1
Exhibit 10.16
RESEARCH & DEVELOPMENT AGREEMENT
This Agreement is entered into effective as of March 10, 1995 (the "Effective
Date") between PHARMACIA BIOTECH AB ("Pharmacia"), a Swedish corporation having
its principal offices at Xxxxxxxxxx 00, X-000 00 Xxxxxxx, Xxxxxx and ARQULE,
INC. ("ArQule"), a Delaware corporation having its principal offices at 000
Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX 00000, XXX.
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BACKGROUND
A. ArQule has developed certain technologies that Pharmacia believes may
be useful in the development of products in the areas of
bioseparations, synthesis of certain biomolecules, and cell culture.
B. Pharmacia and ArQule have entered into an Option Agreement, dated as of
the Effective Date, which grants to Pharmacia the right to acquire
certain exclusive rights to use the ArQule technologies and
improvements to make, use, and sell products in these business areas.
C. Pharmacia desires to evaluate whether the ArQule technology would
contribute to the development of products in these business areas, and
ArQule desires to give Pharmacia the opportunity to conduct such an
evaluation.
D. ArQule is willing to perform this technology evaluation, with the
assistance and funding of Pharmacia, subject to the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the covenants and promises
contained herein, Pharmacia and ArQule agree as follows:
SECTION 1. DEFINITIONS
The following definitions shall control the construction of this Agreement
wherever they appear:
1.1 "AFFILIATE" shall mean any company or other legal entity which controls, is
controlled by, or is under common control with either party. A company or other
legal entity shall be presumed to control another if it owns fifty percent (50%)
or more of the outstanding voting equity or assets of the other company or
entity.
1.2 "ARQULE TECHNOLOGY" shall mean all of the patents and patent applications
listed in Enclosure 1 hereto and all corresponding foreign patents and patent
applications and all
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continuations, continuations-in-part, and divisions thereof, as well as all of
the Proprietary Materials and unpatented know-how and trade secrets relating
thereto.
1.3 "BIOMOLECULES" shall mean amino acids, peptides, proteins, nucleic acids
(nucleotides, oligonucleotides, polynucleotides), carbohydrates
(monosaccharides, oligosaccarides, polysaccharides), lipids, phospholipids, or
any combination of such molecules, whether produced by natural means or by
organic synthesis in solution or using solid phase technologies.
1.4 "COMMENCEMENT DATE" shall mean April 1, 1995.
1.5 "CONFIDENTIAL INFORMATION" shall have the meaning set forth in Section 7.1.
1.6 "CONTRIBUTED TECHNOLOGY" shall mean all patents, patent applications,
Proprietary Materials, know-how, and trade secrets that Pharmacia may legally
provide to ArQule and which relate to or are useful for the development of the
ArQule Technology for applications in the Field of Applications.
1.7 "DERIVATIVES" shall mean any molecules that are chemical derivatives or
analogues of Biomolecules or Natural Products.
1.8 "FIELD OF APPLICATIONS" shall mean
*
1.9 "IMPROVEMENT" shall mean any improvement, change, addition, upgrade, or
modification to the ArQule Technology or Contributed Technology that either
party discovers or develops in the course of any Research Project.
1.10 "NATURAL PRODUCTS" shall mean all molecules (other than Biomolecules) that
are the naturally occurring products of biosynthesis in living cells or are
produced by isolated cellular components outside of living cells, whether by
natural means or by organic synthesis in solution or using solid phase
technologies. This definition is intended to include subcellular components and
viral particles. Examples of Natural Products are vitamins, steroid hormones,
and various cofactors.
1.11 "OPTION AGREEMENT" shall mean a certain Option Agreement between the
parties, dated as of the Effective Date, which is attached to this Agreement as
Enclosure 2.
1.12 "PROJECT LEADER" shall have the meaning set forth in Section 2.3.
1.13 "PROJECT PLAN" shall mean a comprehensive plan of research that the parties
intend to conduct under this Agreement, as amended from time to time by the
Research Committee. The Project Plan will contain a description of current
Research Projects, payments for each
* confidential treatment has been
requested for marked portions
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Research Project, and personnel for each Research Project. The initial Project
Plan is attached as Enclosure 3 to this Agreement.
1.14 "PROPRIETARY MATERIALS" shall have the meaning set forth in Section 7.2.
1.15 "RESEARCH COMMITTEE" shall have the meaning set forth in Section 4.1.
1.16 "RESEARCH PERIOD" shall mean the six-month period during which the parties
conduct each Research Project.
1.17 "RESEARCH PROJECT" shall mean the research planned for a particular
Subfield during a Research Period. The initial Research Project, for Subfield I,
is described in the initial Project Plan. Subsequent Research Projects for
Subfield I or any other Subfield will be established by the Research Committee
in accordance with the procedures set forth below.
1.18 "SUBFIELD I" shall mean
*
1.19 "SUBFIELD II" shall mean
*
1.20 "SUBFIELD III" shall mean
*
1.21 "SUBFIELD IV" shall mean
*
* confidential treatment has been
requested for marked portions
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*
SECTION 2. RESEARCH ACTIVITIES
2.1 Initial Research Project. The initial Research Project relating to Subfield
I shall be described in the Project Plan attached to this Agreement on the
Effective Date. As further described below, the initial Project Plan shall also
provide for a description of the resources that each party will commit to the
initial Research Project, specifically including personnel.
2.2 Establishment of Subsequent Research Projects. After the completion of the
initial Research Project, Pharmacia may elect to fund subsequent Research
Projects in one or more Subfields during subsequent Research Periods in
accordance with the procedures set forth in the Option Agreement. If Pharmacia
elects to fund one or more additional Research Projects, the Research Committee
shall amend the Research Plan to provide for (i) a description of each Research
Project, including without limitation overall goals, specific goals, priorities,
and time schedules, (ii) payments to ArQule for each Research Project, and (iii)
a description of the resources that each party will commit to each Research
Project. Each amended Research Plan shall be adopted by the Research Committee
during the time periods specified in the Option Agreement, and then attached to
this Agreement as an addition to Enclosure 3.
2.3 Conduct of Research Projects. During the term of this Agreement, ArQule
agrees to use commercially reasonable efforts to conduct all Research Projects
in accordance with the Project Plan and as directed by the Research Committee.
Pharmacia agrees to provide reasonable assistance to ArQule in the conduct of
the Research Projects in accordance with the Project Plan and as directed by the
Research Committee. ArQule and Pharmacia each agree that the ArQule Technology
and the Contributed Technology may be used as reasonably required to perform any
Research Project, and each party further agrees to effect the transfer of such
required technology upon request. ArQule agrees to use the Contributed
Technology only for the purposes set forth in this Agreement. Each party shall
designate a project leader (the "Project Leaders") who shall have primary
responsibility over (i) the performance of the Research Project by such party
and (ii) coordination of efforts with the other party. The Project Leaders shall
report directly to the Research Committee. The Project Leaders for each Research
Project shall be identified in the Project Plan; provided, however, that each
party shall have the right to change its Project Leaders upon thirty (30) days
written notice to the other party. All Project Leaders designated by a party
must be approved by the other party, provided that such approval may not be
unreasonably withheld.
2.4 Personnel. In addition to the Project Leaders, each party agrees to assign
to each Research Project such qualified and competent members of its staff as
may be required to achieve the aims and goals set forth for such Research
Project. All such commitments of personnel shall be listed in the Project Plan,
as amended from time to time. ArQule agrees to commit a total of *
full-time equivalents to the initial Research Project and
* Confidential treatment has been
requested for marked portions
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Pharmacia agrees to commit a total of * full-time equivalents to such
Research Project, as further described in the Project Plan. Upon the completion
of each Research Project, ArQule agrees to provide Pharmacia with a written
summary of time committed by ArQule personnel to such Research Project.
2.5 Compliance. In conducting each Research Project, each party shall use
reasonable efforts (i) to ensure that each Research Project will comply with all
technical and other requirements set out in the Project Plan, as adjusted by the
Research Committee, (ii) to generate and maintain adequate documentation
describing in sufficient detail the results of each Research Project, and (iii)
to conduct each Research Project in accordance with all applicable laws and
regulations.
SECTION 3. PAYMENTS
Pharmacia agrees to pay ArQule a total of * Dollars
* on the Effective Date in accordance with the Project Plan for
performance of the initial Research Project. Thereafter, in consideration of the
performance of each Research Project, Pharmacia agrees to pay ArQule the amount
set forth in the Project Plan prior to the commencement of the Research Period
for that Research Project. All such payments shall be nonrefundable.
SECTION 4. MANAGEMENT AND REPORTING
4.1 Composition and Duties of Research Committee. Prior to the Commencement
Date, each party shall designate two (2) of its employees or consultants to
serve as members of a committee that will supervise and direct all Research
Projects, report on results of all Research Projects, and adopt amendments to
the Project Plan (the "Research Committee"). If any Project Leader is not a
member of the Research Committee, such Project Leader shall attend all meetings
of the Research Committee as an observer. Other personnel of either party may
attend meetings of the Research Committee as observers with the consent or
invitation of the Research Committee. The initial members of the Research
Committee from both Pharmacia and ArQule are named in Enclosure 4 hereto. Either
party may change the individuals so named upon thirty (30) days written notice
to the other party.
4.2 Meetings of Research Committee. The Research Committee will meet at least
once each calendar month. Members of the Research Committee may participate
either in person or by telephone. If a designated representative of a party
cannot attend any meeting of the Research Committee, such party may designate a
different representative for that meeting without notice to the other party, and
the substitute member will have full power to vote on behalf of the permanent
member. All decisions of the Research Committee will require the vote of a
majority of its members. If the Research Committee cannot reach agreement on any
matter, the matter will be resolved in accordance with the procedures set forth
in Section 9.9 below.
4.3 Reports. The Research Committee and/or the applicable Project Leaders shall
prepare and submit the following reports to the management of each of the
parties:
* Confidential treatment has been
requested for marked portions
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(a) within ten (10) days of the end of every calendar month, a
management report that describes the progress of each of the current
Research Projects, the significant results obtained for such Research
Projects, deviations of the Research Project from the description
provided in the Project Plan, and recommended modifications to the
Research Project for the subsequent one-month period; and
(b) within ten (l0) days of the completion, cessation, or termination
of any Research Project, a final report that describes in full detail
(i) the work completed in the course of the Research Project and (ii)
the significant results obtained for the Research Project.
4.4 Meetings. The Research Committee shall organize bi-monthly meetings for the
purpose of reporting on the progress of each Research Project and planning for
the future conduct of each Research Project. Such meetings shall be held at
alternating locations suitable to both parties or by teleconferences, and shall
be attended by appropriate management individuals from both Pharmacia and
ArQule.
SECTION 5. TERM AND TERMINATION
5.1 Term. This Agreement shall commence on the Effective Date and shall
terminate upon the expiration or termination of the Option Agreement, unless
earlier terminated in accordance with this Section 5.
5.2 Termination for Breach. If either Pharmacia or ArQule breaches any
representation made herein or fails to abide by any of the material terms of
this Agreement, the other party shall have the right to terminate this Agreement
upon sixty (60) days' prior written notice to the defaulting party specifying
the default; provided, however, that if said defaulting party cures the default
within the said sixty (60) day period, this Agreement shall continue in full
force and effect as if no default had occurred.
5.3 Personal Services. In addition to, and independent of, the right of
Pharmacia to terminate this Agreement under Section 5.2, if (i) proceedings in
bankruptcy or insolvency are instituted by or against ArQule, or a receiver is
appointed for ArQule, or if any substantial part of the assets of ArQule is the
object of attachment, sequestration, or other type of comparable proceeding, and
such proceeding is not vacated or terminated within sixty (60) days after its
commencement or institution, and (ii) ArQule defaults under any of the material
terms of this Agreement and fails to cure such default within sixty (60) days
after receiving written of such default from Pharmacia, then Pharmacia shall
also have the right to negotiate with Xx. Xxxxxx X. Xxxxx, Xx. (the
"Consultant"), an employee and officer of ArQule, for the purpose of entering
into a consulting agreement between the Consultant and Pharmacia (the
"Consulting Agreement"), in order to enable Pharmacia to continue to receive the
services that are provided by the Consultant under this Agreement. ArQule
acknowledges and agrees that the rights provided to Pharmacia under this Section
5.3 (i.e., the right to conduct negotiations with the Consultant and the right
to enter into the Consulting Agreement) do not (a) violate any state laws or the
common law, including without limitation any notions of public policy, or (b)
violate any federal laws, including without limitation the protections afforded
to a debtor in bankruptcy pursuant to the
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provisions of section 362 of title 11 of the United States Code, and are in the
nature of security for and/or guaranty of the performance of ArQule under the
terms of this Agreement. By this acknowledgement and agreement, ArQule further
agrees that it shall be estopped to make any argument, pursuant to any of the
laws described in the foregoing sentence, to prevent the exercise by Pharmacia
of any of the rights provided to Pharmacia under this Section 5.3.
5.4 Survival. The termination of this Agreement shall not release either party
from fulfilling any obligations which it may have incurred prior to any such
termination. The following provisions shall survive termination of this
Agreement: Sections 1, 4.3(b), 5.3, 5.4, 6, 7, 9.8, and 9.9.
SECTION 6. INTELLECTUAL PROPERTY
6.1 Ownership. ArQule shall have sole ownership of all Improvements to the
ArQule Technology that are made, developed, or discovered in the course of the
Research Project by employees or consultants of either party. Pharmacia shall
have sole ownership of all Improvements to the Contributed Technology that are
made, developed, or discovered in the course of the Research Project by
employees or consultants of either party. Ownership of all other intellectual
property that is made, developed, or discovered in the course of the Research
Project shall be determined in accordance with (i) the rules of inventorship
under the applicable patent law (in the case of patentable inventions), (ii) the
rules of authorship under the applicable copyright law (in the case of
copyrightable works), or (iii) the mutual agreement of the parties (in all other
cases).
6.2 Legal Protection. Each party shall have sole control, at its expense, over
obtaining any form of legal protection for the intellectual property owed solely
by such party. In the case of intellectual property for which the parties have
joint ownership, the parties shall mutually agree on the division of
responsibility for, and expense of, obtaining appropriate legal protection for
such intellectual property, and any disputes shall be resolved in accordance
with the procedures set forth in Section 9.9.
6.3 Full Cooperation. ArQule and Pharmacia agree to cooperate fully in the
preparation, filing, and prosecution of any patent applications covering
Improvements. Such cooperation includes, but is not limited to,
(a) executing any documents of assignment, or requiring employees or
consultants of each party to execute such documents of assignment, so
as to effect the appropriate ownership of Improvements as set forth
above;
(b) executing all papers and instruments, or requiring employees or
consultants of each party to execute such papers and instruments, so as
to enable the other party to apply for and to prosecute patent
applications in any country; and
(c) undertaking no actions that are potentially deleterious to the
preparation, filing, or prosecution of such patent applications.
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6.4 License Agreement. The parties intend that in the event of any conflict
between the provisions of this Article 6 and the terms and conditions of any
License Agreement entered into by the parties as contemplated by the Option
Agreement, the terms of the License Agreement shall prevail.
SECTION 7. CONFIDENTIAL INFORMATION AND PROPRIETARY MATERIALS
7.1 Confidential Information.
7.1.1 Definition of Confidential Information. Confidential Information
shall mean any technical or business information furnished by one party (the
"Disclosing Party") to the other party (the "Receiving Party") in connection
with this Agreement and specifically designated as confidential. Such
Confidential Information may include, without limitation, the ArQule Technology
and the Contributed Technology, as well as trade secrets, know-how, inventions,
technical data or specifications, testing methods, business or financial
information, research and development activities, product and marketing plans,
and customer and supplier information.
7.1.2 Designation of Confidential Information. Confidential Information
that is disclosed in writing shall be marked with a legend indicating its
confidential status. Confidential Information that is disclosed orally or
visually shall be documented in a written notice prepared by the Disclosing
Party and delivered to the Receiving Party within thirty (30) days of the date
of disclosure; such notice shall summarize the Confidential Information
disclosed to the Receiving Party and reference the time and place of disclosure.
7.1.3 Obligations. The Receiving Party agrees that it shall:
(a) maintain all Confidential Information in strict
confidence, except that the Receiving Party may disclose or permit the
disclosure of any Confidential Information to its directors, officers,
employees, consultants, and advisors who are obligated to maintain the
confidential nature of such Confidential Information and who need to know such
Confidential Information for the purposes set forth in this Agreement;
(b) use all Confidential Information solely for the purposes
set forth in this Agreement; and
(c) allow its directors, officers, employees, consultants, and
advisors to reproduce the Confidential Information only to the extent necessary
to effect the purposes set forth in this Agreement, with all such reproductions
being considered Confidential Information.
7.1.4 Exceptions. The obligations of the Receiving Party under Section
7.1.3 above shall not apply to the extent that the Receiving Party can
demonstrate that certain Confidential Information:
(a) was in the public domain prior to the time of its
disclosure under this Agreement;
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(b) entered the public domain after the time of its disclosure
under this Agreement through means other than an unauthorized disclosure
resulting from an act or omission by the Receiving Party;
(c) was independently developed or discovered by the Receiving
Party without use of the Confidential Information;
(d) is or was disclosed to the Receiving Party at any time,
whether prior to or after the time of its disclosure under this Agreement, by a
third party having no fiduciary relationship with the Disclosing Party and
having no obligation of confidentiality with respect to such Confidential
Information; or
(e) is required to be disclosed to comply with applicable laws
or regulations, or with a court or administrative order, provided that the
Disclosing Party receives prior written notice of such disclosure and that the
Receiving Party takes all reasonable and lawful actions to obtain confidential
treatment for such disclosure and, if possible, to minimize the extent of such
disclosure.
7.2 Proprietary Materials.
7.2.1 Definition of Proprietary Materials. "Proprietary Materials"
shall mean any tangible chemical, biological, or physical research materials
that are furnished by one party (the "Transferring Party") to the other party
(the "Receiving Party") in connection with this Agreement regardless of whether
such materials are specifically designated as proprietary to the Transferring
Party. The Transferring Party shall furnish such Proprietary Materials to the
Receiving Party in a mutually acceptable form, including appropriate labelling
and packaging.
7.2.2 Limited Use. The Receiving Party shall use Proprietary Materials
solely for the purposes set forth in this Agreement. The Receiving Party shall
use the Proprietary Materials only in compliance with all applicable
governmental laws and regulations, and not for any in vivo experiments on human
subjects. The Receiving Party assumes all liability for damages that may arise
from the use, storage, or disposal of any Proprietary Materials. The
Transferring Party will not be liable to the Receiving Party for any loss,
claim, or demand made by Receiving Party, or made against the Receiving Party by
any other party, due to or arising from the use, storage, or disposal of any
Proprietary Materials by the Receiving Party, and the Receiving Party agrees, to
the extent allowed under applicable law, to defend, indemnify, and hold the
Transferring Party harmless from and against any such losses, claims, or
demands, except to the extent caused by the gross negligence or willful
misconduct of the Transferring Party.
7.2.3 Limited Disposition. The Receiving Party shall not transfer or
distribute any Proprietary Materials to any third party without the prior
written consent of the Transferring Party.
7.3 Return of Confidential Information and Proprietary Materials. Upon the
termination of this Agreement, at the request of the Disclosing Party, the
Receiving Party shall return to
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the Disclosing Party all originals, copies, and summaries of documents,
materials, and other tangible manifestations of Confidential Information in the
possession or control of the Receiving Party, except that the Receiving Party
may retain one copy of the Confidential Information in the possession of its
legal counsel solely for the purpose of monitoring its obligations under this
Agreement. Upon the termination of this Agreement, the Receiving Party shall at
the instruction of the Transferring Party either destroy or return any unused
Proprietary Materials.
7.4 Survival of Obligations. The obligations set forth in this Section 7 shall
remain in effect for a period of five (5) years after termination of this
Agreement, except that the obligations of the Receiving Party to return
Confidential Information to the Disclosing Party and to return or destroy
Proprietary Materials received from the Transferring Party shall survive until
fulfilled.
SECTION 8. REPRESENTATIONS, WARRANTIES, AND DISCLAIMERS
8.1 Entire Agreement. The parties hereto each acknowledge and agree:
(a) that no representation or promise not expressly contained in
this Agreement or the Option Agreement has been made by the
other party hereto or by any of its agents, employees,
representatives or attorney; and
(b) that this Agreement is not being entered into on the basis of,
or in reliance on, any promise or representation, expressed or
implied, covering the subject matter hereof, other than those
which are set forth expressly in this Agreement and the Option
Agreement.
8.2 Authority; No Conflict. The parties hereto each represent and warrant that
they have the authority and legal right to enter into this Agreement, and that
the terms of this Agreement are not inconsistent with any other contractual
arrangements they may have, express or implied.
8.3 Ownership of Technology. ArQule warrants and represents that it is the owner
by assignment of the entire right, title, and interest in and to all the ArQule
Technology. Pharmacia warrants and represents that it owns or is free to license
or sublicense all of the Contributed Technology.
8.4 Disclaimer. NEITHER PARTY MAKES ANY WARRANTIES, EXPRESS OR IMPLIED,
REGARDING THE QUALITY OF ANY RESULTS OR THE ACHIEVEMENT OF ANY GOALS FOR ANY
RESEARCH PROJECT. THERE ARE NO EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE FOR ANY PROPRIETARY MATERIALS OF EITHER
PARTY. EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, NEITHER PARTY MAKES ANY
WARRANTIES THAT THE USE OF ARQULE TECHNOLOGY, CONTRIBUTED TECHNOLOGY, OR ANY
PROPRIETARY MATERIALS WILL NOT INFRINGE ANY PATENT OR OTHER INTELLECTUAL
PROPERTY RIGHTS OF A THIRD PARTY.
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SECTION 9. MISCELLANEOUS
9.1 Publicity. Neither party shall use the name of the other party or reveal the
terms of this Agreement in any publicity or advertising without the prior
written approval of the other party, except that (i) either party may use the
text of a written statement approved in advance by both parties without further
approval, (ii) either party shall have the right to identify the other party and
to disclose the terms of this Agreement as required by applicable securities
laws or other applicable law or regulation, and (iii) either party may use the
name of the other party and reveal the existence of this Agreement and the
Option Agreement.
9.2 Assignment. Neither party hereto shall have the right to assign their rights
or obligations under this Agreement without the prior written consent of the
other party, which consent shall not be unreasonably withheld; provided,
however, that either party hereto may assign, upon prior written notice to the
other, its rights and obligations to an Affiliate or to a legal entity acquiring
all or substantially all of such party's assets or business to which this
Agreement relates. Subject to the preceding sentence, this Agreement shall be
binding upon and inure to the benefit of the permitted successors and assigns of
each party.
9.3 Relationship. The status of the parties hereto is that of independent
contractors, and as such the parties shall not be deemed to be partners, joint
venturers, or each other's agents, and neither shall have the right to act for
or on behalf of the other except as expressly provided hereunder or otherwise
expressly agreed to in writing.
9.4 Force Majeure. The parties hereto shall not be liable for failure to perform
as required by any provision of this Agreement where such failure results from a
force majeure beyond such party's control. In the event of any delay
attributable to a force majeure, the time for performance affected thereby shall
be extended for a period equal to the time lost by reason of the delay;
provided, however, that if the delay extends for a period exceeding one hundred
and eighty (180) days, the party capable of performance shall have the right to
terminate this Agreement immediately upon written notice to the affected party.
9.5 Entire Agreement. Except for the Option Agreement, this Agreement
constitutes the entire understanding of the parties with respect to the subject
matter contained herein and may be modified only by a written agreement signed
by both parties.
9.6 Notices. Service of all notices hereunder shall be in writing and shall be
deemed duly given if sent by courier, certified or registered mail, postage
prepaid, or confirmed telecopier transmission to the addresses or telecopier
numbers below.
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If to Pharmacia: If to ArQule:
Pharmacia Biotech AB ArQule, Inc.
S-751 82 Uppsala 000 Xxxxxx Xxxxxx
Xxxxxx Xxxxx 0000
Attention: Johan von Heijne Xxxxxxx, Xxxxxxxxxxxxx 00000
Attention: President
Tel: 00 0000 0000 Tel: (000) 000-0000
Fax: 00 0000 0000 Fax: (000) 000-0000
With a copy to: With a copy to:
Xxx Xxxxxxxx Xxxxxx & Dodge
General Counsel One Beacon Street
Pharmacia Biotech AB Xxxxxx, Xxxxxxxxxxxxx 00000
X-000 00 Xxxxxxx XXX
Xxxxxx Attention: Xxxxxxx Xxxxxx, Esq.
Tel: 00 0000 0000 Tel: (000) 000-0000
Fax: 00 0000 0000 Fax: (000) 000-0000
Either party may change its designated address and facsimile number by notice to
the other party in the manner provided in this Section.
9.7 Severability. In the event that any provision of this Agreement shall, for
any reason, be held to be invalid or unenforceable in any respect, such
invalidity or unenforceability shall not affect any other provision hereof, and
the parties shall negotiate in good faith to modify the Agreement to preserve
(to the extent possible) their original intent.
9.8 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York irrespective of any conflicts
of law principles.
9.9 Dispute Resolution. Any disputes between the parties that arise under or
relate to this Agreement shall be resolved in accordance with the following
procedures. The parties shall first attempt in good faith to resolve the matter
among themselves. If the matter remains unresolved after a period of thirty (30)
days, the dispute shall be referred to a member of senior management from each
party. If the matter remains unresolved after an additional thirty-day period,
the dispute shall be finally settled by binding arbitration in London, England
under the Rules of Conciliation and Arbitration of the International Chamber of
Commerce. In case of a dispute which cannot be resolved by good faith
negotiations, ArQule shall also have the right to apply with a court of
competent jurisdiction to enjoin Pharmacia from further use of the ArQule
Technology and Improvements. Notwithstanding any of the foregoing, Pharmacia
does not waive any right to contest such application and to argue that the
requisite criteria that would allow the court to issue an injunction do not
exist.
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IN WITNESS HEREOF, the parties have caused this instrument to be
executed by their duly authorized officers effective as of the day and year
first set forth above.
PHARMACIA BIOTECH AB
By: /s/
---------------------------
Xxxx Xxxxxxx
President
By: /s/
---------------------------
Xxxxx Xxxxxxxx
Executive Vice President
ARQULE, INC.
By: /s/
---------------------------
Xxxx X. Xxxxxxxx
President and Chief Executive Officer
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ENCLOSURE 1
ARQULE TECHNOLOGY*
* Confidential treatment has been
requested for marked portions
15
ENCLOSURE 2
OPTION AGREEMENT
See Exhibit 10.17 to the Registrant's Registration Statement.
16
ENCLOSURE 3
PROJECT PLAN
17
ENCLOSURE 3 (Project Plan) TO PHARMACIA RESEARCH
RESEARCH PLAN FOR "LIGAND DESIGN" PROJECT
AN ARQULE/PHARMACIA BIOTECH COOPERATION
CONTENTS
1 DESCRIPTION OF THE CURRENT PROJECT
1.1 Objective of the project
1.2 Organization
1.2.1 Project Leaders and Reference Groups
1.2.2 Project Resources
1.3 Project Presentation
1.3.1 Pre-Initiation Phase
1.3.2 Project Xxxxx
0 Xx # 0
0 PROJECT WORK PLAN
4 PRIORITIES
5 PROJECT TIME LINES
5.1 Pre-Initiation Phase
5.2 Project Xxxxx
00
0 DESCRIPTION OF THE CURRENT PROJECT
1.1 Objective of the project
The objective of the project is *
1. *
2. *
3. *
These objective were decided upon at the meeting at Pharmacia in
January, 1995
1.2 Organisation
1.2.1 Project Leaders and Reference Groups
At ArQule Xxx Xxxxx (JH) is assigned as Project Leader and contact person.
At Pharmacia Xxx Xxxxxxx (AP) is assigned as Project Leader and contact
person.
1.2.2 Project Resources
The following persons from ArQule are assigned to the project:
Xxx Xxxxx, Xxxxx Xxxxxxx, Xxxxx Xxxxxxx, Xxxx Xxxxxx, Xxxxx Xxxxxx, and a
PhD with ten years experience from the field who is presently being
employed.
From Pharmacia two person will work at ArQule during the project phase.
One of these will stay for the whole 6 month period, and two others will
spend 3 months each at ArQule. Two PhD's are presently being employed for
this purpose, and the third, Geir Fonnum, who presently works at Pharmacia
Norway is one of the resources that will stay for 3 months.
In addition, AP or someone else from the Swedish Reference Group will be
spending at least one week/month at ArQule during the project phase.
1.3 Project Presentation
The project will be divided into pre-initiation and a project phase.
1.3.1 Pre-Initiation Phase
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The purpose of the pre-initiation phase is to generate sufficient amount
of structure lead information and to develop the appropriate screening
methods.
During the pre-initiation phase two important activities are planned:
A. Literature search
All possible structural leads are being collected from the literature to
make the initial choice of chemical structures to be synthesized as easy
as possible. The results from the literature searches will be exchanged
between the two sites and the extracted publications scrutinized for lead
structures. All progress will be shared via fax or tele-conference.
At the end of the pre-initiation phase a meeting will be held to decide
which molecules we will start to synthesize libraries around.
Chemical syntheses of these structures will be performed mainly at ArQule.
B. Screening methods
Xxxx Xxxxx and Xxxx Xxxxxxxxx will initiate the design of screening
methods. The basic idea is to develop systems that mimick * conditions.
The development of the screening methods will be performed primarily at
Pharmacia.
1.3.2 Project Phase
The Project Phase is described in Sections 3-5 below.
2
3 Project Work Plan:
1. At the end of * one of the selected targets
will be prioritized. The decision will be based on the results
achieved during the first third of the project phase. All resources
will then be used to focus on the synthesis and screening for ligands
suitable for the prioritized target molecule.
2. After *
3. After * we need to know which ligands should
be synthesized in large scale. The large scale sythesis will then be
performed.
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20
4. After *
5. Report writing will start after *
4 PRIORITIES
The targets chosen are *
All decisions will be taken by the Research Committee. If everything works
perfect we will of course continue with the next target molecule in the
following order of priority:
1. *
2. *
3. *
5 TIME PLAN
5.1 Pre-Initiation Phase (See Appendix 1)
5.2 Project Phase (See Appendix 1)
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ENCLOSURE 4
MEMBERS OF RESEARCH COMMITTEE
ArQule
Xxxxxx Xxxxx, Xx.
Xxxxx Xxxxxxx
Pharmacia
Ingvar Viberger
Xxx Xxxxxxx
22
February 13, 1996
BY FACSIMILE - 011-46 18 166301
-------------------------------
Xx. Xxx Xxxxxxxx
General Counsel
Pharmacia Biotech AB
Xxxxxxxxxx 00
X-000 00 Xxxxxxx, Xxxxxx
Re: Amendment to Option Agreement and Research Agreement
----------------------------------------------------
Dear Xx. Xxxxxxxx:
Reference is hereby made to the Option Agreement (the "Option Agreement")
and the Research and Development Agreement (the "Research Agreement"), both
effective as of March 10, 1995, by and between ArQule, Inc. ("ArQule") and
Pharmacia Biotech AB ("Pharmacia"). In consideration of the mutual covenants and
agreements hereinafter set forth and other valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the undersigned hereby
acknowledge and agree as follows:
I. In accordance with Section 2.2.1 of the Option Agreement, Pharmacia
hereby confirms to ArQule (i) that it has elected not to extend the Option
Period for its Option Right for Subfields II, III and IV (as such capitalized
terms are defined in the Option Agreement) in accordance with Section 2.2.1(b)
of the Option Agreement and (ii) that it has elected to extend the Option Period
for its Option Rights for Subfield I through August 15, 1996 in accordance with
Section 2.2.1(a) of the Option Agreement.
1. The Project Plan is hereby amended by replacing the initial Research
Project (as such capitalized terms are defined in the Research Agreement)
entitled "Research Plan for Ligand Design Project" attached as Enclosure 3 to
the Research Agreement with the Research Project entitled "Research Plan for the
Second Ligand Design Project", a copy of which is attached hereto (as so
amended, the "Amended Research Project"), for the period commencing on February
15, 1996 and continuing until August 15, 1996. The parties agree that the
Amended Research Project has been approved by the Research Committee, as
required under Section 2.2 of the Research Agreement.
23
Pharmacia biotech
February 13, 1996
Page 2
2. In consideration of the research to be conducted by ArQule as
provided in the Amended Research Project, Pharmacia hereby agrees to pay ArQule
* payable on or before March 12, 1996.
Except as otherwise expressly amended by this letter agreement, each of the
terms, conditions and provisions of the Option Agreement and the Research
Agreement shall remain in full force and effect. This letter agreement may be
signed in one or more counterparts, each of which when taken together shall
constitute one and the same instrument.
Very truly yours,
ARQULE, INC.
By:/s/
--------------------------------
Xxxx X. Xxxxxx
President and
Chief Executive Officer
Agreed to and Accepted
this 19th day of February, 1996
PHARMACIA BIOTECH AB
By: /s/ Xxx Xxxxxxxx
------------------------------
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24
Xx. Xxxxxx X. Xxxxx, PhD
CEO, Senior VP Research and Development
ArQule Inc.
000 Xxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
XXX
August 15, 1996
Dear Xx. Xxxxx,
This letter confirms that Pharmacia Biotech AB elects to extend its option
Period for Subfield I by entering into a Subsequent Research Period for 6
months, in accordance with the Option Agreement and the Research & Development
Agreement between ArQule Inc. and Pharmacia Biotech AB, dated March 10, 1995,
respectively.
With reference to our discussion in Boston, August 26 in Uppsala, we suggest
that we amend the Research Plan, to provide for a description of the new
research project including overall goals, priorities, time schedules, a
description of the necessary resources that each party will commit to the new
project. Furthermore, we feel that the initial Research Plan could serve as a
good frame work for the new plan.
Best Regards.
PHARMACIA BIOTECH AB
Research & Development
Xxxxxx Xxxxxxxx
Executive Vice President
Copy to: Xxxx Xxxxxxx Xxxxxxx Xxxxxx
Pharmacia Biotech XX Xxxxxx & Dodge
One Beacon Street
Johan von Heijne Boston Massachusetts
Pharmacia Biotech AB USA
Fax: (000) 000-0000
