Common use of Infringement Actions by Third Parties Clause in Contracts

Infringement Actions by Third Parties. 10.1 If a party, or to its knowledge, any of its sublicensees or customers shall be sued by a THIRD PARTY for infringement of a patent because of the research, development, importation, manufacture, use, offer for sale or sale of RESEARCH COMPOUNDS or PRODUCTS, such party shall promptly notify the other in writing of the institution of such suit. SB shall have the first right but not the obligation to defend such suit at its own expense. If SB does not commence a defense of such suit within ninety (90) days after the receipt of written notice, LIGAND, after notifying SB in writing, shall be entitled to defend such suit at LIGAND's expense. In either event each party shall assist the other party and shall cooperate fully in the defense of such suit and furnish to the party defending the suit all evidence in its control and reasonable assistance. Any judgments, settlements or damages payable with respect to legal proceedings covered by this Article 10 shall be paid by the party which controls the litigation, subject to any claims against the other party for breach of or indemnification under this Agreement or otherwise available at law or in equity. Any THIRD PARTY royalty payments or damages required to be paid as the result of a judgment or settlement under this Article 10 shall be paid by the party controlling the suit subject to any claims against the other party for breach of or indemnification under this Agreement or otherwise available at law or in equity; provided, however, in the case of a PRODUCT sold by SB, if such damages or THIRD PARTY royalty payments arise from the infringement of a patent having a claim or claims which cover the screening activities of LIGAND or SB under the RESEARCH PROGRAM, the damages or the THIRD PARTY royalty payments shall be fully creditable against royalties owed LIGAND under this Agreement provided, further, that in the event SB defends the suit SB may credit any damages or THIRD PARTY royalties against up to *** of that portion of the royalty payments due LIGAND under this Agreement at a royalty rate *** of NET SALES, and further provided that any excess deduction shall be carried over into subsequent years of the Agreement until the full deduction is taken.

Infringement Actions by Third Parties. 10.1 If a partyUroGen, or to its knowledge, any of its Affiliates, sublicensees or customers shall be sued by a THIRD PARTY Third Party for infringement of a Third Party's patent because of the research, development, importation, manufacture, use, offer for sale use or sale of RESEARCH COMPOUNDS Licensed Products or PRODUCTSpractice of Licensed Methods, such party UroGen shall promptly notify the other IRC in writing of the institution of such suit. SB If the alleged infringing process, method or composition is claimed under the Licensed Patent Rights, IRC shall have the first right but not right, in its sole discretion, to control the obligation to defend defense of such suit at its own expense. If SB does not commence a defense , in which event UroGen shall have the right to be represented by advisory counsel of such suit within ninety (90) days after the receipt of written noticeits own selection, LIGANDat its own expense, after notifying SB in writing, shall be entitled to defend such suit at LIGAND's expense. In either event each party shall assist the other party and shall cooperate fully in the defense of such suit and furnish to IRC all evidence and assistance in its control. If IRC does not elect within thirty (30) days after such notice to so control the defense of such suit, UroGen may undertake such control at its own expense, and IRC shall then have the right to be represented by advisory counsel of its own selection, at its own expense, and IRC shall cooperate fully in the defense of such suit and furnish to UroGen all evidence and assistance in IRC's control. The party defending controlling the suit all evidence may not settle the suit or otherwise consent to an adverse judgment in its control and reasonable assistancesuch suit that diminishes the rights or interests of the non-controlling party without the express written consent of the non-controlling party. Any judgments, settlements or damages (except for royalties based on future sales of Licensed Products or Licensed Methods) payable with respect to legal proceedings covered by this Article 10 8 shall be paid by the party which controls the litigation. If IRC, subject to or any claims against of its Affiliates, licensees (other than UroGen) or customers, is sued by a Third Party who alleges that such entity's manufacture, use or sale of any process, method or composition claimed in the other party for breach of or indemnification under this Agreement Licensed Patent Rights infringes a Third Party's patent, IRC shall notify UroGen promptly in writing. IRC and its Affiliates may not settle a suit or otherwise available at law consent to an adverse judgment in such a suit that diminishes the rights or in equity. Any THIRD PARTY royalty payments or damages required to be paid as interests of UroGen without the result express written consent of a judgment or settlement under this Article 10 shall be paid by the party controlling the suit subject to any claims against the other party for breach of or indemnification under this Agreement or otherwise available at law or in equity; provided, however, in the case of a PRODUCT sold by SB, if such damages or THIRD PARTY royalty payments arise from the infringement of a patent having a claim or claims which cover the screening activities of LIGAND or SB under the RESEARCH PROGRAM, the damages or the THIRD PARTY royalty payments shall be fully creditable against royalties owed LIGAND under this Agreement provided, further, that in the event SB defends the suit SB may credit any damages or THIRD PARTY royalties against up to *** of that portion of the royalty payments due LIGAND under this Agreement at a royalty rate *** of NET SALES, and further provided that any excess deduction shall be carried over into subsequent years of the Agreement until the full deduction is takenUroGen.

Infringement Actions by Third Parties. 10.1 (a) If a partyTRIS, AYTU or to its knowledgetheir Affiliates, any of its sublicensees or customers shall be sued or threatened with suit during the Term or with respect to actions during the Term by a THIRD PARTY Third Party for infringement of any patent of a patent because Third Party or for misappropriation of any Third Party know-how, trade secret, proprietary, technical or confidential or the development, manufacture and commercialization of a Product (which for purposes of this Section 7 includes an AG Product) in the Territory (other than infringement or misappropriation of any copyright or trademark arising out of the research, development, importation, manufacture, use, offer for sale or marketing and/or sale of RESEARCH COMPOUNDS or PRODUCTSa Product in the Territory during the Term) (each, an “Infringement Action”), such party Party shall promptly notify the other Party in writing of (whether such action was brought against AYTU or TRIS). During the institution of such suit. SB Term and thereafter with respect to events arising during the Term, TRIS shall have the first right right, but not the obligation obligation, to undertake control of and manage and defend such suit at its own expenseInfringement Action, including, without limitation, selection of counsel, and settling such Infringement Action subject to AYTU’s consent as set forth below. If SB does AYTU shall, promptly upon TRIS’s request, provide reasonable assistance in conducting the litigation. TRIS shall have the right to settle the Infringement Action only with the consent of AYTU, not commence a defense to be unreasonably withheld, conditioned or delayed. For the avoidance of doubt, AYTU shall not have the right to settle such action. EXPLANATORY NOTE: [**] INDICATES THE PORTION OF THIS EXHIBIT THAT HAS BEEN OMITTED BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) WOULD BE COMPETITIVELY HARMFUL IN PUBLICLY DISCLOSED. (b) The Parties shall share equally the ongoing costs and expenses (including attorney’s fees) of any Infringement Action. AYTU shall reimburse TRIS for AYTU’s share of such suit costs and expenses, within ninety thirty (9030) days after the receipt date of written noticeTRIS’ invoice for same. (c) Each of TRIS and AYTU shall share equally and be responsible for any settlement payment, LIGANDdamages award and/or judgment, after notifying SB including any Losses, in writing, shall be entitled to defend such suit at LIGAND's expenseconnection with any Infringement Action (an “Infringement Action Award”). In either event each party shall assist Each Party will indemnify and hold harmless the other party Party and shall cooperate fully in the defense of such suit and furnish its Affiliates from its payment obligations pursuant to the party defending the suit all evidence in its control and reasonable assistancethis Section 7.1(c). Any judgments, settlements or damages payable and all amounts recovered with respect to legal proceedings covered by this Article 10 such an action shall be paid by applied first to reimburse the party which controls Parties for their reasonable and documented out-of-pocket expenses (including reasonable attorney’s fees) in prosecuting such action and the litigation, subject to any claims against the other party for breach of or indemnification under this Agreement or otherwise available at law or in equity. Any THIRD PARTY royalty payments or damages required to be paid as the result of a judgment or settlement under this Article 10 remainder shall be paid shared equally. (d) This Article VII shall cover the procedure and remedy for indemnification for Infringement Actions by Third Parties, to the party controlling the suit subject to any claims against the other party for breach exclusion of or indemnification under this Agreement or otherwise available at law or in equityArticle XIII; provided, however, in that the case foregoing shall not limit a Party’s right to recover for a breach of a PRODUCT sold by SB, if such damages any representation or THIRD PARTY royalty payments arise from the infringement of a patent having a claim or claims which cover the screening activities of LIGAND or SB under the RESEARCH PROGRAM, the damages or the THIRD PARTY royalty payments shall be fully creditable against royalties owed LIGAND under this Agreement provided, further, that in the event SB defends the suit SB may credit any damages or THIRD PARTY royalties against up to *** of that portion of the royalty payments due LIGAND under this Agreement at a royalty rate *** of NET SALES, and further provided that any excess deduction shall be carried over into subsequent years of the Agreement until the full deduction is takenwarranty.

Infringement Actions by Third Parties. 10.1 (a) If a partyTRIS, AYTU or to its knowledgetheir Affiliates, any of its sublicensees or customers shall be sued or threatened with suit during the Term or with respect to actions during the Term by a THIRD PARTY Third Party for infringement of any patent of a patent because Third Party or for misappropriation of any Third Party know-how, trade secret, proprietary, technical or confidential or the development, manufacture and commercialization of a Product (which for purposes of this Section 7 includes an AG Product) in the Territory (other than infringement or misappropriation of any copyright or trademark arising out of the research, development, importation, manufacture, use, offer for sale or marketing and/or sale of RESEARCH COMPOUNDS or PRODUCTSa Product in the Territory during the Term) (each, an “Infringement Action”), such party Party shall promptly notify the other Party in writing of (whether such action was brought against AYTU or TRIS). During the institution of such suit. SB Term and thereafter with respect to events arising during the Term, TRIS shall have the first right right, but not the obligation obligation, to undertake control of and manage and defend such suit at its own expenseInfringement Action, including, without limitation, selection of counsel, and settling such Infringement Action subject to AYTU’s consent as set forth below. If SB does AYTU shall, promptly upon TRIS’s request, provide reasonable assistance in conducting the litigation. TRIS shall have the right to settle the Infringement Action only with the consent of AYTU, not commence a defense to be unreasonably withheld, conditioned or delayed. For the avoidance of doubt, AYTU shall not have the right to settle such action. (b) The Parties shall share equally the ongoing costs and expenses (including attorney’s fees) of any Infringement Action. AYTU shall reimburse TRIS for AYTU’s share of such suit costs and expenses, within ninety thirty (9030) days after the receipt date of written noticeTRIS’ invoice for same. (c) Each of TRIS and AYTU shall share equally and be responsible for any settlement payment, LIGANDdamages award and/or judgment, after notifying SB including any Losses, in writing, shall be entitled to defend such suit at LIGAND's expenseconnection with any Infringement Action (an “Infringement Action Award”). In either event each party shall assist Each Party will indemnify and hold harmless the other party Party and shall cooperate fully in the defense of such suit and furnish its Affiliates from its payment obligations pursuant to the party defending the suit all evidence in its control and reasonable assistancethis Section 7.1(c). Any judgments, settlements or damages payable and all amounts recovered with respect to legal proceedings covered by this Article 10 such an action shall be paid by applied first to reimburse the party which controls Parties for their reasonable and documented out-of-pocket expenses (including reasonable attorney’s fees) in prosecuting such action and the litigation, subject to any claims against the other party for breach of or indemnification under this Agreement or otherwise available at law or in equity. Any THIRD PARTY royalty payments or damages required to be paid as the result of a judgment or settlement under this Article 10 remainder shall be paid shared equally. (d) This Article VII shall cover the procedure and remedy for indemnification for Infringement Actions by Third Parties, to the party controlling the suit subject to any claims against the other party for breach exclusion of or indemnification under this Agreement or otherwise available at law or in equityArticle XIII; provided, however, in that the case foregoing shall not limit a Party’s right to recover for a breach of a PRODUCT sold by SB, if such damages any representation or THIRD PARTY royalty payments arise from the infringement of a patent having a claim or claims which cover the screening activities of LIGAND or SB under the RESEARCH PROGRAM, the damages or the THIRD PARTY royalty payments shall be fully creditable against royalties owed LIGAND under this Agreement provided, further, that in the event SB defends the suit SB may credit any damages or THIRD PARTY royalties against up to *** of that portion of the royalty payments due LIGAND under this Agreement at a royalty rate *** of NET SALES, and further provided that any excess deduction shall be carried over into subsequent years of the Agreement until the full deduction is takenwarranty.

Infringement Actions by Third Parties. 10.1 If a party(a) Each Party shall notify the other Party promptly in writing of any claim of, or to its knowledgeaction for, infringement of any Patents owned or licensed by Third Parties which is threatened, made or brought against either Party by reason of either Party’s performance of its sublicensees obligations under this Agreement or customers shall be sued by a THIRD PARTY for infringement of a patent because of the research, development, importation, manufacture, use, offer for sale use or sale of RESEARCH COMPOUNDS any Licensed Products in the Territory in the Field. (b) Except as provided in Section 13.1 in the event that such an action for infringement is commenced solely against a Party or PRODUCTSboth Parties jointly and/or any of their respective Affiliates or Sublicensees, such party as the case may be, with respect to any Licensed Product Developed and Commercialized by Sanofi, its Affiliates and/or Sublicensees, Sanofi shall promptly notify the other in writing of the institution of such suit. SB shall have the first right but not the obligation to defend such suit action at its own expense. If SB does not commence a defense of such suit within ninety (90) days after the receipt of written notice, LIGAND, after notifying SB in writing, shall be entitled and IMDZ hereby agrees to defend such suit at LIGAND's expense. In either event each party shall assist the other party and shall cooperate fully in the defense of such suit and furnish with Sanofi to the party extent reasonably necessary, provided that Sanofi shall ***. (c) The costs and expenses of defending the suit all evidence in its control and reasonable assistance. Any judgments, settlements or damages payable any infringement action with respect to legal proceedings covered a Licensed Product Developed and Commercialized by this Article 10 Sanofi, its Affiliates, Sublicensees and/or Service Providers shall be paid by ***. (d) During the party which controls the litigationpendency of any such action, subject Sanofi shall continue to any claims against the other party for breach of or indemnification under this Agreement or otherwise available at law or in equitypay all royalties due hereunder. Any THIRD PARTY royalty payments or damages required Subject to be paid as the result of a judgment or settlement under this Article 10 shall be paid by the party controlling the suit subject to any claims against the other party for breach of or indemnification under this Agreement or otherwise available at law or in equity; providedSection 7.4, however, in the case of a PRODUCT sold by SB, if such damages or THIRD PARTY royalty payments arise from the infringement of a patent having a claim or claims which cover the screening activities of LIGAND or SB under the RESEARCH PROGRAM, the damages or the THIRD PARTY royalty payments Sanofi shall be fully creditable against royalties owed LIGAND under this Agreement providedliable for the payment of any award for damages, furtheror any amount due pursuant to any settlement entered into by Sanofi, to the extent that in the event SB defends the suit SB may credit any damages such action pertains to a Licensed Product Developed and Commercialized by Sanofi and/or its Affiliates, Sublicensees or THIRD PARTY royalties against up to Service Providers. *** INDICATES MATERIAL THAT WAS OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT WAS REQUESTED. ALL SUCH OMITTED MATERIAL WAS FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. (f) Notwithstanding any provision of that portion of the royalty payments due LIGAND under this Agreement at to the contrary, Sanofi shall not, as a royalty rate *** settlement or compromise of NET SALESany claim by a Third Party that a Patent licensed to Sanofi hereunder is infringed, and further provided that not infringed, invalid or unenforceable, grant any excess deduction sublicense, covenant not to xxx or agree to any similar arrangement, without the prior consent of IMDZ, which consent shall not be carried over into subsequent years of the Agreement until the full deduction is takenunreasonably withheld or delayed.

Infringement Actions by Third Parties. 10.1 If a partyAP Cells, or to its knowledge, any of its Affiliates, sublicensees or customers shall be sued becomes the subject of a suit by a THIRD PARTY for Third Party that alleges infringement of a Third Party's patent because arising out of the research, development, importation, manufacture, use, offer for sale use or sale of RESEARCH COMPOUNDS Licensed Products and the alleged infringing process, method or PRODUCTScomposition is claimed under the Licensed Patent Rights or otherwise provided to AP Cells as Licensed Technology, such party AP Cells shall promptly notify the other Epimmune in writing of the institution of such suit. SB As between the parties, AP Cells shall have the first right but not right, subject to the obligation reasonable approval of Epimmune, to defend control the defense of such suit at AP Cells' own expense, in which event Epimmune shall have the right to be represented by advisory counsel of its own selection, at its own expense. If SB does not commence a defense of such suit within ninety (90) days after the receipt of written notice, LIGAND, after notifying SB in writing, shall be entitled to defend such suit at LIGAND's expense. In either event each party shall assist the other party and shall cooperate fully in the defense of such suit and furnish to AP Cells all evidence and assistance in Epimmune's control. If AP Cells does not elect within thirty (30) days after such notice to so control the defense of such suit, Epimmune may undertake such control at its own expense, and AP Cells shall then have the right to be represented by advisory counsel of its own selection, at its own expense, and AP Cells shall cooperate fully in the defense of such suit and otherwise furnish to Epimmune all evidence and assistance in AP Cells' control. The party defending controlling the suit all evidence shall not enter into any settlement of such suit or otherwise consent to an adverse judgment in its control and reasonable assistancesuch suit that admits the invalidity or unenforceability of any patent within the Licensed Patent Rights, or the unpatentability of any invention covered by a patent application within the Licensed Patent Rights, or exceeds the rights under the Licensed Technology granted hereunder. Any judgments, settlements or damages payable with respect to legal proceedings covered by this Article 10 7 shall be paid by the party which that controls the litigation, subject to any claims against the other party for breach of or indemnification under this Agreement or otherwise available at law or in equity. Any THIRD PARTY royalty payments or damages required to be paid as the result of a judgment or settlement under this Article 10 shall be paid by the party controlling the suit subject and to any claims against the other party for breach of or indemnification under this Agreement or otherwise available at law or in equity; provided, however, in the case of a PRODUCT sold by SB, if such damages or THIRD PARTY royalty payments arise from the infringement of a patent having a claim or claims which cover the screening activities of LIGAND or SB under the RESEARCH PROGRAM, the damages or the THIRD PARTY royalty payments shall be fully creditable against royalties owed LIGAND under this Agreement provided, further, that in the event SB defends the suit SB may credit any damages or THIRD PARTY royalties against up to *** of that portion of the royalty payments due LIGAND under this Agreement at a royalty rate *** of NET SALES, and further provided that any excess deduction shall be carried over into subsequent years of the Agreement until the full deduction is takenSection 4.2.3.

Infringement Actions by Third Parties. 10.1 If a partyParty, or to its knowledge, any of its Affiliates, sublicensees or customers shall be sued by a THIRD PARTY third party for infringement of a patent because of the research, development, importation, manufacture, use, offer for sale use or sale of RESEARCH COMPOUNDS Research Compounds or PRODUCTSProducts, such party Party shall promptly notify the other in writing of the institution of such suit. SB The Party sued shall have the first right but not right, in its sole discretion, to control the obligation to defend defense of such suit at its own expense. If SB does not commence a defense of such suit within ninety (90) days after the receipt of written notice, LIGAND, after notifying SB in writing, shall be entitled to defend such suit at LIGAND's expense. In either which event each party shall assist the other party and Party shall cooperate fully in the defense of such suit and furnish to the party defending the suit Party sued all evidence and assistance in its control and reasonable assistancecontrol. Any judgments, settlements or damages payable with respect to legal proceedings covered by this Article 10 12 shall be paid by the party Party which controls the litigation, subject to any claims against the other party Party for breach of or indemnification under this Amended and Restated Agreement or otherwise available at law or in equity. Any THIRD PARTY third party royalty payments or damages required to be paid as the result of a judgment or settlement under this Article 10 12 shall be paid by the party Party controlling the suit subject to any claims against the other party Party for breach of or indemnification under this Amended and Restated Agreement or otherwise available at law or in equity; provided, however, in the case of a PRODUCT Product sold by SBWYETH, if such damages or THIRD PARTY third party royalty payments arise from the infringement of a patent having a claim or claims which cover the screening activities of LIGAND or SB Ligand under the RESEARCH PROGRAMResearch Program, the damages or the THIRD PARTY third party royalty payments shall be fully creditable against royalties owed LIGAND Ligand under this Amended and Restated Agreement in the circumstance where WYETH permits Ligand to defend the suit; provided, further, that in the event SB WYETH defends the suit SB may the credit taken for any damages or THIRD PARTY third party royalties against up to *** shall not be in excess of that portion fifty percent (50%) of the royalty payments due LIGAND Ligand under this Amended and Restated Agreement for Product sales which caused such third party royalty payments, subject to any claims for breach of or indemnification under this Amended and Restated Agreement or otherwise available at a royalty rate *** of NET SALES, and further provided that any excess deduction shall be carried over into subsequent years of the Agreement until the full deduction is takenlaw or in equity.

Infringement Actions by Third Parties. 10.1 If a partyParty, or to its knowledge, any of its sublicensees Affiliates or customers Sublicensees shall be sued by a THIRD PARTY or threatened to be sued for infringement of a patent or other intellectual property rights of a Third Party because of the research, reasonable development, importation, manufacture, use, offer for sale use or sale of RESEARCH COMPOUNDS Collaboration Compounds, Collaboration Lead Compounds or PRODUCTSProducts or any other action undertaken by such Party under this Agreement, such party Party shall promptly notify the other in writing of the *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. Ligand Initial [/s/WR] Organon Initial [/s/JV] institution or threat of such suitaction. SB The Party sued or threatened to be sued shall have the first right but not right, in its sole discretion, to control the obligation to defend defense and settlement of such suit claim at its own expense. If SB does not commence a defense of such suit within ninety (90) days after the receipt of written notice, LIGAND, after notifying SB in writing, shall be entitled to defend such suit at LIGAND's expense. In either which event each party shall assist the other party and Party shall cooperate fully in the defense of such suit and furnish to the party defending the suit Party sued all evidence and assistance in its control and reasonable assistancecontrol. Any judgments, settlements or damages payable with respect to legal proceedings covered by this Article 10 7 shall be paid by the party Party which controls the litigation, subject to any claims against the other party Party for breach of or indemnification under this Agreement or otherwise available at law or in equity. Any THIRD PARTY Third Party royalty payments or damages required to be paid as the result of a judgment or settlement under this Article 10 7 shall be paid by the party Party controlling the suit subject to any claims against the other party Party for breach of or indemnification under this Agreement or otherwise available at law or in equity; provided, however, (a) in the case of a PRODUCT Product sold by SBOrganon, if such damages or THIRD PARTY Third Party royalty payments or damages arise from the infringement of a patent published or granted before the date of this Agreement having a claim or claims which cover the screening activities of LIGAND Ligand or SB use of Ligand Background Technology under the RESEARCH PROGRAMResearch Program, the Third Party royalty payments or damages shall be creditable against the royalty due Ligand under Article 6; or (b) in the THIRD PARTY case of a Product sold by Organon, if such Third Party royalty payments arise from the infringement of a granted patent published after the date of this Agreement having a claim or claims which cover the screening activities of Ligand or use of Ligand Background Technology under the Research Program, *** per cent (***% ) of the Third Party royalty payments shall be fully creditable against royalties owed LIGAND the royalty due Ligand under Article 6, but in no event shall the royalty due Ligand be reduced by more than ***per cent (***%) under this Agreement provided, further, that in the event SB defends the suit SB may credit any damages or THIRD PARTY royalties against up to *** of that portion of the royalty payments due LIGAND under this Agreement at a royalty rate *** of NET SALES, and further provided that any excess deduction shall be carried over into subsequent years of the Agreement until the full deduction is takensubsection (b).

Infringement Actions by Third Parties. 10.1 If a partyNexell, or to its knowledge, any of its Affiliates, sublicensees or customers shall be sued by a THIRD PARTY Third Party for infringement of a Third Party's patent because of the research, development, importation, manufacture, use, offer for sale use or sale of RESEARCH COMPOUNDS or PRODUCTSProducts, such party Nexell shall promptly notify the other Epimmune in writing of the institution of such suit. SB If the alleged infringing process, method or composition is claimed under the Licensed Patent Rights, Nexell shall promptly cease the manufacture, use, sale, offering for sale or importation of the allegedly infringing process, method or composition claimed under the Licensed Patent Rights and Nexell shall have the first right but not right, subject to the obligation reasonable approval of Epimmune, to defend control the defense of such suit at Nexell's own expense, in which event Epimmune shall have the right to be represented by advisory counsel of its own selection, at its own expense. If SB does not commence a defense of such suit within ninety (90) days after the receipt of written notice, LIGAND, after notifying SB in writing, shall be entitled to defend such suit at LIGAND's expense. In either event each party shall assist the other party and shall cooperate fully in the defense of such suit and furnish to Nexell all evidence and assistance in its control. If Nexell does not elect within thirty (30) days after such notice to so control the defense of such suit, Epimmune may undertake such control at its own expense, and Nexell shall then have the right to be represented by advisory counsel of its own selection, at its own expense, and Nexell shall cooperate fully in the defense of such suit and otherwise furnish to Epimmune all evidence and assistance in Nexell's control. The party defending controlling the suit all evidence may not settle the suit or otherwise consent to an adverse judgment in its control and reasonable assistancesuch suit that diminishes the rights or interests of the non- controlling party without the express written consent of the non-controlling party. Any judgments, settlements or damages payable with respect to legal proceedings covered by this Article 10 7 shall be paid by the party which controls the litigation, subject to any claims against the other party for breach of or indemnification under this Agreement or otherwise available at law or in equity. Any THIRD PARTY royalty payments or damages required to be paid as the result of a judgment or settlement under this Article 10 shall be paid by the party controlling the suit subject to any claims against the other party for breach of or indemnification under this Agreement or otherwise available at law or in equity; provided, however, in the case of a PRODUCT sold by SB, if such damages or THIRD PARTY royalty payments arise from the infringement of a patent having a claim or claims which cover the screening activities of LIGAND or SB under the RESEARCH PROGRAM, the damages or the THIRD PARTY royalty payments shall be fully creditable against royalties owed LIGAND under this Agreement provided, further, that in the event SB defends the suit SB may credit any damages or THIRD PARTY royalties against up to *** of that portion of the royalty payments due LIGAND under this Agreement at a royalty rate *** of NET SALES, and further provided that any excess deduction shall be carried over into subsequent years of the Agreement until the full deduction is taken.