Exhibit (C)2
RESEARCH ALLIANCE AGREEMENT
THIS AGREEMENT, effective this 6th day of August, 1997
("Effective Date"), by and between E. I. du Pont de Nemours and
Company, a corporation of the State of Delaware having a
principal business address at 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000 ("DUPONT") and Pioneer Hi-Bred International,
Inc., a corporation of the State of Iowa having a principal
business address at 000 Xxxxxxx Xxxxxx, 000 Xxxxxx Xxxxxx, Xxx
Xxxxxx, Xxxx 00000 ("PIONEER").
WITNESSETH:
WHEREAS, the parties have developed complementary expertise,
technology and know-how concerning quality grain traits,
agronomic traits, industrial use traits, genomics and enabling
technologies for developing seed, grain, grain products, plant
materials and other crop improvement products and desire to
collaborate in order to realize significant synergies for the
benefit of both parties in a research alliance ("Research
Alliance") and to speed the discovery of new developments in
corn, soybean and other selected oilseeds, genetics and crop
improvement, both in agronomic traits and quality traits, and in
industrial uses and in grain, grain products and plant materials
that have unique end-use functionality;
WHEREAS, the parties have formed a jointly owned, commercial
joint venture ("Venture") in accordance with a Formation
Agreement executed herewith that will take advantage of the
complementary skills and resources, and through such synergies
create value for quality trait seed, grain, grain products and
plant material with beneficial end-use functionality delivered
through corn, soybean and other selected oilseeds to enable the
parties to speed new discoveries and their development for the
market, and to maximize their business opportunity in such
developments; and
WHEREAS, it is the desire of the parties to form the
Research Alliance between themselves with the primary goal to
take advantage of opportunities for synergy which will speed new
discoveries and support the business objectives of the Venture in
the area of quality trait seed, grain, grain products and plant
material in corn, soybean and other selected oilseeds.
Secondarily, the Research Alliance will support each party's core
business in these crops.
NOW, THEREFORE, the parties agree as follows:
ARTICLE I
DEFINITIONS
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A. "Field of Interest" means corn, soybean and other
selected oilseed crops.
B. "Field of Agricultural Research" means improvement of
economically important quality seed, grain, grain products or
plant material traits and agronomic and industrial traits in the
Field of Interest. The improvements may result from, but are not
limited to, plant breeding, genetics, genomics research, gene
discovery, gene expression and regulation technology, grain
traits, transformation, gene targeting, enabling technology,
industrial traits, agronomic traits, molecular markers,
bioinformatics, analytical chemistry, and crop production
chemical technology including technology related to the
interaction of chemicals with genes and gene products.
C. "Venture Products" means seed, grain, grain products
and plant material in the Field of Interest that embodies a trait
or traits that results in modifications of plant or grain
composition or its attributes (excluding silage that does not
include such a trait) that have value to end-users of grain,
grain products, or plant materials and that commands a value in
the market which is capable of being captured.
D. "PIONEER Product" means planting seed or plants in the
Field of Interest that embody a trait or traits that impact crop
yield potential or the realization of yield potential.
E. "DUPONT Crop Production Product" means any chemical or
biological substance or microorganism or technology related to
the interaction of chemicals with genes and gene products that
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beneficially protects, modifies, regulates or controls crop
growth or development when applied to the soil, seed, or plant in
the Field of Interest.
F. "DUPONT Industrial Product" means raw materials,
intermediates, proteins, molecules or chemicals for use in non-
agricultural markets including biochemical catalysts (enzymes and
microorganisms), chemicals for industrial, pharmaceutical and
consumer applications, and polymer intermediates, polymer and
fibers for applications typical of DUPONT's coatings and
industrial businesses.
G. "Other Product" means any product other than those
defined above in C, D, E, or F.
H. "Collaborative Effort" means research and development
undertaken by the parties based upon mutually agreed upon product
targets, timelines, strategies, division of responsibilities,
allocation of resources, and funding.
I. "Affiliate" means:
(1) Any corporation owning or directly or indirectly
controlling at least fifty percent (50%) of the stock normally
entitled to vote for election of directors of a party; and
(2) Any corporation owned or directly or indirectly
controlled by a party, or by a corporation defined by
subparagraph (1) above through ownership of at least fifty
percent(50%) of stock normally entitled to vote for election of
directors.
J. "Independent Effort" means research and development
conducted by either of the parties independently of the
Collaborative Effort, either prior to or after the Effective
Date.
K. "PIONEER Proprietary Property" means all existing or
future PIONEER know-how, trade secrets, proprietary processes,
formulae, PIONEER sourced germplasm, patents, patent
applications, plant variety protection certificates, inventions,
and rights in licenses or sublicenses owned by PIONEER or its
Affiliates applicable within the Field of Interest developed
through Independent Effort which it has the right to convey.
L. "DUPONT Proprietary Property" means all existing or
future DUPONT know-how, trade secrets, proprietary processes,
formulae, DUPONT sourced germplasm, patents, patent applications,
plant variety protection certificates, inventions, and rights in
licenses or sublicenses owned by DUPONT or its Affiliates
applicable within the Field of Interest developed through
Independent Effort which it has the right to convey.
M. "Confidential Information" means any and all
proprietary information (including without limitation,
information related to technical, business and Intellectual
Property matters), know-how, data, Intellectual Property, trade
secrets, and germplasm and biological and other physical
materials owned or held by either party to this Agreement, now
and in the future, which such party maintains as confidential.
N. "Intellectual Property" means all germplasm and
industrial and intellectual property rights including, but not
limited to, patents, patent applications, patent rights, plant
variety protection certificates, inventions, trade secrets, know-
how, trademarks, service marks, brand names, trade names,
copyrights, licenses, sublicenses and proprietary processes and
formulae and all regulatory registrations/approvals or
applications for registration of any of the foregoing.
O. "Joint Intellectual Property" means Intellectual
Property developed as the result of a Collaborative Effort.
P. "Commingled Germplasm" means germplasm in the Field of
Interest containing a Venture Product trait or traits descending
from crossing PIONEER-sourced germplasm and DUPONT-sourced
germplasm, or the introduction of a gene or genes for a Venture
Product trait from one party into the germplasm of the other.
ARTICLE II
General Purpose
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A. The parties agree to form a Research Alliance to speed
the discovery and development of new beneficial agronomic,
quality, industrial, and crop production traits, and optimize
research efforts and share expertise, technology and know-how in
the Field of Agricultural Research to benefit primarily the
Venture and secondarily PIONEER and DUPONT. The role and
management of the Research Alliance will evolve; however, at a
minimum the Research Alliance will be organized and managed to:
(1) ensure that the research needs of the Venture are
met through the discovery and development of
Venture Products in a timely way;
(2) operate in a way that allows the research
organizations of both parties to capitalize on
their respective scientific competencies,
strengths, and resources;
(3) assign portions of the Collaborative Effort so as
to reduce inefficiencies;
(4) support the core businesses of the parties in
PIONEER Products for PIONEER and DUPONT Crop
Production Products and DUPONT Industrial Products
for DUPONT;
(5) develop and implement state of the art
technologies in genomics, transformation, gene
targeting, gene regulation, and gene expression
for Venture Products, PIONEER Products, DUPONT
Crop Production Products and DUPONT Industrial
Products;
(6) develop technologies to enable plant scientists to
be more efficient in managing and exploiting corn,
soybean, and selected oilseed germplasm bases to
improve selections therefrom;
(7) develop strategies to protect Joint Intellectual
Property thereby protecting the investments of
both parties;
(8) identify and use new technologies in the
Collaborative Efforts.
ARTICLE III
Management of Research Alliance
-------------------------------
A. Management of the Research Alliance shall be the
responsibility of a Research Board that will oversee the
coordination and execution of all Collaborative Efforts conducted
in accordance herewith. The Research Board shall be composed of
two representatives from each party, with each party having one
vote on issues as appropriate, plus a representative of the
Venture, who shall be non-voting until such time that the Venture
contributes at least 50% of the total funding of all
Collaborative Efforts after which the Venture shall have one
vote.
B. A seven person Research Committee shall be formed and
will be composed of three representatives from each party, one of
whom will also be a Research Board member of said party, and the
person representing the Venture on the Research Board. The
Research Committee will report to the Research Board and be
responsible for detailed management of all Collaborative Efforts.
C. Each party and the Venture may replace any of its
designated Research Board or Research Committee members as it may
desire at its sole discretion.
D. The Research Board shall have the following powers and
duties:
(1) Ensure that each Collaborative Effort is
prioritized, sufficiently resourced and focused to
maximize the value realized by the parties through
the Venture;
(2) Approve initiation of new Collaborative Efforts
and the assignment of responsibilities of each
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party under such programs based upon input and
recommendations of the Research Committee;
(3) Make decisions to continue or terminate
Collaborative Efforts based upon input and
recommendations of the Research Committee
including, without limitation, rescinding any
Collaborative Effort or any part of any
Collaborative Effort;
(4) Make all decisions regarding significant changes
in resources and funding to ensure a balanced,
efficient effort between the parties;
(5) Identify opportunities for collaboration between
parties.
E. All decisions by the Research Board will require
unanimity.
F. Since decisions of the Research Board have the
potential for significant impact on the success of the Venture,
every effort to evaluate the options for major decisions shall be
made and shared among the parties and the Venture. The Research
Board shall meet frequently, but in no event less than once in
each calendar quarter. Minutes of each meeting shall be kept and
promptly circulated to each of the parties.
G. The Research Committee shall have the following powers
and duties:
(1) Appoint research teams ("Research Teams") to
efficiently and effectively implement each
Collaborative Effort which include representatives
of the parties and the Venture as appropriate;
(2) Define and evaluate (i) the objective of each
Collaborative Effort, (ii) the technical
challenges and chance of success of each
Collaborative Effort, (iii) timelines of
Collaborative Efforts, (iv) the responsibility of
each party under each Collaborative Effort, and
(v) the resources needed to pursue and complete
each Collaborative Effort;
(3) Recommend to the Research Board the initiation of
a new Collaborative Effort and the
responsibilities of each party;
(4) Provide regular reports to the Research Board
addressing progress against budget, technical
goals, and significant developments and issues
under the Collaborative Effort;
(5) Recommend to the Research Board the continuation
or termination of any Collaborative Effort;
(6) Organize and empower a sub-committee on
intellectual property and licensing relating to
Collaborative Efforts to review, evaluate and
recommend to the Research Committee the need for
any third party technology and patent rights to
complete any Collaborative Effort, and to the
extent possible, the Independent Efforts of and
party in the Field of Interest;
(7) Oversee and assess technical developments and
progress against objectives of each Collaborative
Effort.
ARTICLE IV
Collaborative Efforts
---------------------
A. To ensure the business success of the Venture, the
parties will conduct Collaborative Efforts presently contemplated in the
following areas:
(1) Oils
(2) Carbohydrates
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(3) Protein and amino acids
(4) Other quality grain traits
(5) Crop yield
(6) Crop production traits
(7) Industrial traits
(8) Genomics
(9) Transformation and gene targeting
(10) Gene expression and evaluation
(11) Trait functionality
(12) Energy availability and nutritional quality
(13) Phosphate availability
Detailed planning of any Collaborative Effort in said areas and
the assignment of responsibilities to each party for certain
points of each Collaborative Effort will be concluded as soon as
possible following execution of this Research Alliance Agreement.
B. Either party or the Venture at any time can request an
evaluation to initiate a new Collaborative Effort, provided that
such potential new Collaborative Effort can be reasonably
completed on or before the expiration of this Agreement, as
determined by the Research Board. The request will be made to
the Research Board which will instruct the Research Committee to
define and evaluate all aspects of the proposed Collaborative
Effort and recommend to the Board: (i) where the program should
be conducted; (ii) the budget and resources needed; (iii) the
probability of technical success; (iv) the anticipated
development schedule; (v) critical decision points and milestones
along the development schedule; and (vi) an estimated time frame
for completing the effort.
Based on the recommendations of the Research Committee, the
Research Board will approve or reject such Collaborative Effort
or resubmit the effort to the Research Committee with suggested
revisions for reevaluation.
C. The Research Team assigned for a particular
Collaborative Effort by the Research Committee will recommend
which party should be responsible for specific parts of any
Collaborative Effort based on the technical capabilities of the
parties. The Research Team's recommendation will be presented to
the Research Committee for review. Once a Collaborative Effort
has been approved by the Research Board, each party will then be
committed to perform its part of such Collaborative Effort within
the levels of effort approved by the Research Board. If it is
later determined that such Collaborative Effort requires
substantial additional resources in excess of initial
expectations, then approval of the Research Board will be needed
before additional resources are committed.
D. Unless the Research Board decides to drop or defer a
Collaborative Effort or part of an effort each party will use
best efforts to perform any material part of any Collaborative
Effort. Failure to use best efforts (after notice from the other
party and a ninety (90) day cure period, or such period
established by the Research Board) will result in a material
breach of this Agreement.
E. In the event that substantial additional resources
(substantially in excess of the resources initially anticipated
by the Research Committee) need to be devoted by a party to
complete a specific part of a Collaborative Effort, then the
Research Board will be responsible for resolving any inequities
that may result from the extra effort.
ARTICLE V
Grant of Rights to Conduct Research
-----------------------------------
A. PIONEER hereby grants to DUPONT, to the extent it has
the authority and ability to do so, a worldwide, nonexclusive,
nontransferable royalty free license to PIONEER Proprietary
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Property solely for the purpose of, and solely to the extent
necessary for DUPONT to conduct its research activities under
Collaborative Efforts and Independent Efforts in the Field of
Interest.
X. XXXXXX hereby grants to PIONEER, to the extent it has
the authority and ability to do so, a worldwide, nonexclusive,
nontransferable royalty free license to DUPONT Proprietary
Property solely for the purpose of, and solely to the extent
necessary for PIONEER to conduct its research activities under
Collaborative Efforts and Independent Efforts in the Field of
Interest.
ARTICLE VI
Funding and Efforts
-------------------
A. Each party shall fund its own efforts under each
Collaborative Effort approved and assigned by the Research Board;
provided however, that the Research Board shall attempt, if
possible, to balance the resources and funding provided by each
party so that there will be approximately an equal contribution
by each party to the funding of the sum total of all
Collaborative Efforts. An annual review of the total funding of
each party to each Collaborative Effort shall be made by the
Research Board to determine the equality of funding based on the
level of effort by each of the parties. It is anticipated that
in the future, the Venture will assist in funding all or a
significant portion of any Collaborative Effort relating to
Venture Products as determined in the sole discretion of the
Venture Board (as defined in the Formation Agreement).
B. The Research Board will review and consider the level
of funding that each party undertakes toward all Collaborative
Efforts. Although the parties recognize that there may be a
reallocation and change in focus of their research efforts as a
result of the Research Alliance, the parties agree that their
current levels of research spending and effort for Venture
Product traits will be maintained or increased.
ARTICLE VII
Ownership and Licensing of
Intellectual Property and Proprietary Property
----------------------------------------------
A. The parties will promptly inform the Research Committee
of any ideas or improvements, including any potentially
patentable inventions, arising from any ongoing research under
any Collaborative Effort, and make a reasonable effort to
disclose to the Research Committee proprietary property from
Independent Efforts wherein said proprietary property is
potentially applicable to DUPONT Crop Production Products, DUPONT
Industrial Products, PIONEER Products or Venture Products.
B. All Joint Intellectual Property shall be jointly owned
by the parties. In those instances where the Venture has
contributed 50% or more of the funding to such Collaborative
Effort, the Venture shall be a joint owner of such Intellectual
Property. Any Intellectual Property resulting from an
Independent Effort by either party shall be owned by the party
that developed it. Any Intellectual Property independently
developed by the Venture, or the development of which was fully
funded by the Venture shall be owned solely by the Venture.
C. The classification of the rights in Joint Intellectual
Property or PIONEER Proprietary Property or DUPONT Proprietary
Property to establish which party possesses the right to make,
have made, use or sell product for various commercial
applications shall be carried out using the following sequential
queries:
(1). Is the Joint Intellectual Property or
PIONEER Proprietary Property or DUPONT Proprietary
Property to be exploited or value captured through a
DUPONT Crop Production Product? If yes, DUPONT
possesses the commercial application. If no, proceed
to (2.);
(2). Is the Joint Intellectual Property or
PIONEER Proprietary Property or DUPONT Proprietary
Property to be exploited or value captured through a
DUPONT Industrial Product? If yes, DUPONT possesses
the commercial application. If no, proceed to (3.);
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(3). Is the Joint Intellectual Property or
PIONEER Proprietary Property or DUPONT Proprietary
Property to be exploited or value captured through a
Venture Product? If yes, the Venture possesses the
commercial application. If no, proceed to (4.);
(4). Is the Joint Intellectual Property or
PIONEER Proprietary Property or DUPONT Proprietary
Property to be exploited or value captured through a
PIONEER Product? If yes, PIONEER possesses the
commercial application. If no, proceed to (5.);
(5). The Joint Intellectual Property or PIONEER
Proprietary Property or DUPONT Proprietary Property to
be exploited or value captured is Other Product.
D. Each party shall grant to the Venture an irrevocable,
exclusive, worldwide and royalty free license to make, use or
sell Venture Products, with the right to grant sublicenses, to
the extent permitted, under said party's rights in Joint
Intellectual Property, Commingled Germplasm, and its respective
Proprietary Property. The Venture shall license PIONEER to
produce and sell seed for production of Venture Products under
terms of the Seed Supply Agreement executed herewith. Further,
the Venture shall xxxxx XXXXXX a right of first refusal for an
exclusive license to produce and sell DUPONT Industrial Products
which may be derived from Venture Products.
X. XXXXXX shall xxxxx to PIONEER an irrevocable,
exclusive, worldwide and royalty bearing license to make, use, or
sell PIONEER Products, including the right to grant sublicenses,
under DUPONT's rights in Joint Intellectual Property. Subject to
the exclusive rights granted herein to the Venture, DUPONT shall
grant to PIONEER an irrevocable, nonexclusive, worldwide and
royalty bearing license to make, use, or sell PIONEER Products,
including the right to grant sublicenses, to the extent permitted
and subject to the restrictions of ARTICLE IX, under DUPONT
Proprietary Property. PIONEER shall be free to use PIONEER
Proprietary Property in any manner without any obligation to pay
royalties to DUPONT. PIONEER shall be free to use in any manner,
including the right to license, its ownership rights in Joint
Intellectual Property outside the Field of Interest in any
product areas outside DUPONT Industrial Products, DUPONT Crop
Production Products and Venture Products without the approval of
DUPONT and without any obligation to pay royalties to DUPONT,
subject to the rights of Paragraph G, below.
F. PIONEER shall grant to DUPONT an irrevocable,
exclusive, worldwide and royalty bearing license to make, use, or
sell DUPONT Industrial Products and DUPONT Crop Production
Products, including the right to grant sublicenses, under
PIONEER's rights in Joint Intellectual Property with the proviso
that in the case of DUPONT Crop Production Products in the Field
of Interest, PIONEER shall retain a nonexclusive right under the
Joint Intellectual Property, and DUPONT shall grant to PIONEER,
to the extent permitted, a nonexclusive license under DUPONT
Proprietary Property as required for PIONEER for the purpose of
producing and selling seed responsive to a DUPONT Crop Production
Product in return for a reasonable royalty to be negotiated in
good faith. Further, in the event that a DUPONT Industrial
Product or a DUPONT Crop Production Product is produced in a
plant or grain within the Field of Interest, to the extent the
Venture can competitively source such a DUPONT Industrial Product
or DUPONT Crop Production Product, DUPONT shall obtain its
requirements from the Venture. Subject to the exclusive rights
granted herein to the Venture, PIONEER shall grant to DUPONT an
irrevocable, nonexclusive, worldwide and royalty bearing license
to make, use, or sell DUPONT Industrial Products or DUPONT Crop
Production Products, including the right to grant sublicenses to
the extent permitted and subject to the restrictions of ARTICLE
IX, under PIONEER Proprietary Property. DUPONT shall be free to
use DUPONT Proprietary Property in any manner without any
obligation to pay royalties to PIONEER. DUPONT shall be free to
use in any manner, including the right to license, its ownership
rights in Joint Intellectual Property outside the Field of
Interest in any product areas outside PIONEER Products and
Venture Products without the approval of PIONEER and without any
obligation to pay royalties to PIONEER, subject to the rights of
Paragraph G, below.
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X. XXXXXX, PIONEER, and the Venture shall xxxxx XXXXXX and
PIONEER a right of first refusal for an irrevocable, exclusive
and royalty bearing license to make, use or sell Other Product in
the Field of Interest, including the right to grant sublicenses,
under their rights in Joint Intellectual Property.
H. Each royalty bearing license for Joint Intellectual
Property and DUPONT or PIONEER Proprietary Property granted to
PIONEER or DUPONT shall have a royalty rate and terms negotiated
in good faith by the parties involved. Such royalty rate shall
be reasonable and based upon a good faith estimate of the royalty
rate that would be granted or is granted to a third party for an
identical license having terms and conditions reasonable and
customary in the subject area and resulting from arms length
negotiations. In the event that the parties involved cannot
agree on a royalty rate and terms for any particular license, the
issue shall be arbitrated in accordance with the rules of the
American Arbitration Association. The parties agree to maintain
adequate records in sufficient detail to enable the royalties due
from each under the grants of rights above to be determined and
permit said records to be inspected on no more than an annual
basis at any time during regular business by an independent
auditor acceptable to DUPONT and PIONEER for this purpose, who
shall report to the appropriate licensor only the amount of the
fees due hereunder.
ARTICLE VIII
Confidentiality
---------------
A. During the term of this Agreement and for a period of
five (5) years from the termination of this Agreement, each party
will keep confidential any and all Confidential Information (not
otherwise excluded from the confidentiality and nonuse
obligations of this Article as set forth below) received from the
other party in connection with the performance of this Agreement
and will not disclose it to third parties or use it for any
purpose other than pursuant to this Agreement, without the prior
written consent of the disclosing party.
The confidentiality and nonuse obligations of this Article
VIII will not apply to information and other items listed under
the definition of Confidential Information:
(a) which is public knowledge at the time of disclosure, or
which after disclosure becomes public knowledge in any
way except through the wrongful act of the party so
disclosing it;
(b) which the receiving party is able to prove was in its
possession at the time of disclosure by the disclosing
party or subsequently and independently developed and
which had not been obtained from the latter, either
directly or indirectly;
(c) whose disclosure is compelled by administrative or
judicial requirement; or
(d) which either party received from a third party having
the legal right to disclose such information, provided
that such information was not obtained by the third
party directly or indirectly from the other party to
this Agreement on a confidential basis.
B. Confidential Information may be disclosed to an
Affiliate for purposes of carrying out research under this
Agreement where the receiving party agrees in writing to be bound
by the terms of confidentiality and other applicable obligations
expressed in this Agreement.
C. The provisions of this Article VIII will survive any
termination of this Agreement.
ARTICLE IX
Protection and Use of Germplasm
-------------------------------
X. XXXXXX shall not give, transfer, convey or license
PIONEER-sourced germplasm or Commingled Germplasm to any third
party without the prior written approval of PIONEER.
B. PIONEER shall not give, transfer, convey or license
DUPONT-sourced germplasm or Commingled Germplasm to any third
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party without the prior written approval of DUPONT.
C. Notwithstanding Paragraphs A and B, above, in the event
of termination the parties shall be free to use Commingled
Germplasm for any purpose without payment of a royalty if the
following conditions are met:
1. In the case of PIONEER, PIONEER shall remove any
Venture Product trait from the Commingled
Germplasm; and
2. In the case of DUPONT, DUPONT shall carry out four
(4) backcrosses of Commingled Germplasm with other
germplasm, or achieve greater than 95%
dissimilarity of the resulting germplasm from the
Commingled Germplasm as assessed by molecular
marker analysis.
ARTICLE X
Patent Prosecution, Defense and Enforcement
-------------------------------------------
A. (1) Each party shall promptly disclose to the other
party and the Research Committee the conception or reduction to
practice under a Collaborative Effort of inventions by employees
or others acting on behalf of such party. When such an invention
has been made that may reasonably be considered to be patentable,
a priority patent application shall be filed as soon as
reasonably possible. The party conducting the project shall have
the first right, using in-house or outside legal counsel selected
at its sole discretion and expense, to prepare, file, prosecute,
maintain and extend patent applications and patents concerning
all such inventions. The party having such first right shall
solicit the Research Committee's and the other party's advice and
review of the nature and text of such patent applications and
important prosecution matters related thereto in reasonably
sufficient time prior to filing thereof, and shall take into
account the reasonable comments related thereto. If the party
having the first right, prior or subsequent to filing certain
patent applications on any inventions or discoveries, elects not
to file, prosecute or maintain such patent applications
inventions or discoveries, elects not to file, prosecute or
maintain such patent applications or ensuing patents or certain
claims encompassed by such patent applications or ensuing patents
in any country, that party shall give the other party notice
thereof within a reasonable period prior to allowing such patent
applications or patents or such certain claims encompassed by
such patent applications or patents to lapse or become abandoned
or unenforceable, and the other party shall thereafter have the
right, at its sole expense, to prepare, file, prosecute and
maintain patent applications and patents or divisional
applications related to such certain claims encompassed by such
patent applications or patents concerning all such inventions and
discoveries in countries of its choice throughout the world.
(2) No later than nine (9) months following the filing date
of a priority patent application with respect to an invention
made under a Collaborative Effort and filed according to the
above paragraph, the parties shall consult together, through the
Research Committee or otherwise, to determine whether such
priority application with respect to such invention should be
abandoned without replacement; abandoned and refiled; proceeded
within the country of filing only; or used as the basis for a
claim of priority under the Paris Convention for corresponding
applications in or designating other countries. The parties
shall consult together to ensure that so far as practicable the
texts filed in the United States and in other countries contain
the same information and claim the same scope of protection. The
parties agree that they will cooperate in good faith in supplying
whatever assistance is reasonably needed by the other for the
preparing, filing and prosecuting of any such patent
applications.
B. Each party agrees to indemnify and defend the other
party and the Venture from any claim of infringement by a third
party based upon the use by the indemnifying party of Joint
Intellectual Property or DUPONT Proprietary Property or PIONEER
Proprietary Property. Each party shall have full responsibility
with respect to its own potentially infringing activities which
occurred prior to this Agreement.
C. In the event that a third party is misappropriating or
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infringing any Joint Intellectual Property right, then the
parties will consult with one another regarding enforcement of
such Joint Intellectual Property right. In this respect, the
parties will consider the nature and extent of the
misappropriation or infringement, the strength of such Joint
Intellectual Property right with respect thereto and the
existence of facts or circumstances that would weigh against
enforcement of such rights.
If the parties agree that such Joint Intellectual Property
right should be sufficient to stop the infringing activity or
collect damages or compel the misappropriating or infringing
party to seek a license from either party, then the parties will
consider whether they want to act in concert in an enforcement
action. If a party does not want to engage in a joint
enforcement action, then the other party will be free to enforce
such Joint Intellectual Property right on its own and at its own
expense and will retain all monetary damages that it may be
awarded as a result of such enforcement. If the parties decide
to act in concert in an enforcement action then they will agree
upon: (i) retention of legal counsel; (ii) who controls the
action; (iii) sharing of legal and other expenses; (iv)
settlement authority and (v) sharing of damages or other award.
ARTICLE XI
Termination
-----------
A. This Agreement, unless terminated earlier as set forth
below, may be terminated by three (3) years prior notice in
writing by either party which notice may be delivered at any time
after the 13th anniversary of the date of this Agreement, except
that if the Venture is terminated, the termination provisions of
the Venture Agreement shall apply. This Agreement shall be
extendable by mutual agreement of the parties.
B. Termination may be effected under the terms and
conditions of Article IX-TERMINATION AND DISSOLUTION provisions
of the Venture Formation Agreement executed concomitantly by the
parties. The rights and obligations of the parties in the event
of termination shall also be found in such Article IX.
ARTICLE XII
Representations and Warranties
------------------------------
Each party to this Agreement, only with respect to itself,
hereby represents and warrants to the other party as follows:
a. Each party has all the requisite corporate power and
authority to execute and deliver this Agreement and to
consummate the transactions contemplated herein and to
perform its obligations hereunder. The execution,
delivery and performance of this Agreement, including,
without limitation, the grant of licenses authorized
herein has been duly and validly authorized by proper
corporate action and constitutes a valid and legally
binding agreement of such party, without requiring the
consent of any third party or governmental authority.
b. Each party warrants that it has good title (either as
the owner or as a licensee) to that Proprietary
Property in which it has granted a nonexclusive license
for research and commercial purposes to the other party
in accordance herewith. Each party further warrants
that the practice or use of any of their technology and
patent rights of proprietary property is free of
infringement or interference with any valid or
enforceable property rights belonging to a third party.
c. Neither party has entered into any understanding or
agreement with any third party that will in any way
conflict with any right granted, or obligation arising,
under this Agreement, other than those agreements
previously disclosed by each party to the other.
ARTICLE XIII
Notices and Reports
-------------------
Any notice required or permitted to be given to any party
for all of the purposes hereof shall be mailed by registered
mail, return receipt requested, or hand delivered, addressed as
follows:
11
To: E.I. du Pont de Nemours and Company
Agricultural Products
X.X. Xxx 00000
Xxxxxxxxxx, XX 00000-0000
Attention: X. X. Xxxxx-Director,
Global Technology
To: Pioneer Hi-Bred International, Inc.
000 Xxxxxxx Xxxxxx
000 Xxxxxx Xxxxxx
Xxx Xxxxxx, Xxxx 00000
Attention: General Counsel
or to such other address or addresses as any of the parties shall
designate by notice given as herein required. Notices shall be
effective upon receipt by the party to whom they are addressed.
ARTICLE XIV
Force Majeure
-------------
A. One should consider as a case of force majeure,
involving an exoneration of liability, any unpredictable or
inevitable event which, as for its nature or consequences for the
party invoking it, cannot be avoided or overcome by said party,
and which does not result from a fault, committed by the latter,
and is such as to render impossible, fully or partially,
temporarily or finally, the performance of contractual
obligations.
B. A case of force majeure can only be invoked if the
party invoking it has informed the other party of the beginning
and end of the case of force majeure by registered mail, return
receipt requested, within thirty (30) calendar days of the date
of its appearance and disappearance.
C. In the case of force majeure duly communicated
according to the preceding paragraph, the obligations of the
parties will be automatically prolonged for the time of the delay
caused by such force majeure, and the parties shall consult each
other.
ARTICLE XV
Assignability
-------------
Neither this Agreement nor the rights or licenses herein
granted to any party shall, except as expressly permitted or
required under the Investment Agreement, be assignable or
otherwise transferable by any party other than to an Affiliate
without the prior written consent of the other party. Each of
PIONEER and DUPONT agree that they shall each cause their
respective Subsidiaries (as defined in the Investment Agreement)
to take such action as shall be necessary to enable PIONEER and
DUPONT, as the case may be, to fulfill their respective
obligations under this Agreement, including without limitation,
by providing or making available to their respective parent
companies such research capabilities as may be transferred to
such Subsidiaries by each such parent company.
ARTICLE XVI
Applicable Law
--------------
This Agreement shall be interpreted in accordance with the
laws of the State of Delaware.
ARTICLE XVII
Severability
------------
If any term of this Agreement is held unenforceable or in
conflict with the law of any applicable jurisdiction, it is the
intention of the parties that the validity of the remaining terms
hereof shall not be affected by such holding and that such
conflicting term be construed and enforced to the fullest extent
permissible under law.
ARTICLE XVIII
Complete Agreement
------------------
This Agreement together with the LLC Agreement, the
Formation Agreement, the Investment Agreement, the Preferred Seed
Support Agreement and related implementing agreements executed
12
herewith or after the Effective Date constitutes the entire
Agreement between the parties and supersedes and merges all prior
agreements with respect to the subject matter discussed herein
and any warranty, representation, promise or condition in
connection therewith not expressly incorporated herein shall not
be binding upon any party. No modification, extension or waiver
of this Agreement or any of its provisions shall be binding
unless in writing signed by a duly authorized representative of
each of the parties.
ARTICLE XIX
Descriptive Headings
--------------------
The descriptive headings in this Agreement are for
convenience only and shall not be interpreted so as to limit or
affect in any way the meaning of the language in the pertaining
article, paragraph or subparagraph.
IN WITNESS WHEREOF, the parties hereby execute and deliver
this Agreement as of the date first written above.
E.I. du Pont de Nemours and Company
By: /s/X.X. Xxxx
------------------------------
Pioneer Hi-Bred International, Inc.
By: /s/Xxxxxxx X. XxXxxxxxx
------------------------------
bwm/August 6, 1997
