or liability covered by this Article 13.
The Indemnitee shall not, except at its own cost, voluntarily make any payment
or incur any expense with respect to any claim or suit without the prior written
consent of the Indemnitor, which the Indemnitor shall not be required to give.
14. TERM AND TERMINATION
14.1 Term. The term of this Agreement shall commence on the Effective Date
----
Unless earlier terminated as provided in this Article 14 or Section 3.6, this
Agreement shall continue in full force and effect on a country-by-country and
Product-by-Product basis until there are no remaining royalty payment
obligations in a country, at which time the Agreement shall expire in its
entirety in such country.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-16-
<PAGE>
14.2 Termination for Cause. Either party may terminate this Agreement in
---------------------
the event the other party has materially breached or defaulted in the
performance of any of its obligations hereunder, and such default has continued
for sixty (60) days after written notice thereof was provided to the breaching
party by the non-breaching party. Any termination shall become effective at the
end of such sixty (60) day period unless the breaching party has cured any such
breach or default prior to the expiration of the sixty (60) day period.
Notwithstanding the above, in the case of a failure to timely pay any amounts
due hereunder, the period for cure of any subsequent default following notice
thereof shall be ten (10) days and, unless payment is made within such period
the termination shall become effective at the end of such period.
14.3 Termination for Insolvency. If voluntary or involuntary proceedings
--------------------------
by or against a party are instituted in bankruptcy under any insolvency law, or
a receiver or custodian is appointed for such party, or proceedings are
instituted by or against such party for corporate reorganization or the
dissolution of such party, which proceedings, if involuntary, shall not have
been dismissed within sixty (60) days after the date of filing, or if such party
makes an assignment for the benefit of creditors, or substantially all of the
assets of such party are seized or attached and not released within sixty (60)
days thereafter, the other party may immediately terminate this Agreement
effective upon notice of such termination.
14.4 Effect of Termination.
---------------------
14.4.1 Accrued Rights and Obligations. Termination of this
------------------------------
Agreement for any reason shall not release any party hereto from any liability
which, at the time of such termination, has already accrued to the other party
or which is attributable to a period prior to such termination nor preclude
either party from pursuing any rights and remedies it may have hereunder or at
law or in equity with respect to any breach of this Agreement. It is understood
and agreed that monetary damages may not be a sufficient remedy for any breach
of this Agreement and that the non-breaching party may be entitled to injunctive
relief as a remedy for any such breach.
14.4.2 Return of Confidential Information. Upon any termination of
----------------------------------
this Agreement, EOS and Medarex shall promptly return to the other party all
Confidential Information of the other; provided counsel of each party may retain
one (1) copy of such Confidential Information solely for archival purposes and
for ensuring compliance with Article 9.
14.4.3 Stock on Hand. Notwithstanding anything herein to the
-------------
contrary, in the event this Agreement is terminated for any reason, EOS shall
have the right to sell or otherwise dispose of the stock of any Product subject
to this Agreement then on hand, subject to Articles 5, 6 and 7 until the first
anniversary of the effective date of such termination.
14.4.4 Return of Mice and Mice Materials. Upon any termination of
---------------------------------
this Agreement, EOS shall promptly return to Medarex all Mice, or destroy all
materials derived from
-17-
<PAGE>
the Mice, including without limitation, all Antibodies, hybridomas, all cells
capable of producing Antibodies and other biological materials, and an officer
of EOS shall provide Medarex with written certification thereof.
14.4.5 Licenses. The option and license rights granted in Sections
--------
2.4, 3.2, 4.1 and 4.3 shall terminate upon any termination of this Agreement,
and in such event EOS and its Affiliates and Sublicensees shall immediately
cease all development and commercialization of Products.
14.4.6 Right to Use. In the event that EOS elects to terminate this
------------
Agreement, or the Agreement expires after all royalty obligations due hereunder
have been fully satisfied, all licenses granted under this Agreement will
terminate concurrently.
14.5 Survival. Sections 2.6, 3.5, 4.6, 14.4 and 14.5, and Articles 6, 7,
--------
9, 10, 11, 12, 13 and 15 of this Agreement shall survive termination of this
Agreement for any reason.
15. MISCELLANEOUS
15.1 Governing Law. This Agreement and any dispute, including without
-------------
limitation any arbitration, arising from the performance or breach hereof shall
be governed by and construed and enforced in accordance with the laws of the
state of New Jersey, without reference to conflicts of laws principles.
15.2 Independent Contractors. The relationship of the parties hereto is
-----------------------
that of independent contractors. The parties hereto are not deemed to be agents,
partners or joint venturers of the others for any purpose as a result of this
Agreement or the transactions contemplated thereby.
15.3 Assignment. This Agreement shall not be assignable by either party
----------
to any third party hereto without the written consent of the other party which
consent shall not be unreasonably withheld; except either party may assign this
Agreement, without such consent, to (i) an Affiliate of such party, or (ii) an
entity that acquires all or substantially all of its business or assets to which
this Agreement pertains, whether by merger, reorganization, acquisition, sale or
otherwise. This Agreement shall be binding upon and inure to the benefit of the
parties and their successors and assigns.
15.4 Notices. All notices, requests and other communications hereunder
-------
shall be in writing and shall be personally delivered or sent by telecopy or
other electronic facsimile transmission or by registered or certified mail,
return receipt requested, postage prepaid, in each case to the respective
address specified below, or such other address as may be specified in writing to
the other parties hereto:
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<PAGE>
If to Medarex: Medarex, Inc.
1545 Route 22 East
Annandale, New Jersey 08801
Attn: President
If to EOS: EOS Biotechnology, Inc.
225A Gateway Boulevard
South San Francisco, California 94080
Attn: President
15.5 Force Majeure. Neither party shall lose any rights hereunder or be
-------------
liable to the other party for damages or losses (except for payment obligations)
on account of failure of performance by the defaulting party if the failure is
occasioned by war, strike, fire, Act of God, earthquake, flood, lockout,
embargo, governmental acts or orders or restrictions, failure of suppliers, or
any other reason where failure to perform is beyond the reasonable control and
not caused by the negligence, intentional conduct or misconduct of the
nonperforming party has exerted all reasonable efforts to avoid or remedy such
force majeure; provided, however, that in no event shall a party be required to
settle any labor dispute or disturbance.
15.6 Injunctive Relief. EOS acknowledges that limitations and
-----------------
restrictions on its possession and use of Mice and Mice Materials set forth in
Article 3 hereunder are necessary and reasonable to protect Medarex, and
expressly agrees that monetary damages might be inadequate to compensate Medarex
for any violation by EOS or EOS of any such limitations or restrictions. The
parties agree that any such violation may cause irreparable injury to Medarex
and agrees that without resorting to prior mediation or arbitration, and, in
addition to any other remedies that may be available in law, in equity or
otherwise, either party shall be entitled to obtain temporary and permanent
injunctive relief against any threatened violation of such limitations or
restrictions or the continuation of any such violation in any court of competent
jurisdiction, without the necessity of proving actual damages or the posting of
any bond.
15.7 Advice of Counsel. Medarex and EOS have each consulted counsel of
-----------------
their choice regarding this Agreement, and each acknowledges and agrees that
this Agreement shall not be deemed to have been drafted by one party or another
and will be construed accordingly.
15.8 Compliance with Laws. Each party will comply with all applicable
--------------------
laws and regulations in connection with its performance under this Agreement.
Each party shall furnish to the other party any information requested or
required by that party during the term of this Agreement or any extensions
hereof to enable that party to comply with the requirements of any U.S. or
foreign federal, state and/or government agency.
15.9 Further Assurances. At any time or from time to time on and after
------------------
the date of this Agreement, either party shall at the request of the other party
hereto (i) deliver to the requesting party any records, data or other documents
consistent with the provisions of this Agreement, (ii)
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<PAGE>
execute, and deliver or cause to be delivered, all such consents, documents or
further instruments of transfer or license, and (iii) take or cause to be taken
all such actions, as the requesting party may reasonably deem necessary in order
for the requesting party to obtain the full benefits of this Agreement and the
transactions contemplated hereby.
15.10 Export Controls. EOS agrees that it will take all actions necessary
---------------
to insure compliance with all U.S. laws, regulations, orders or other
restrictions on exports and further will not sell, license or re-export,
directly, or indirectly, the Product(s) to any person or entity for sale in any
country or territory, if, to the knowledge of EOS based upon reasonable inquiry,
such sale, would cause the parties to be in violation of any such laws or
regulations now or hereafter in effect. EOS agrees to secure from any recipient
of Product(s) adequate manually signed written assurances prior to shipment from
the United States as are required by the U.S. Export Regulations.
15.11 Severability. In the event that any provisions of this Agreement are
------------
determined to be invalid or unenforceable by a court of competent jurisdiction,
the remainder of the Agreement shall remain in full force and effect without
said provision. In such event, the parties shall in good faith negotiate a
substitute clause for any provision declared invalid or unenforceable, which
shall most nearly approximate the intent of the parties in entering this
Agreement.
15.12 Waiver. It is agreed that no waiver by either party hereto of any
------
breach or default of any of the covenants or agreements herein set forth shall
be deemed a waiver as to any subsequent and/or similar breach or default.
15.13 Complete Agreement. This Agreement, with its Exhibits, constitutes
------------------
the entire agreement, both written and oral, between the parties with respect to
the subject matter hereof, and that all prior agreements respecting the subject
matter hereof, either written or oral, expressed or implied, are merged and
canceled, and are null and void and of no effect. No amendment or change hereof
or addition hereto shall be effective or binding on either of the parties hereto
unless reduced to writing and duly executed on behalf of both parties.
15.14 Use of Name. Unless otherwise permitted by this Agreement or required
-----------
by applicable laws or regulations, neither party shall use the name or
trademarks of the other party without the prior written consent of such other
party.
15.15 Headings. The captions to the several Sections and Articles hereof
--------
are not a part of this Agreement, but are included merely for convenience of
reference only and shall not affect its meaning or interpretation.
15.16 Counterparts. This Agreement may be executed in two counterparts,
------------
each of which shall be deemed an original and which together shall constitute
one instrument.
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<PAGE>
IN WITNESS WHEREOF, Medarex and EOS have executed this Agreement by their
respective duly authorized representatives.
MEDAREX, INC. EOS BIOTECHNOLOGY, INC.
By: /s/ D. Drakeman By: /s/ D.W. Martin, Jr.
--------------------------------- ---------------------------------
Print Name: Donald L. Drakeman Print Name: David W. Martin, Jr.
------------------------- -------------------------
Title: President Title: President
------------------------------ ------------------------------
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<PAGE>
Appendix A: Antibody Criteria
-22-
<PAGE>
Exhibit 10.8
------------
RESEARCH AND COMMERCIALIZATION AGREEMENT
THIS RESEARCH AND COMMERCIALIZATION AGREEMENT (the "Agreement"), effective
as of September 21, 1999 (the "Effective Date"), is entered into by and among
Medarex, Inc., a New Jersey corporation, with a principal place of business at
1545 Route 22 East, Annandale, New Jersey 08801 and GenPharm International,
Inc., a California corporation and wholly-owned subsidiary of Medarex, Inc.,
with a principal place of business at 2350 Qume Drive, San Jose, California
95131-1807 ("Medarex", as defined below), and Amgen Inc., a Delaware
corporation, with a principal place of business at One Amgen Center Drive,
Thousand Oaks, California 91320-1799 ("Amgen", as defined below).
BACKGROUND
A. Medarex is the sole and exclusive owner of certain transgenic Mice (as
defined below) useful for the preparation of fully human monoclonal antibodies;
B. Medarex has the right to conduct research with such Mice and related
technology;
C. Amgen desires Medarex to conduct research with the Mice to generate
fully human monoclonal antibodies to certain Antigens (as defined below), on the
terms and conditions herein;
D. Amgen further desires to analyze, characterize, evaluate the utility
of and conduct research with such fully human monoclonal antibodies to such
certain Antigens, on the terms and conditions herein; and
E. Amgen wishes to acquire from Medarex an option to acquire a commercial
license for such fully human monoclonal antibodies, on the terms and conditions
herein.
NOW, THEREFORE, Medarex and Amgen agree as follows:
1. DEFINITIONS
1.1 "Affiliate" means any corporation or other entity which is directly or
---------
indirectly controlling, controlled by or under common control with a party. For
the purpose of this definition, "control" shall mean the direct or indirect
ownership of fifty percent (50%) or more of the outstanding shares or other
voting rights of the subject entity to elect directors, or if not meeting the
preceding, any entity owned or controlled by or owning or controlling at the
maximum control or ownership right permitted in the country where such entity
exists.
<PAGE>
1.2 "Amgen" shall mean Amgen Inc. and Affiliates of Amgen Inc.
-----
1.3 "Amgen Technology" shall mean the Amgen Patent Rights and Amgen Know
----------------
How.
1.3.1 [*****]
1.3.2 "Amgen Patent Rights" shall mean all Patent Rights which
-------------------
claim Amgen Know How and which are owned or Controlled by Amgen as of the
Effective Date or during the term of the Agreement.
1.4 "Antibody(ies)" shall mean one or more fully human monoclonal
-------------
antibodies having a binding affinity for an Antigen (a) delivered by Medarex to
Amgen pursuant to this Agreement [*****].
1.5 "Antibody Cell(s)" shall mean one or more cells expressing or
----------------
secreting Antibody(ies) and/or containing Genetic Material(s) which encode
Antibody(ies).
1.6 "Antigen(s)" shall mean one or more specifically defined chemical or
----------
biological entities, as set forth in a mutually agreed written description in
Exhibit B or Exhibit C which shall include DNA sequences and amino acid
sequences, where available, which Exhibits shall be amended from time to time in
accordance with Section 2.1.2. [*****].
1.7 "Approval" shall mean all approvals, licenses, registrations and
--------
authorizations of all governmental agencies in a country necessary for the
distribution, importation, manufacture, production, use, storage, transport or
sale of a Product(s) in the applicable country.
1.8 "Biological License Application" or "BLA" shall mean a Biological
------------------------------ ---
License Application as defined in the U.S. Food, Drug and Cosmetic Act and the
regulations promulgated thereunder, and any corresponding foreign application,
registration or certification to obtain marketing approval of a human biological
therapeutic product.
1.9 [*****].
1.9.1 [*****].
1.9.2 [*****].
1.10 "Commercially Reasonable Efforts" shall mean [*****].
-------------------------------
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
2
<PAGE>
1.11 "Confidential Information" shall mean any proprietary or confidential
------------------------
information of a party which (i) if disclosed in tangible form hereunder, shall
be marked as "Confidential" at the time it shall be delivered to the receiving
party, or (ii) if disclosed orally, shall be identified as confidential or
proprietary when disclosed and shall be confirmed in writing within thirty (30)
days by the disclosing party.
1.12 "Control" or "Controlled" shall mean possession of the ability to
------- ----------
grant the licenses or sublicenses as provided for herein without violating the
terms of any agreement or other arrangement with any Third Party.
1.13 "Cross-License Agreement" shall mean that certain Cross License
-----------------------
Agreement entered into by and between Abgenix, Inc., Cell Genesys, Inc., Japan
Tobacco Inc., Xenotech L.P., and GenPharm International, Inc., effective as of
March 26, 1997, as the same may be amended from time to time.
1.14 "Evaluation" shall mean, with respect to an Antibody(ies) to a
----------
particular Antigen listed in Exhibit C, the activities conducted by Amgen
pursuant to Article 3 during the applicable Evaluation Period to determine
whether Amgen wishes to obtain a commercial license with respect to Product(s)
directed against such Antigen.
1.15 "Evaluation Period" shall mean, with respect to a particular
-----------------
Evaluation, the period from the initiation of such Evaluation as set forth in
Section 3.3 until the earlier of the termination of (i) the period set forth in
Section 3.3 or (ii) [*****].
1.16 "Field of Use" shall mean all uses of Product(s), including all human
------------
therapeutic, prophylactic and diagnostic uses of Product(s).
1.17 "Genetic Material(s)" shall mean the nucleotide sequences encoding an
-------------------
entire Antibody (or a fragment of an entire Antibody containing that portion of
the Antibody conferring binding specificity for an Antigen) [*****].
1.18 "Immunization" shall mean, with respect to an Antigen listed in
------------
Exhibit C, the activities conducted by Medarex pursuant to Article 2 during the
applicable Immunization Period for the generation and characterization of
Antibody(ies) to such Antigen.
1.19 "Immunization Period" shall mean, with respect to a particular
-------------------
Immunization, the period from the initiation of such Immunization as set forth
in Section 2.3 until the earlier of the termination of (i) the period set forth
in Section 2.3 or (ii) [*****].
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
3
<PAGE>
1.20 "IND" shall mean an Investigational New Drug application, as
---
defined in the U.S. Food, Drug and Cosmetic Act and the regulations promulgated
thereunder, or any corresponding foreign application, registration or
certification.
1.21 [*****].
1.22 [*****].
1.22.1 [*****].
1.22.2 [*****].
1.23 "Licensed Technology" shall mean the Licensed Know How and Licensed
-------------------
Patent Rights.
1.23.1 [*****].
1.23.2 [*****].
1.24 "Major Market" shall mean each of [*****].
------------
1.25 "Medarex" shall mean Medarex, Inc., GenPharm International, Inc.,
B.V., and any Affiliate of Medarex whose principal business activity is the
development and/or commercialization of human or humanized antibodies for human
therapeutic use.
1.26 "Medarex Technology" shall mean the Medarex Patent Rights and
------------------
Medarex Know How.
1.26.1 "Medarex Know How" shall mean the Confidential Information and
----------------
materials, including without limitation, biological materials, technical data,
protocols, methods and processes, owned or Controlled by Medarex during the term
of the Agreement necessary for the exercise of an invention claimed by the
Medarex Patent Rights. For the avoidance of doubt, the Medarex Know How shall
not include any Medarex Patent Rights.
1.26.2 "Medarex Patent Rights" shall mean all Patent Rights [*****],
---------------------
owned or Controlled by Medarex during the term of the Agreement, in each case,
which claim an invention necessary to make, have made, import, have imported,
use, offer for sale and sell Product(s), specifically including all Patent
Rights Controlled by Medarex under the MRC and Cross-License Agreements.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
4
<PAGE>
1.27 "Mice" shall mean immunizable transgenic mice containing
----
unrearranged human immunoglobulin genes which are owned or Controlled by Medarex
as of the Effective Date or during the term of the Agreement but not including
transgenic mice in-licensed by Medarex after the Effective Date (other than
improvements of transgenic mice owned or Controlled by Medarex as of the
Effective Date). "Mouse" shall mean one of the Mice.
------
1.28 "MRC Agreement" shall mean that certain License Agreement entered
-------------
by and between (i) the Medical Research Council, Institute of Animal Physiology
and Genetics Immunization of Babraham Hall and Marianne Bruggemann and (ii)
GenPharm International, Inc., effective October 1, 1993, as amended.
1.29 "Net Sales" shall mean [*****].
---------
1.30 "Patent Rights" shall mean all United States and foreign patents
-------------
(including all utility, model and design patents and certificates of invention,
reissues, extensions, substitutions, confirmations, re-registrations, re-
examinations, revalidations, and patents of addition) and patent applications
(including without limitation, all continuations, continuations-in-part and
divisions thereof).
1.31 "Pivotal Clinical Trial" shall mean a clinical trial or a
----------------------
comparable trial which, [*****], shall be intended [*****] to provide
statistically significant evidence of the safety and efficacy of a Product in
humans sufficient to obtain regulatory approval for the sale of such Product.
1.32 "Product(s)" shall mean, with respect to an Antigen listed in
----------
Exhibit C, a composition or compositions, with each composition comprising one
or more Antibody(ies), [*****].
1.33 "Regulatory Filings" shall mean, collectively, INDs, BLAs,
------------------
establishment license applications (ELAs) and drug master files (DMFs) or any
other similar filings (including any foreign equivalents and further including
any related correspondence and discussions) as may be required by the FDA or
equivalent foreign regulatory agencies for the clinical testing, manufacture or
sale of a Product.
1.34 "Research Plan" shall mean a mutually-agreed-upon written plan
-------------
describing the generation and characterization of Antibody(ies) to an Antigen
listed in Exhibit C and to related activities, which plan shall be carried out
by Medarex solely in furtherance of an Immunization and Evaluation. Each
Research Plan for each Immunization and Evaluation shall be attached to and made
part of Exhibit A of this Agreement.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
5
<PAGE>
1.35 "Royalty" or "Royalties" shall mean the royalty or royalties
------- ---------
payable by Amgen to Medarex pursuant to Section 5.6.
1.36 "Sublicensee" shall mean a Third Party to whom Amgen shall have
-----------
granted a license or sublicense to make, have made, import, use, sell, offer for
sale or otherwise exploit a Product(s) in the Territory. As used in this
Agreement, "Sublicensee" shall also include a Third Party which Amgen or a
Sublicensee shall have granted the right to distribute one or more Product(s)
[*****].
1.37 "Territory" shall mean all countries of the world.
---------
1.38 "Third Party" shall mean any individual, partnership, joint venture,
-----------
corporation, trust, estate, unincorporated organization, government or any
department or agency thereof, or any other entity other than Amgen or Medarex.
2. IMMUNIZATION
2.1 Antigen Availability.
--------------------
2.1.1 Antigen Selection and Replacement.
---------------------------------
(a) At any time until [*****] the Effective Date, Amgen shall have
the right to notify Medarex of Amgen's interest in a particular Antigen. Any
such Antigen(s) with respect to which Medarex shall provide Amgen with notice of
availability thereof under Section 2.1.2(a) below (i) shall be placed on the
list attached hereto as Exhibit C, upon Amgen notifying Medarex that Amgen
desires to enter into a commercial license under Section 4.2 and paying to
Medarex the commercial license fee due pursuant to Section 5.4 with respect to
such Antigen, (ii) shall be placed on the list attached hereto as Exhibit C,
upon Amgen notifying Medarex that Amgen desires to enter into an Immunization
and paying to Medarex the immunization fee due pursuant to Section 5.2 with
respect to such Antigen or (iii) shall be placed on the list attached hereto as
Exhibit B on any of the following four (4) dates per year: March 1, June 1,
September 1 and December 1, upon Amgen notifying Medarex that Amgen desires to
take an option under Section 4.1, subject to Amgen paying to Medarex the
applicable Antigen Reservation Fee pursuant to Section 5.1.
(b) At any time upon Amgen exercising its option in accordance with
Section 4.1.1 with respect to an Antigen listed in Exhibit B, such Antigen shall
be removed from
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
6
<PAGE>
Exhibit B upon such Antigen being placed in Exhibit C. In addition, once an
Antigen shall have been placed in Exhibit B, such Antigen may be removed by
Amgen from Exhibit B for any reason, on any of the following four (4) dates per
year: March 1, June 1, September 1 and December 1.
(c) Upon removal of an Antigen from Exhibit B, Amgen may designate
a replacement Antigen, such that at all times there may be up to and including
[*****] Antigen(s) listed in Exhibit B, subject to the availability of such
Antigen for inclusion in Exhibit B as described in Section 2.1.2(a) below and
Amgen paying to Medarex the applicable Antigen Reservation Fee pursuant to
Section 5.1, provided however, that [*****]. Any Antigen which is no longer
listed in Exhibit B shall no longer be an Antigen pursuant to this Agreement,
and Amgen shall have no further rights under this Agreement with respect
thereto, or rights to Product(s) directed against such Antigen, unless such
Antigen shall have been placed in Exhibit C and Amgen shall have option rights
under Section 4.1 and/or its exclusive license rights under Section 4.2 with
respect to Product(s) directed against such Antigen.
(d) The information contained within each notification provided by
Amgen pursuant to this Section 2.1.1, including Amgen's interest in such
Antigen, shall be considered the Confidential Information of Amgen.
(e) [*****].
2.1.2 Notice of Availability: Notice Date.
-----------------------------------
(a) Within [*****] following receipt of notice from Amgen under
Section 2.1.1(a) that it is interested in a particular Antigen, Medarex shall
notify Amgen whether such Antigen shall be available for listing in Exhibit B or
C and possible immunization on behalf of Amgen. If such Antigen shall be
available for Immunization on behalf of Amgen, the Antigen shall [*****] such
notification, as appropriate, (i) be placed on the list in Exhibit C or (ii) be
placed on the list in Exhibit B for a period of [*****] as provided in Section
2.1.2(b) below, subject to [*****] Antigen limit described in Section 2.1.1(c)
and Amgen's payment of the Antigen reservation fee for such Antigen pursuant to
Section 5.1. [*****].
(b) With respect to each Antigen listed in Exhibit B, Amgen shall
have a period of [*****] from the date the Antigen is placed in Exhibit B (the
"Antigen Reservation Period") to exercise its right to request Medarex to
conduct an Immunization on behalf of Amgen or to acquire a license to such
Antigen. Amgen may extend the Antigen Reservation Period for a particular
Antigen listed in Exhibit B for [*****], subject to [*****] Antigen limit
described in
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
7
<PAGE>
Section 2.1.1(c) and Amgen's payment of the Antigen reservation fee for such
Antigen pursuant to Section 5.1 for the applicable [*****] period; [*****].
(c) If an Antigen shall be available for immunization of Mice on
behalf of Amgen pursuant to Section 2.1.2(a), during the applicable Antigen
Reservation Period, if any, [*****]. Medarex hereby acknowledges that all
Antigen(s) set forth in Exhibit B as of the Effective Date are available for
immunization and Amgen shall have the rights set forth in Section 4.1 with
respect to all Product(s) directed against such Antigen(s).
(d) It is understood and agreed that the rights set forth in
Section 2.1.2(a) with respect to an Antigen may not be available for Amgen if
[*****].
2.1.3 [*****].
2.1.4 Extension. Amgen may provide Medarex notice that it wishes to
---------
have Medarex conduct an Immunization with any Antigen until [*****] the
Effective Date. Medarex shall have no obligation to initiate an Immunization
with any Antigen unless Amgen has provided notice under Section 2.2.1 before
[*****] the Effective Date. With the written agreement of the parties, Amgen may
select Antigens for Immunizations to be conducted after *****] the Effective
Date, on terms to be agreed by the parties.
2.2 Immunizations.
-------------
2.2.1 Notice by Amgen. From time-to-time during the term of this
---------------
Agreement, Amgen may notify Medarex that it wishes to have Medarex use Mice to
prepare Antibody(ies) to an Antigen. At such time, the Antigen, if listed in
Appendix B, shall be removed from Appendix B and shall be listed in Appendix C.
2.2.2 Medarex Activities. Subject to the terms and conditions set
------------------
forth herein, with respect to each Antigen listed in Exhibit C for which Amgen
shall provide Medarex notice under Section 2.2.1, during the term of the
applicable Immunization Period, Medarex shall perform its respective
obligations, including producing and characterizing Antibody(ies), in accordance
with a Research Plan, which shall be attached to and made part of Exhibit A
prior to each Immunization.
2.3 Immunization Period.
-------------------
2.3.1 Initial [*****] Period. With respect to each Immunization, the
----------------------
initial term of the Immunization Period during which Medarex shall work pursuant
to Section 2.4 to prepare
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
8
<PAGE>
Antibodies to an Antigen shall commence on the date an applicable Antigen shall
have been received by Medarex from Amgen pursuant to Section 2.5 and continue,
for up to [*****], until Medarex shall have generated and provided Amgen with
Antibodies meeting the criteria set forth in Section 2.4.
2.3.2 Extension of Immunization Period. In the event Medarex shall
--------------------------------
be unable to generate Antibodies to an Antigen meeting the criteria set forth in
Section 2.4 within said [*****], the initial term of the Immunization Period may
be extended for such longer period (and for such additional fees) as the parties
may mutually agree.
2.4 Diligent Efforts. Medarex shall use diligent efforts to conduct each
----------------
Immunization in a professional manner and shall commit the personnel, facilities
and other resources necessary to perform each Immunization in order to prepare
Antibodies which have criteria as set forth in the applicable Research Plan;
provided however, Medarex does not warrant that any Immunization will result in
the preparation of an Antibody to such Antigen suitable for development as a
Product. If Medarex shall be unable to prepare an Antibody to a particular
Antigen during the [*****] Immunization Period that Amgen shall have been
providing funding pursuant to Section 5.2 to Medarex for such applicable
Immunization, then Medarex shall have no obligation to conduct any further work
with respect to such Antigen, and shall have no liability to Amgen hereunder for
such inability to produce such Antibody.
2.5 Delivery of Antigens: License. Amgen shall deliver to Medarex a
-----------------------------
mutually agreed quantity of each Antigen in a form(s) as set forth in the
applicable Research Plan to immunize the Mice in connection with each
Immunization. Amgen hereby grants to Medarex a non-exclusive, non-transferable
license under all intellectual property owned or Controlled by Amgen to use each
Antigen(s) solely in accordance with the applicable Research Plan.
2.6 [*****].
2.7 [*****].
2.8 [*****].
2.9 [*****].
2.10 [*****].
3. EVALUATION
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
9
<PAGE>
3.1 Delivery of Collaboration Technology. Upon the preparation of an
------------------------------------
Antibody(ies) to an Antigen meeting the criteria set forth in the applicable
Research Plan [*****], Medarex shall promptly deliver to Amgen for evaluation by
Amgen (i) an agreed-upon number and quantity of such Antibody(ies), [*****].
Upon request by Amgen, Medarex shall provide reasonable assistance to Amgen in
the performance of Amgen's activities conducted with respect to the applicable
Evaluation.
3.2 Evaluation License. On an Antigen-by-Antigen basis, commencing on the
------------------
delivery to Amgen of the Antibody(ies) to such Antigen under Section 3.1[*****].
3.3 Evaluation Period.
-----------------
3.3.1 Initial [*****] Period. The initial term of the Evaluation
----------------------
Period for a particular Antigen shall commence on the date that Amgen shall
receive from Medarex the Antibody(ies) to such Antigen [*****] and shall
terminate [*****].
3.3.2 Extension of Evaluation Period. Amgen shall have the option
------------------------------
to extend the initial term of the Evaluation Period for an Antigen and the
corresponding Evaluation license under Section 3.2, for [*****], by providing
Medarex notice at least [*****] before the end of the initial term of the
Evaluation Period and concurrently paying to Medarex the extension fee due
pursuant to Section 5.2.
4. OPTION; RIGHT OF LAST REFUSAL; LICENSE RIGHTS
4.1 Option for Commercial Licenses. Amgen shall have an option to
------------------------------
obtain a commercial license with respect to Product(s) directed against such
Antigen in the Field of Use in all countries of the Territory, from the time an
Antigen shall be first listed in Exhibit B or C pursuant to Section
2.1.1(a)(iii) or (ii), respectively, for such time that the Antigen shall be
listed in either of Exhibit B or C (except Amgen shall not have such option (i)
upon termination of the respective Immunization Period without initiation of the
Evaluation Period with respect to such Antigen or without Amgen electing to
obtain a commercial license to develop and commercialize Products(s) directed
against such Antigen as set forth in Section 4.2) or (ii) upon termination of
the respective Evaluation Period with respect to such Antigen without Amgen
electing to obtain a commercial license to develop and commercialize Products(s)
directed against such Antigen as set forth in Section 4.2).
4.1.1 Exercise. At any time during the term of the option with
--------
respect to an Antigen as set forth in Section 4.1 above, Amgen may exercise its
option for such commercial license by providing notice to Medarex.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
10
<PAGE>
4.1.2 License Fee. [*****] after providing notice to Medarex under
-----------
Section 4.1.1 with respect to an Antigen, Amgen shall pay to Medarex the
commercial license fee due pursuant to Section 5.4 with respect to such Antigen.
4.1.3 [*****].
4.2 Commercial License.
------------------
4.2.1 Grant. Upon a particular Antigen being placed on Exhibit C
-----
pursuant to Section 2.1.1(a)(i) or upon Amgen exercising its option under
Section 4.1 with respect to a particular Antigen, Medarex shall grant to Amgen
an exclusive (even as to Medarex) license, with the right to sublicense, under
the Licensed Technology to make, have made, import, have imported, use, offer
for sale and sell Product(s) directed against such Antigen in the Field of Use
in the Territory.
4.2.2 Sublicenses. [*****] execution of any sublicense agreement
-----------
under Section 4.2.1, Amgen shall provide Medarex with at least the following
information with respect to each potential Sublicensee: (i) the identity of the
Sublicensee; (ii) a description of the Product(s), and the rights being granted
to the Sublicensee; and (iii) the territory in which the Product(s) will be
sold. Each sublicense granted by Amgen shall be consistent with all the terms
and conditions of this Agreement, and subordinate thereto, and Amgen shall
remain responsible to Medarex for the compliance of each such Sublicensee with
the financial and other obligations due under this Agreement.
4.2.3 Acknowledgement. It is understood and agreed that the
---------------
foregoing license in Section 4.2.1 above shall not grant to Amgen any right to
make any transgenic animal or use any transgenic animal for any purpose.
4.3 [*****].
4.4 Retained Rights: No Further Rights. Only the licenses granted
----------------------------------
pursuant to the express terms of this Agreement shall be of any legal force or
effect. [*****]
4.5 [*****].
4.6 [*****].
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
11
<PAGE>
5. CONSIDERATION
5.1 Antigen Reservation Fee. For each Antigen for which Amgen shall
-----------------------
believe it may desire to obtain an exclusive license to Product(s) directed
against such Antigen and shall desire to list in Exhibit B pursuant to Section
2.1.3, Amgen shall pay to Medarex an Antigen reservation fee of [*****] per
Antigen for each [*****] period (the "Antigen Reservation Period"). Such Antigen
reservation fee shall be paid to Medarex within [*****] of the date Medarex
shall notify Amgen under Section 2.1.2(a) that such Antigen is first listed in
Exhibit B. If Amgen shall desire to extend the Antigen Reservation Period for a
particular Antigen, and such Antigen is available for continued reservation, as
described in Section 2.1.2(b), then the Antigen Reservation Period for such
Antigen may be extended by Amgen for [*****] with notice to Medarex and payment
to Medarex of [*****], prior to the expiration of [*****].
5.2 Immunization Fee. During the initial [*****] day term of the
----------------
Immunization Period with respect to each Antigen, Amgen shall pay to Medarex an
immunization fee of [*****] per [*****] period. The first payment shall be due
within [*****] following the date of commencement of the Immunization Period in
accordance with Section 2.3.1 and, if appropriate, a second payment for a
[*****] period shall be due on or before the [*****]. The amount and timing of
any subsequent payments for any mutually-agreed-upon extensions of the initial
term of an Immunization Period pursuant to Section 2.3.2 shall be as mutually
agreed upon by the parties. Subject to Section 4.1.3, such payments shall be
non-refundable and non-creditable against other amounts due Medarex under this
Agreement.
5.3 Evaluation Period Extension Fee. If Amgen elects to extend the
-------------------------------
initial term of an Evaluation Period for a particular Antigen pursuant to
Section 3.3.2, it shall pay to Medarex [*****] for a [*****] extension, which
amount shall be paid to Medarex no later than [*****] following the date of
commencement of the Evaluation Period in accordance with Section 3.3.1.
5.4 Commercial License Fee.
----------------------
5.4.1 Amount. If Amgen shall exercise its option pursuant to
------
Section 4.1 to acquire from Medarex a commercial license under Section 4.2 with
respect to Product(s) directed against an Antigen, within [*****] after Amgen's
notice to Medarex of its exercise of such option, Amgen shall pay to Medarex a
commercial license fee of [*****] per Antigen.
5.4.2 Credit for Evaluation Period Extension Fee. If Amgen shall
------------------------------------------
have extended the initial term of the Evaluation Period for an Antigen beyond
the [*****] period pursuant to Section 3.3.2, and the commercial license for
such Antigen shall be obtained during the extension period of that Evaluation
license under Section 3.2, then the extension fees shall be
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
12
<PAGE>
pro-rated based on the remainder of the Evaluation Period with respect to the
applicable Antigen and the pro rata amount of such extension fee shall be
credited against the commercial license fee.
5.5 Milestone Payments.
------------------
5.5.1 Milestone Payment(s). Within thirty (30) days following the
--------------------
first occurrence of the relevant event(s) with respect to the first Product(s)
directed against an Antigen specified below ("Milestone"), Amgen shall pay to
Medarex the following one-time milestone payments ("Milestone Payment(s)"):
[*****]
5.5.2 [*****]
5.5.3 [*****]
5.6 Royalties.
---------
5.6.1 Royalty on Net Sales. In partial consideration for the
--------------------
commercial license, Amgen shall pay to Medarex a Royalty on annual Net Sales of
Product(s), on a Product-by-Product basis, as follows:
[*****]
5.6.2 Royalty Term. The Royalties due pursuant to Section 5.6.1
------------
shall be payable on a country-by-country and Product-by-Product basis [*****].
5.6.3 Third Party Royalties.
---------------------
(a) Medarex shall be responsible for payment to the Medical
Research Council ("MRC") of any royalties due the MRC pursuant to the MRC
Agreement; provided however, in the event that Amgen obtains a direct license
from the Medical Research Council with respect to the intellectual property
subject to the MRC License, all royalties paid to the MRC under such a license
with respect to Product(s) shall be fully creditable against Royalties due
Medarex under Section 5.6.1, on a Product-by-Product basis.
(b) Except with respect to the MRC Agreement under Section
5.6.3(a), Amgen shall be responsible for the payment of any royalties, license
fees and milestone and
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
13
<PAGE>
other payments to a Third Party during the term of the Agreement under
agreement(s) for license rights to one or more patent claims which would be
infringed by the making, having made, using, offering to sell, selling and
importing of a Product(s) and/or other intellectual property necessary for such
activities.
5.6.4 [*****].
5.6.5 [*****].
5.6.6 [*****].
5.6.7 Cumulative Royalties. The obligation to pay Royalties on the
--------------------
Net Sales of a Product under this Section 5.6 shall be imposed only once with
respect to the same unit of said Product due under Section 5.6.1, regardless of
the number of claims within Licensed Patent Rights which would, but for this
Agreement, be infringed by the making, having made, using, offering to sell,
selling or importing of said Product.
5.6.8 Paid-Up License. Upon the expiration of Amgen's obligation
---------------
pursuant to Section 5.6.1 to pay Royalties on Net Sales of a Product in a
country, Amgen shall have a fully paid-up, unrestricted, non-exclusive license
under Licensed Technology to make, have made, use, sell, offer to sell and
import said Product in the Field of Use in that country.
5.6.9 [*****]
5.7 [*****]
5.7.1 [*****]
5.7.2 [*****]
5.7.3 [*****]
6. PAYMENTS
6.1 Timing of Royalty Payments. All Royalties on Net Sales due to Medarex
--------------------------
shall be paid within [*****] after the last day of the calendar quarter in which
such Net Sales accrue.
6.2 Payment Method. All amounts due Medarex hereunder shall be paid in
--------------
U.S. dollars by wire transfer in immediately available funds to an account
designated by Medarex.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
14
<PAGE>
Any payments or portions thereof due hereunder which shall not be paid on the
date such payments are due under this Agreement shall bear interest at a rate
equal to the lesser of the prime rate as reported by the Chase Manhattan Bank,
New York plus [*****] or of the maximum rate permitted by law, calculated on the
number of days such payment shall be delinquent compounded monthly. This Section
6.2 shall in no way limit any other remedies available to Medarex.
6.3 Currency: Foreign Payments. If any currency conversion shall be
--------------------------
required in connection with the payment of any Royalties hereunder, such
currencies shall be converted into the United States Dollar equivalent, at the
average rate of exchange for the quarter (as calculated by averaging the rate of
exchange at the close of business of the last day of each month of said quarter)
as reported in International Financial Statistics (publisher, International
Monetary Fund) during the Royalty period of such Net Sales, or in the event
International Financial Statistics shall not be available then as reported in
The Wall Street Journal, for the currency of the country in which the sale shall
be made at the average rate of exchange during the Royalty period of such Net
Sales. If at any time legal restrictions or other reasons beyond Amgen's control
prevent the prompt remittance of any Royalties owed on Net Sales in any
jurisdiction, Amgen may notify Medarex and make such payments by depositing the
amount thereof in local currency in a bank account or other depository in such
country in the name of Medarex, and Amgen shall have no further obligations
under this Agreement with respect thereto.
6.4 Taxes. All Royalty amounts required to be paid to Medarex pursuant
-----
to this Agreement may be paid with deduction for withholding or on account of
any taxes (other than taxes imposed on or measured by net income) or similar
governmental charge imposed by a jurisdiction other than the United States
("Withholding Taxes"). At Medarex's request, Amgen shall provide Medarex a
certificate evidencing payment of any Withholding Taxes hereunder sufficient to
enable Medarex to obtain the benefit of any applicable tax treaty.
7. REPORTS AND RECORDS
7.1 Royalty Reports. Beginning with the first calendar quarter in which
---------------
Royalties shall be due under Section 5.6.2 until the quarter during which there
shall be the expiration of Amgen's obligation to pay Royalties for any and all
Product(s) under Section 5.6.2, Amgen shall deliver to Medarex within [*****]
after the end of each calendar quarter in which a Product(s) shall be sold a
report setting forth the Net Sales of each Product(s) for such calendar quarter,
including the Product(s) sold in each country by Amgen and Sublicensee(s) and
the Net Sales thereof. Such reports shall be the Confidential Information of
Amgen and will be maintained in confidence by Medarex in accordance with the
terms of Article 9 herein.
*****REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
15
<PAGE>
7.2 Inspection of Books and Records. Amgen and Sublicensee(s) shall
-------------------------------
maintain accurate books and records which enable verification of the calculation
of Royalties payable hereunder. Amgen and Sublicensee(s) shall retain the books
and records for each quarterly period for [*****] after submission of the
corresponding report under Section 7.1 above. [*****] Medarex shall have the
option, upon [*****] prior notice to Amgen, to engage an independent accountant
from a "Big Five" accounting firm (selected by Medarex and approved by Amgen,
which approval will not be unreasonably withheld) to conduct a review or audit
of [*****] Any such inspection or audit shall be at Medarex's expense; however,
in the event an inspection reveals, as set forth in a final report, an
underpayment of [*****] or more in any quarter, Amgen shall pay the costs of the
inspection and [*****].
8. DEVELOPMENT AND COMMERCIALIZATION
8.1 [*****]
8.2 [*****]
8.3 [*****]
8.4 [*****]
9. CONFIDENTIALITY
9.1 Confidential Information. Except as expressly provided herein, the
------------------------
parties agree that the receiving party of any Confidential Information furnished
to it by the disclosing party pursuant to and as necessary for carrying out the
purposes of this Agreement shall keep such Confidential Information completely
confidential and shall not publish or otherwise disclose it (other than by Amgen
to Sublicensee(s)) and shall not use it for any purpose except for the purposes
contemplated by this Agreement, except to the extent that it can be established
by the receiving party by competent proof that such Confidential Information:
9.1.1 was already known to the receiving party, other than under an
obligation of confidentiality, at the time of disclosure;
9.1.2 was generally available to the public or otherwise part of the
public domain at the time of its disclosure to the receiving party;
*****REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
16
<PAGE>
9.1.3 became generally available to the public or otherwise part of
the public domain after its disclosure, other than through any act or omission
of the receiving party in breach of this Agreement;
9.1.4 was independently developed by the receiving party as
demonstrated by documented evidence prepared contemporaneously with such
independent development; or
9.1.5 was subsequently lawfully disclosed to the receiving party by a
person other than a party hereto.
9.2 Permitted Use and Disclosures.
------------------------------
9.2.1 Each party may use or disclose Confidential Information
disclosed to it by the other party to the extent such use or disclosure shall be
required [*****] in complying with applicable governmental regulations or
otherwise submitting information to tax or other governmental authorities;
provided however, that if a party shall be required to make any such disclosure
of the other party's Confidential Information under this Section 9.2.1 it shall
give reasonable advance notice to the other party of such disclosure and shall
use reasonable efforts to secure confidential treatment (whether through
protective orders or otherwise) of such Confidential Information required to be
disclosed.
9.2.2 Amgen (or Sublicensee(s)) may disclose the Confidential
Information of Medarex to the extent such disclosure shall be reasonably
necessary in (i) filing and prosecuting patent applications and maintaining
patents, [*****] and with respect to disclosures pursuant to Sections 9.2.2(i)
and 9.2.2(iv) above shall make reasonable efforts to disclose only information
required to be disclosed.
9.2.3 [*****]
9.2.4 Notwithstanding the above, in no event shall Amgen or
Sublicensee(s) disclose any Confidential Information of Medarex or Confidential
Information which is jointly developed by Medarex and Amgen to Abgenix, Inc. or
its Affiliates.
9.3 Public Disclosure. Except as otherwise required by law or regulation,
-----------------
neither party shall issue a press release or make any other disclosure of the
existence of or the terms of this Agreement or any aspect of the research
conducted pursuant to this Agreement without the prior approval of such press
release or disclosure by the other party hereto. Each party shall submit any
such press release or disclosure to the other party, and the receiving party
shall have [*****] to review and approve any such press release or disclosure,
which approval shall not be
*****REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
17
<PAGE>
unreasonably withheld. If the receiving party shall not respond within such
[*****] period, the press release or disclosure shall be deemed approved. In
addition if, in the reasonable opinion of a disclosing party's counsel, a public
disclosure shall be required by law, regulation or court order, including
without limitation, in a filing with the United States Securities and Exchange
Commission, the disclosing party shall provide copies of the disclosure
reasonably in advance of such filing or other disclosure for the nondisclosing
party's prior review and comment; the nondisclosing party shall provide its
comments, if any, on such announcement as soon as practicable.
9.4 Confidential Terms. Notwithstanding anything to the contrary herein,
------------------
(a) each party may disclose the terms of this Agreement or any aspect of the
research conducted pursuant to this Agreement in confidence under terms and
conditions at least as restrictive as set forth herein, on a need-to-know basis
to its legal and financial advisors to the extent such disclosure shall be
reasonably necessary in connection with such party's activities as expressly
permitted by this Agreement or [*****]. Notwithstanding the above, in no event
shall Amgen or Sublicensee(s) disclose any Confidential Information of Medarex
to Abgenix, Inc. or its Affiliates.
9.5 [*****]
10. REPRESENTATIONS, WARRANTIES [*****]
10.1 Medarex. Medarex represents and warrants that as of the Effective
-------
Date:
10.1.1 it is a corporation duly organized, validly existing and in
good standing under the laws of the State of New Jersey, and it has the
corporate power and authority and the legal right to enter into this Agreement
and to perform its obligations hereunder;
10.1.2 the execution, delivery and performance of this Agreement have
been duly authorized by all necessary corporate action on the part of Medarex,
and the person executing this Agreement on behalf of Medarex has been duly
authorized to do so by all requisite corporate actions;
10.1.3 it is the sole and exclusive owner of all right, title and
interest in the Mice;
10.1.4 it has the right to grant the rights and licenses granted
herein;
[*****]
*****REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
18
<PAGE>
10.2 Amgen. Amgen represents and warrants that as of the Effective Date:
-----
10.2.1 it is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, and it has the corporate
power and authority and the legal right to enter into this Agreement and to
perform its obligations hereunder;
10.2.2 the execution, delivery and performance of this Agreement
have been duly authorized by all necessary corporate action on the part of
Amgen, and the person executing this Agreement on behalf of Amgen has been duly
authorized to do so by all requisite corporate actions;
[*****]
10.4 Disclaimer of Warranties. [*****] ARE PROVIDED TO AMGEN "AS IS", AND
------------------------
EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, MEDAREX MAKES NO
REPRESENTATIONS AND EXTENDS NO WARRANTIES OR CONDITIONS OF ANY KIND, EITHER
EXPRESS OR IMPLIED, WITH RESPECT TO THE MICE, PRODUCT(S) OR LICENSED TECHNOLOGY,
INCLUDING BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, VALIDITY OF THE PATENT RIGHTS LICENSED HEREUNDER, OR
NONINFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.
10.5 Disclaimer. Nothing in this Agreement is or shall be construed as:
----------
10.5.1 [*****], a warranty or representation by Medarex as to the
validity or scope of any claim or patent within the Patent Rights;
10.5.2 [*****], a warranty or representation that anything made,
used, sold, or otherwise disposed of under any license granted in this Agreement
is or will be free from infringement of any Patent Rights or other intellectual
property right of any Third Party;
10.5.3 [*****], an obligation to bring or prosecute actions or suits
against Third Parties for infringement of any of the Medarex Patent Rights; or
*****REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
19
<PAGE>
10.5.4 [*****], granting by implication, estoppel, or otherwise any
licenses or rights under patents or other rights of Medarex or Third Parties,
regardless of whether such patents or other rights are subordinate to any patent
within the Licensed Patent Rights.
11. INTELLECTUAL PROPERTY
11.1 Ownership.
---------
11.1.1 [*****]
11.2 Prosecution of Patent Rights.
----------------------------
11.2.1 [*****]
11.3 [*****]
11.4 [*****]
11.5 [*****]
12. DISPUTE RESOLUTION
[*****]
13. INDEMNIFICATION
13.1 Medarex. Medarex shall indemnify, defend and hold harmless Amgen
-------
and its directors, officers and employees (each an "Amgen Indemnitee") from and
against any and all liabilities, damages, losses, costs or expenses (including
attorneys' and professional fees and other expenses of litigation and/or
arbitration) (each a "Liability") resulting from a claim, suit or proceeding
made or brought by a Third Party against an Amgen Indemnitee arising from or
occurring as a result of (i) any breach of the representations and warranties
set forth in Section 10.1, in each case, which breach was the proximate cause of
the relevant Liability, or (ii) the activities of Medarex hereunder, except, in
each case, under this Section 13.1(ii) to the extent caused by the negligence or
willful misconduct of Amgen.
13.2 Amgen. Amgen shall indemnify, defend and hold harmless Medarex and
-----
its directors, officers and employees (each a "Medarex Indemnitee") from and
against any and all liabilities, damages, losses, costs or expenses (including
attorneys' and professional fees and
*****REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
20
<PAGE>
other expenses of litigation and/or arbitration) (each a "Liability") resulting
from a claim, suit or proceeding made or brought by a Third Party [*****]
against a Medarex Indemnitee, arising from or occurring as a result of (i) any
breach of the representations and warranties set forth in Section 10.2 in each
case, which breach was the proximate cause of the relevant Liability, (ii) the
practice by Amgen of any right granted herein, [*****] or to the extent caused
by the negligence or willful misconduct of Medarex, or (iii) any development,
testing, manufacture, importation, use, offer for sale, sale or other
distribution of any Product(s) by Amgen or Sublicensee(s) except, in each case,
under this Section 13.2(iii) to the extent caused by the negligence or willful
misconduct of Medarex.
13.3 Procedure. In the event that a Medarex Indemnitee or an Amgen
---------
Indemnitee intends to claim indemnification under this Article 13, it shall
promptly notify the other party (the "Indemnitor") in writing of such alleged
Liability. The Indemnitor shall have the sole right to control the defense and
settlement thereof. Each Indemnitee shall cooperate with the Indemnitor and its
legal representatives in the investigation of any action, claim or liability
covered by this Article 13. Each Indemnitee shall not, except at its own cost,
voluntarily make any payment or incur any expense with respect to any claim or
suit without the prior written consent of the Indemnitor, which the Indemnitor
shall not be required to give. [*****]
13.4 [*****]
14. TERM AND TERMINATION
14.1 Term. The term of this Agreement shall commence on the Effective
----
Date. Unless earlier terminated as provided in this Article 14, this Agreement
shall continue in full force and effect until the later of [*****] on a country-
by-country basis, until there shall be no remaining Royalty payment obligations
for all Product(s) in a country. It is understood and agreed that Medarex shall
have no obligation to conduct any Immunizations with Antigens proposed by Amgen
after [*****] of the Effective Date.
14.2 [*****]
14.3 Effects of Termination of an Immunization or an Evaluation. In the
----------------------------------------------------------
event that, with respect to an Antigen listed in Appendix C, Amgen terminates it
option or license rights under Section 14.2 or fails to exercise its option
under Section 4.1 within the specific time period to acquire the Commercial
License under Section 4.2:
14.3.1 Medarex shall immediately cease use of and, within thirty (30)
days thereafter, to the extent not previously delivered to Amgen deliver to
Amgen copies of all
*****REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
21
<PAGE>
documents and other tangible embodiments disclosing or containing Amgen
Technology, Collaboration Technology and Joint Technology specifically and
solely relating to such Antigen (including Product(s)), other than with respect
to maintaining one (1) archival copy of documents disclosing Confidential
Information related thereto for its legal files, for the sole purpose of
determining its obligations hereunder. Further, Medarex shall at Amgen's request
destroy all Mice immunized with such Antigen, and all antibody(ies), antibody
cell(s) and genetic material(s) generated by Medarex pursuant to the respective
Immunization and shall provide Amgen with certification by an officer of Medarex
that all such materials have been destroyed or returned to Amgen, as
appropriate.
14.3.2 The parties shall retain their respective ownership rights as
set forth in Section 11.1.
14.3.3 [*****]
14.3.4 [*****]
14.4 Default.
-------
14.4.1 In the event any material representation or warranty made
hereunder by either party shall have been untrue in any material respect
("Representation Default") or upon any material breach or material default of a
material obligation of this Agreement by a party ("Performance Default"), the
party not in default ("Non-Defaulting Party") must first give the other party
("Defaulting Party") written notice thereof ("Notice of Default"), which notice
must state the nature of the Representation Default or Performance Default in
reasonable detail and request the Defaulting Party cure such default within
[*****], or within [*****] for non-payment. If the Defaulting Party shall
dispute the existence, extent or nature of any default set forth in a Notice of
Default, the parties shall use good faith efforts to resolve the dispute.
14.4.2 [*****]
14.5 Insolvency or Bankruptcy.
------------------------
[*****]
14.6 Effect of Termination. Upon termination of this Agreement under this
---------------------
Article 14, the following rights and obligations shall apply:
*****REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
22
<PAGE>
14.6.1 The parties shall retain their respective ownership rights as
set forth in Section 11.1.
14.6.2 [*****].
14.6.3 Medarex shall immediately cease use of and, within thirty (30)
days thereafter, to the extent not previously delivered to Amgen deliver to
Amgen copies of all documents and other tangible embodiments disclosing or
containing all Collaboration Technology and Joint Technology (including
Product(s) in each case that specifically and solely relates to the Antigen(s)
listed in Exhibit C) and of all Amgen Technology (including Product(s), other
than with respect to maintaining one (1) archival copy of documents disclosing
Confidential Information related thereto for its legal files, for the sole
purpose of determining its obligations hereunder. Further, Medarex shall at
Amgen's request destroy all Mice immunized with such Antigen(s) listed in
Exhibit C, and all antibody(ies), antibody cell(s) and genetic material(s)
generated by Medarex pursuant to this Agreement and shall provide Amgen with
certification by an officer of Medarex that all such materials shall have been
destroyed or returned to Amgen, as appropriate.
14.6.4 [*****]
14.6.5 Termination of any licenses under this Agreement or of this
Agreement for any reason shall not release either party hereto from any
liability which, at the time of such termination, shall have already accrued to
the other party or which shall be attributable to a period prior to such
termination nor preclude either party from pursuing any rights and remedies it
may have hereunder or by law or in equity with respect to any breach of this
Agreement. It is understood and agreed that, subject to Section 14.4, monetary
damages may not be a sufficient remedy for any breach of this Agreement and that
the non-breaching party may be entitled to injunctive relief as a remedy for any
such breach.
14.6.6 Notwithstanding anything to the contrary in this Agreement,
except as provided in Article 13, neither party shall be liable for
consequential or incidental damages of any nature incurred by the other party
arising out of any Default under this Agreement.
14.6.7 [*****]
14.6.8 The option and license rights granted in Sections 3.2, 4.1 and
4.2 shall terminate upon any termination of this Agreement under this Article
14, and in such event Amgen and Sublicensee(s) shall immediately cease all
development and commercialization of Product(s), subject to Amgen's right to
dispose of Product(s) in accordance with Section 14.6.7.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
23
<PAGE>
14.6.9 All Antigen Reservation Periods shall terminate
concurrently.
14.6.10 Articles 6 (Payments), 7 (Reports and Records), 9
(Confidentiality), 11 (Intellectual Property), 12 (Dispute Resolution), 13
(Indemnification) and 15 (Miscellaneous) of this Agreement shall survive
termination of this Agreement for any reason [*****].
15. MISCELLANEOUS
15.1 Governing Law. This Agreement shall be governed by and interpreted
-------------
in accordance with the substantive laws of the State of Delaware, without
reference to the conflicts of law principles thereof. [*****]
15.2 Independent Contractors. The relationship of the parties hereto
-----------------------
shall be that of independent contractors. The parties hereto shall not be deemed
to be agents, employer-employee, partners or joint venturers of the other for
any purpose as a result of this Agreement or of the transactions contemplated
thereby. No party shall incur any debts or make any commitments for the other
party except to the extent, if at all, specifically provided herein.
15.3 Assignment. This Agreement shall not be assignable by either party
----------
to any Third Party hereto without the written consent of the other party which
consent shall not be unreasonably withheld; except a party may assign this
Agreement, without such consent, to an entity that shall acquire all or
substantially all of its business or assets to which this Agreement pertains,
whether by merger, consolidation, reorganization, acquisition, sale or
otherwise. This Agreement shall be binding upon and inure to the benefit of the
parties and their successors and assigns, and the name of a party appearing
herein shall be deemed to include the names of such party's successors and
permitted assigns to the extent necessary to carry out the intent of this
Agreement. Any assignment not in accordance with this Section 15.3 shall be
void.
15.4 Notices. All notices, requests, approval or consent, and other
-------
communications hereunder shall be deemed to have been sufficiently given if in
writing and shall be personally delivered or sent by telecopy, telegram or other
electronic facsimile transmission (receipt verified), or by registered or
certified mail (return receipt requested), postage prepaid, commercial overnight
courier, in each case to the respective address specified below, or such other
address as may be specified in writing to the other party hereto.
If to Medarex: Medarex, Inc.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
24
<PAGE>
1545 Route 22 East
Annandale, New Jersey 08801
Attn: President
If to Amgen: Amgen Inc.
One Amgen Center Drive
Thousand Oaks, California 91320-1799
Attn: Lawrence M. Souza, Ph.D.
Senior Vice President, Research
cc: Secretary and General Counsel
15.5 Force Majeure. If the performance of any part of this Agreement by
-------------
either party or of any obligation under this Agreement (other than for the
payment of money) shall be prevented, restricted, interfered with or delayed by,
for example, war, strike, fire, Act of God, earthquake, flood, lockout, embargo,
governmental acts or orders or restrictions, or failure of suppliers, neither
party shall lose any rights hereunder or be liable to the other party for
damages or losses (except for payment obligations) on account of failure of
timely performance by the nonperforming party occasioned where failure to timely
perform shall be beyond the reasonable control and not caused by the negligence,
intentional conduct or misconduct of the nonperforming party and the
nonperforming party shall have given written notice to the other party and shall
have exerted all reasonable efforts to avoid or remedy such force majeure and
shall continue performance with the utmost dispatch whenever such causes shall
be removed; provided however, that in no event shall a party be required to
settle any labor dispute or disturbance. When such circumstances shall arise,
the parties shall discuss what, if any, modification of the terms of this
Agreement may be required in order to arrive at an equitable solution.
15.6 Advice of Counsel. Medarex and Amgen have each consulted counsel of
-----------------
their choice regarding this Agreement, and each acknowledges and agrees that
this Agreement shall not be deemed to have been drafted by one party or another
and shall be construed accordingly.
15.7 Compliance with Laws. Each party shall furnish to the other party
--------------------
any information reasonably requested by that party to enable that party to
comply with the requirements of any U.S. or foreign, federal, state and/or
government agency.
15.8 Further Assurances. From time to time, a party shall at the
------------------
request of the other party hereto (i) deliver to the requesting party any
records, data or other documents consistent with the provisions of this
Agreement, (ii) execute, and deliver or cause to be delivered, all such
consents, documents or further instruments of transfer or license, and (iii)
take or cause to be taken all such actions as may be reasonably deemed necessary
by the parties in order for the requesting party to obtain the full benefits of
this Agreement and the transactions contemplated hereby.
25
<PAGE>
15.9 Export Controls. Each party agrees that it will take all actions
---------------
necessary to insure its compliance with all U.S. laws, regulations, orders or
other restrictions on exports and Amgen further agrees that it will not sell,
license or reexport, directly or indirectly, the Product(s) to any person or
entity for sale in any country or territory if, to the knowledge of Amgen based
upon reasonable inquiry, such sale would cause the parties to be in violation of
any such laws or regulations now or hereafter in effect.
15.10 Severability. In the event that any provision of this Agreement is
------------
determined to be illegal, invalid or unenforceable by a court of competent
jurisdiction, the parties shall in good faith negotiate a substitute clause for
any provision declared illegal, invalid or unenforceable, which shall most
nearly approximate the intent of the parties in entering this Agreement. If
unreformable, such provision shall be divisible and deleted in such jurisdiction
so long as the parties shall still able to realize the principal benefits
bargained for in this Agreement.
15.11 Waiver. It is agreed that no waiver by either party hereto of any
------
breach or default of any of the covenants or agreements herein set forth shall
be deemed a waiver as to any subsequent and/or similar breach or default.
15.12 Complete Agreement. This Agreement, with its Exhibits, constitutes
------------------
the entire agreement, both written and oral, between the parties with respect to
the subject matter hereof, and all prior negotiations, correspondence,
representations, understandings and agreements respecting the subject matter
hereof, either written or oral, expressed or implied, are merged and canceled
and are null and void and of no effect. No amendment or change hereof or
addition hereto shall be effective or binding on either of the parties hereto
unless reduced to writing and duly executed an behalf of both parties. The
Materials Transfer Agreement dated April 22, 1999 (Amgen Reference No.
19992424), as amended effective May 31, 1999 (Amgen Reference No. 19992424-001)
is hereby superseded, provided that all Confidential Information and/or
materials disclosed, transferred, characterized, generated, derived, or
identified or the like under the Materials Transfer Agreement shall be treated
as if disclosed, transferred, characterized, generated, derived, or identified
or the like, and be subject to the terms of, this Agreement.
15.13 Use of Name. Except as required by law or in required filings with
-----------
government entities, neither party shall use the name or trademarks of the other
party or the names of any employees thereof, without the prior written consent
of such other party.
15.14 Headings. The captions to the several Articles and Sections hereof
--------
are included merely for convenience of reference only and shall not affect its
meaning nor the interpretation of any of the provisions of this Agreement.
15.15 Counterparts. This Agreement may be executed in two counterparts,
------------
each of which shall be deemed an original and which together shall constitute
one instrument.
26
<PAGE>
15.16 Exhibits. All Exhibits referenced in and attached hereto are
--------
incorporated herein by reference. In case of any discrepancies between language
incorporated from the Exhibits and the terms of the Articles and Sections
herein, the terms of the Articles and Sections shall prevail.
IN WITNESS WHEREOF, Medarex, Inc., GenPharm International, Inc. and Amgen
have executed this Agreement by their respective duly authorized
representatives.
AMGEN INC.
By: /s/ Lawrence M. Souza
-----------------------------------
Name: Lawrence M. Souza, Ph.D.
Title: Senior Vice President, Research
MEDAREX, INC. GENPHARM INTERNATIONAL, INC.
By: /s/ Michael Appelbaum By: /s/ Michael Applebaum
---------------------------------- -------------------------------
Name: Michael Appelbaum Name: Michael Appelbaum
Title: Executive Vice President Title: President
27
<PAGE>
EXHIBIT A
RESEARCH PLAN
- -------------
[*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
28
<PAGE>
EXHIBIT B
ROLLING LIST OF ANTIGENS
- ------------------------
29
<PAGE>
EXHIBIT C
OPTIONED OR LICENSED ANTIGENS
- -----------------------------
[*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
30
<PAGE>
EXHIBIT D
[*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
31
<PAGE>
EXHIBIT E
[*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
32
<PAGE>
Exhibit 10.9
------------
Agreement
Medarex, Inc. and GenPharm International (Medarex, Inc. and GenPharm
International are referred to hereinafter as "Provider") agree to provide
Immuno-Designed Molecules S.A., ("Recipient") with certain research
material requested by Recipient for use, subject to the terms and
conditions set forth in this Agreement (the "Agreement"). Provider
(collectively on the one hand) and Recipient (on the other hand) are each
referred to herein singularly as a "Party" and collectively as the
"Parties" to this Agreement.
1. This Agreement applies to the transfer by Provider to Recipient of
transgenic mice ("Mice") and to any biological materials (including
human and murine antibodies and immunized Mice) derived from the
Recipient's use of those Mice hereunder (collectively, the "Derived
Material"). The Mice and the Derived Materials are referred to herein
collectively as the "Materials". Recipient shall use the Mice solely
for purposes of conducting research expected to result in Derived
Materials (and data, results and information relating thereto),
[*****]. The Research is expected to include the immunization of the
Mice with antigens supplied by Recipient (each an "Antigen"), and any
such antigens or other materials provided or used by Recipient for
purposes of the Research are referred to herein collectively as the
"Recipient Materials". Recipient shall be under no obligation to
disclose the nature of or provide any Recipient Materials to Provider.
2. Legal title to all Mice shall be and remain solely with Provider, and
nothing in this Agreement grants Recipient any rights under any
patents or patent applications of Provider. Recipient shall not
transfer the mice. Recipient will use the Mice solely for the purposes
contemplated under this Agreement, and in no event will attempt to
breed or duplicate in any way the Mice provided to Recipient by
Provider hereunder. Any information of Provider that is disclosed to
Recipient by Provider in connection with the transfer of the Mice or
the Research hereunder shall be used by Recipient solely for the
purposes of Research, and shall be held in confidence by Recipient
subject to the terms and conditions of Schedule A ("Confidentiality
Provisions"). Legal title to any and all Recipient Materials shall be
and remain solely with Recipient, and nothing in this Agreement grants
Provider any rights under any patents or patent applications of
Recipient. Any information of Recipient
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
relating to any Recipient Materials that is disclosed to Provider by
Recipient shall not be used by Provider for any purpose, and shall be
held in confidence by Provider subject to the terms and conditions of
the Schedule A.
3. [*****] Recipient shall be under no obligation to provide any such
Derived Materials to Provider. During the Materials Term (as
hereinafter defined), Recipient shall not make any use of any such
Derived Materials except for purposes of the Research, and thereafter
Recipient shall not make any use of the Derived Materials, shall not
transfer any Derived Materials to any third party, and shall not file
any patent applications covering any Derived Materials or based on the
Research without Provider's prior written consent, [*****]. Upon
expiration or termination of the Materials Term, unless the Parties
have entered into a definitive agreement, Recipient shall return or
destroy the Mice and destroy all Derived Materials; provided, however,
that legal title to any data, research results or other information
relating to the Derived Materials shall be and remain with Recipient,
but such shall be treated as confidential information and shall be
held in confidence by Recipient subject to the terms and conditions of
Schedule A. Recipient shall be under no obligation to disclose any
such data, research results or other information to Provider, but if
and to the extent that Recipient does make any such disclosure, any
such information of Recipient disclosed to Provider by Recipient shall
not be used by Provider for any purpose and shall be held in
confidence by Provider subject to the terms and conditions of the
Schedule A.
4. The transfer of the Mice constitutes a nonexclusive license to use the
Mice solely for the purposes of the Research. This Agreement does not
restrict Provider's right to distribute the Mice to other commercial
or to non-commercial entities. Provider shall have no obligation to
grant a license to Recipient, and may grant exclusive or nonexclusive
licenses to others who may be investigating uses of the Mice.
5. The Mice are provided to Recipient to conduct experiments in animals
or in vitro. The Materials will not be used in humans, including for
purposes of diagnostic testing.
6. During the Materials Term and thereafter until the return or
destruction of the Mice and destruction of the Derived Materials,
written records will be maintained by Recipient of all uses made of,
and all persons allowed access to Materials, and copies of such
records will be furnished to Provider as
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
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<PAGE>
confidential information of Recipient subject to the terms and
conditions of Schedule A.
7. The Materials are experimental in nature and shall be used with
prudence and appropriate caution, since not all of the characteristics
are known. THE MATERIALS ARE PROVIDED "AS IS" WITHOUT WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR ANY OTHER
WARRANTY, EXPRESS OR IMPLIED. PROVIDER MAKES NO REPRESENTATION OR
WARRANTY THAT THE USE OF THE MATERIALS WILL NOT INFRINGE ANY PATENT OR
OTHER PROPRIETARY RIGHT.
8. This Agreement shall commence as of December 27, 1999 (the "Effective
Date"). Except for Schedule A, the term of this Agreement (the
"Materials Term") shall expire on the date that is [*****] after the
Effective Date, unless either extended by the Parties by written
agreement, sooner terminated in accordance herewith or the Parties
have entered into a definitive agreement. The term of Schedule A shall
not expire until five (5) years after the Effective Date. Either Party
may terminate the Materials Term of this Agreement for any reason
effective thirty (30) days after written notice to the other Party.
Upon expiration or termination of the Materials Term, unless the
Parties have entered into a definitive agreement, Recipient shall
return or destroy the Mice and destroy all Derived Materials, and
Provider shall return or destroy any Recipient Materials (if any)
received from Recipient and shall destroy any Derived Materials (if
any) received from Recipient. The Parties anticipate that the
definitive agreement will have a term of [*****].
9. If Recipient provides written notice to Provider of the identity of
the Antigen for which Derived Materials have been obtained by
Recipient, unless Provider has previously granted a third party rights
to use the Mice with respect to such Antigen or has commenced or has
the intent to commence an active research program on its own behalf
with respect to such Antigen, as shown by written records, during the
Materials Term Recipient shall have a right of first negotiation to
obtain a commercial license from Provider with respect to the Derived
Materials specific for such Antigen. During the Materials Term, if
Recipient provides such notice and either a third party notifies
Provider that such third party wishes to acquire a commercial license
to antibodies directed against such Antigen or Provider wishes to
commercialize antibodies against such Antigen itself, Provider shall
notify Recipient; however, Provider shall not be obligated to identify
such party,
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
3
<PAGE>
whether Provider or a third party. If Recipient has not notified
Provider within ten (10) business days of such Provider's notice that
Recipient will enter a definitive agreement with Provider for a non-
exclusive commercial license for the Derived Materials on the terms
set forth on Schedule B, or if Recipient and Provider have failed to
enter into a definitive license agreement consistent with such terms
within ninety (90) days from the date of Provider's notice to
Recipient, then Recipient's right of first negotiation shall terminate
with respect to the Derived Materials and the related Antigen. In any
such case, Provider may grant one or more third parties commercial
licenses with respect to antibodies specific for the applicable
Antigen, or conduct commercialization of such antibodies itself.
10. In no event shall Provider be liable for any use by Recipient of the
Materials or for any loss, claim, damage, or liability, of any kind or
nature, that may arise from or in connection with this Agreement or
the use, handling, or storage of the Materials. The Recipient agrees
to indemnify and hold harmless Provider and Provider's officers,
agents, and employees from any liability, loss, or damage they may
suffer as a result of claims, demands, costs, or judgments against
them arising out of the use and disposition of the Materials by the
Recipient, except insofar as such liability arises out of the
negligence or wrongdoing of Provider or its officers, agents or
employees.
11. Recipient will use the Materials in compliance with all laws,
governmental regulations and guidelines, including without limitation
current NIH guidelines and any regulations or guidelines pertaining to
research with recombinant DNA that may be applicable to the Materials.
12. Provider and Recipient agree in principal, subject to the terms of a
definitive agreement, for Provider to license to Recipient on a non-
exclusive basis the right to develop and commercialize Medarex's in-
licensed anti-CTLA-4 intellectual property, technology and Provider's
anti-CTLA-4 human antibody in connection with cellular vaccines and
cellular therapy. The terms of such license will [*****] include
milestone payments, beginning upon [*****], equal to [*****] and
royalties equal to [*****]. To the extent that Recipient may develop
patents or patent applications on the use of anti-CTLA-4 antibodies in
connection with cellular vaccines or cellular therapy, Recipient and
Provider agree that Provider will have the right to out-license the
relevant patents and patent applications to potential licensees,
[*****].
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
4
<PAGE>
13. [*****]
14. This Agreement, including its Schedule A and Schedule B, contains the
entire agreement between the Parties with respect to the subject
matter contained herein and supersedes any previous understandings,
commitments or agreements, oral or written. This Agreement may only be
amended with a written agreement signed by authorized representatives
of the Parties hereto.
15. This Agreement shall be governed by New Jersey law. The Parties hereby
submit to the exclusive jurisdiction of the courts of New Jersey in
all matters concerning this Agreement.
FOR MEDAREX INC. AND FOR IMMUNO-DESIGNED MOLECULES S.A.
GENPHARM INTERNATIONAL
Signature: /s/ D. Drakeman Signature: /s/ J. Romet-Lemonne
----------------------- ---------------------------
Name: DONALD L. DRAKEMAN Name: JEAN-LOUP ROMET-LEMONNE
Title: CHIEF EXECUTIVE OFFICER Title: PRESIDENT
Date: December 27, 1999 Date: December 27, 1999
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
5
<PAGE>
SCHEDULE A
CONFIDENTIALITY PROVISIONS
Each Party (herein referred to as the "Disclosing Party") is in possession
of certain non-public confidential and/or proprietary information (such
information, whether in written or oral form and including summaries or
notes thereof, is hereinafter defined as the "Information") that it is
willing to disclose to the other Party (herein referred to as the
"Receiving Party") for the purpose of discussing a possible collaboration
involving Medarex's transgenic mouse and antibody technology.
The Receiving Party agrees on behalf of itself and its affiliates,
successors and assigns to accept such Information, which may be disclosed
in written or oral form, in accordance with the following terms:
1. The Receiving Party agrees not to disclose to anyone and to protect
the confidentiality of any and all Information disclosed to it under
this Agreement, with the exception of the following:
a) Information that, at the time of disclosure to the Receiving
Party, is generally known to the public;
b) Information that, after disclosure by the Disclosing Party
becomes part of the public knowledge by publication or
otherwise, except by breach of this Agreement;
c) Information that was in the Receiving Party's possession at
the time of disclosure but not acquired, directly or
indirectly, from the Disclosing Party, provided the
Receiving Party furnishes the Disclosing Party with
satisfactory written documentation thereof prior to any
disclosure of such Information to a third party;
d) Information that the Receiving Party receives from third
parties who have the legal right to disclose such
information, provided such Information was not obtained to
the knowledge of the Receiving Party by said third parties,
directly or indirectly, from the Disclosing Party on a
confidential basis.
2. The Receiving Party agrees that it will not use the Information that
it is required hereunder to keep confidential for any purpose other
than for the purpose described above.
6
<PAGE>
SCHEDULE B
TERM SHEET
HuMAb-Mouse /(TM)/ Technology
The Collaboration
Medarex proposes to make the HuMAb-Mouse technology available to Immuno-
Designed Molecules S.A. to create antibodies for an antigen, or antigens,
of Immuno-Designed Molecules S.A. choice.
Demonstration Project
Medarex offers a free demonstration project to allow to work with the HuMAb
mice and develop a pool of high affinity, human antibodies for [*****]
antigens. The exact number of mice needed is to be determined. At Immuno-
Designed Molecules S.A.'s option, Medarex will perform immunizations,
derive hybridomas and characterize the resulting antibodies, using Immuno-
Designed Molecules S.A.'s antigen and assays, for a fee of [*****] per
antigen. Medarex can also develop assays, at a price to be determined.
Research License
Following the demonstration project, if Immuno-Designed Molecules S.A.
chooses to enter into a business collaboration, for a fee of [*****] per
antigen target, Medarex will grant a research license on a non-exclusive
basis for a [*****] period to allow Immuno-Designed Molecules S.A. to
evaluate the human antibodies to the antigen. This license may be renewed
for an additional fee of [*****] per antigen target for [*****].
Commercial License
An exclusive commercial license for the antibodies created by Immuno-
Designed Molecules will be granted for a fee of [*****] per antigen. If the
commercial license is obtained during the research license renewal period,
the renewal fee will be pro-rated and credited against the commercial
license fee. Immuno-Designed Molecules S.A. may proceed directly to the
commercial license for a target antigen without obtaining a research
license first. Commercial licenses are subject to availability.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
7
<PAGE>
Milestones
[*****]
Royalties
Annual Worldwide Sales
[*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
8
<PAGE>
Exhibit 10.10
-------------
AGREEMENT ON ESSENTIAL TERMS FOR COLLABORATION
between
KIRIN BREWERY CO, LTD.
and
MEDAREX, INC. / GENPHARM, INC.
THIS AGREEMENT ("Agreement"), effective as of December 27, 1999 ("Effective
Date"), is made and entered into by and between Kirin Brewery Co., Ltd., having
principal offices at 10-1 Shinkawa 2-chome, Chuou-ku, Tokyo 104-8288, Japan,
("Kirin"), and Medarex, Inc., having principal offices at 67 Beaver Avenue,
Annandale, New Jersey 08801, United States of America, including its wholly
owned subsidiary, GenPharm, Inc., having principal offices at 2350 Qume Drive,
San Jose, California 95131, United States of America ("Medarex").
WHEREAS, Kirin and Medarex each have developed, and continue to refine and
further develop, novel technologies in the area of human antibodies utilizing
mice carrying human immunoglobulin loci; and
WHEREAS, Medarex owns or otherwise controls the Medarex HuMAb-Mouse and
improvements thereto, and has a right to grant license rights under intellectual
property covering such Medarex HuMAb-Mouse ("HuMAb-Mouse") and improvements; and
WHEREAS, Kirin owns or otherwise controls the Kirin Transchromosomic Mouse
("TC-Mouse") and improvements thereto, and the Kirin Human Artificial Chromosome
Mouse ("HAC-Mouse") and improvements thereto, and has a right to grant license
rights under intellectual property covering such TC-Mouse and improvements, and
such HAC-Mouse and improvements; and
WHEREAS, Medarex desires to grant license rights to Kirin to permit Kirin
to utilize the HuMAb-Mouse, TC-Mouse, or HAC-Mouse and improvements thereto to
generate human antibodies and to develop and commercialize products derived from
targets selected by Kirin or its partners; and
WHEREAS, Kirin desires to grant license rights to Medarex to permit Medarex
to utilize the TC-Mouse and improvements thereto, and the HAC-Mouse and
improvements thereto, to generate human antibodies and to develop and
commercialize products derived from targets selected by Medarex or its partners.
<PAGE>
NOW, THEREFORE, in accordance with the facts and desires set forth above,
Kirin and Medarex hereby agree as follows:
1. License Grants
(a) Subject to the terms and conditions set forth in this Agreement,
Medarex hereby grants to Kirin a right and license, together with a right to
enter into licensing arrangements with third parties as further described in
Section 14 below, under intellectual property owned or otherwise controlled by
Medarex, to the extent that Medarex can grant such a right and license, covering
the HuMAb-Mouse and improvements thereto and covering the TC-Mouse and/or HAC-
Mouse and improvements thereto, if any, including without limitation any mouse
strains developed by Medarex or Kirin by cross breeding the HuMAb-Mouse, the TC-
Mouse and the HAC-Mouse, to make, have made, use, have used, offer for sale,
sell, have sold, export and import human antibodies derived from targets
selected by Kirin or its partners (as further described below). Medarex and
Kirin each acknowledge and agree that such grant will include all such
intellectual property pertaining to the license granted herein held by Medarex
as a result of a grant to Medarex of any right and license by a third party and
under which Medarex can grant sublicense rights. [*****].
(b) Subject to the terms and conditions set forth in this Agreement, Kirin
hereby grants to Medarex a right and license, together with a right to enter
into licensing arrangements with third parties as further described in Section
14 below, under intellectual property owned or otherwise controlled by Kirin, to
the extent that Kirin can grant such a right and license, covering the TC-Mouse
and improvements thereto, and the HAC-Mouse and improvements thereto, including
without limitation any mouse strains developed by Kirin or Medarex by cross
breeding the HuMAb-Mouse, the TC-Mouse and the HAC-Mouse, to make, have made,
use, have used, offer for sale, sell, have sold, export and import human
antibodies derived from targets selected by Medarex or its partners (as further
described below). Kirin and Medarex each acknowledge and agree that such grant
will include all such intellectual property pertaining to the license granted
herein held by Kirin as a result of a grant to Kirin of any right and license by
a third party and under which Kirin can grant sublicense rights.
(c) It is the intent of the parties to provide access to their mouse
technology to each other in a manner that encourages commercial use. Therefore,
the parties hereto will use their best efforts to provide for the right to
sublicense, to the other party and its sublicensees, in license agreements
entered into for intellectual property which would be necessary for either party
to practice first party's technology without an infringement of that
intellectual property.
2. Territory
(a) The Kirin Territory will be Asia as specifically indicated in Exhibit
A.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
2
<PAGE>
(b) The Medarex Territory will be outside Asia as specifically indicated
in Exhibit A.
(c) Medarex and Kirin agree to discuss in good faith, within two years
after the Effective Date, whether to add Australia and New Zealand to the Kirin
Territory.
(d) Medarex agrees that Medarex will not make a fully-human antibody
partnering deal with a corporate partner or customer whose headquarters is
located in the Kirin Territory.
(e) Kirin agrees that Kirin will not make a fully-human antibody
partnering deal with a corporate partner or customer whose headquarters is
located in the Medarex Territory.
(f) Notwithstanding (d) or (e) above, Medarex and Kirin and their
corporate partners or customers are free to produce, market, promote and sell
any antibody product derived from the mice worldwide.
(g) [*****].
(h) In addition, both parties agree that each party may advertise its
technology, including publishing papers regarding its technology and presenting
its technology at conferences, anywhere in the world. In the event that such
activities give rise to inquiries from potential corporate partners or customers
in the other party's territory, the first party will respond to any such inquiry
and indicate that the other party is its sole licensee with respect to such
potential corporate partner or customer. [*****].
3. Target Information
(a) Medarex shall institute a mechanism whereby Medarex will notify its
partners by written documentation of the availability or non-availability of
targets. If Kirin asks about the availability of a target and Medarex has
licensed the target to a third party Medarex shall send Kirin a copy of the
aforementioned documentation with the name of the partner redacted.
(b) The identity of targets chosen by Medarex or Kirin and its corporate
partners is confidential. In particular, because of confidentiality constraints
imposed upon Medarex under agreement with corporate partners existing as of the
Effective Date, Medarex cannot disclose to Kirin the identity of targets chosen
by such partners.
(c) Notwithstanding the above, in recognition of equal partnership between
the parties, Medarex during the term of this Agreement, shall disclose to Kirin
the target identity of Medarex' and Medarex Affiliates' existing and future
internal projects. For purposes of this Section 3(c), the term "Medarex
Affiliate" shall mean any corporation or other business entity controlled by,
controlling or under common control with Medarex, and the term "control" shall
mean direct or
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
3
<PAGE>
indirect beneficial ownership of more than 50% of the voting stock or equity, or
more than 50% interest in the income of such corporation or other business
entity; provided that, if local law requires a minimum percentage of local
ownership, control will be established by direct or indirect beneficial
ownership of 100% of the maximum ownership percentage that may, under such local
law, be owned by foreign interests. Furthermore, Medarex shall use its
reasonable efforts to obtain the permission of its partners partnered after the
Effective Date to disclose the identity of targets chosen by such partners as
further defined in Sections 14(b) and (c) below.
(d) Medarex acknowledges that Kirin will need to know whether a specific
target is available for Kirin's in-house projects or for collaboration with
potential corporate partners. Therefore, Kirin may ask Medarex if a specific
target is available for licensing, to which Medarex will respond in a timely
manner. [*****] If Kirin inquires about the availability of a specific target
from Medarex for Kirin's in-house development activities, a positive response
from Medarex will [*****]. Kirin may, however, inquire about the availability
of [*****] for Kirin's in-house development without having to designate those
three targets as in-house project targets.
4. Target List Designation
(a) A list of targets designated by Kirin for in-house development,
subject to availability, will be maintained (the "Target List") and limited, at
all times, to [*****] agreed upon targets (the "List Limitation"). Kirin, in
year 2000, may designate, subject to availability, [*****] targets to be put on
the Target List. Subsequently, Kirin will be permitted to add up to [*****]
targets per calendar year to the Target List subject to the List Limitation. If
a third party requests rights to a target from Medarex, as evidenced by written
documentation (the identity of the party does not have to be disclosed to
Kirin), and such target is on the Target List, Kirin shall have a first right to
designate such target as a [*****] as described below.
(b) Kirin may designate up to [*****] available targets from the Target
List as "in-house project" targets, [*****] milestone payments, subject [*****]
obligations set forth in Section 8 below [*****]. An "in-house project" is a
project in which (i) substantially all of the research and development effort
comes from Kirin's internal research assets or, (ii) Kirin has entered into a
collaborative research and development effort in exchange for substantial
commercialization rights. Substantial commercialization rights should include at
least [*****]. For purposes of this Agreement, [*****] shall mean the [*****].
(c) Rights to [*****] will accrue to Kirin, alternately, [*****] in one
year and [*****] in the next year, accruing at the beginning of each calendar
year until Kirin will have accumulated a total of [*****] opportunities. Kirin
will have the right to substitute a new target from the Target List for an
existing [*****], but the total number of such substitutions may not exceed more
than [*****] during the term of this Agreement. Any such substitution must
occur prior to [*****] after the commencement of Phase [*****] clinical trials
and will require payment of $[*****] to Medarex
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
4
<PAGE>
at the time of the substitution request. If a third party requests rights to a
target from Medarex, as evidenced by written documentation (the identity of the
party does not have to be disclosed to Kirin), and such target is on the Target
List and Kirin designates such target as a [*****], such [*****] will not be
eligible for substitution except as otherwise indicated in this Section 4(c)
below. In addition, Kirin will be required to develop such a [*****] through the
IND filing stage (or its equivalent) unless Kirin provides scientific evidence
to Medarex that demonstrates that continued development of such [*****] is not
feasible. If, in Medarex' reasonable judgment, based upon Kirin's scientific
evidence obtained prior to commencement of Phase [*****] clinical trials,
continued clinical development of such a [*****] is not feasible, Kirin, after
paying Medarex [*****], may substitute a new target from the Target List for
such failed [*****]. In any such case, upon Medarex' request, Kirin will grant
to Medarex, at no cost other than provided below to Medarex, a right and license
under any and all intellectual property owned or otherwise controlled by Kirin,
including without limitation a right to use know-how and data, necessary or
useful for development of the failed [*****]. If Medarex decides to continue the
development of such failed [*****] and eventually commercializes a product based
on that Target, Medarex will reimburse Kirin the [*****] substitution fee.
(d) In addition to [*****] opportunities, Kirin will have an unlimited
(subject to the List Limitation) number of [*****] target opportunities, subject
to [*****] obligations set forth in Sections [*****] and [*****] below ("[*****]
Targets"). Not withstanding the above, once Kirin has paid to Medarex the
[*****] commercialization fee for a [*****] Target as set forth in this Section
4(d), such [*****] Target shall no longer be considered a target subject to the
List Limitation. As a result, Kirin may have more than a total of [*****] in-
house targets at any time; provided, however, that the total of all [*****]
Targets and all [*****] Targets for which a commercialization fee has not been
paid does not exceed [*****]. Further, once a target has been commercialized in
any major country, that target shall be deleted from the Target List and an
additional target may be added to the Target List, which may be either a [*****]
Target or [*****] Target if Kirin has any remaining [*****] Targets available in
accordance with the above.
5. Target Designation and Fee Target Commercialization Fee
(a) Within [*****] after the date that a target is included on the Target
List, Kirin shall designate whether such target is a [*****] Target or a [*****]
Target, or whether such target is of no further interest to Kirin. Kirin may
extend its decision to designate any target on the Target List for [*****] by
providing, within 30 days prior to the date on which a target is to be
designated as either a [*****] Target or a [*****] Target, (i) written notice to
Medarex of such extension and (ii) payment to Medarex via wire transfer of a fee
equal to [*****].
(b) If Kirin designates a target as a [*****] Target, Kirin shall use one
of the accumulated [*****] Target Rights allocated to Kirin pursuant to Section
4(b) above. Kirin may only use [*****] Target Rights that have accrued to Kirin
at the time of designation. A target
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
5
<PAGE>
[*****] below; provided, however that Kirin, at any time, may redesignate a
[*****] Target as a [*****] Target if Kirin has available previously unused
[*****] Target Rights to do so.
(d) If Kirin designates a target as a target in which Kirin has no further
interest, Kirin will have no further right or license with respect to such
target and Medarex shall have no obligation to Kirin regarding such target.
However, if Kirin later decides to resume the development of such target and if,
and only if, such target is still available, Kirin may designate such target as
a [*****] Target or a [*****] Target subject to the List Limitation.
6. [*****] Milestones
(a) [*****]
(b) Each milestone payment shall be made to Medarex within 30 days after
the date of the achievement of the corresponding milestone set forth in the
table in this Section 6(a).
(c) No milestone payment shall be applied to or otherwise credited against
any other payment which may be due to Medarex under this Agreement.
(d) Before a milestone applicable to the second [*****] Target, or any
subsequent [*****] Target, pursuant to Section 6(a) would apply, all milestones
due with respect to previous [*****] Targets must be paid. For example, if a
product attributed to the first [*****] Target has achieved all milestone events
up to [*****], and a product attributed to the [*****] milestone would be
payable to Medarex with respect to the [*****] Target. If the first Target
subsequently receives a [*****] milestone would be payable to Medarex.
7. [*****]
For purposes of this Agreement, "Net Sales" shall mean the gross amount invoiced
by Kirin, its affiliates and sublicensees to third parties on all sales of
products attributed to targets selected by Kirin in accordance with the terms of
this Agreement, less (i) discounts actually allowed, (ii) credits for claims,
allowances, retroactive price reductions or returned goods, (iii) prepaid
freight, and (iv) sales taxes or other governmental charges actually paid in
connection with sales of such products. For purposes of determining Net Sales, a
sale shall be deemed to have occurred on the earlier of generation of an invoice
therefor or shipment of the product for delivery. The gross amount from sales
of products by Kirin, or an affiliate or sublicensee of Kirin to any affiliate
or sublicensee which is a reseller of such products shall be excluded from Net
Sales; provided that the gross amount from the subsequent sale of such products
by such affiliates or sublicensees of Kirin to unrelated parties shall be
included in Net Sales hereunder.
(a) In addition to [*****] as set forth in Section 7(a) above, Kirin shall
bear the [*****], if applicable, with respect to products attributed to [*****]
Targets designated by Kirin under this Agreement.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
6
<PAGE>
For purposes of determining Net Sales, a sale shall be deemed to have occurred
on the earlier of generation of an invoice therefor or shipment of the product
for delivery. The gross amount from sales of products by Kirin, or an affiliate
or sublicensee of Kirin to any affiliate or sublicensee which is a reseller of
such products shall be excluded from Net Sales; provided that the gross amount
from the subsequent sale of such products by such affiliates or sublicensees of
Kirin to unrelated parties shall be included in Net Sales hereunder.
(a) In addition to [*****] as set forth in Section 7(a) above, Kirin shall
bear the [*****], if applicable, with respect to products attributed to [*****]
Targets designated by Kirin under this Agreement.
8. [*****]
9. [*****]
10. Other Payments
(a) Kirin will pay to Medarex, for a period of [*****] years after the
Effective Date, (i) [*****] of all partnering payments received by Kirin from
its partners in the Kirin Territory for use of the TC-Mouse, the HAC-Mouse, any
future TC-Mouse, any future HAC-Mouse, a TC/HAC-Mouse or any of these mice
crossbred with any HuMAb-Mouse (hereinafter, collectively, "Kirin Mice"), or any
HuMAb-Mouse or any future HuMAb-Mouse (hereinafter, collectively, referred to as
"Medarex Mice"), and (ii) [*****] of all partnering payments received from its
partners in the Medarex Territory for use of Kirin Mice and Medarex Mice.
Furthermore, Kirin will pay to Medarex, for a period of [*****] years after the
Effective Date, (iii) [*****] of all royalties received by Kirin from its
partners based on the sales in the Kirin Territory and (iv) [*****] of all
royalties received by Kirin from its partners based on the sales in the Medarex
Territory, of products developed using Kirin Mice and Medarex Mice. Such
payments pursuant to (i) through (iv) collectively shall be referred to as
"Kirin Partner Payments." For the purpose of this Agreement, "partnering
payments" include any payments received from partners or customers as
consideration for the license or technology access, such as up-front payments,
research licensing fees, commercialization fees and milestones, but exclude
royalty payments and fees, at fair market value, for services such as producing
antibodies and manufacturing antibody products.
(b) Except as provided in this Section 10(b) below, Medarex will pay to
Kirin, for a period of [*****] years after the Effective Date, (i) [*****] of
all partnering payments received by Medarex from its partners in the Medarex
Territory for use of Kirin Mice, and (ii) [*****] of all partnering payments
receiving by Medarex from its partners in the Kirin Territory for use of Kirin
Mice. Furthermore, Medarex will pay to Kirin, for a period of [*****] years
after the Effective Date, (iii) [*****] of all royalties received by Medarex
from its partners based on the sales in the Medarex Territory and (iv) [*****]
of all royalties received by Medarex from its partners based on
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
7
<PAGE>
the sales in the Kirin Territory, of products developed using Kirin Mice. Such
payments pursuant to (i) through (iv) collectively shall be referred to as
"Medarex Partner Payments." Notwithstanding the above, with respect to current
license agreements (but not with respect to future license agreements, or
extensions and revisions of a current agreement) with certain licensees of
Medarex that are licensees of Medarex as of the Effective Date and listed in
Exhibit B ("Special Licensees"), Medarex will pay to Kirin [*****] of all
partnering payments for use of Kirin Mice received by Medarex from such
licensees, provided, however, Medarex will pay to Kirin [*****] and [*****] of
all royalties received from such licensees relating to products created using
Kirin's Mice pursuant to (iii) and (iv) above.
(c) In addition, within twenty (20) days after the Effective Date, Kirin
will pay to Medarex an initial fee equal to $12 million.
(d) In addition, until the earlier of either [*****] years after the
Effective Date or payment by Kirin to Medarex of a total of $[*****] million,
including the initial fee equal to $12 million paid by Kirin to Medarex pursuant
to Section 10(c), Kirin will (i) pay to Medarex, in addition to amounts to be
paid to Medarex pursuant to Section 10(a) above, [*****] of the amount retained
by Kirin after payment of the Kirin Partner Payments in accordance with Section
10(a), and (ii) forego receipt of [*****] of the amount of Medarex Partner
Payments that Kirin would otherwise receive pursuant to Section 10(b). Kirin's
agreement to forego receipt of a portion of Medarex Partner Payments will also
apply to any payments for use of Kirin Mice received by Medarex from Special
Licensees.
(e) For purposes of illustration, the following examples are provided to
summarize the distribution between Kirin and Medarex of payments received from
corporate partners:
(i) Kirin will receive [*****] of partnering payments received from
its partners in the Kirin Territory and [*****] of royalties received from
its partners based on sales in the Kirin Territory for use of Kirin Mice
and Medarex will receive [*****] of such payments. However, in addition,
pursuant to Section 10(d), Medarex will receive [*****] of the [*****] of
the payments retained by Kirin in accordance with Section 10(a) until the
end of the period set forth in Section 10(d).
(ii) Medarex will receive [*****] of partnering payments received from
its partners in the Medarex Territory and [*****] of royalties received
from its partners based on sales in the Medarex Territory for use of Kirin
Mice and [*****] of all payments received from such partners for use of
Medarex Mice and, subject to Section 10(d), Kirin will receive [*****] and
[*****], respectively, of such payments. However, in addition, pursuant to
Section 10(d), Medarex will retain the [*****] of the amount of Medarex
Partner Payments that Kirin would otherwise receive pursuant to Section
10(b) until the end of the period set forth in Section 10(d).
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
8
<PAGE>
(iii) Notwithstanding Sections 10(e)(i) and (ii) above, Medarex will
receive [*****] of the partnering payments received by Medarex from Special
Licensees corresponding to milestone payments for use of Kirin Mice and,
subject to Section 10(d) whereby Kirin will forego receipt of a portion of
payments for the period defined in such Section 10(d), Kirin will receive
[*****] of such payments.
(iv) Kirin will receive [*****] of partnering payments received from
its partners in the Kirin Territory and [*****] of royalties received from
its partners based on sales in the Kirin Territory for use of Medarex Mice
and Medarex will receive [*****] of such payments. However, in case
Medarex has a special relationship with such a potential corporate partner
or customer in the Kirin Territory and has entered into agreement with such
party in accordance with Section 2(d) above, Medarex will receive [*****]
of such payments.
(v) Except as otherwise provided in Section 10(e)(iii), payments
received from partners will be allocated between Kirin and Medarex based
upon whether such payments originated from the Kirin Territory or the
Medarex Territory. "Originated" shall mean (1) in the case of partnering
payments, paid by corporate partners or customers whose headquarters is
located in each Territory, and (2) in the case of royalties, based on the
sales of products in each Territory.
11. Payment of Royalties, Records and Audit Rights
(a) Within 90 days after the first day of each calendar quarter after the
first commercial sale of a product, Kirin shall pay to Medarex earned royalties
due and payable to Medarex pursuant to Sections [*****] and [*****] for the
just-ended calendar quarter.
(b) At the same time as each earned royalty payment is made to Medarex,
Kirin shall furnish to Medarex a detailed written report of Net Sales of each
product subject to the payment of earned royalties hereunder, and the
calculation of the earned royalties due and payable thereon, including a
description of any offsets or credits deducted there from, on a product-by-
product and country-by-country basis, for the calendar quarter upon which the
royalty payment is based.
(c) Kirin shall keep, and cause its affiliates and sublicensees to keep,
full, complete and proper records and accounts of all sales of products in
sufficient detail to enable the royalties payable on Net Sales of each such
product to be determined. Medarex shall have the right to appoint an
independent certified public accounting firm to audit the records of Kirin and
its affiliates and sublicensees as necessary to verify the royalties payable
pursuant to this Agreement. Kirin and its affiliates and sublicensees shall pay
to Medarex an amount equal to any additional royalties to which Medarex is
entitled as disclosed by the audit, plus interest thereon at the rate of 1.5%
per month. Such audit shall be at Medarex' expense; provided, however, that if
the audit discloses that Medarex
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
9
<PAGE>
was underpaid royalties with respect to any product by 5% or more for any
calendar quarter, then Kirin shall reimburse Medarex for any such audit costs.
Medarex may exercise its right to audit as to each of Kirin and its affiliates
or sublicensees no more frequently than once in any calendar year. The
accounting firm shall disclose to Medarex only information relating to the
accuracy of the royalty payments. Kirin and its affiliates and sublicensees
shall preserve and maintain all such records required for audit for a period of
3 years after the calendar quarter to which the record applies.
(d) The remittance of royalties payable on sales outside the United States
shall be payable to Medarex in United States Dollars at the official rate of
exchange of the currency of the country from which the royalties are payable, as
quoted in the United States of America edition of the Wall Street Journal for
the last business day of the calendar quarter in which the royalties are
payable. If the transfer of or the conversion into the United States Dollars of
any such remittance in any such instance is not lawful or possible, the payment
of such part of the royalties as is necessary shall be made by the deposit
thereof, in the currency of the county where the sale was made on which the
royalty was based, to the credit and account of Medarex or its nominee in any
commercial bank or trust company of Medarex' choice located in that country,
prompt written notice of which shall be given by Kirin to Medarex.
12. Medarex In-House Targets Utilizing Kirin Mice
The terms and conditions set forth in Sections 4-9 and Section 11 relating
to Kirin's obligations under this Agreement with targets and products will apply
to Medarex with respect to Medarex' in-house use of Kirin Mice in connection
with targets and products, except that (i) the payment required to substitute a
------
new target for an existing [*****] Target set fort in Section 4(c) shall be
$[*****], (ii) all milestone payments payable by Medarex to Kirin with respect
to Medarex' [*****] Targets shall be equal to [*****] the amount set forth in
Section 6(a), and (iii) royalties payable by Medarex to Kirin with respect to
Medarex' [*****] Targets pursuant to Section [*****] shall be [*****] with any
third party royalty, if any, payable by Medarex.
13. Ex-vivo, Diagnostic or Reagent Use Products
Kirin and Medarex acknowledge and agree that the milestone and royalty
schedules set forth above are intended to apply to in-vivo therapeutic
applications of products. The parties also acknowledge and agree that other
non-in vivo applications of products are possible and, in recognition of such
other applications, Kirin and Medarex agree to negotiate in good faith
reasonable fee schedules other than as set forth in Sections 6, 7 and 8 to
pertain to such non in-vivo therapeutic applications of products.
14. License Arrangement Terms and Conditions
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
10
<PAGE>
(a) Kirin and Medarex each agree that the terms and conditions of any
partnering arrangement entered into with a third party for the use of Kirin Mice
and Medarex Mice to develop antibody products will be such that the amount paid
either by Kirin to Medarex or by Medarex to Kirin pursuant to this Agreement as
a result of activities of such third party [*****].
(b) In addition, Kirin and Medarex each agree that the terms and
conditions of any partnering arrangement entered into with a third party for the
use of Kirin Mice and Medarex Mice to develop antibody products will provide
that such third party will provide notice to Kirin or Medarex, as the case may
be, in a timely manner as to (i) any product developed by use of technology
licensed to such third party under such licensing arrangement, and (ii) the
particular system used by such third party in development of each product,
whether or not such development is complete. Medarex will provide notice to
Kirin of who is using Kirin Mice and, in addition, will provide notice to Kirin
of the specific target that a Medarex partner is trying to develop using Kirin
Mice with the name of that partner at the earlier of either (iii) publication of
the fact that a human antibody was made utilizing Kirin Mice, or (iv) the
granting of a commercialization license to the partner for the target.
(c) Furthermore, Kirin and Medarex each agree to include in any partnering
arrangement entered into with a third party after the Effective Date, for the
use of Kirin Mice and Medarex Mice to develop antibody products, terms and
conditions which will allow Kirin or Medarex, as the case may be, [*****].
Kirin and Medarex each agree to provide written notice to the other within 30
days after the effective date of a partnering arrangement. Kirin and Medarex
each agree not to hold the other liable or bring any legal action against the
other based on any obligation of a party pursuant to this Section 14(c) or the
identity of any target disclosed pursuant to this Section 14(c).
15. Partner Opportunities
(a) Medarex agrees to offer Medarex' corporate partners an opportunity to
negotiate with Kirin for commercialization rights or an option to acquire
commercialization rights in Japan and other Asian countries with respect to such
partner's fully human antibody product. Time permitting and upon reasonable
request of Kirin, Medarex shall assist Kirin with the negotiation of a licensing
arrangement between Kirin and a Medarex partner.
(b) [*****]
16. Reports and Joint Meetings
(a) [*****]
(b) Joint meetings between Kirin and Medarex shall occur on a regular
basis during the term of this Agreement. Such joint meetings shall occur on a
twice yearly basis alternating between
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
11
<PAGE>
Japan and the United States of America. Each party shall bear its own expenses
relating to attending and participating in joint meetings. Each joint meeting
shall be attended by representatives of both Kirin and Medarex to discuss the
activities of the parties with respect to the technology licensed under this
Agreement.
(c) The parties' representatives will discuss the continued development by
the parties of the novel technologies licensed under this Agreement, the
development of products utilizing the technologies licensed under this
Agreement, and the progress in establishing licensing arrangements with third
parties in accordance with the rights and licenses granted under this Agreement.
In addition, each party's representatives will, subject to the provisions of
paragraph 14, provide information to the representatives of the other party
regarding: [*****]
17. Confidentiality
(a) Each party shall hold in strict confidence and not use or disclose to
any third party (other than employees, affiliates, consultants and advisors who
are similarly bound in writing) any product, technical, marketing, financial,
business or other information, ideas or know-how identified in writing as
confidential ("Confidential Information") of or used by the other party;
provided, however, that Confidential Information of a party shall not include:
(i) Information which at the time of disclosure was previously known
to the receiving party as demonstrated by written records;
(ii) Information which at the time of disclosure is published or
otherwise generally available to the public; or
(iii) Information which, after disclosure by the other party, is
published or otherwise becomes generally available to the public through no
breach of this Agreement by the receiving party.
(b) A party may disclose Confidential Information of the other:
(i) In connection with the order of a court or other governmental
body;
(ii) As required by or in compliance with laws or regulations;
(iii) In confidence, to accountants, banks and financing sources and
their advisors; or
(iv) In confidence, to consultants and advisors in connection with a
merger or acquisition or proposed merger or acquisition, or the like.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
12
<PAGE>
(c) The obligations of Kirin and Medarex under the terms of this Section
17 shall remain in full force and effect for 5 years after expiration of this
Agreement.
18. Term of Agreement
The term of this Agreement shall be [*****] years, at which time the
licenses of the partners to each other shall be fully paid up. Notwithstanding
the previous sentence, any and all payment obligations with respect to products
launched in any country shall continue until expiration of the term of the
royalty payment obligation as set forth in Section 9. Each and any third party
licenses in effect upon the expiration of this Agreement requiring payment,
performance or other obligations will continue in full force and effect in
accordance with the terms and conditions provided therein.
19. Withholding Taxes
Notwithstanding any provision of this Agreement, all payments remitted by
either of the parties to the other will be reduced by the applicable withholding
requirements of the applicable taxing jurisdiction.
20. Notices
Any notices to a party provided under this Agreement shall be given in
writing at the address of such party set forth above, or to such other address
as either party may substitute by written notice to the other in the manner
contemplated herein, and shall be deemed served when delivered or, if delivery
is not accomplished by reason or some fault of the addressee, when tendered.
21.
Legal Effect; Binding Arbitration
(a) This Agreement is intended as legal and binding contract, enforceable
in accordance with its terms by and against both Kirin and Medarex and is
intended to contain all of the essential terms between Kirin and Medarex
regarding the transactions contemplated by this Agreement and will be
incorporated [*****].
(b) In furtherance and not in limitation of the foregoing, it is the
intention of Kirin and Medarex to initiate promptly [*****] during which Kirin
and Medarex will conduct exclusive discussions relating to any additional terms
and conditions [*****] the entire and exclusive agreement between Kirin and
Medarex with respect to the subject matter hereof and shall supersede and cancel
all previous and contemporaneous registrations, agreements, commitments and
writings in respect thereof, including without limitation this Agreement.
(c) If the parties are not able to reach agreement on any such additional
terms [*****] described in Section 21 (b) above, the parties shall be entitled
to submit the dispute to binding
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
13
<PAGE>
arbitration under the commercial rules of the American Arbitration Association
by three arbitrators appointed in accordance with such rules. The arbitration
proceedings and all written information provided in such arbitration shall be in
the English language. In such arbitration, each party shall submit [*****]. The
arbitrators shall select whichever of the versions, in part or in its entirety,
which more closely adheres to the [*****]. Such version [*****] shall then
embody the agreements of and between the parties governing the relationships
contemplated [*****]. The arbitration shall take place in San Diego, California.
22. Assignment
Neither this Agreement nor any interest hereunder shall be directly or
indirectly assigned or transferred (whether voluntarily, by operation of law or
otherwise) by either party without prior written consent of the other party:
provided, however, that either Kirin or Medarex may assign or transfer this
Agreement or any of its rights or obligations hereunder from the earlier of six
months from the effective date of this Agreement or [*****] (i) to any Kirin
affiliate or Medarex affiliate, respectively (ii) to any third party with which
it may merge or consolidate, or to which it may transfer all or substantially
all of its assets to which this Agreement relates, in each case without
obtaining the consent of the other party, if in any such event (including any
merger involving Kirin or Medarex), (A) the assigning party remains jointly and
severally liable with the relevant Kirin affiliate, Medarex affiliate or third
party assignee under this Agreement, and (B) the relevant Kirin affiliate or
Medarex affiliate assignee, third party assignee or surviving entity assumes in
writing all of the assigning party's obligations under this Agreement. Any
purported assignment or transfer in violation of this section shall be void.
23. Entire Agreement
This Agreement constitutes the entire and exclusive agreement between Kirin
and Medarex with respect to the subject matter hereof and shall supersede and
cancel all previous and contemporaneous registrations, agreements, commitments
and writings in respect thereof.
24. Language
This Agreement is in the English language, which language shall be
controlling in all respects, and all versions hereof in any other language shall
be for accommodation only and shall not be binding upon the parties hereto. All
communications and notices to be made or given pursuant to this Agreement shall
be in the English language.
25. Counterparts
This Agreement may be executed in counterparts, each of which shall be
deemed an original, but both of which together shall constitute one and the same
instrument.
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
14
<PAGE>
IN WITNESS WHEREOF, the undersigned are duly authorized to execute this
Agreement on behalf of Kirin and Medarex, as applicable.
KIRIN BREWERY CO., LTD. MEDAREX, INC.,
("Kirin") including its wholly owned subsidiary,
GENPHARM, INC.
("Medarex")
By: /s/ Koichiro Aramaki By: /s/ Michael Appelbaum
------------------------------------- ----------------------------------
Print Name: Koichiro Aramaki, Ph.D. Print Name: Michael Appelbaum
----------------------------- --------------------------
Title: President, Pharmaceutical Division Title: Executive V.P. - Medarex
---------------------------------- -------------------------------
President and C.O.O. GenPharm
15
<PAGE>
Exhibit A
---------
Kirin Territory
Afghanistan
Bahrain
Bangladesh
Brunei
Cambodia
East Timor
India
Indonesia
Iran
Iraq
Israel
Japan
Jordan
Kuwait
Laos
Lebanon
Malaysia
Mongolia
Myanmar
Nepal
North Korea
Oman
Pakistan
People's Republic of China
Philippines
Saudi Arabia
Singapore
South Korea
South Yemen
Sri Lanka
Syria
Taiwan
Thailand
Turkey
United Arab Emirates
Vietnam
Yemen
16
<PAGE>
Exhibit B
---------
Special Licensees
[*****]
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
17
<PAGE>
Exhibit 10.11
-------------
Scil
biomedicals
Scil Biomedicals GmbH
Fraunhoferstr. 18a
D-82152 Martinsried
Tel: + 49 89 8565 1800
Fax: + 49 89 8565 1818
Donald Drakeman, PhD
President and CEO
Medarex, Inc.
707 State Road 206
Suite 206
Princeton, NJ 08540
USA
January 3, 2000
Binding Letter of Intent
Dear Donald:
We were very pleased that your board agreed with the Terms for the MDX-RA and
MDX-H210 projects which we prepared last Thursday. It is our understanding that
the Terms as defined again in this letter are binding for Medarex and Scil
Biomedicals GmbH (former BioNet Pharma) and constitute the basis for completing
a final licensing agreement that will contain all of the terms that are to be
agreed to by the parties.
The agreed to Terms are as follows:
MDX-RA:
Territory: Europe and the Near East
<PAGE>
Costs: Scil Biomedicals will pay 100% of the costs up to [*****]
for clinical trials, regulatory filings and approvals and
manufacturing scale up for development in Europe, the Near
East and North America. Thereafter, Medarex and Scil
Biomedicals will share all such costs on a 50-50 basis
[*****].
Upfront: [*****] paid by Scil Biomedicals to Medarex; [*****]. The
upfront payment is non-refundable and non-creditable.
Milestones Paid
by Medarex: [*****]
Royalties/Supply: Scil Biomedicals will pay 3/rd/ party royalties and
royalties to Medarex in a staggered manner: in stage 1, Scil
Biomedicals will pay a basic 3/rd/ party royalty rate of
[*****], a royalty rate of [*****] to Medarex and an
additional 3/rd/ party royalty rate of [*****], Scil
Biomedicals will pay in stage 2 a basic 3/rd/ party royalty
rate of [*****] and a royalty rate of [*****] to Medarex.
[*****], Scil Biomedicals will pay in stage 3 to Medarex a
royalty rate of [*****]. These royalty rates are based upon
a projected manufacturing price of [*****] and are subject
to the following adjustment: [*****].
MDX-H210
Territory: Europe and the Near East
Product: All applications except cell therapy.
Upfront: [*****] paid by Scil Biomedicals to Medarex. [*****] The
upfront payment is non-refundable and non-creditable.
Costs: All Phase II (estimated at [*****]) will be paid by Scil
Biomedicals. At the end of Phase II, Medarex can elect to
fund [*****] of the Phase III [*****] and retain all rights
outside of Europe and the Near East. Otherwise, Scil
Biomedicals will fund 100% of Phase III up to $17 million
(including the Phase II costs) and thereafter the parties
will share all worldwide costs (clinical, regulatory and
manufacturing scale-up) on a 50:50 basis; if Scil
Biomedicals funds all costs up to $17 million, it will
obtain US co-promotion
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILLED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
<PAGE>
or co-marketing rights [*****].
Milestones Paid
by Medarex: [*****]
Royalties/Supplies: Scil Biomedicals will pay 3/rd/ party royalties to [*****]
and will pay to Medarex royalties of [*****]. Upon the
expiration of 3/rd/ party royalties paid by Scil
Biomedicals, Medarex's royalty will increase by [*****].
These royalties are based on a projected manufacturing price
of [*****] subject to the following modifications: [*****].
Both parties acknowledge their agreement by signing this binding letter of
intent.
Best regards,
Scil Biomedicals GmbH
/s/ Ulrich Martin January 3, 2000
Dr. Ulrich Martin
- -CEO-
Accepted by Medarex Inc.:
/s/ D. Drakeman 1/3/00
Donald Drakeman, PhD
- -President and CEO-
***** REPRESENTS CONFIDENTIAL PORTION WHICH HAS BEEN OMITTED AND FILLED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
