Exhibit 10.24
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT HAS BEEN
OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION (THE "SEC") PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT WITH RESPECT TO THE OMITTED PORTIONS.
OMITTED PORTIONS ARE INDICATED BY [***]
RESEARCH AND LICENSE AGREEMENT
This Agreement ("AGREEMENT") is made and entered into August 8, 2006 (the
"EFFECTIVE DATE") by and between Nektar Therapeutics AL, Corporation, having its
principal place of business at 000 Xxxxxxxxx Xxxxx, Xxxxxxxxxx, XX 00000
("NEKTAR AL"); and PharmAthene, Inc. having its principal place of business at
000 Xxxxxxx Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxx, XX 00000 ("COMPANY"). NEKTAR
AL and COMPANY may be referred to herein individually as a "PARTY" and
collectively as the "PARTIES."
RECITALS
WHEREAS, COMPANY is in the business of developing, making, marketing and selling
pharmaceutical products for the treatment of diseases;
WHEREAS, NEKTAR AL has proprietary technology useful for attaching
poly(ethylene) glycol-based molecules to pharmaceutical compounds;
WHEREAS, COMPANY desires to obtain a license under certain of NEKTAR AL's
intellectual property rights and proprietary technology to make, have made, use,
sell, offer for sale and import the SELECTED PRODUCT (as defined herein)
throughout the world, under the terms and conditions specified herein;
WHEREAS, NEKTAR AL is also engaged in the business of performing research in
relation to REAGENTS and CONJUGATES (as defined herein) and manufacturing bulk
quantities of REAGENTS used in the manufacture of pharmaceutical products;
WHEREAS, COMPANY desires NEKTAR AL to perform research in relation to REAGENTS
and CONJUGATES, and NEKTAR AL agrees to undertake such research, all in
accordance with and subject to the terms and conditions specified below; and
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NOW, THEREFORE, in consideration of the foregoing and the covenants and promises
contained in this AGREEMENT, the PARTIES agree as follows:
AGREEMENT
1. Definitions
1.1 "AFFILIATE" means, with respect to any person or entity, any other person or
entity that directly or indirectly controls, is controlled by, or is under
common control with, such person or entity. For purposes of this definition
only, "control," "controlled by" and "under common control with" shall mean the
possession of the power to direct or cause the direction of the management and
policies of an entity, whether through the ownership of voting stock or
partnership interest, by contract or otherwise. In the case of a corporation,
the direct or indirect ownership of fifty percent (50%) or more of its
outstanding voting shares or the ability otherwise to elect a majority of the
board of directors or other managing authority of the entity shall in any event
be deemed to confer control, it being understood that the direct or indirect
ownership of a lesser percentage of such shares shall not necessarily preclude
the existence of control.
1.2 "BIODEFENSE SALES" means sales of SELECTED PRODUCT for the purpose of the
treatment or prophylaxis of organophosphate poisoning by a nerve agent (i) to a
government or agency thereof and/or (ii) to non-government entities that are
required by a government or agency thereof to purchase SELECTED PRODUCT provided
that the price paid by such non-government entities does not exceed ([***]%)
(net of all discounts) of the price paid by the federal government in the
country where such sale occurs.
1.3 "BLA" means a Biologics License Application filed with the FDA or any
foreign equivalent filed with the regulatory authorities in a country or
territory to obtain MARKETING AUTHORIZATION for SELECTED PRODUCT in such country
or territory.
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1.4 "CLAIMS" has the meaning set forth in Section 10.1.1.
1.5 "COMBINATION PRODUCT" means a product that contains one or more clinically
active components that are not SELECTED PRODUCT in addition to the SELECTED
PRODUCT.
1.6 "COMMERCIAL SALES" has the meaning set forth in Section 2.8.2.
1.7 "COMMERCIALLY REASONABLE EFFORTS" means, with respect to the research,
development or commercialization of the SELECTED PRODUCT under this AGREEMENT,
as the case may be, the efforts and resources typically used by pharmaceutical
companies for an internally-developed product of similar commercial potential at
a similar stage in its development or commercialization lifecycle, without
regard to the particular circumstances of a PARTY, including any other product
opportunities of such PARTY.
1.8 "COMPANY CORE TECHNOLOGY" means: (i) the composition of the THERAPEUTIC
AGENT; (ii) methods of using the THERAPEUTIC AGENT; and/or (iii) methods of
making the THERAPEUTIC AGENT but, in each case, specifically excluding
PEGYLATION of any REAGENT (including SELECTED REAGENT) to or with the
THERAPEUTIC AGENT.
1.9 "COMPANY CORE TECHNOLOGY INVENTIONS" has the meaning set forth in Section
11.5.
1.10 "COMPANY INDEMNITEE" has the meaning set forth in Section 10.1.1.
1.11 "COMPANY KNOW-HOW" means all KNOW-HOW CONTROLLED by COMPANY that is
necessary or useful for NEKTAR AL in connection with NEKTAR AL's performance of
its obligations under this AGREEMENT. COMPANY PATENT RIGHTS are excluded from
the definition of COMPANY KNOW-HOW.
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1.12 "COMPANY PATENT RIGHTS" means all PATENTS and PATENT APPLICATIONS
CONTROLLED by COMPANY that are necessary for NEKTAR AL in connection with NEKTAR
AL's performance of its obligations under this AGREEMENT.
1.13 "CONFIDENTIAL INFORMATION" has the meaning set forth in Section 7.1.
1.14 "CONJUGATE" has the meaning set forth in Section 3.3.
1.15 "CONTROL(LED)" means the ability to grant a license or sublicense as
provided for herein without violating the terms of any agreement or other
arrangement with any THIRD PARTY.
1.16 "DISCLOSING PARTY" means the PARTY disclosing CONFIDENTIAL INFORMATION to
the other PARTY hereunder.
1.17 "DOLLAR(S)" means United States dollars.
1.18 "EMEA" means the European Medicines Agency, and any successor agency
thereto, having the administrative authority to regulate the marketing of human
pharmaceutical products, biological therapeutic products and delivery systems in
the European Union.
1.19 "FDA" means the United States Food and Drug Administration, or any
successor entity that may be established hereafter which has substantially the
same authority or responsibility currently vested in the United States Food and
Drug Administration.
1.20 "FIELD" means the treatment, prevention or diagnosis of human diseases,
disorders or conditions (other than Hemophilia A).
1.21 "FIRST COMMERCIAL SALE" means, with respect to SELECTED PRODUCT, the first
sale by COMPANY or its SUBLICENSEE to a THIRD PARTY following receipt of
MARKETING AUTHORIZATION in the country of sale; provided, however, that SELECTED
PRODUCT shipped by COMPANY or its SUBLICENSEE to a THIRD PARTY prior to receipt
of MARKETING AUTHORIZATION therefor in a particular country where such SELECTED
PRODUCT is intended for sale, shall be deemed for the purposes hereof a FIRST
COMMERCIAL SALE to the extent such SELECTED PRODUCT is sold to a THIRD PARTY for
sale in that country after such MARKETING AUTHORIZATION is obtained.
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1.22 "INQUIRIES" has the meaning set forth in Section 8.3.
1.23 "INVENTIONS" means any and all ideas, concepts, methods, procedures,
processes, improvements, inventions and discoveries, whether or not patentable,
that are conceived or made after the EFFECTIVE DATE during and in the course of
the performance of activities conducted under this AGREEMENT including the
development or manufacture of SELECTED PRODUCT.
1.24 "JOINT INVENTION" has the meaning set forth in Section 11.3.
1.25 "JOINT PATENT APPLICATIONS" has the meaning set forth in Section 11.7.
1.26 "KNOW-HOW" means all technical, scientific and other know-how, data,
materials, information, trade secrets, ideas, formulae, inventions, discoveries,
processes, machines, manufactures, compositions of matter, improvements,
protocols, techniques, works of authorship, and results of experimentation and
testing (whether or not patentable) in written, electronic, oral or any other
form.
1.27 "LAW(S)" means any local, state or federal rule, regulation, statute or law
in the United States or any foreign country relevant to the activities
undertaken pursuant to this AGREEMENT or applicable to either of the PARTIES
with respect to any matters set forth herein.
1.28 "MANAGING COMMITTEE" means the committee described in Section 14.1.
1.29 "MARKETING AUTHORIZATION" means the requisite governmental approval for the
marketing and sale of SELECTED PRODUCT in a given country.
1.30 "MSA" has the meaning set forth in Section 4.9.
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1.31 "NEKTAR AL CORE TECHNOLOGY" means: (i) the composition of REAGENTS
(including SELECTED REAGENT); (ii) methods of using REAGENTS (including SELECTED
REAGENT) by themselves or in combination; (iii) methods of making, processing,
analyzing or characterizing REAGENTS (including SELECTED REAGENT) or products
(including SELECTED PRODUCT) incorporating REAGENT by means of covalent chemical
bonding; (iv) methods of attaching one or more REAGENTS (including SELECTED
REAGENT) to or associating one or more REAGENTS (including SELECTED REAGENT)
with or to any therapeutic agent (including the THERAPEUTIC AGENT); (v) methods
of directing or determining the point of attachment of one or more REAGENTS
(including SELECTED REAGENT) to or associating one or more REAGENTS (including
SELECTED REAGENT) with any therapeutic agent (including the THERAPEUTIC AGENT);
(vi) the chemical structure of product (including the chemical structure of
SELECTED PRODUCT) obtained by attaching or associating one or more REAGENTS
(including by PEGYLATION and including SELECTED REAGENT) to or with any
therapeutic agent (including the THERAPEUTIC AGENT) but for the avoidance of
doubt, excluding the chemical structure and composition of THERAPEUTIC AGENT;
and (vii) methods of making, formulating, combining, processing, using,
analyzing or characterizing two (2) or more REAGENTS (including SELECTED
REAGENT) in combination.
1.32 "NEKTAR AL CORE TECHNOLOGY INVENTIONS" has the meaning set forth in Section
11.4.
1.33 "NEKTAR AL INDEMNITEE" has the meaning set forth in Section 10.1.2.
1.34 "NEKTAR AL KNOW-HOW" means all KNOW-HOW that
(a) is owned in whole or in part by NEKTAR AL, or licensed to NEKTAR AL as
of the EFFECTIVE DATE; or
(b) that becomes owned in whole or in part by NEKTAR AL during the TERM;
or
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(c) that is licensed to NEKTAR AL during the TERM with the right to grant
a sublicense;
in each case that is necessary or useful for COMPANY to develop, make, have
made, use, sell, offer for sale or import SELECTED PRODUCT pursuant to the
license granted under Sections 2.1 and 3.2 of this AGREEMENT, but excluding
KNOW-HOW for manufacture of SELECTED REAGENT and/or methods for delivery of
SELECTED PRODUCT to a patient by a means other than injection.
1.35 "NEKTAR AL LICENSED TECHNOLOGY" means, collectively, the NEKTAR AL PATENT
RIGHTS and NEKTAR AL KNOW-HOW.
1.36 "NEKTAR AL MATERIALS" has the meaning set forth in Section 3.3.
1.37 "NEKTAR AL PATENT RIGHTS" means all PATENTS and PATENT APPLICATIONS (a)
that are owned in whole or in part by NEKTAR AL, or licensed to NEKTAR AL, as of
the EFFECTIVE DATE, (b) that become owned in whole or in part by NEKTAR AL at
any time during the TERM, or (c) that are licensed to NEKTAR AL after the
EFFECTIVE DATE, with the right to grant a sublicense, in each of the foregoing
cases ((a), (b) and (c)), to the extent that such PATENTS or PATENT APPLICATIONS
are infringed (in the case of a pending patent application, would be infringed
if granted) by making, having made, using, selling, offering to sell or
importing SELECTED PRODUCT and/or the SELECTED REAGENT in accordance with the
terms of the license granted under Section 2.1 or Section 3.2 of this AGREEMENT.
1.38 "NET SALES" means the amount invoiced (or in the absence of an invoice,
received) by COMPANY, its AFFILIATES or SUBLICENSEES for the sale to THIRD
PARTIES (including without limitation, distributors) of SELECTED PRODUCT less
the following, to the extent included in the amount invoiced:
(i) trade, quantity and/or cash discounts, allowances or rebates,
including promotional or similar discounts or rebates and discounts or rebates
to governmental or managed care organizations, in each case to the extent
reasonable and customary;
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(ii) credits or allowances with respect to SELECTED PRODUCT by
reason of rejection, defects, recalls or returns, or chargebacks;
(iii) an allowance for bad debt not to exceed ([***] percent
([***]%)) of NET SALES, provided such amounts are included in NET SALES if and
when subsequently collected;
(iv) any tax, tariff, duty or government charge (including any
sales, value added, excise or similar tax or government charge, but excluding
any income tax) levied on the sale, transportation or delivery of any SELECTED
PRODUCT; and
(v) any charges for freight, postage, shipping or transportation, or
for insurance (if charged to the purchaser).
NET SALES shall be deemed to accrue upon the date of the invoice for
SELECTED PRODUCT. In addition, NET SALES by COMPANY hereunder are subject to the
following:
(a) In the case of pharmacy incentive programs, hospital performance
incentive program charge backs, disease management programs, similar
programs or discounts on "bundles" of products, all discounts and the like
shall be allocated among products on the basis on which such discounts and
the like were accrued, or if such basis cannot be determined,
proportionately to the list prices of such products; and
(b) In the case of any sale or other disposal of SELECTED PRODUCT by
COMPANY to an AFFILIATE, for resale, the NET SALES shall be calculated as
above on the value charged or invoiced on the first arm's length sale to a
THIRD PARTY.
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If the SELECTED PRODUCT is sold as part of a COMBINATION PRODUCT, then the
NET SALES from the COMBINATION PRODUCT, for the purposes of determining royalty
payments, shall be determined by multiplying the NET SALES of the COMBINATION
PRODUCT (as determined using the standard NET SALES definition), during the
applicable royalty reporting period, by the fraction, A/A+B, where A is the
average unit net sales price of the SELECTED PRODUCT in the applicable country,
where net sales is calculated in the same manner as NET SALES, when sold
separately in finished form and B is the average unit net sales price in the
same country (net sales being calculated in the same manner as NET SALES) of
products that include only the therapeutically active ingredient other than the
SELECTED PRODUCT that is included in the COMBINATION PRODUCT ("OTHER PRODUCTS")
when such OTHER PRODUCTS are sold separately in finished form at the same dosage
levels, in each case during the applicable royalty reporting period or, if sales
of both the SELECTED PRODUCT, and the OTHER PRODUCT(S) did not occur in the same
country in such period, then in the most recent royalty reporting period in
which sales of both occurred. In the event that such average unit sale price
cannot be determined for both the SELECTED PRODUCT and all such OTHER PRODUCT(S)
included in the COMBINATION PRODUCT, NET SALES for the purposes of determining
royalty payments shall be calculated by multiplying the NET SALES of the
COMBINATION PRODUCT by the fraction of C/C+D where C is the fair market value of
the SELECTED PRODUCT, and D is the fair market value of all OTHER PRODUCTS
included in the COMBINATION PRODUCT, as agreed by the PARTIES as follows:
COMPANY shall initially make a reasonable determination of such fair market
values for purposes of its royalty reporting and payments and shall advise
NEKTAR AL of its basis for such determination. NEKTAR AL shall have the right to
review such COMPANY determination and supporting data with respect to fair
market value, and to notify COMPANY if it disagrees with such determination. If
NEKTAR AL does not agree with such determination and if the PARTIES are unable
to agree in good faith as to such respective fair market values, then the
determination of fair market value shall be determined by an independent THIRD
PARTY.
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NET SALES will be determined in accordance with GAAP consistently applied.
1.39 "NON-DISCLOSURE AGREEMENT" means that agreement entered into between the
PARTIES on July 15, 2005 providing for confidential treatment of the PARTIES'
information.
1.40 "PATENT" means: (i) any letters patent and utility models including any
extension, substitution, registration, confirmation, reissue, supplemental
protection certificate, re-examination or renewal thereof; and (ii) to the
extent valid and enforceable rights are granted by a governmental authority
thereunder, a PATENT APPLICATION (and in each case any foreign counterpart
thereto).
1.41 "PATENT APPLICATION" means an application for letters patent, including a
provisional application, converted provisional application, continuation
application, a continued prosecution application, a continuation-in-part
application, a divisional application, a re-examination application, and a
reissue application (and in each case any foreign counterpart thereto).
1.42 "PEG" means poly(ethylene) glycol or a derivative thereof.
1.43 "PEGYLATION," with correlative meanings "PEGYLATED" or to "PEGYLATE", means
covalent chemical bonding of any REAGENT (including SELECTED REAGENT and
including covalent chemical bonding through linking groups) with or to another
material or materials. Such materials include, without limitation, proteins,
peptides, oligonucleotides, other biomolecules, small molecules, therapeutic
agents (including THERAPEUTIC AGENT), diagnostic agents, imaging agents and
detectable labels. Additional materials that may be PEGYLATED include without
limitation, polymers, liposomes, films, chemical separation and purification
surfaces, solid supports, metal/metal oxide surfaces and other surfaces such as,
by way of example but not limitation, those on implanted devices, and equipment,
where a REAGENT is covalently chemically bonded to one or more reactive
molecules on the surface of such device or equipment. "PEGYLATION" shall include
the synthesis, derivatization, characterization, and modification of PEG for
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such purposes, together with the synthesis, derivatization, characterization,
and modification of the raw materials and intermediates for the manufacture of
REAGENTS (including SELECTED REAGENT) or products (including SELECTED PRODUCT)
incorporating such REAGENT by means of covalent chemical bonding, and all
methods of making and using each and all of the foregoing.
1.44 "PHASE I CLINICAL TRIAL" means a study in humans, conducted in accordance
with 21 C.F.R. ss. 312.21(a), as amended from time to time or any successor
regulation thereto, including, as applicable, the corresponding regulation in
jurisdictions other than the United States.
1.45 "PHASE III CLINICAL TRIAL" means a study in humans, conducted in accordance
with 21 C.F.R. ss. 312.21(c) as amended from time to time or any successor
regulation thereto, including, as applicable, the corresponding regulation in
jurisdictions other than the United States.
1.46 "PLAN" means the work plan attached hereto as Schedule I.
1.47 "PURCHASE PRICE" has the meaning set forth in Section 4.5.1.
1.48 "REAGENT" means a PEG derivative used in the manufacture of a
pharmaceutical or diagnostic product or medical device.
1.49 "RECIPIENT" means the PARTY receiving CONFIDENTIAL INFORMATION hereunder.
1.50 "RESEARCH COMMITTEE" means the committee described in Section 14.2.
1.51 "RESEARCH PROGRAM" means the PARTIES' respective activities and
responsibilities as set forth in the PLAN attached hereto as Schedule I and made
a part hereof, and COMPANY's payment obligations in respect thereof.
1.52 "RESPONSIBLE PARTY" has the meaning set forth in Section 11.7.
1.53 "ROYALTY TERM" means, with respect to SELECTED PRODUCT in each country in
the world, the period of time commencing on the date of the FIRST COMMERCIAL
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SALE of the first SELECTED PRODUCT in such country and expiring for such a
SELECTED PRODUCT in such country upon the later of: (a) [***] years after such
FIRST COMMERCIAL SALE of such SELECTED PRODUCT; and (b) the expiration date of
the last VALID CLAIM in such country that is infringed in such country by the
manufacture, use, importation, sale or offer to sell SELECTED REAGENT or such
SELECTED PRODUCT.
1.54 "SELECTED PRODUCT" means the chemical entity resulting from attachment of
the THERAPEUTIC AGENT to the SELECTED REAGENT by means of PEGYLATION, as
formulated, packaged and sold in finished form.
1.55 "SELECTED REAGENT" means the REAGENT that is selected by the RESEARCH
COMMITTEE pursuant to the RESEARCH PROGRAM to be attached to the THERAPEUTIC
AGENT by means of PEGYLATION.
1.56 "SOLE INVENTION" has the meaning set forth in Section 11.3.
1.57 "SPECIFICATIONS" has the meaning set forth in Section 4.7.
1.58 "SUBLICENSEE" means any person or entity, including AFFILIATES, to which
COMPANY grants a sublicense (i) to research and/or develop SELECTED PRODUCT, or
(ii) to make, have made, use, sell, have sold and/or import SELECTED PRODUCT.
1.59 "TERRITORY" means the world.
1.60 "TERM" has the meaning set forth in Section 13.1.
1.61 "THERAPEUTIC AGENT" means human recombinant butyrylcholinesterase (BChE)
having the amino acid sequence shown in Schedule II or having an amino acid
sequence with ([***]%) sequence identity to such human BChE sequence or a
fragment of such a BChE and in each case which has activity of human recombinant
butyrylcholinesterase (BChE).
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1.62 "THIRD PARTY" means any entity other than NEKTAR AL, COMPANY and their
respective AFFILIATES.
1.63 "VALID CLAIM" means either: (a) a claim of an issued and unexpired PATENT
covering the manufacture, use, import, sale or offer for sale of SELECTED
REAGENT or SELECTED PRODUCT, which PATENT is owned or CONTROLLED by NEKTAR AL or
jointly by the PARTIES and has not (i) expired or been canceled, (ii) been
declared invalid by an unreversed and unappealable or unappealed decision of a
court or other appropriate body of competent jurisdiction, (iii) been admitted
to be invalid or unenforceable through reissue, disclaimer, or otherwise, or
(iv) been abandoned; or (b) a claim filed and kept pending in good faith that is
included in a PATENT APPLICATION, provided that such PATENT APPLICATION has not
been pending for the longer of [***] years from the EFFECTIVE DATE or for more
than [***] years from the earliest priority date to which the PATENT APPLICATION
is entitled.
2. Licenses to NEKTAR AL LICENSED TECHNOLOGY and COMPANY Technology
2.1 License to COMPANY. Subject to the terms and conditions of this AGREEMENT
and upon selection of the SELECTED REAGENT pursuant to Section 3.4, NEKTAR AL
agrees to grant and hereby grants to COMPANY a worldwide, exclusive,
royalty-bearing license, with the right to grant sublicenses as provided in
Section 2.2, in the NEKTAR AL LICENSED TECHNOLOGY solely to use SELECTED REAGENT
for and to research, develop, make, have made, import, use, offer for sale and
sell SELECTED PRODUCT in the FIELD and in the TERRITORY. Except as may be
provided in the MSA, no license is granted to make or have made SELECTED
REAGENT.
2.2 Terms of Sublicense. Subject to Section 3.4, COMPANY shall have the right to
grant sublicenses under the rights and licenses granted to COMPANY under this
Agreement subject to the terms of this Agreement; provided, however, COMPANY
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shall neither grant a sublicense to nor exercise COMPANY's rights under Section
2.1 to have made SELECTED PRODUCT by an AFFILIATE or THIRD PARTY in either case
when such AFFILIATE or THIRD PARTY, at the time of the proposed grant of a
sublicense or exercise of COMPANY's rights under Section 2.1 to have made
SELECTED PRODUCT, is engaged in the business of manufacturing REAGENTS or
attaching REAGENTS to pharmaceutical or biotechnology products, without NEKTAR
AL's prior written consent, provided however that no such consent shall be
required with respect to a CMO listed on Schedule III. Notwithstanding the
foregoing, NEKTAR AL's prior written consent shall no longer be required after
(i) first dosing in a phase III clinical study of the SELECTED PRODUCT in
primate animals for BIODEFENSE SALES or (ii) first dosing in a human in a PHASE
III CLINICAL TRIAL of the SELECTED PRODUCT in the FIELD. The sublicense shall be
consistent with the terms and conditions of this AGREEMENT. COMPANY's grant of
any sublicense shall not relieve COMPANY from any of its obligations (including
without limitation financial obligations) or liability under this AGREEMENT.
Without limiting the foregoing, COMPANY shall require that each SUBLICENSEE
comply with the provisions of Sections 2.4, 2.7, 2.8, 6.1, 6.2, 8.3, 8.4, 9.5,
17.9 and 17.12 and Articles 7, 10, 11, and 12 of this AGREEMENT; provided,
however, that to the extent that the U.S. government or agency thereof is a
SUBLICENSEE, COMPANY shall not be required to include in a sublicense agreement
provisions to comply with Section 2.7.1, and/or Articles 10, 11 or 12 of this
AGREEMENT. Notwithstanding the foregoing or anything to the contrary herein, if
COMPANY is unwilling or unable to enforce any SUBLICENSEE's (including without
limitation the U.S. government or agency thereof) compliance with any of the
foregoing Sections or Articles, then NEKTAR AL shall have the right to terminate
this AGREEMENT under Section 13.2.
2.3 NEKTAR AL Research Rights and Limitations. Notwithstanding anything to the
contrary in this AGREEMENT and without limiting any other retained rights, the
license granted under Section 2.1 shall be subject to the retained right of
NEKTAR AL and its AFFILIATES: (i) to practice the NEKTAR AL LICENSED TECHNOLOGY
for the conduct of research and development of products that it is developing
either itself or with others that are not SELECTED PRODUCTS, and in connection
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with the sale of REAGENTS through NEKTAR AL's catalog for research purposes;
(ii) to develop, make, have made, use, sell, offer for sale, import and license
products other than SELECTED PRODUCT, including products containing SELECTED
REAGENT that are not SELECTED PRODUCTS; and (iii) to practice the NEKTAR AL
LICENSED TECHNOLOGY solely to the extent necessary or useful to perform its
obligations under this AGREEMENT.
2.4 No Implied Rights or Licenses. Neither PARTY grants to the other PARTY any
rights or licenses, including without limitation to any PATENTS, PATENT
APPLICATIONS, KNOW -HOW or other intellectual property rights, whether by
implication, estoppel or otherwise, except to the extent expressly provided for
under this AGREEMENT. Other than as expressly provided for or licensed herein or
in the MSA, COMPANY is not authorized or licensed to develop, make, have made,
use, sell, offer for sale or import NEKTAR AL MATERIALS or SELECTED REAGENT.
Except as expressly permitted by or licensed under this AGREEMENT or the MSA,
COMPANY may not copy, distribute, reverse engineer (except for quality control)
(by way of example but not limitation, by performing tests such as HPLC, gas
chromatography or x-ray crystallography), sell, lease, license or otherwise
transfer, modify, adapt or create derivatives of any NEKTAR AL MATERIALS or
SELECTED REAGENT.
2.5 License to NEKTAR AL. COMPANY hereby grants to NEKTAR AL a non-exclusive,
worldwide, royalty-free license, with the right to grant and authorize the grant
of sublicenses under the COMPANY KNOW-HOW owned by the COMPANY and COMPANY
PATENT RIGHTS owned by the COMPANY only to the extent useful or necessary for
NEKTAR AL to fulfill its obligations under this AGREEMENT.
2.6 Use of Therapeutic Agent. COMPANY hereby acknowledges and agrees that
COMPANY has the right to transfer to NEKTAR AL the THERAPEUTIC AGENT that
COMPANY will transfer to NEKTAR AL for performing work pursuant to the RESEARCH
PROGRAM and that NEKTAR AL has the right to use the THERAPEUTIC AGENT for
performing work pursuant to the RESEARCH PROGRAM. NEKTAR AL acknowledges and
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agrees that COMPANY shall retain all right, title and interest in and to such
transferred THERAPEUTIC AGENT and that NEKTAR AL will not use or transfer such
THERAPEUTIC AGENT to a THIRD PARTY except for use in connection with the
RESEARCH PROGRAM.
2.7 Covenants.
2.7.1 COMPANY covenants and agrees that neither it nor COMPANY's
AFFILIATES will use the SELECTED REAGENT or the PEGYLATION process transferred
by NEKTAR AL to COMPANY with respect to producing SELECTED PRODUCT or any
CONFIDENTIAL INFORMATION of NEKTAR AL provided by NEKTAR AL to COMPANY for any
purpose other than for research, development, making, having made, selling,
offering for sale and/or importing SELECTED PRODUCT in accordance with the
licenses granted under this AGREEMENT. A breach of this covenant that results in
material harm to NEKTAR AL shall be a material breach of this AGREEMENT. COMPANY
covenants and agrees to cease any non-permitted use and to take all necessary
actions to assign to NEKTAR AL any inventions made through use of CONFIDENTIAL
INFORMATION of NEKTAR AL outside the scope of the license rights granted
hereunder.
2.7.2 Other than for the purposes of obtaining MARKETING AUTHORIZATION of
SELECTED PRODUCT, and except as may be permitted by the MSA COMPANY agrees not
to disclose to any foreign government or agency thereof any of the CONFIDENTIAL
INFORMATION of NEKTAR AL that is provided to COMPANY pursuant to this AGREEMENT.
Except as permitted by the MSA and/or except as permitted pursuant to NEKTAR
AL's prior written consent, COMPANY shall not enter into an agreement with a
foreign government or agency thereof that requires NEKTAR AL to disclose to a
foreign government or agency thereof CONFIDENTIAL INFORMATION with respect to
SELECTED REAGENT.
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2.8 Diligence.
2.8.1 COMPANY shall use COMMERCIALLY REASONABLE EFFORTS (a) to perform any
other activities or undertakings assigned to it under the PLAN in accordance
with this AGREEMENT, (b) to develop and obtain BLA approval for SELECTED PRODUCT
for BIODEFENSE SALES in accordance with the outline of Schedule IV, and (c) to
market, promote, distribute and sell SELECTED PRODUCT for BIODEFENSE SALES in
each country in the TERRITORY within [***] months after receiving the approval
of the BLA for such SELECTED PRODUCT in such country. The remedy for the failure
to meet such obligation will be handled according to Section 13.2; except that
with respect to Section 2.8.1 (c), such remedy shall apply only to the
applicable country; however, if the failure is primarily due to a suspension of
government funding of development of SELECTED PRODUCT or the government or
government agency causing a delay or suspension of such development work, and in
each case provided that COMPANY has not caused such suspension or delay (a
"GOVERNMENT DELAY"), there shall be no breach and the obligation shall be
suspended until the GOVERNMENT DELAY is terminated unless the GOVERNMENT DELAY
exceeds [***] consecutive months, in which case NEKTAR AL, by written notice to
COMPANY, may convert the exclusive license granted under this AGREEMENT with
respect to BIODEFENSE SALES to a non-exclusive license with respect to
BIODEFENSE SALES. In addition to (and without limiting) the foregoing general
diligence obligation, COMPANY shall meet the following objectives by the
following dates (each, a "DEVELOPMENT DATE"):
First dosing of the first patient in a PHASE I CLINICAL TRIAL with respect
to SELECTED PRODUCT for BIODEFENSE SALES by [***]; and
Submission of the first BLA for SELECTED PRODUCT with respect to SELECTED
PRODUCT for BIODEFENSE SALES by [***].
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In the event that COMPANY has not successfully achieved a DEVELOPMENT DATE,
NEKTAR AL may terminate this AGREEMENT in accordance with Section 13.2, except
in the case of a GOVERNMENTAL DELAY, in which case the applicable DEVELOPMENT
DATES shall be extended by the aggregate period of GOVERNMENT DELAY. Without
limiting the foregoing, if COMPANY's inability to achieve a DEVELOPMENT DATE is
due to (a) an event of Force Majeure, or (b) any material breach of this
AGREEMENT by NEKTAR AL, or (c) any regulatory delays, in each case that
materially and adversely affects COMPANY's ability to meet the relevant
deadline, then the applicable DEVELOPMENT DATE shall be extended by a period of
time equivalent to the length of such delay; provided, however, that in no event
shall a DEVELOPMENT DATE be extended more than (i) [***] years, in any one
instance, or (ii) [***] years, in the aggregate, during TERM.
2.8.2 COMPANY shall use COMMERCIALLY REASONABLE EFFORTS to (a) develop and
obtain BLA approval for SELECTED PRODUCT for sales other than BIODEFENSE SALES
(such other sales being "COMMERCIAL SALES"), and (b) market, promote, distribute
and sell SELECTED PRODUCT for COMMERCIAL SALES in each country in the TERRITORY
within [***] months after receiving the approval of the BLA for such SELECTED
PRODUCT in such country. The sole and exclusive remedy for the breach of either
such obligation is termination of the license granted under this AGREEMENT with
respect to SELECTED PRODUCT for COMMERCIAL SALES by written notice from NEKTAR
AL to COMPANY, except that with respect to Section 2.8.2(b), such remedy shall
apply only to the applicable country. In addition to (and without limiting) the
foregoing general diligence obligation, COMPANY shall meet the following
objectives by the following dates (each, a "COMMERCIAL DEVELOPMENT DATE"):
First dosing of the first patient in a PHASE I CLINICAL TRIAL with respect
to SELECTED PRODUCT for COMMERCIAL SALES by [***]; and
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Submission of the first BLA for SELECTED PRODUCT with respect to SELECTED
PRODUCT for COMMERCIAL SALES by [***].
In the event that COMPANY has not successfully achieved a COMMERCIAL
DEVELOPMENT DATE, as the sole and exclusive remedy, NEKTAR AL may terminate the
license granted under this AGREEMENT with respect to SELECTED PRODUCT for
COMMERCIAL SALES by written notice to COMPANY. Without limiting the foregoing,
if COMPANY's inability to achieve a COMMERCIAL DEVELOPMENT DATE is due to (a) an
event of Force Majeure, or (b) any material breach of this AGREEMENT by NEKTAR
AL, or (c) any regulatory delays, in each case that materially and adversely
affects COMPANY's ability to meet the relevant deadline, then the applicable
DEVELOPMENT DATE shall be extended by a period of time equivalent to the length
of such delay; provided, however, that in no event shall a COMMERCIAL
DEVELOPMENT DATE be extended more than (i) [***] years, in any one instance, or
(ii) [***] years, in the aggregate, during TERM.
3. RESEARCH PROGRAM
3.1 PLAN. NEKTAR AL and COMPANY shall use COMMERCIALLY REASONABLE EFFORTS to
collaborate and cooperate in researching and developing the SELECTED PRODUCT as
specified in the PLAN for the RESEARCH PROGRAM that is attached hereto as
Schedule I and made a part hereof. In consideration of NEKTAR AL's performance
under the PLAN, COMPANY shall make the payments to NEKTAR AL as provided in
Schedule I.
3.2 Research Licenses. In addition to the licenses granted under Section 2.1,
NEKTAR AL hereby grants to COMPANY a non-assignable, non-exclusive,
royalty-free, sublicensable (but only to the parties listed in Schedule III)
license under PATENTS, PATENT APPLICATIONS and KNOW HOW owned by NEKTAR AL for
the sole purpose of performing COMPANY's activities under the PLAN. For clarity,
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other than the THIRD PARTIES listed in Schedule III, COMPANY shall not have the
right to use any THIRD PARTY in connection with the performance of its
activities under the PLAN, except with the prior written consent of NEKTAR AL
which consent may be withheld at NEKTAR AL's sole discretion.
3.3 NEKTAR AL Materials. Any samples of REAGENTS or chemical entities that are
the product of the covalent chemical attachment of a REAGENT to a therapeutic
agent (including the THERAPEUTIC AGENT) ("CONJUGATES") that are provided by
NEKTAR AL to COMPANY in the course of the PLAN (collectively, the "NEKTAR AL
MATERIALS") are owned exclusively by NEKTAR AL and provided solely for the
performance of the PLAN and for no other purpose. Without limitation, except as
authorized by the licenses of Section 2.1 and Section 3.2, COMPANY will not use
any such NEKTAR AL MATERIALS (i) in any research or other activities except for
the PLAN, (ii) or any derivative products thereof in humans, or (iii) for any
commercial purpose. COMPANY understands and agrees that the NEKTAR AL MATERIALS
may have unpredictable and unknown biological and/or chemical properties, and
that they are to be handled and used with caution. COMPANY will handle and use
the NEKTAR AL MATERIALS and conduct its activities under the PLAN in compliance
with LAWS and the terms of this AGREEMENT. COMPANY will maintain reasonable
security measures, no less strict than it maintains to protect its own valuable
tangible property against loss, theft or destruction. Except as permitted in
accordance with Schedule III or expressly authorized in or licensed under this
AGREEMENT, COMPANY will not sell, transfer, disclose or otherwise provide access
to any NEKTAR AL MATERIALS to any THIRD PARTY, without the prior written consent
of NEKTAR AL.
3.4 Selection of SELECTED REAGENT; Technology Transfer and Assistance.
3.4.1 The RESEARCH COMMITTEE shall select the SELECTED REAGENT(S) and,
following such selection, NEKTAR AL shall (i) transfer to COMPANY and/or a THIRD
PARTY designated by COMPANY and approved by NEKTAR AL, all of the NEKTAR AL
KNOW-HOW necessary for enabling COMPANY and/or such THIRD PARTY to attach the
SELECTED REAGENT to the THERAPEUTIC AGENT by means of PEGYLATION, which shall
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include a description of the synthetic and analytical methods for the SELECTED
PRODUCT and (ii) reasonably assist in the technical transfer of such NEKTAR AL
KNOW-HOW, including such synthetic and analytical methods at the laboratory
scale used in the RESEARCH PROGRAM. The CMO's listed in Schedule III and
permitted SUBLICENSEES are hereby approved by NEKTAR AL, as a THIRD PARTY who
can be designated by COMPANY for such transfer. After dosing of a first primate
in a phase III clinical trial with respect to a SELECTED PRODUCT for BIODEFENSE
SALES or first dosing of a human patient in a PHASE III CLINICAL TRIAL of the
SELECTED PRODUCT in the FIELD, the approval of NEKTAR AL shall not be required
for such transfer to any THIRD PARTY whether or not such THIRD PARTY is on
Schedule III.
3.4.2 If, following NEKTAR AL's receipt of COMPANY's notice to proceed
with the use of a SELECTED REAGENT in accordance with Section 12.1.5, NEKTAR AL
reasonably believes that the use of such SELECTED REAGENT for the SELECTED
PRODUCT may pose a risk of infringement or misappropriation of THIRD PARTY
intellectual property rights that have been identified by either PARTY, within
thirty (30) days after such notice from COMPANY, NEKTAR AL shall notify COMPANY
and identify such intellectual property rights to COMPANY. In such case, COMPANY
shall have the right to cause NEKTAR AL to proceed with such SELECTED REAGENT
for the SELECTED PRODUCT if, and only if, (x) COMPANY assumes sole and exclusive
responsibility for making any and all payments to any and all THIRD PARTIES
arising out of the manufacture, use, sale offer for sale or import of such
SELECTED REAGENT used in SELECTED PRODUCT, and (y) in accordance with Section
10.1.2, COMPANY assumes sole and exclusive responsibility for indemnifying any
and all NEKTAR AL INDEMNITEES against any CLAIMS based on infringement or
misappropriation of such identified THIRD PARTY intellectual property arising
from the use, manufacture, sell, offer for sale, or import of such SELECTED
REAGENT or SELECTED PRODUCT, and (z) NEKTAR AL's royalties are not reduced as a
result thereof.
3.4.3 NEKTAR AL shall provide COMPANY and/or a THIRD PARTY designated by
COMPANY (subject to the limitations of Sections 2.2 and 3.4) with the technical
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assistance reasonably requested by COMPANY and agreed in writing by NEKTAR AL in
order to manufacture and produce SELECTED PRODUCT from SELECTED REAGENT for
research, development, clinical trials and commercialization of SELECTED
PRODUCT. COMPANY shall pay NEKTAR AL for such technical assistance at a rate
agreed to by the PARTIES to compensate NEKTAR AL for the cost (including FTE
time) and expenses associated with such technical assistance.
3.4.4 NEKTAR AL shall assist COMPANY with respect to selecting a SELECTED
REAGENT and a CMO for producing SELECTED PRODUCT incorporating such SELECTED
REAGENT. In this respect NEKTAR AL shall assist COMPANY by providing, to the
CMO's listed in Schedule III, certain information that will enable such CMOs to
assess the manufacturability of a potential SELECTED PRODUCT utilizing potential
SELECTED REAGENT; provided however, COMPANY shall not make any disclosures of
such information to such CMO's except with NEKTAR AL, and in no event shall
COMPANY disclose any NEKTAR AL CONFIDENTIAL INFORMATION related to REAGENTS or
CONJUGATES without NEKTAR AL's prior written consent, such consent not to be
unreasonably withheld.
3.4.5 NEKTAR AL shall provide reports to COMPANY as provided for in
Schedule I..
3.5 Disclaimer of Warranty. EXCEPT FOR THE WARRANTIES MADE BY EACH PARTY IN
SECTION 4.10 AND ARTICLE 9 OF THIS AGREEMENT, NEITHER PARTY PROVIDES WARRANTIES,
EXPRESS OR IMPLIED, REGARDING THE PLAN OR ANY REAGENT, CONJUGATE, PRODUCT OR
DELIVERABLE PROVIDED PURSUANT TO THE PLAN, AND DISCLAIMS ALL EXPRESS AND IMPLIED
WARRANTIES, INCLUDING WITHOUT LIMITATION THE IMPLIED WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NON-INFRINGEMENT WITH
RESPECT THERETO. MOREOVER, EXCEPT FOR THE WARRANTIES MADE BY EACH PARTY IN
SECTION 4.10 AND ARTICLE 9 OF THIS AGREEMENT, NEITHER PARTY PROVIDES WARRANTIES,
EXPRESS OR IMPLIED, REGARDING THE NEKTAR AL LICENSED TECHNOLOGY, SELECTED
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REAGENT OR SELECTED PRODUCT (INCLUDING THE SUCCESSFUL DEVELOPMENT, REGISTRATION,
MANUFACTURE OR COMMERCIALIZATION OF SELECTED PRODUCT), AND EXCEPT FOR THE
WARRANTIES MADE IN SECTION 4.10 AND ARTICLE 9 OF THIS AGREEMENT, EACH PARTY
DISCLAIMS ALL EXPRESS AND IMPLIED WARRANTIES, INCLUDING WITHOUT LIMITATION THE
IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND
NON-INFRINGEMENT.
3.6 Records. NEKTAR AL shall maintain records, in sufficient detail and in good
scientific manner appropriate for patent and regulatory purposes, which shall
fully and properly reflect all work done and results achieved in the performance
of its work pursuant to the RESEARCH PROGRAM. At the reasonable request of
COMPANY following the conclusion of an applicable stage of the RESEARCH PROGRAM,
NEKTAR AL shall provide COMPANY with copies of the above-described records.
COMPANY shall have the right, twice per calendar year, during normal business
hours and upon reasonable notice, to inspect the above-described records as
applicable to COMPANY's performance of its activities under the PLAN (including
COMPANY's production of SELECTED PRODUCT by PEGYLATION with the SELECTED
REAGENT).
3.7 Reports. At each Committee meeting during the RESEARCH PROGRAM, each PARTY
shall provide to the other PARTY a report on the progress and evaluate the work
performed in relation to the RESEARCH PROGRAM. Such report shall include all
other information reasonably requested by the other PARTY relating to such
progress and reasonably necessary to assess the completion of the other PARTY's
activities under the PLAN.
4. Manufacture and Supply of SELECTED REAGENT
4.1 Manufacturing Process Development. Upon selection of a SELECTED REAGENT, if
not established, NEKTAR AL shall establish a manufacturing process for SELECTED
REAGENT in order to meet the obligations of NEKTAR AL with respect to
manufacture of SELECTED REAGENT for use in pre-clinical development and in PHASE
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I CLINICAL TRIALS under this AGREEMENT. NEKTAR AL agrees to establish such
manufacturing process on a fixed fee basis based on NEKTAR AL's then current
rates, which shall be payable by COMPANY in installments as set forth in the
applicable work order agreed upon by the PARTIES. The fixed fee to be charged by
NEKTAR AL shall be inclusive of all work and materials and NEKTAR AL shall
notify COMPANY thereof in writing promptly after selection of the SELECTED
REAGENT. Such fixed fee shall be approved by COMPANY prior to NEKTAR AL
commencing any such services. Such fixed fee when agreed to by the PARTIES shall
cover NEKTAR AL's performance of all activities appropriate for the development,
scale-up and validation of the manufacture of SELECTED REAGENT, including, but
not limited to:
(a) improvements to and expansion of facilities, analytical method
development, analytical method validation, cleaning method
validation, process validation, reprocessing, supporting
documentation including, but not limited to, the preparation, filing
and maintenance of Drug Master Files and other regulatory filings;
(b) NEKTAR AL's generating and providing information or performing work
pursuant to any governmental or regulatory agency requests for
information or work (including any testing) regarding SELECTED
REAGENT or its manufacturing process; and
(c) installation, qualification and validation needed for SELECTED
REAGENT including scale-up.
4.2 Pre-Clinical and Phase I Clinical Supply. Upon establishing a manufacturing
process for SELECTED REAGENT, NEKTAR AL shall manufacture and supply to COMPANY
the SELECTED REAGENT for the purpose of producing SELECTED PRODUCT under the
terms of this Article 4 solely for use in pre-clinical development and PHASE I
CLINICAL TRIALS. NEKTAR AL shall manufacture and produce SELECTED REAGENT in
accordance with applicable laws, rules and regulations and with respect to
SELECTED REAGENT produced for PHASE I CLINICAL TRIALS such work shall be
consistent with ICH Q7A. COMPANY agrees to purchase and NEKTAR AL agrees to
supply one hundred percent (100%) of COMPANY's requirements of such SELECTED
REAGENT for pre-clinical and PHASE I CLINICAL TRIALS.
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4.3 Forecasts. No later than [***] days after selection of the SELECTED REAGENT,
COMPANY shall provide NEKTAR AL with a [***] quarter rolling forecast of its
requirements of SELECTED REAGENT. COMPANY shall update such forecast at least
[***] days following the start of each calendar quarter. Such forecasts are
estimates and are not binding on either PARTY.
4.4 Purchase Orders. COMPANY shall, from time to time, purchase SELECTED REAGENT
from NEKTAR AL by a written purchase order provided to NEKTAR AL. Each such
purchase order shall be sent to the attention of NEKTAR AL's Contract Management
and shall specify the quantity and requested delivery date of SELECTED REAGENT,
as well as the site to which SELECTED REAGENT is to be shipped; provided,
however, that COMPANY shall not designate in any purchase order a delivery date
that is less than [***] months after the date of such purchase order. No
purchase order shall be binding upon NEKTAR AL until accepted by NEKTAR AL in
writing. NEKTAR AL shall accept such orders for SELECTED REAGENT to the extent
that the quantities of SELECTED REAGENT do not exceed the forecasted amount and
to the extent such order is consistent with the terms of this AGREEMENT. Upon
acceptance of a purchase order, NEKTAR AL shall have each shipment of SELECTED
REAGENT shipped pursuant to its standard shipping procedures and documentation.
Any change to NEKTAR AL's standard shipping procedures and documentation will be
addressed through NEKTAR AL's change control procedures. The terms and
conditions of this AGREEMENT shall govern all purchase orders, notwithstanding
the fact that a purchase order or the standard shipping document may provide for
additional or different obligations of NEKTAR AL than the terms and conditions
of this AGREEMENT. Any such additional or different terms in any such purchase
order or shipping documents are hereby expressly rejected. NEKTAR AL shall
deliver SELECTED REAGENT in the quantities and at the delivery schedules set
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forth in this Section 4.4 provided, however, the specifics thereof will be
mutually agreed to by the PARTIES in writing and set forth in a purchase order
delivered in accordance with this Section 4.4.
4.5 Fees for Manufacturing and Supply of SELECTED REAGENT.
4.5.1 NEKTAR AL shall supply SELECTED REAGENT to COMPANY at a commercially
reasonable price (the "PURCHASE PRICE"), equal to the BENCHMARK PRICE for such
SELECTED REAGENT as that BENCHMARK PRICE is adjusted as provided for herein. For
the purposes hereof, BENCHMARK PRICE (at a scale of [***]kg or less) means [***]
DOLLARS per gram of the REAGENT [***] (2006 NEKTAR AL catalogue price is $[***]
per gram), and [***] DOLLARS per gram of the REAGENT [***])) (2006 NEKTAR AL
catalogue price is $[***] per gram); if a REAGENT other than [***] is being
considered for selection as a SELECTED REAGENT, prior to selection thereof,
NEKTAR AL shall provide to COMPANY the PURCHASE PRICE of such REAGENT. Prior to
selection of a REAGENT as a SELECTED REAGENT, NEKTAR AL shall disclose to
COMPANY any increase or decrease to the applicable BENCHMARK to reflect the cost
of raw materials for such REAGENT, any process changes related to such REAGENT
and any changes required by LAW. If such REAGENT is selected as the SELECTED
REAGENT such increased or decreased price shall be the PURCHASE PRICE for such
SELECTED REAGENT.
4.5.2 During the TERM hereof, COMPANY shall pay to NEKTAR AL the PURCHASE
PRICE for the supply of SELECTED REAGENT, which PURCHASE PRICE shall be adjusted
on an annual basis as follows: by November 1st during the TERM, the PURCHASE
PRICE will be:
(a) Increased for the following year by adding to the PURCHASE PRICE a
number obtained by multiplying the then-current PURCHASE PRICE by a
fraction, the
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numerator of which is the United States Department of Labor Producer
Price Index for Chemical Manufacturing Series ID: PCU325---325---
("PPI") in the month and year of the EFFECTIVE DATE subtracted from
the PPI in the month three (3) months prior to November 1st and the
denominator of which is the PPI in the month and year of the
EFFECTIVE DATE. If the numerator reflects an increase, the number
will be added to the PURCHASE PRICE; and
(b) increased or decreased for the following year to reflect the then
current forecasted cost of raw materials for such SELECTED REAGENT,
any process changes related to such SELECTED REAGENT, and any
changes required by applicable LAW; in each case to the extent not
covered by the change to PPI described in Section 4.5.2(a).
4.6 Delivery and Shipment; Title and Risk of Loss. NEKTAR AL shall deliver all
SELECTED REAGENT to COMPANY, and title to and risk of loss of each quantity of
SELECTED REAGENT so delivered shall pass to COMPANY Ex Works (Incoterms 2000)
NEKTAR AL's manufacturing or storage facilities. Such delivery shall constitute
a shipment hereunder. COMPANY shall pay all packaging, storage, shipping,
customs, duties, taxes, freight and insurance charges associated with shipments
of SELECTED REAGENT. All shipments shall be addressed to the destination
selected by COMPANY and set forth in the relevant purchase order. NEKTAR AL
shall send invoices to COMPANY for any SELECTED REAGENT shipped to COMPANY no
earlier than the date of shipment pursuant to this Section.
4.7 Acceptance and Rejection. COMPANY shall notify NEKTAR AL in writing if
COMPANY believes that a shipment of SELECTED REAGENT does not meet
specifications therefor that have been mutually agreed in writing by the PARTIES
("SPECIFICATIONS"). Such notice must be received by NEKTAR AL within [***] days
after COMPANY's receipt of the relevant shipment of SELECTED REAGENT (or [***]
days if the cycle time of tests require a longer period, such notice date to be
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determined upon selection of the SELECTED REAGENT), and shall include full
details of the basis for its assertion of such nonconformance (including
supporting data) for purposes of consideration and verification by NEKTAR AL. If
no such written notice of nonconformance is received by NEKTAR AL within the
above [***] day period, COMPANY shall be deemed to have accepted the applicable
shipment of SELECTED REAGENT, and NEKTAR AL shall thereafter have no liability
with respect to such delivered SELECTED REAGENT under the warranty or any other
provision of this AGREEMENT.
4.8 Replacement of Nonconforming SELECTED REAGENT. NEKTAR AL shall at no
additional cost to COMPANY, supply COMPANY with a replacement quantity of
SELECTED REAGENT in an amount equal to that which is determined not to meet the
SPECIFICATIONS (provided notice thereof is given to NEKTAR AL within the [***]
day period or longer, as applicable, specified in Section 4.7. Such replacement
shipment shall be made within a timeframe that has been mutually agreed to by
both PARTIES in writing, such agreement not to be unreasonably withheld or
delayed and which timeframe shall be no longer than the normal timeframe for
producing SELECTED REAGENT. In addition, NEKTAR AL shall replace, upon a
timeframe that is mutually agreed to by both PARTIES in writing (which time
period shall be no longer than the normal time for producing SELECTED REAGENT),
all SELECTED REAGENT that is lost or damaged during shipment at the cost and
expense of COMPANY, except if caused by NEKTAR AL, in which case, such
replacement shall be at the cost and expense of NEKTAR AL. Notwithstanding
anything to the contrary in this AGREEMENT, NEKTAR AL's sole liability and
COMPANY's sole remedy for any SELECTED REAGENT that does not meet the
SPECIFICATIONS, shall be limited to NEKTAR AL's replacement of such
nonconforming SELECTED REAGENT as provided for in this Section 4.8.
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4.9 Manufacturing and Supply Agreement. Upon selection of the SELECTED REAGENT,
the PARTIES shall commence good-faith negotiations of and enter into a
Manufacturing and Supply Agreement ("MSA") for SELECTED REAGENT to govern the
exclusive purchase of SELECTED REAGENT other than in connection with
pre-clinical or PHASE I CLINICAL TRIALS. Until such MSA is completed, the terms
and conditions of this AGREEMENT shall be applicable to the purchase of SELECTED
REAGENT by COMPANY from NEKTAR AL; provided that, pursuant to this Article 4,
NEKTAR AL shall have no obligation to supply SELECTED REAGENT for uses other
than for research, pre-clinical and PHASE I CLINICAL TRIALS. In the event that
the PARTIES are not able to reach agreement as to all of the terms of the MSA
within [***] days after initiating such negotiations, either PARTY shall have
the right to initiate an arbitration proceeding in accordance with Schedule VIII
in order to resolve the dispute as to the terms that have not been agreed to by
the PARTIES.
4.10 Warranty. NEKTAR AL hereby warrants and represents that all SELECTED
REAGENTS purchased by COMPANY from NEKTAR AL under this AGREEMENT shall conform
to the SPECIFICATIONS when delivered to COMPANY and will have been manufactured
for and delivered to COMPANY in accordance with applicable laws, rules and
regulations, and except for SELECTED REAGENTS to be used for preclinical use,
consistent with ICH Q7A.
4.11 Records; Audits. NEKTAR AL shall keep full and accurate records and books
of account containing all particulars that may be reasonably necessary for the
purpose of determining amounts that are charged to COMPANY pursuant to this
AGREEMENT are consistent with NEKTAR AL's standard current practices for
charging THIRD PARTIES for similar services for similar REAGENTS as those
provided by NEKTAR AL to COMPANY pursuant to this AGREEMENT. Such books of
account shall be kept by NEKTAR AL at its places of business and, with all
necessary supporting data shall, for the two (2) years following the end of the
calendar year to which each shall pertain be open for inspection by an
independent certified accountant selected by COMPANY and reasonably acceptable
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to NEKTAR AL upon reasonable notice during normal business hours for the sole
purpose of verifying that the amounts charged to COMPANY under this AGREEMENT
are consistent with NEKTAR AL's standard practices for charging THIRD PARTIES
for similar services for similar REAGENTS as those provided by NEKTAR AL to
COMPANY pursuant to this AGREEMENT. The foregoing inspection shall occur no more
than once each calendar year. All information and data offered shall be redacted
to protect any confidential information of the THIRD PARTY and shall be used
only for the purpose of verifying the consistency of amounts charged to COMPANY.
In the event that such inspection shall indicate in any calendar year that the
charges paid by COMPANY exceeded by [***] percent or more the charges (as
adjusted to reflect any increase in PPI) paid by THIRD PARTIES for similar
services for similar REAGENTS as those provided by NEKTAR AL to COMPANY pursuant
to this AGREEMENT, then NEKTAR AL shall pay the cost of the inspection. COMPANY
will invoice NEKTAR AL for any overpayments, which shall become due and payable
no later than [***] days after receipt of an invoice from COMPANY.
4.12 NEKTAR AL agrees that it will comply with the FAR and DFAR clauses of
Schedule VII of this Agreement (such clauses being incorporated herein in their
entirety). For the purposes of this AGREEMENT NEKTAR AL shall be considered the
"Contractor" and COMPANY shall be the "Government" under such clauses.
With respect to the inclusion of clauses 52.215 -- 2 and 52.215 -- 20, if as a
result of any government audit or inspection of NEKTAR AL's books or records
(including any contracts) under these clauses, the government determines that
the pricing of the SELECTED REAGENT and/or the SELECTED PRODUCT is too high
under this AGREEMENT, or that the government otherwise does not agree with
NEKTAR AL's methodology in determining the pricing of the SELECTED REAGENT under
this AGREEMENT, and the government wants NEKTAR AL to supply the SELECTED
REAGENT at a lower price than what has been agreed by NEKTAR AL and COMPANY in
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this AGREEMENT, or wants COMPANY to supply the SELECTED PRODUCT at a lower
price, or if the government decides not to purchase the SELECTED PRODUCT at all
from COMPANY because of the pricing of the SELECTED REAGENT under this
AGREEMENT, then NEKTAR AL shall have no liability whatsoever to COMPANY (other
than as contractually obligated under this AGREEMENT) or to the government as a
result thereof. Any kind of information that is required to be provided to the
government under such clauses would be provided by NEKTAR AL directly to the
government, and not to COMPANY as an intermediary.
If in connection with COMPANY's compliance with FAR 52.246-2 or similar
Inspection Clause, the government or an agency thereof requires access to NEKTAR
AL'S facilities where the SELECTED REAGENT is made, NEKTAR AL will provide
access to the government for such purpose provided that COMPANY bears the costs
and expenses of such access and inspection. Moreover if the government requires
that any samples of SELECTED REAGENT be provided to the government, NEKTAR AL
will agree to do so entirely at COMPANY's cost and expense. In the event that as
a result of any government inspection pursuant to such clause with respect to
NEKTAR AL'S manufacturing facility and or samples of SELECTED REAGENT, the
government requires any corrective actions on the part of NEKTAR AL or otherwise
finds the SELECTED REAGENT not to be acceptable, in each case for reasons other
than what NEKTAR AL is contractually obligated to provide to COMPANY under this
AGREEMENT, then NEKTAR AL, will take corrective action only if COMPANY agrees to
be solely responsible for all of the costs and expenses that may be required in
connection with such corrective actions, including any government re-inspection
of NEKTAR AL's facilities, or other steps that must be taken in order to meet
the government's requirements regarding the SELECTED REAGENT.
5. Milestones; Royalty Payments; Royalty Reports
5.1 Milestone Payments. COMPANY shall pay to NEKTAR AL milestone payments in
accordance with and on the dates provided in Schedule V hereto for SELECTED
PRODUCT. Such milestone payments shall be non-refundable and non-creditable, and
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in addition to any royalty or other payments due under this AGREEMENT. If for
whatever reason, Milestone Event A is not achieved then in such case, the
milestone payment that NEKTAR AL would have received upon the occurrence of
Milestone Event A shall be paid on the occurrence of any of the next occurring
Milestone Events B through E, which payment shall be paid in addition to and not
instead of the milestone payment that is to be paid to NEKTAR AL upon the
occurrence of any of the next occurring Milestone Events B through E.
5.2 Royalties.
5.2.1 During the ROYALTY TERM for a country, COMPANY shall pay NEKTAR AL
non-refundable and non-creditable royalties for sales of SELECTED PRODUCT on a
country-by-country basis as follows:
(a) For sales that are BIODEFENSE SALES, a royalty of [***] percent
([***]%) of NET SALES of SELECTED PRODUCT.
(b) For NET SALES of SELECTED PRODUCT other than those of Section
5.2.1(a):
Annual NET SALES Royalty Rate
(i) If aggregate, worldwide, NET SALES of ([***]%) of
SELECTED PRODUCT other than for BIODEFENSE NET SALES
SALES in a calendar year do not exceed $[***]
(ii) If aggregate, worldwide, NET SALES of ([***]%) of
SELECTED PRODUCT other than for BIODEFENSE NET SALES
SALES in a calendar year exceed $[***] but not
$[***]
(iii) If aggregate, worldwide, NET SALES of ([***]%) of
SELECTED PRODUCT other than for BIODEFENSE NET SALES
SALES in a calendar year exceed $[***]
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By way of example, for purposes of this Section 5.2.1(b) if aggregate,
worldwide NET SALES of SELECTED PRODUCT other than BIODEFENSE SALES during a
calendar year were equal to $[***], then the [***]% royalty rate would apply to
all such NET SALES, not just the portion in excess of $[***], resulting in a
royalty of $[***].
5.2.2 The royalties payable pursuant to Section 5.2.1 for NET SALES of
SELECTED PRODUCT sold in a country shall be reduced by [***] percent ([***]%) in
such country if manufacture, use, import, offer for sale and or sale of SELECTED
PRODUCT in such country does not infringe a VALID CLAIM in such country. In any
country where the royalty reduction of Section 5.2.2 is in effect, there shall
not be any further royalty reduction pursuant to Sections 5.2.3, 5.2.4 or
12.1.4.
5.2.3 [***]
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[***]
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[***]
5.2.4 [***]
5.2.5 Only one royalty shall be due under this AGREEMENT with respect to
the same unit of SELECTED PRODUCT.
5.2.6 Notwithstanding anything to the contrary in this AGREEMENT, in no
event shall the royalties paid by COMPANY for SELECTED PRODUCT be lower than the
following:
(a) For sales that are BIODEFENSE SALES, a royalty of [***] percent
([***]%) of NET SALES of SELECTED PRODUCT.
(b) For NET SALES of SELECTED PRODUCT other than those of Section
5.2.6(a):
Annual NET SALES Royalty Rate
(i) If aggregate, worldwide, NET SALES of ([***]%) of
SELECTED PRODUCT other than for BIODEFENSE NET SALES
SALES in a calendar year do not exceed $[***]
(ii) If aggregate, worldwide, NET SALES of ([***]%) of
SELECTED PRODUCT other than for BIODEFENSE NET SALES
SALES in a calendar year exceed $[***] but not
$[***]
(iii) If aggregate, worldwide, NET SALES of ([***]%) of
SELECTED PRODUCT other than for BIODEFENSE NET SALES
SALES in a calendar year exceed $[***]
5.3 Reports, Exchange Rates. COMPANY shall notify NEKTAR AL in writing promptly
upon the FIRST COMMERCIAL SALE of SELECTED PRODUCT in each country. Commencing
upon the FIRST COMMERCIAL SALE of SELECTED PRODUCT, COMPANY shall furnish to
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NEKTAR AL with respect to NET SALES of SELECTED PRODUCT for which royalties are
payable under this AGREEMENT a quarterly written report showing, on a
country-by-country basis, according to the volume of units of SELECTED PRODUCT
sold in each such country during the reporting period: (a) the gross invoiced
sales of the SELECTED PRODUCT subject to royalty sold in each country during the
reporting period, and the amounts deducted therefrom to determine NET SALES from
such gross invoiced sales detailed in accordance with those deductions provided
for in the definition of NET SALES; (b) the royalties payable in DOLLARS, if
any, which shall have accrued hereunder based upon the NET SALES of SELECTED
PRODUCT; (c) the withholding taxes, if any, required by LAW to be deducted in
respect of such sales; and (d) the date of the FIRST COMMERCIAL SALE of SELECTED
PRODUCT in each country during the reporting period. With respect to sales of
SELECTED PRODUCT invoiced in DOLLARS, the gross invoiced sales, NET SALES, and
royalties payable shall be expressed in the report in DOLLARS. With respect to
sales of SELECTED PRODUCT invoiced in a currency other than DOLLARS, the gross
invoiced sales, NET SALES and royalties payable shall be expressed in the report
provided hereunder in the domestic currency of the party making the sale as well
as in the DOLLAR equivalent of the royalty payable and the exchange rate used in
determining the amount of DOLLARS. The DOLLAR equivalent shall be calculated
using the average exchange rate (local currency per DOLLAR) published in The
Wall Street Journal, Western Edition, under the heading "Currency Trading," on
the last business day of each month during the applicable calendar quarter.
Reports shall be due hereunder on the thirtieth (30th) day following the close
of each quarter.
6. Records; Audits; Shipment Terms; Payment Terms
6.1 Records. COMPANY and its SUBLICENSEES shall keep complete and accurate
records in sufficient detail to make the reports required hereunder. Without
limiting the foregoing, COMPANY shall include in each sublicense granted by it
pursuant to this AGREEMENT a provision requiring the SUBLICENSEE to make reports
to COMPANY consistent with those COMPANY is required to provide hereunder, to
keep and maintain records of sales made and deductions taken in calculating
royalties due to NEKTAR AL with respect to such sublicense, and to grant access
to such records by NEKTAR AL's independent accountant pursuant to Section 6.2
below to the same extent required of COMPANY under this AGREEMENT.
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6.2 Audits. Upon reasonable advance written notice from NEKTAR AL, COMPANY shall
permit an independent certified public accounting firm of recognized national
standing in the United States, selected by NEKTAR AL and reasonably acceptable
to COMPANY, at NEKTAR AL's expense, to have access during normal business hours
to such of the records of COMPANY as may be reasonably necessary to verify (i)
COMPANY's compliance with the purchase requirements of Section 4.2 and the
royalty payments of Section 5.2, and (ii) the accuracy of any amounts reported,
actually paid or payable under this AGREEMENT for any year ending not more than
twenty-four (24) months prior to the date of such request. Such inspection shall
occur no more than once a year. If such accounting firm concludes that
additional royalty amounts were owed to NEKTAR AL during such period, or that
there has been an overpayment of royalties, COMPANY shall pay NEKTAR AL such
additional royalties or NEKTAR AL shall credit COMPANY the amount of such
overpayment (including interest on such additional royalties or overpayment at
the prime rate reported in the Wall Street Eastern Edition plus [***] percent
([***]%), compounded annually, or the maximum rate allowed under LAW, whichever
is less from the date such royalty amounts were payable) within [***] days of
the date NEKTAR AL delivers to COMPANY such accounting firm's written report so
concluding. The fees charged by such accounting firm shall be paid by NEKTAR AL;
provided however, that if the audit discloses that the royalties payable by
COMPANY for the audited period are more than [***] percent ([***]%) of the
royalties actually paid for such period or if the audit discloses that COMPANY
has breached its obligations under Section 4.2, then COMPANY shall pay the
reasonable fees and expenses charged by such accounting firm. Upon the
expiration of twenty-four (24) months following the end of any calendar year,
the calculation of royalties payable with respect to such calendar year shall be
binding and conclusive upon NEKTAR AL and COMPANY and its SUBLICENSEES.
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6.3 Invoicing; Payment Terms. All undisputed payments due under this AGREEMENT
(other than royalty and milestone payments) shall be due and payable thirty (30)
days from date of invoice but in no event later than any date otherwise
prescribed by this AGREEMENT. Royalties shown to have accrued to NEKTAR AL as
set forth in each royalty report to be provided under Section 5.3 shall be due
and payable on or before the date such royalty report is due. Any and all
amounts past due under this AGREEMENT shall bear interest at the prime rate
reported in the Wall Street Eastern Edition plus [***] percent ([***]%),
compounded annually, or the maximum rate allowed under LAW, whichever is less.
If there is a dispute between NEKTAR AL and COMPANY as to whether a royalty or
milestone is owed and/or the amount thereof, and such amount has not been
determined pursuant to an audit under Section 6.2, if COMPANY pays such amount,
such payment itself shall not limit the COMPANY's right to seek to recover such
payment including through a legal action provided that COMPANY notifies NEKTAR
in writing within thirty (30) days after the end of the quarter in which the
payment is made that the COMPANY has the right to recover such payment.
6.4 Payment Method. Except as otherwise provided for herein, all payments by
COMPANY under this AGREEMENT shall be paid in DOLLARS, and all such payments
shall be made by bank wire transfer in immediately available funds to such
account as NEKTAR AL shall designate before such payment is due. Upon the
election of NEKTAR AL made in writing not less than thirty (30) days prior to
any payment date, COMPANY shall pay all royalties owing to NEKTAR AL hereunder
in the currency in which such royalties accrued, without conversion into
DOLLARS. If at any time legal restrictions prevent the prompt remittance of part
or all royalties due with respect to sales of SELECTED PRODUCT in any country
where SELECTED PRODUCT is sold, payment shall be made through such lawful means
or methods as NEKTAR AL shall reasonably determine.
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6.5 Taxes. All royalty amounts due hereunder shall be paid with deduction for
withholding for any taxes or similar governmental charges imposed by a
jurisdiction other than the United States, and COMPANY shall provide NEKTAR AL
evidence of its payment of any such withholdings that may be required to claim a
credit against NEKTAR AL's United States tax liability.
7. Confidentiality
7.1 In General. For the TERM and for a period of ten (10) years thereafter, each
PARTY shall maintain in confidence all information and materials of the other
PARTY (including, but not limited to, KNOW-HOW and samples of THERAPEUTIC AGENT,
any NEKTAR AL MATERIALS, SELECTED REAGENT, and SELECTED PRODUCT) disclosed or
provided to it by the other PARTY and identified as confidential in writing or,
if disclosed verbally or by observation, summarized in writing and submitted to
RECIPIENT within thirty (30) days of the oral or visual disclosure thereof
(together with all embodiments thereof, the "CONFIDENTIAL INFORMATION").
CONFIDENTIAL INFORMATION may also include information regarding intellectual
property and confidential or proprietary information of THIRD PARTIES. In
addition, and notwithstanding the foregoing, INVENTIONS that, under Article 11
are to be owned by one PARTY, shall be deemed CONFIDENTIAL INFORMATION of such
PARTY and not the other PARTY, even if such INVENTIONS initially are generated
and disclosed by the other PARTY. The terms and conditions of this AGREEMENT and
the NON-DISCLOSURE AGREEMENT, also shall be deemed CONFIDENTIAL INFORMATION of
both PARTIES. Notwithstanding the foregoing, CONFIDENTIAL INFORMATION shall not
include that portion of information or materials that the RECIPIENT can
demonstrate by written documentation or other competent proof was (i) known to
the general public at the time of its disclosure to the RECIPIENT, or thereafter
became generally known to the general public, other than as a result of actions
or omissions of the RECIPIENT; (ii) known by the RECIPIENT prior to the date of
disclosure by the DISCLOSING PARTY; (iii) disclosed to the RECIPIENT on an
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unrestricted basis from a source unrelated to the DISCLOSING PARTY and not under
a duty of confidentiality to the DISCLOSING PARTY; or (iv) independently
developed by the RECIPIENT by personnel that did not have access to or use of
CONFIDENTIAL INFORMATION of the DISCLOSING PARTY.
Any combination of features or disclosures shall not be deemed to fall within
the foregoing exclusions merely because individual features are published or
known to the general public or in the rightful possession of the RECIPIENT
unless the combination itself and principle of operation thereof are published
or known to the general public or are in the rightful possession of the
RECIPIENT.
7.2 Additional Protections. Each PARTY shall take reasonable steps to maintain
the confidentiality of the CONFIDENTIAL INFORMATION of the other PARTY, which
steps shall be no less protective than those that such PARTY takes to protect
its own information and materials of a similar nature, but in no event less than
a reasonable degree of care. Neither PARTY shall use or permit the use of any
CONFIDENTIAL INFORMATION of the other PARTY except for the purposes of carrying
out its obligations or exercising its rights under this AGREEMENT. All
CONFIDENTIAL INFORMATION of a PARTY, including all copies thereof, is and shall
remain the sole and exclusive property of the DISCLOSING PARTY and subject to
the restrictions provided for herein. Neither PARTY shall disclose any
CONFIDENTIAL INFORMATION of the other PARTY other than to those of its
directors, officers, AFFILIATES, employees, licensors, independent contractors,
SUBLICENSEES, assignees, agents and external advisors directly concerned with
the carrying out of this AGREEMENT (in the case of COMPANY, subject to the
limitations and restrictions on disclosures to be made to potential and actual
CMOs and government agencies and entities hereunder); provided, however, that
any such disclosure is subject to written confidentiality and non-use
obligations no less protective than those provided herein. Other than as
expressly permitted herein, RECIPIENT may not use CONFIDENTIAL INFORMATION of
the other PARTY in applying for PATENTS or securing other intellectual property
rights.
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7.3 Permitted Disclosures. The obligations of Sections 7.1 and 7.2 shall not
apply to the extent RECIPIENT (a) is required to disclose information by LAW,
judicial order by a court of competent jurisdiction, or rules of a securities
exchange or requirement of a governmental agency (provided the RECIPIENT shall
provide prior written notice thereof to the DISCLOSING PARTY and sufficient
opportunity for the DISCLOSING PARTY to review and comment on such required
disclosure and request confidential treatment thereof or a protective order
therefor), or (b) discloses information to a patent office for the purposes of
filing or maintaining a PATENT APPLICATION or PATENT to the extent covering an
INVENTION assigned to a PARTY pursuant to Article 11 of this AGREEMENT, or (c)
discloses CONFIDENTIAL INFORMATION of NEKTAR AL (other than CONFIDENTIAL
INFORMATION of NEKTAR AL with respect to manufacture of SELECTED REAGENT) to a
government or agency thereof in order to obtain regulatory approval of SELECTED
PRODUCT and/or discloses CONFIDENTIAL INFORMATION of NEKTAR AL with respect to
production of SELECTED PRODUCT to a government or government agency pursuant to
a contract with a government or government agency related to research,
development or supply of SELECTED PRODUCT, provided that in each case COMPANY
requests confidential treatment thereof.
7.4 Publicity/Use of Names; Selected Transactions.
7.4.1 A PARTY may issue a press release relating to entry into this
AGREEMENT only if approved in advance, in writing, by the other PARTY. A PARTY
may issue subsequent press releases relating to this AGREEMENT, upon prior
written approval of the other PARTY, such approval not to be unreasonably
withheld or delayed; provided, however, that no approval of the other PARTY
shall be required if a subsequent press release or SEC filing solely discloses
any information that has previously been approved and disclosed as permitted by
this Section 7.4. Except as otherwise provided in this Section 7.4, neither
PARTY shall use the name, trademark, trade name or logo of the other PARTY or
its employees in any publicity or news release relating to this AGREEMENT or its
subject matter, without the prior express written permission of the other PARTY.
Neither PARTY shall publicly disclose the existence or terms of this AGREEMENT
pursuant to a press release or otherwise except as provided in this Article 7.
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7.4.2 Notwithstanding the terms of this Article 7, either PARTY shall be
permitted to disclose the existence and terms of this AGREEMENT to the extent
required, in the reasonable opinion of such PARTY'S legal counsel, to comply
with applicable laws, rules or regulations, including without limitation the
rules and regulations promulgated by the United States Securities and Exchange
Commission or any other governmental agency. Notwithstanding the foregoing,
before disclosing this AGREEMENT or any of the terms hereof pursuant to this
Section 7.4, the PARTIES will consult with one another on the terms of this
AGREEMENT for which confidential treatment will be sought in making any such
disclosure. If a PARTY wishes to disclose this AGREEMENT or any of the terms
hereof in accordance with this Section 7.4, such PARTY agrees, at its own
expense, to seek confidential treatment of the portions of this AGREEMENT or
such terms as may be reasonably requested by the other PARTY, provided that the
disclosing PARTY shall always be entitled to comply with legal requirements,
including without limitation the requirements of the SEC.
7.4.3 Either PARTY may also disclose the existence and terms of this
AGREEMENT in confidence to its attorneys and advisors, and to potential
acquirors (and their respective professional advisors), in connection with a
potential change of control and to existing and potential investors or lenders
of such PARTY, as a part of their due diligence investigations, or to potential
licensees and SUBLICENSEES or to permitted assignees and SUBLICENSEES in each
case under an agreement to keep the terms of this AGREEMENT confidential under
terms of confidentiality and non-use substantially similar to the terms
contained in this AGREEMENT and to use such CONFIDENTIAL INFORMATION solely for
the purpose permitted pursuant to this Section 7.4.3. A PARTY may disclose this
AGREEMENT to investment bankers in connection with a contemplated transaction
without an obligation of confidentiality provided that reasonable efforts are
exerted to obtain such obligation and that the PARTY wishing to make such
disclosure notifies the other PARTY in advance thereof.
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7.5 Notwithstanding the obligations in this Section 7.1 and 7.2, COMPANY may
disclose the CONFIDENTIAL INFORMATION of NEKTAR AL, if such disclosure is made
to governmental or other regulatory agencies in order to gain or maintain
approval to conduct clinical trials or to market SELECTED PRODUCT, but such
disclosure may be only to the extent reasonably necessary to obtain such
approvals or authorizations; or is deemed necessary by COMPANY to be disclosed
to SUBLICENSEES, AFFILIATES, agents, consultants, or other THIRD PARTIES for the
development or commercialization of SELECTED PRODUCT, or in connection with an
assignment of this AGREEMENT, a licensing transaction related to such SELECTED
PRODUCT(s) or loan, financing or investment or acquisition, merger,
consolidation or similar transaction (or for such entities to determine their
interest in performing such activities), in each case on the condition that any
THIRD PARTIES to whom such disclosures are made agree to be bound by
confidentiality and non-use obligations substantially similar to those contained
in this AGREEMENT. In the event a THIRD PARTY who receives CONFIDENTIAL
INFORMATION of NEKTAR AL from COMPANY breaches any of the obligations of
confidentiality in this Article 7, COMPANY agrees to enforce such provisions
against such THIRD PARTY and the failure to enforce such provisions shall be a
material breach as to which NEKTAR AL shall have the ability to terminate this
AGREEMENT under Section 13.2, provided that the cure period shall be limited to
thirty (30) days.
7.6 Irreparable Injury. The PARTIES acknowledge that either PARTY'S breach of
this Article 7 would cause the other PARTY irreparable injury for which it would
not have an adequate remedy at LAW. In the event of a breach, the nonbreaching
PARTY shall be entitled to seek injunctive relief in addition to any other
remedies it may have at LAW or in equity without necessity of posting a bond.
7.7 Return of CONFIDENTIAL INFORMATION. Each PARTY shall return or destroy all
CONFIDENTIAL INFORMATION of the other PARTY in its possession upon termination
or expiration of this AGREEMENT, except any CONFIDENTIAL INFORMATION that is
necessary to allow such PARTY to perform or enjoy any of its rights or
obligations that expressly survive the termination or expiration of this
AGREEMENT.
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8. Regulatory Matters
8.1 In General. Upon completion of the RESEARCH PROGRAM, as between the PARTIES,
COMPANY shall be responsible for the research, development, testing, use,
manufacture, transport, storage, disposal of, commercialization and marketing of
SELECTED PRODUCT and, except as specifically provided in this AGREEMENT, COMPANY
shall bear all costs of doing so. As authorized in writing in advance by
COMPANY, to the extent NEKTAR AL advances or incurs any of the costs
contemplated in the preceding sentence, COMPANY shall reimburse NEKTAR AL for
such costs within thirty (30) days after the date of any invoice therefor. Each
PARTY shall promptly notify the other in writing of any information that comes
to its attention concerning the safety or efficacy of SELECTED REAGENT and/or
SELECTED PRODUCT and/or any PEG and/or any product conjugated to a PEG,
including, without limitation, any threatened or pending action by any
regulatory authority with respect thereto.
8.2 Specific Requirements. Without limiting the generality of Section 8.1,
COMPANY shall learn and verify the hazards involved in using SELECTED REAGENT,
including the Material Safety Data Sheet ("MSDS") therefor. COMPANY shall comply
with safety instructions provided by NEKTAR AL. COMPANY shall warn COMPANY's
freight handlers, SUBLICENSEES, customers and others who reasonably might be
expected to come into contact with SELECTED REAGENT or SELECTED PRODUCT of any
risks involved in using or handling SELECTED REAGENT or SELECTED PRODUCT,
including providing them with the MSDS.
8.3 Complaints and Communications. COMPANY shall be responsible for handling all
complaints and communications (including with regulatory authorities) relating
to SELECTED PRODUCT. In addition to the foregoing, COMPANY shall promptly notify
NEKTAR AL and make NEKTAR AL aware of the nature of any communications with or
inspections by regulatory authorities relating to, or which could affect,
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SELECTED REAGENT, including any questions, complaints or comments ("INQUIRIES")
by regulatory authorities relating to or affecting SELECTED REAGENT. COMPANY
shall provide NEKTAR AL with copies of any correspondence with regulatory
authorities that relate to or could affect SELECTED REAGENT. COMPANY shall give
NEKTAR AL sufficient opportunity to review and comment on any proposed response
to any INQUIRIES prior to filing any such response, and shall give NEKTAR AL a
copy of any final response so filed.
8.4 Adverse Reaction Reporting. To the extent permitted by LAW, each PARTY shall
notify the other in writing of all information that comes to its attention
concerning serious adverse events relating to SELECTED REAGENT or SELECTED
PRODUCT. Such reports shall be provided to the other PARTY within forty-eight
(48) hours after receipt of the information in the case of any experience
coincident with the use of SELECTED REAGENT or SELECTED PRODUCT, whether or not
considered related to the SELECTED REAGENT or SELECTED PRODUCT, that suggests a
significant hazard, contraindication, side effect or precaution or results in
death, a life-threatening experience, inpatient hospitalization, prolongation of
an existing hospitalization, a persistent or significant disability or
incapacity, or a congenital anomaly or birth defect. Information concerning all
other serious adverse events not covered by the preceding sentence (including
those covered in summary reports that may be prepared annually by a PARTY
covering product complaints and complaint handling) shall be provided on a
semi-annual basis by each PARTY to the other.
9. Representations, Warranties; Covenants; Limitation of Liability
9.1 By Both PARTIES. Each PARTY represents and warrants to the other that as of
the EFFECTIVE DATE to the best of its knowledge and belief: (a) it has the full
corporate power to enter into and perform this AGREEMENT; (b) this AGREEMENT
constitutes its legal, valid and binding obligation; (c) it has sufficient legal
and/or beneficial title or other rights under its intellectual property rights
to grant the licenses contained in this AGREEMENT; (d) each of such PARTY'S
employees and officers has executed an agreement that requires such employee or
officer to the extent permitted by law, to assign all INVENTIONS, PATENTS, and
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KNOW-HOW made during the course of and as a result of the performance of such
PARTY'S obligations under this AGREEMENT, to such PARTY; and (e) each of such
PARTY'S employees and officers is subject to an executed agreement that requires
such employee or officer to maintain as confidential any information CONTROLLED
by such PARTY, or provided by the other PARTY, that is CONFIDENTIAL INFORMATION
under this AGREEMENT.
9.2 By NEKTAR AL.
9.2.1 As of the effective date of the license of Section 2.1, NEKTAR AL
shall represent and warrant to COMPANY that, to the knowledge of NEKTAR AL,
NEKTAR AL has not previously assigned, transferred, conveyed or otherwise
encumbered its right, title and interest in the NEKTAR AL PATENT RIGHTS, or the
NEKTAR AL KNOW-HOW, with respect to SELECTED PRODUCT in a manner that conflicts
and/or is inconsistent with the rights granted to COMPANY under this AGREEMENT.
9.2.2 NEKTAR AL agrees that if during the TERM, NEKTAR AL assigns to an
AFFILIATE any of the NEKTAR AL LICENSED TECHNOLOGY that is subject to the
license grant provided for in Section 2.1 or Section 3.4 of this AGREEMENT, then
COMPANY's license under such NEKTAR AL LICENSED TECHNOLOGY shall follow such
assignment and COMPANY's license under such NEKTAR AL LICENSED TECHNOLOGY will
not, as a result of such assignment, be diminished or impaired.
9.2.3 As of the effective date of the license of Section 2.1, NEKTAR AL
shall represent and warrant to COMPANY that to the knowledge of NEKTAR AL except
for PATENTS AND PATENT APPLICATIONS licensed to COMPANY under Section 2.1,
AFFILIATES of NEKTAR AL do not own any PATENTS or PATENT APPLICATIONS that if
owned by NEKTAR AL as of such effective date would be NEKTAR AL PATENT RIGHTS
licensed to COMPANY under 2.1 of the AGREEMENT.
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9.3 Exclusion of Damages.
9.3.1 EXCEPT FOR INTENTIONAL OR WILLFUL MISCONDUCT, AND EXCEPT FOR
INTENTIONAL OR WILLFUL MATERIAL BREACH AS TO WHICH COMPANY HAS KNOWLEDGE AND HAS
PROVIDED WRITTEN NOTICE THEREOF TO NEKTAR AL WITHIN FIVE (5) DAYS OF SUCH
KNOWLEDGE: (i) IN NO EVENT SHALL NEKTAR AL's LIABILITY ARISING OUT OF THE
DEVELOPMENT, MANUFACTURE, SUPPLY, USE OR SALE OF SELECTED REAGENT OR SELECTED
PRODUCT, EXCEED NEKTAR AL's OBLIGATION TO REPLACE THAT QUANTITY OF SELECTED
REAGENT GIVING RISE TO THE LIABILITY, AND (ii) IN NO EVENT SHALL NEKTAR AL's
LIABILITY ARISING OUT OF THIS AGREEMENT, EXCEED IN THE AGGREGATE, AN AMOUNT THAT
IS EQUAL TO THE TOTAL AMOUNT PAID BY COMPANY UNDER THE RESEARCH PLAN. THE
FOREGOING LIMITATION ON NEKTAR AL'S LIABILITY SHALL NOT APPLY WITH RESPECT TO
THE AMOUNT OF ANY OVERPAYMENT OF ROYALTIES OR MILESTONES BY COMPANY TO NEKTAR AL
HEREUNDER, PROVIDED SUCH OVERPAYMENT IS (X) NOTIFIED IN WRITING BY COMPANY TO
NEKTAR AL PROMPTLY AFTER SUCH OVERPAYMENT IS DISCOVERED BY COMPANY, BUT IN NO
EVENT LATER THAN 30 DAYS AFTER THE QUARTER IN WHICH SUCH OVERPAYMENT WAS MADE,
OR (Y) REVEALED BY AN AUDIT AS PROVIDED FOR UNDER SECTION 6.2. IN THE EVENT OF
SUCH OVERPAYMENT, NEKTAR AL SHALL CREDIT COMPANY WITH RESPECT TO FUTURE PAYMENTS
OWED BY COMPANY TO NEKTAR AL HEREUNDER, TO THE EXTENT OF SUCH OVERPAYMENT
9.3.2 NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR SPECIAL,
INDIRECT, INCIDENTAL, PUNITIVE OR CONSEQUENTIAL DAMAGES (INCLUDING WITHOUT
LIMITATION, DAMAGES RESULTING FROM LOSS OF USE, LOSS OF PROFITS, INTERRUPTION OR
LOSS OF BUSINESS OR OTHER ECONOMIC LOSS) ARISING OUT OF THIS AGREEMENT OR WITH
RESPECT TO A PARTY'S PERFORMANCE OR NON-PERFORMANCE HEREUNDER.
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9.3.3 Nothing in this Article 9 shall limit COMPANY's and/or NEKTAR AL'S
indemnification obligation under Article 10 or recovery of damages for breach of
Article 7 or COMPANY's indemnification under Section 3.4.2 or Section 12.1.2.
9.4 Essential Basis. The limitation of liability and exclusion of damages under
this AGREEMENT: (i) apply even if a PARTY had or should have had knowledge,
actual or constructive, of the possibility of such damages; (ii) are a
fundamental element of the basis of the bargain between the PARTIES and this
AGREEMENT would not be entered into without such limitations and exclusions and
(iii) shall apply whether a claim is based on breach of contract, breach of
warranty, tort (including negligence), product liability, strict liability or
otherwise, and notwithstanding any failure of essential purpose of any limited
remedy herein. Moreover, the exclusive remedies under this AGREEMENT are
intended to be exclusive and the limitations of liability and the exclusion of
damages under this AGREEMENT are intended to apply even if there is a total and
fundamental breach of this AGREEMENT, and the essential purpose of these
provisions is to limit the PARTIES' respective liabilities hereunder.
9.5 Covenant. COMPANY agrees that COMPANY will not use government funds to pay
for work performed by NEKTAR AL (a) under the RESEARCH PROGRAM or (b) with
respect to the development of the manufacturing process by NEKTAR AL pursuant to
Section 4.1 of this AGREEMENT, in either case, unless NEKTAR AL provides its
prior written consent to the use of such government funds or monies for such
purpose. COMPANY may use government funds (i) to purchase SELECTED REAGENT from
NEKTAR AL under this AGREEMENT and/or (ii) to manufacture and sell SELECTED
PRODUCT to the government, which SELECTED PRODUCT includes SELECTED REAGENT
obtained from NEKTAR AL, and/or (ii) to pay NEKTAR AL for transfer of NEKTAR AL
KNOW-HOW pursuant to Section 3.4.1 and 3.4.3 of this AGREEMENT. COMPANY may
provide the government with the necessary information and data with respect to
manufacture of SELECTED PRODUCT, provided that such use of government funds
and/or the providing of such information and data does not breach the covenant
of COMPANY set forth in the first sentence of this Section and provided further
that COMPANY seek confidential treatment of any such information and data
provided to the government.
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COMPANY covenants and agrees that the COMPANY will not grant any rights or
licenses under this AGREEMENT to a THIRD PARTY, including, without limitation,
any agency of the U.S. federal government other than as permitted by this
AGREEMENT and/or as may be permitted by the MSA. Except as provided in the MSA,
COMPANY may not authorize, or purport to authorize, the government (or any THIRD
PARTY) to manufacture SELECTED REAGENT and/or to use, practice or otherwise
exploit any intellectual property of NEKTAR AL for manufacture of SELECTED
REAGENTS.
10. Indemnification; Insurance
10.1 Indemnity.
10.1.1 By NEKTAR AL. NEKTAR AL shall defend, indemnify and hold COMPANY,
COMPANY's AFFILIATES, COMPANY SUBLICENSEES and their respective shareholders,
directors, officers, employees and agents (each, a "COMPANY INDEMNITEE")
harmless from and against all losses, liabilities, damages, costs and expenses
(including reasonable attorney's fees and costs of investigation and litigation,
regardless of outcome) resulting from all claims, demands, actions and other
proceedings by or on behalf of any THIRD PARTY (including any governmental
authority) (collectively, "CLAIMS") to the extent arising from: (a) the breach
of any representation, warranty (other than any warranty that SELECTED REAGENT
conforms to SPECIFICATIONS), covenant or material obligation of NEKTAR AL under
this AGREEMENT; or (b) the gross negligence, recklessness or willful misconduct
of NEKTAR AL in the performance of its obligations under this AGREEMENT, or (c)
any CLAIMS brought by an employee or contractor of NEKTAR AL, for personal
injury or death or damage to property caused directly and proximately by such
employee's or contractor's performance of the manufacture of SELECTED REAGENT
for NEKTAR AL under this AGREEMENT, or (d) any CLAIMS brought by a THIRD PARTY
for personal injury or death or damage to property, which personal injury, death
or damage occurs as a direct and proximate result of an accident occurring at
the facility of NEKTAR AL where the manufacture of SELECTED REAGENT is carried
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out under this AGREEMENT, except in each case (i) to the extent such claim,
demand, action or proceeding arises from COMPANY's material breach of this
AGREEMENT or a breach of any representation or warranty of COMPANY under this
AGREEMENT, or the gross negligence, recklessness or willful misconduct of a
COMPANY INDEMNITEE; or (ii) to the extent that COMPANY is obligated to indemnify
NEKTAR AL under Section 10.1.2.
10.1.2 By COMPANY. Subject to the limitations and exclusions set forth in
Section 9.3, COMPANY shall defend, indemnify and hold NEKTAR AL, NEKTAR AL
AFFILIATES, and their respective shareholders, directors, officers, employees
and agents (each, a "NEKTAR AL INDEMNITEE") harmless from and against all
losses, liabilities, damages, costs and expenses (including reasonable
attorney's fees and costs of investigation and litigation, regardless of
outcome) resulting from all CLAIMS to the extent arising from: (a) the breach of
any representation, warranty, covenant or material obligation of COMPANY under
this AGREEMENT; (b) the development (including without limitation the conduct of
clinical trials), manufacturing, testing, storage, handling, transportation,
disposal, commercialization (including any recalls, field corrections or market
withdrawals), marketing, distribution, promotion, sale or use of SELECTED
PRODUCT by or for COMPANY or its SUBLICENSEES or any of their respective THIRD
PARTY agents or subcontractors (including as a result of any illness, injury or
death to persons, including employees, agents or contractors of COMPANY or its
SUBLICENSEES, or damage to property); or (c) the gross negligence, recklessness
or willful misconduct of COMPANY or its SUBLICENSEES or any of their respective
THIRD PARTY agents or subcontractors in the performance of its or their
obligations under this AGREEMENT, except in each case (i) to the extent such
claim, demand, action or proceeding arises from NEKTAR AL's material breach of
this AGREEMENT or the gross negligence, recklessness or willful misconduct of a
NEKTAR AL INDEMNITEE and/or (ii) to the extent that NEKTAR AL is obligated to
indemnify COMPANY under Section 10.1.1.
10.2 Procedures. If any CLAIM covered by Section 10.1 is brought: (i) the
indemnified PARTY shall promptly notify the indemnifying PARTY in writing of
such CLAIM, (ii) the indemnifying PARTY shall assume, at its cost and expense,
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the sole defense of such CLAIM through counsel selected by the indemnifying
PARTY and reasonably acceptable to the other PARTY, except that those
indemnified may at their option and expense select and be represented by
separate counsel; provided that the indemnifying PARTY shall have the sole right
to control such defense; (iii) the indemnifying PARTY shall maintain control of
such defense and/or the settlement of such CLAIM; (iv) those indemnified may, at
their option and expense, participate in such defense, and if they so
participate, the indemnifying PARTY and those indemnified shall cooperate with
one another in such defense, provided that the indemnifying PARTY shall have the
sole right to control such defense; (v) the indemnifying PARTY will have
authority to consent to the entry of any judgment, to enter into any settlement
or otherwise to dispose of such CLAIM, and (vi) an indemnified PARTY may not
consent to the entry of any judgment, enter into any settlement or otherwise to
dispose of such CLAIM or admit liability with respect thereto without the prior
written consent of the indemnifying PARTY.
10.3 Insurance. COMPANY, at its own expense, shall maintain comprehensive
general liability insurance, including product liability insurance, in the
minimum amount of [***] DOLLARS ($[***]) per occurrence, and [***] DOLLARS
($[***]) in the aggregate, with NEKTAR AL named as an additional insured,
provided however that such aggregate shall be increased to [***] dollars
($[***]) when SELECTED PRODUCT is used in a human. Such policies shall include a
provision that NEKTAR AL shall be given [***] days written notice prior to
cancellation or material change in such a policy, except in the case of
non-payment, which shall require at least [***] days notice. The insurance
carriers must be rated A-, VII or better by A.M. Best Company. COMPANY shall
maintain such insurance for so long as it continues to research or develop or
commercialize SELECTED PRODUCT, and shall from time to time provide copies of
certificates of such insurance to NEKTAR AL upon its request. If the insurance
policy is written on a claims-made basis than the coverage must be kept in place
for at least [***] years after the termination of this AGREEMENT.
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11. INVENTIONS, KNOW-HOW and PATENTS
11.1 Existing Intellectual Property. Other than as expressly provided in this
AGREEMENT, neither PARTY grants nor shall be deemed to grant any right, title or
interest to the other PARTY in any PATENT, PATENT APPLICATION, KNOW-HOW or other
intellectual property right CONTROLLED by such PARTY as of the EFFECTIVE DATE.
11.2 Disclosure. Each PARTY shall promptly disclose in writing to the other all
INVENTIONS arising from the joint or separate activities (including any
INVENTIONS first made, conceived or first reduced to practice as a result of
such activities) of the PARTIES or their employees, agents, independent
contractors or SUBLICENSEES; provided, however, NEKTAR AL shall not be obligated
to disclose a SOLE INVENTION to the extent such SOLE INVENTION falls outside the
scope of COMPANY CORE TECHNOLOGY owned by COMPANY and that COMPANY shall not be
obligated to disclose a SOLE INVENTION to the extent such SOLE INVENTION falls
outside the scope of NEKTAR AL CORE TECHNOLOGY owned by NEKTAR AL.
11.3 Ownership of INVENTIONS. Except as otherwise set forth in Sections 11.4 or
11.5, all INVENTIONS made solely by employees, agents, independent contactors or
SUBLICENSEES of a PARTY (each, a "SOLE INVENTION") shall be the exclusive
property of such PARTY. Except as otherwise set forth in Sections 11.4 or 11.5,
if employees, agents, independent contractors or SUBLICENSEES of each of NEKTAR
AL and COMPANY jointly develop any INVENTION (each, a "JOINT INVENTION"),
COMPANY and NEKTAR AL shall each own an undivided one-half (1/2) interest in and
to such JOINT INVENTION, and, subject to the exclusive licenses granted to
COMPANY under this AGREEMENT, each PARTY shall have the right to freely exploit
and grant licenses under any such JOINT INVENTION and any PATENT claiming such
JOINT INVENTION without consent of or a duty of accounting to the other PARTY.
For the avoidance of doubt, the determination as to whether an INVENTION has
been "solely" or "jointly" made shall be based upon whether employees, agents,
independent contractors or SUBLICENSEES of a PARTY would be or are properly
named as an inventor on a corresponding PATENT APPLICATION under United States
inventorship laws.
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11.4 NEKTAR AL CORE TECHNOLOGY INVENTIONS. Any and all rights, title and
interest in and to all SOLE INVENTIONS and JOINT INVENTIONS which fall within
the scope of NEKTAR AL CORE TECHNOLOGY that are potentially patentable and/or as
to which a patent application has been filed shall belong solely to NEKTAR AL
("NEKTAR AL CORE TECHNOLOGY INVENTIONS"). COMPANY hereby agrees to and hereby
does, and shall, without additional consideration transfer and assign to NEKTAR
AL all of its right, title and interest in and to such NEKTAR AL CORE TECHNOLOGY
INVENTIONS and all intellectual property rights therein including enforcement
rights, and, except for a government or government agency, shall require its
employees, agents, independent contractors and SUBLICENSEES to so transfer and
assign their right, title and interest therein to NEKTAR AL. NEKTAR AL shall be
responsible, at its sole expense and discretion, and with the cooperation of
COMPANY, for the filing, prosecution and maintenance of foreign and domestic
PATENT APPLICATIONS and PATENTS covering such NEKTAR AL CORE TECHNOLOGY
INVENTIONS. Any disputes arising from the foregoing or under Section 11.5 as to
ownership shall be presented to the MANAGING COMMITTEE for discussion and
resolution, provided neither PARTY shall have the right of final determination
with respect to such dispute. In the event the MANAGING COMMITTEE cannot agree
on the foregoing, either PARTY may seek remedy in accordance with Schedule VIII.
11.5 COMPANY CORE TECHNOLOGY INVENTIONS. Any and all rights, title and interest
in and to all SOLE INVENTIONS and JOINT INVENTIONS which fall within the scope
of COMPANY CORE TECHNOLOGY that are potentially patentable and/or as to which a
patent application has been filed shall belong solely to COMPANY ("COMPANY CORE
TECHNOLOGY INVENTIONS"). NEKTAR AL hereby agrees to and hereby does, and shall,
without additional consideration transfer and assign to COMPANY all of its
right, title and interest in and to any COMPANY CORE TECHNOLOGY INVENTIONS and
all intellectual property rights therein including enforcement rights, and shall
require its employees, agents, independent contractors to so transfer and assign
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their right, title and interest therein to COMPANY. COMPANY shall be
responsible, at its sole expense and discretion, and with the cooperation of
NEKTAR AL if requested by COMPANY, for the filing, prosecution and maintenance
of foreign and domestic PATENT APPLICATIONS and PATENTS covering such COMPANY
CORE TECHNOLOGY INVENTIONS.
11.6 Individual PATENT Filings. Each PARTY shall have sole discretion and right
to prepare, file, prosecute, maintain and defend PATENT APPLICATIONS or PATENTS
for INVENTIONS it solely owns under this AGREEMENT, and shall be responsible for
related interference proceedings.
11.7 Joint PATENT Filings. With respect to all PATENT APPLICATIONS on JOINT
INVENTIONS that are jointly owned by the PARTIES (i.e., JOINT INVENTIONS that
have not been assigned nor are assignable to the other PARTY pursuant to
Sections 11.4 and 11.5) (the "JOINT PATENT APPLICATIONS"), the PARTIES shall
determine which PARTY shall be responsible for filing, prosecuting and
maintaining PATENT APPLICATIONS and PATENTS on behalf of both PARTIES (the
"RESPONSIBLE PARTY") based on a good faith determination of the relative
contributions of the PARTIES to the INVENTION and the relative interests of the
PARTIES in the INVENTION. At least twenty (20) days prior to the contemplated
filing of such PATENT APPLICATION, the RESPONSIBLE PARTY shall submit a
substantially completed draft of the JOINT PATENT APPLICATION to the other PARTY
for its approval, which shall not be unreasonably withheld or delayed. Except as
set forth below, the PARTIES shall share equally the costs of the preparation,
filing, prosecution and maintenance of all JOINT PATENT APPLICATIONS. If either
PARTY elects not to pay its portion of any shared costs for a JOINT PATENT
APPLICATION or PATENT issuing therefrom, the other PARTY may proceed with such
JOINT PATENT APPLICATION in its own name and at its sole expense, in which case
the PARTY electing not to pay its share of costs hereby agrees to transfer and
assign and shall transfer and assign its entire right, title and interest in and
to such JOINT PATENT APPLICATION to the other PARTY and such INVENTION shall be
treated as a SOLE INVENTION of the assignee for the purposes hereof.
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11.8 The PARTIES recognize and agree that this Agreement is a "joint research
agreement" under 35 U.S.C. 103(c)(3). The PARTIES further agree to cooperate to
avail themselves and each other of the provisions of said section 35 U.S.C.
103(c) amended through the CREATE Act on December 10. 2004.
12. Infringement
12.1 Infringement of THIRD PARTY Rights.
12.1.1 Notice. If the development, manufacture, use, import, sale or offer
for sale of SELECTED PRODUCT or SELECTED REAGENT results in a claim for PATENT
infringement by a THIRD PARTY, the PARTY to this AGREEMENT first having notice
shall promptly notify the other PARTY in writing. The notice shall set forth the
facts of the claim in reasonable detail.
12.1.2 Indemnification by COMPANY. Except to the limited extent provided
for in Section 12.1.3, COMPANY shall defend, indemnify and hold harmless each
NEKTAR AL INDEMNITEE from and against all losses, liabilities, damages, costs
and expenses (including reasonable attorney's fees and costs of investigation
and litigation, regardless of outcome) resulting from any claim that the
development, manufacture, use, import, offer for sale or sale of SELECTED
PRODUCT infringes a THIRD PARTY patent or misappropriates THIRD PARTY KNOW-HOW,
and the provisions of Sections 10.1.2 and 10.3 shall apply with respect to any
such claim to the same extent as though it were a CLAIM for which COMPANY has an
obligation to defend, indemnify and defend NEKTAR AL under Section 10.1.2. In
the event of a conflict between the provisions of Article 10 and this Section
12.1.2, the provisions of this Section 12.1.2 shall govern. NEKTAR AL shall
cooperate with COMPANY at COMPANY's request and expense in such defense, and
shall have the right to be represented by counsel of its own choice, at NEKTAR
AL's expense.
12.1.3 Limitation on Indemnity by COMPANY. COMPANY's obligations under
Section 12.1.2 shall not apply to the extent that (a) any infringement of a
THIRD PARTY PATENT or misappropriation of THIRD PARTY KNOW -HOW results solely
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from the composition of matter or the manufacture of SELECTED REAGENT, or (b)
the synthetic and/or analytical methods for the SELECTED PRODUCT at the
laboratory scale used in the RESEARCH PROGRAM, which are transferred by NEKTAR
AL to COMPANY pursuant to Section 3.4.1(ii), have been misappropriated by NEKTAR
AL from a THIRD PARTY. Nothing in this Section 12.1.3 shall be deemed to limit
COMPANY's obligations set forth in Section 3.4.2.
12.1.4 Third Party Royalties. If either PARTY is required to pay royalties
or any other payments to a THIRD PARTY because the composition of matter or
method of making of the SELECTED REAGENT contained in the SELECTED PRODUCT
infringes a PATENT of a THIRD PARTY in a particular country, then COMPANY shall
pay such THIRD PARTY any royalties or other payments for a license under such
PATENT necessary to use, manufacture, import, sell or offer for sale such
SELECTED PRODUCT in such country. In the event that payment of such THIRD PARTY
royalties in accordance with this Section 12.1.4 causes the total royalty
payable by COMPANY to exceed the ORIGINAL ROYALTY cap, or any REVISED ROYALTY
CAP, as applicable, then the terms of Sections 5.2.3 or 5.2.4 shall apply.
12.1.5 Freedom to Operate Determination. Promptly after the selection of
the SELECTED REAGENT, NEKTAR AL will provide to COMPANY any information,
including any freedom to operate studies, then in NEKTAR AL's possession,
relating to composition of matter or method of manufacturing the SELECTED
REAGENT, and following COMPANY's receipt of such information but in no event
later than 30 days following such receipt, COMPANY shall notify NEKTAR AL in
writing whether or not COMPANY shall proceed with the use of such SELECTED
REAGENT and along with such notification, shall provide to NEKTAR AL any and all
freedom to operate studies that COMPANY may have conducted with respect to such
SELECTED REAGENT, in each case, only after entering into a joint defense
agreement or other agreement sufficient to preserve any privilege (including the
attorney client privilege) held by either PARTY.
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12.2 Infringement By THIRD PARTIES.
12.2.1 Notice of Infringement. If any VALID CLAIM is infringed by a THIRD
PARTY, or any NETKTAR AL KNOW-HOW utilized in the manufacture, use, import or
sale of SELECTED REAGENT or SELECTED PRODUCT is misappropriated by a THIRD
PARTY, the PARTY first having knowledge of such infringement or misappropriation
shall promptly notify the other PARTY in writing. The notice shall set forth the
facts of such infringement or misappropriation in reasonable detail.
12.2.2 Prosecution of Actions Relating to SELECTED REAGENT.
(a) NEKTAR AL shall have the primary right, but not the
obligation, to institute, prosecute and control any action or
proceeding with respect to any infringement of a VALID CLAIM
or misappropriation of NEKTAR AL KNOW-HOW by reason of a THIRD
PARTY'S manufacture, use, import, offer for sale or sale of
SELECTED REAGENT using counsel of its own choice, at its own
expense. COMPANY shall cooperate with NEKTAR AL at NEKTAR AL's
request and expense in the prosecution of such action or
proceeding. If NEKTAR AL determines that COMPANY is an
indispensable PARTY to the action, COMPANY hereby consents to
be joined. In such event, COMPANY shall have the right to be
represented in that action by its own counsel and at its own
expense.
(b) If NEKTAR AL fails to bring an action or proceeding within a
period of sixty (60) days after receiving written notice from
COMPANY or otherwise having knowledge of such infringement or
misappropriation by reason of a THIRD PARTY'S manufacture,
use, import, offer for sale or sale of SELECTED REAGENT,
COMPANY shall have the right to bring and control any such
action using counsel of its own choice, and at its own
expense. If COMPANY determines that NEKTAR AL is an
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indispensable PARTY to the action, NEKTAR AL hereby consents
to be joined. In such event, NEKTAR AL shall have the right to
be represented in such action by its own counsel at its own
expense. No settlement, consent judgment or other voluntary
final disposition of a suit under this Section 12.2.2 may be
entered into without the joint consent of COMPANY and NEKTAR
AL (which consent shall not be withheld or delayed
unreasonably).
(c) If either PARTY brings an action for infringement or
misappropriation by a THIRD PARTY under this Section 12.2.2,
any damages or other monetary awards or payments in settlement
recovered by such PARTY shall be applied first to defray the
costs and expenses incurred by both PARTIES in the action. If
NEKTAR AL has brought the action, any remainder shall be
retained by NEKTAR AL. If COMPANY has brought the action, any
remainder shall be retained by COMPANY, except to the extent
that damages are based on lost sales of COMPANY, in which
event such amounts shall be deemed NET SALES and subject to
the payment of royalties under this AGREEMENT.
12.2.3 Prosecution of Actions Related to SELECTED PRODUCT.
(a) Subject to NEKTAR AL's right under Section 12.2.2, COMPANY
shall have the primary right, but not the obligation, to
institute, prosecute and control any action or proceeding with
respect to any infringement of NEKTAR AL PATENT RIGHTS or
misappropriation of NEKTAR AL KNOW -HOW by reason of a THIRD
PARTY'S manufacture, use, import, offer for sale or sale of
SELECTED PRODUCT, using counsel of its own choice, at its own
expense. NEKTAR AL shall cooperate with COMPANY at COMPANY's
request and expense in the prosecution of such action or
proceeding. If COMPANY reasonably determines that NEKTAR AL is
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an indispensable PARTY to the action, NEKTAR AL hereby
consents to be joined. In such event, NEKTAR AL shall have the
right to be represented in that action by its own counsel and
at its own expense.
(b) If COMPANY fails to bring an action or proceeding within a
period of sixty (60) days after receiving written notice from
NEKTAR AL of the possibility of a claim, or otherwise having
knowledge of a claim described in Section 12.2.3(a), NEKTAR AL
shall have the right, but not the obligation, to bring and
control any such action using counsel of its own choice, at
its own expense. If NEKTAR AL determines that COMPANY is an
indispensable PARTY to the action, COMPANY hereby consents to
be joined. In such event, COMPANY shall have the right to be
represented in such action using counsel of its own choice, at
its own expense. No settlement, consent judgment or other
voluntary final disposition of a suit under this Section
12.2.3(b) may be entered into without the joint consent of
NEKTAR AL and COMPANY (which consent shall not be withheld
unreasonably).
(c) If either PARTY brings an action for infringement or
misappropriation by a THIRD PARTY under this Section 12.2.3
any damages or other monetary awards or payments in settlement
recovered by such PARTY shall be applied first to defray the
costs and expenses incurred by both PARTIES in the action. Any
remainder shall be retained by the PARTY bringing such action,
provided that if the remainder is retained by COMPANY, such
remainder shall be treated as NET SALES subject to royalty
under this AGREEMENT.
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13. Term and Termination
13.1 Expiration. The term of this AGREEMENT (the "TERM") shall commence on the
EFFECTIVE DATE and shall expire on a country-by-country basis upon the
expiration of all royalty obligations in the applicable country, unless earlier
terminated as provided herein.
13.2 Termination for Default. Each PARTY shall have the right to terminate this
AGREEMENT for material breach by the other PARTY by providing written notice to
the other PARTY, which notice shall specify the breach and notify the other
PARTY that this AGREEMENT will be terminated if such breach is not cured. If the
material breach is a payment breach and such payment is not made within [***]
days of such notice or if the material breach is other than a payment breach,
and such material breach is not cured in [***] days, then this AGREEMENT shall
be terminated at the end of such [***] day period.
13.3 Voluntary Termination. COMPANY has the right within its sole discretion to
terminate this AGREEMENT by [***] days prior written notice to NEKTAR AL.
13.4 Effect of Termination.
13.4.1 The provisions of Sections 2.4, 3.5, 4.11 (with respect to amounts
charged prior to termination), 6.1 - 6.5 (as to accrued amounts), 9.3, 9.4,
12.1.2, 12.1.3, 13.4, 17.1 - 17.8, and 17.10 - 17.12 and 17.14 and Articles 7,
8, 10, and 11 (and in each case together with any defined terms applicable to
such provisions) shall survive termination of this AGREEMENT for any reason
whatsoever.
13.4.2 Notwithstanding anything in this AGREEMENT to the contrary, if this
AGREEMENT is terminated for any reason whatsoever:
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(a) COMPANY shall have the right to use or sell SELECTED PRODUCTS
on hand on the date of such termination and to complete
SELECTED PRODUCTS in the process of manufacture at the time of
such termination and use or sell the same as if licensed under
this AGREEMENT for a period of [***] months, provided that
COMPANY shall submit the applicable royalty report, along with
the royalty payments required by this AGREEMENT; provided that
COMPANY's right to use or sell SELECTED PRODUCTS pursuant to
this subsection (a) shall be at the discretion of NEKTAR AL if
the AGREEMENT is terminated by NEKTAR AL for material breach
of COMPANY; and
(b) COMPANY shall continue to be obligated to purchase and shall
purchase SELECTED REAGENT manufactured pursuant to any issued
purchase orders pursuant to Article 4, and any SELECTED
REAGENT so manufactured shall be invoiced to COMPANY in full
and paid by COMPANY in accordance with the terms of this
AGREEMENT; and
(c) COMPANY shall be responsible for all unavoidable authorized
costs and expenses, including arising out of those activities
that would reasonably have been required by NEKTAR AL in order
to meet COMPANY's requirements of SELECTED REAGENT, except if
this AGREEMENT is terminated by COMPANY for material breach by
NEKTAR AL; and,
(d) COMPANY shall pay NEKTAR AL all accrued milestone payments and
accrued royalties in accordance with the terms of this
AGREEMENT.
13.4.3 Subject to Section 13.4.2, if this AGREEMENT is terminated for any
reason whatsoever, any licenses granted under this AGREEMENT shall automatically
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terminate and all licensed rights shall revert in their entirety to the
respective licensor and all obligations of each PARTY shall terminate except
those that survive under Section 13.4.1. Subject to the limitations of liability
and exclusions of damages provided for herein, termination of this AGREEMENT by
a PARTY shall not be an exclusive remedy and all other remedies will be
available to the terminating PARTY, in equity and at LAW.
14. Governance
14.1 MANAGING COMMITTEE.
(i) To facilitate communication between the PARTIES during the
RESEARCH PROGRAM, the PARTIES shall appoint a MANAGING COMMITTEE consisting of
two (2) representatives from each of NEKTAR AL and COMPANY. The initial
representatives are set forth on Schedule VI hereto. Each PARTY may replace its
representatives on the MANAGING COMMITTEE by prior written notice to the other
PARTY. The MANAGING COMMITTEE shall have such responsibilities as set forth
herein and as the PARTIES may agree from time to time. The MANAGING COMMITTEE
shall supervise the activities of the RESEARCH COMMITTEE; resolve issues
referred by members of the RESEARCH COMMITTEE; make strategic decisions related
to research and development activities in connection with the SELECTED PRODUCT
and review the progress of research and development activities in connection
with the SELECTED PRODUCT. The MANAGING COMMITTEE shall meet at such times and
places, in person or by telephone conferencing or other electronic
communication, as it shall determine to carry out its responsibilities;
provided, that a meeting of the MANAGING COMMITTEE shall take place no later
than thirty (30) days after the EFFECTIVE DATE.
(ii) The MANAGING COMMITTEE shall operate by consensus with
representatives of NEKTAR AL having one (1) collective vote and representatives
of COMPANY having one (1) collective vote. If a dispute arises or there is not a
unanimous vote regarding matters within the scope of responsibilities of the
MANAGING COMMITTEE, and the MANAGING COMMITTEE fails to reach a consensus on its
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resolution within thirty (30) days of when the dispute was presented to the
MANAGING COMMITTEE or when a unanimous vote is not obtained, then the dispute
shall be referred to the senior management representatives of each PARTY. If
such senior management representatives fail to agree, then (a) NEKTAR AL shall
have the right to resolve the dispute and/or cast the deciding vote on matters
pertaining to (i) the choice of REAGENTS used in the PLAN but not the selection
of a SELECTED REAGENT and (ii) after selection of a SELECTED REAGENT, the
development and/or manufacture of the SELECTED REAGENT, and (b) COMPANY shall
have the right to resolve the dispute and/or cast the deciding vote on all other
matters, provided that resolution or decision does not require NEKTAR AL to
allocate financial or personnel resources or manufacturing capacity not already
provided for in the PLAN in effect at that time.
14.2 RESEARCH COMMITTEE. The MANAGING COMMITTEE shall appoint a RESEARCH
COMMITTEE to plan and manage the research and development activities to be
conducted in connection with the SELECTED PRODUCT pursuant to the RESEARCH
PROGRAM and to facilitate communication on research and development issues
between the PARTIES. Implementation of the RESEARCH PROGRAM and other day-to-day
research and development activities shall be managed by the RESEARCH COMMITTEE,
subject to oversight by the MANAGING COMMITTEE. The RESEARCH COMMITTEE shall be
comprised of appropriate representatives of both PARTIES, and shall meet no less
frequently than once a month in person or by teleconference as agreed upon by
the PARTIES. Each PARTY shall appoint a RESEARCH PROGRAM team leader (and other
key contacts, as necessary) to serve as principal RESEARCH COMMITTEE liaisons
for the PARTIES. Employees of each PARTY who are not on the RESEARCH COMMITTEE
may attend meetings of the RESEARCH COMMITTEE, as required to further the
research and development of the SELECTED PRODUCT. The RESEARCH COMMITTEE shall
operate by consensus with representatives of NEKTAR AL having one (1) collective
vote and representatives of COMPANY having one (1) collective vote. Any
disagreements between the PARTIES' representatives at the RESEARCH COMMITTEE
level shall be referred to the MANAGING COMMITTEE. Members of the RESEARCH
COMMITTEE will be notified by each PARTY to the other PARTY within twenty (20)
days after the EFFECTIVE DATE.
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14.3 Notwithstanding anything to the contrary herein, neither the MANAGING
COMMITTEE nor the RESEARCH COMMITTEE shall have the right or power to amend the
terms of this AGREEMENT or waive rights or obligations of the PARTIES hereunder,
or take any action that would conflict with any provision of this AGREEMENT.
15. Assignment
(a) Unless otherwise expressly permitted hereunder, neither PARTY may
assign any of its rights or delegate any of its duties under this AGREEMENT
without the prior written consent of the other PARTY, except that either PARTY
may assign its rights and responsibilities hereunder without the other PARTY'S
consent as part of: (i) either (a) the sale of all or substantially all of the
assets or the entire business to which this AGREEMENT relates or (b) a merger,
consolidation, reorganization or other combination with or into another person
or entity; or (ii) the transfer or assignment to an AFFILIATE, in each case,
pursuant to which the surviving entity or assignee assumes the assigning or
merging PARTY'S obligations hereunder. Any assignment made in violation of this
Article 15 shall be null and void.
(b) NEKTAR AL shall not assign or transfer PATENTS licensed to COMPANY
under this AGREEMENT without making such assignment or transfer subject to the
licenses granted under this AGREEMENT.
16. Notices
Any notice or other communication or payment herein required or permitted to be
given shall be deemed sufficient if and when personally delivered in writing or
if and when given by United States registered or certified mail, postage
prepaid, return receipt requested, properly addressed to the respective
addresses of the PARTIES as written below. Notices so given shall be effective
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upon the earlier to occur of (i) receipt by the PARTY to which notice is given,
or (ii) the fourth (4th) business day following the date such notice was posted,
whichever occurs first.
If to COMPANY, addressed to:
PharmAthene, Inc.
000 Xxxxxxx Xxxxxxxx Xxxxx, Xxxxx 000,
Xxxxxxxxx, XX 00000
Attention: CEO
If to NEKTAR AL, addressed to:
NEKTAR Therapeutics AL, Corporation
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: Contract Management
With a copy to:
Nektar Therapeutics
000 Xxxxxxxxxx Xxxx
Xxx Xxxxxx, XX 00000-0000
Attention: Vice President, Corporate Legal
17. Miscellaneous
17.1 Force Majeure. Neither PARTY shall be held liable or responsible to the
other PARTY nor be deemed to have defaulted under or breached this AGREEMENT for
failure or delay in fulfilling or performing any term of this AGREEMENT to the
extent, and for so long as, such failure or delay is caused by or results from
causes beyond the reasonable control of the affected PARTY; provided, however,
that the foregoing shall not be applied to excuse or delay any payment
obligation of COMPANY under this AGREEMENT.
17.2 Severability. If any one or more of the provisions contained in this
AGREEMENT is held invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby, unless the absence
of the invalidated provision(s) adversely affects the substantive rights of the
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PARTIES. The PARTIES shall in such an instance use their best efforts to replace
the invalid, illegal or unenforceable provision(s) with valid, legal and
enforceable provision(s) which, insofar as practical, implement the purposes of
this AGREEMENT.
17.3 Variation. This AGREEMENT may not be amended, varied or modified in any
manner except by an instrument in writing signed by a duly authorized officer or
representative of each PARTY hereto.
17.4 Forbearance and Waiver. No waiver by a PARTY in respect of any breach shall
operate as a waiver in respect of any subsequent breach. No forbearance, failure
or delay by a PARTY in exercising any right or remedy shall operate as a waiver
thereof, nor shall any single or partial forbearance, exercise or waiver of any
right or remedy prejudice its further exercise of any right or remedy under this
AGREEMENT or at LAW.
17.5 Counterparts. This AGREEMENT may be executed in more than one counterpart,
each of which constitutes an original and all of which together shall constitute
one enforceable agreement.
17.6 No Partnership. The relationship of the PARTIES is that of independent
contractors and this AGREEMENT shall not operate so as to create a partnership
or joint venture of any kind between the PARTIES.
17.7 Construction. The PARTIES have participated jointly in the negotiation and
drafting of this AGREEMENT. In the event that an ambiguity or question of intent
or interpretation arises, this AGREEMENT shall be construed as if drafted
jointly by the PARTIES and no presumption or burden of proof shall arise
favoring or disfavoring any PARTY by virtue of the authorship of any of the
provisions of this AGREEMENT. Except where the context otherwise requires, where
used, the singular shall include the plural, the plural the singular, the use of
any gender shall be applicable to all genders and the word "or" is used in the
inclusive sense (and/or). The captions of this AGREEMENT are for convenience of
reference only and in no way define, describe, extend or limit the scope or
intent of this AGREEMENT or the intent of any provision contained in this
AGREEMENT. The term "including" as used herein means including the generality of
any description preceding such term.
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17.8 Entire Agreement. This AGREEMENT and the Schedules attached hereto
constitute the entire understanding between the PARTIES and supersedes any prior
or contemporaneous written or oral understanding, negotiations or agreements
between and among them respecting the subject matter hereof. This AGREEMENT
shall be binding upon, and inure to the benefit of, the PARTIES and their
respective successors and assigns.
17.9 Patent Marking and SELECTED PRODUCT Marking. COMPANY shall place
appropriate NEKTAR AL patent and/or patent pending markings on SELECTED PRODUCT
or the packaging therefor provided that NEKTAR AL provides to COMPANY the
identity of such patents and the SELECTED PRODUCT and country for which marking
is applicable. The content, form, size, location and language of such markings
shall be in accordance with the laws, regulations, and practices of the country
in which the applicable units of SELECTED PRODUCT is distributed. In the event
that COMPANY believes that such marking is not in accordance with applicable
law, rules or regulations, COMPANY shall inform NEKTAR AL and COMPANY shall not
be required to xxxx the SELECTED PRODUCT unless COMPANY is indemnified by NEKTAR
AL in writing with respect to any and all losses that may arise from such
marking. COMPANY shall be responsible for all packaging (non-commercial and
commercial) and labeling of SELECTED PRODUCT. To the extent allowed by the
applicable laws and regulations, all SELECTED PRODUCT labeling, packaging and
package inserts and any promotional materials associated with SELECTED PRODUCT
shall carry, in a conspicuous location, the trademark of NEKTAR AL, the identity
and style of which shall be selected by NEKTAR AL in its sole discretion,
provided that such identity and style is reasonably acceptable to COMPANY.
NEKTAR AL authorizes the use of its trademark pursuant to this Section 17.9.
17.10 Governing Law. All questions of inventorship will be determined in
accordance with U.S. patent laws. In respect to all other PATENT rights, the
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rights of the PARTIES will be governed by the laws of the jurisdiction in which
the applicable PATENT is filed or granted. In all other respects, this AGREEMENT
shall be governed by and construed in accordance with the laws of the State of
Delaware without regard to its choice of law rules that would require
application of the law of another jurisdiction.
17.11 Termination of NON-DISCLOSURE AGREEMENT. All provisions of, rights granted
and covenants made in the NON-DISCLOSURE AGREEMENT are hereby terminated and of
no further force and effect and are superseded in their entirety by the
provisions of, rights granted and covenants made in this AGREEMENT. The PARTIES
acknowledge and agree that any disclosure made pursuant to the NON-DISCLOSURE
AGREEMENT shall be governed by the terms and conditions of Article 7.
17.12 Compliance with Laws. COMPANY will comply with all LAWS in performing its
obligations and exercising its rights hereunder, and NEKTAR AL will comply with
all United States laws in performing its obligations and exercising its rights
hereunder. Nothing in this AGREEMENT shall be deemed to permit COMPANY or its
SUBLICENSEES to export, re-export or otherwise transfer any information or
materials (including NEKTAR AL MATERIALS and SELECTED REAGENT) transferred
hereunder or SELECTED PRODUCT manufactured therefrom without complying with
LAWS.
17.13 Section 365(n) of the Bankruptcy Code. All rights and licenses granted
under or pursuant to this AGREEMENT by one PARTY to the other PARTY are, for all
purposes of Section 365(n) of Title 11, U.S. Code (the "BANKRUPTCY CODE"),
licenses of rights to "intellectual property" as defined in the BANKRUPTCY CODE.
As a licensee of such rights under this AGREEMENT, a PARTY shall retain and may
fully exercise all of its rights and elections under the BANKRUPTCY CODE. If a
BANKRUPTCY CODE case is commenced by or against a PARTY (the "BANKRUPTCY PARTY")
and this AGREEMENT is rejected as provided in the BANKRUPTCY CODE and the
BANKRUPTCY PARTY elects to retain its rights hereunder as provided in the
BANKRUPTCY CODE, then the BANKRUPTCY PARTY (in any capacity, including
debtor-in-possession) and its successors and assigns (including, without
limitation, a BANKRUPTCY CODE trustee) shall take such steps as are necessary to
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permit the other PARTY to exercise its rights under this AGREEMENT. All rights,
powers and remedies of the non-BANKRUPTCY PARTY provided under this provision
are in addition to and not in substitution for any and all other rights, powers
and remedies now or hereafter existing at law or in equity (including, without
limitation, the BANKRUPTCY CODE) in the event of any such commencement of a
bankruptcy proceeding by or against a BANKRUPTCY PARTY.
17.14 Export Restrictions. NEKTAR AL acknowledges and understands that the
CONFIDENTIAL INFORMATION supplied by COMPANY with respect to this AGREEMENT are
subject to the export control and sanctions laws and regulations of the United
States and other applicable countries, including without limitation, the
International Traffic in Arms Regulations, the Foreign Assets Control
Regulations, and the Export Administration Regulations. Diversion contrary to
United States and other laws is strictly prohibited. COMPANY will comply with
all applicable laws and regulations and shall ensure, at its sole expense, that
such CONFIDENTIAL INFORMATION are maintained, used disclosed, and transferred in
accordance with United States and other applicable laws and regulations,
including without limitation any restrictions on disclosures to non-United
States persons, export license requirements, or reporting requirements.
Signature Page to Follow
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IN WITNESS WHEREOF, the PARTIES hereto have caused their authorized
representatives to execute this AGREEMENT by signing below:
Signed:
For and on behalf of: For and on behalf of:
NEKTAR Therapeutics AL, Corporation PharmAthene, Inc.
Signature Signature
/s/ Xxxxxxxx X. Xxxxxx /s/ Xxxxxxx Xxxxxxxxxx
---------------------------------- ----------------------------------
Name: Xxxxxxxx X. Xxxxxx Name: Xxxxxxx Xxxxxxxxxx
Title: V.P., Business Development Title: V.P., Operations
Signature Page for Research and License Agreement
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