Exhibit 10.10
CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED BASED UPON A
REQUEST FOR CONFIDENTIAL TREATMENT. THE NON-PUBLIC
INFORMATION HAS BEEN FILED WITH THE COMMISSION.
STRATEGIC ALLIANCE AGREEMENT
This AGREEMENT, having a date of August 19, 2003, is made by and among,
on the one hand, X.XXXXXXXX-XX XXXXX LTD, a Swiss corporation having its
principal place of business at Xxxxxxxxxxxxxxxxx 000, XX-0000, Xxxxx,
Xxxxxxxxxxx and XXXXXXXX-XX XXXXX INC., a New Jersey corporation, having its
principal place of business at 000 Xxxxxxxxx Xxxxxx, Xxxxxx, Xxx Xxxxxx 00000
(collectively "Roche") and, on the other hand, MEMORY PHARMACEUTICALS CORP., a
Delaware corporation, having its principal place of business at 000 Xxxxxxx
Xxxxxxx, Xxxxxxxx, Xxx Xxxxxx 00000 ("Memory").
INTRODUCTION
1. Memory has a development program relating to the neuronal nicotinic
alpha-7 receptor (the "Program"), and owns related intellectual
property rights.
2. Roche has expertise in the research, development, manufacture and
commercialization of pharmaceutical products.
3. Roche desires to secure rights to further develop and commercialize
products developed and to be developed pursuant to the Program.
4. In consideration of the mutual covenants and promises contained in this
Agreement and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Memory and Roche agree as
follows:
ARTICLE 1. DEFINITIONS
As used in this Agreement, the following terms, whether used in the singular or
plural, shall have the following meanings:
1.1 "Affiliate" means (a) a business entity which owns, directly or
indirectly, at least fifty percent (50%) of the voting shares or other
means of control of a Party; or (b) a business entity in which at least
fifty percent (50%) of the voting shares or other means of control are
owned by a Party, either directly or indirectly; or (c) a business
entity, the majority ownership of which is directly or indirectly
common to the majority ownership of a Party. Anything to the contrary
in this paragraph notwithstanding, [*], a Delaware corporation, shall
not be deemed an Affiliate of Roche unless Roche provides written
notice to Memory of its desire to include [*] as an Affiliate of Roche.
Notwithstanding the preceding provisions, once an entity ceases to be
an Affiliate, then such entity shall, without any further action, cease
to have any rights, including license and sublicense rights, under this
Agreement that it has by reason of being an Affiliate.
If [*]does not agree to be bound by the terms and conditions of this
Agreement, then [*] shall have none of the rights and obligations of an
Affiliate of Roche under this Agreement, and [*]
[*] CONFIDENTIAL TREATMENT IS REQUESTED
shall be treated as a Third Party under this Agreement and,
accordingly, Roche may not grant a sublicense to [*] except as provided
in Section 2.4 hereof.
1.2 "Agreement Term" means the term of this Agreement, more fully described
in Section 16.1.
1.3 "Bioequivalent Product" means, with respect to a given Product sold in
a given country of the Territory by Roche, its Affiliate or
sublicensee, a product sold by a Third Party in such country containing
the same or similar compound (or an acid, salt or ester thereof) as
such Product.
1.4 "Combination Product" means any product containing both a
pharmaceutically active agent which causes it to be considered a
Product and one or more other pharmaceutically active agents which are
not Products.
1.5 "Composition of Matter Claim" means, for a given Product in a given
country of the Territory, a Valid Claim of a Memory Patent Right that
Covers the molecule per se of the compound that is included in such
Product, in whole or as a component thereof, as an active ingredient of
such Product.
1.6 "Cover" (including the variations such as "Covered", "Coverage" or
"Covering") shall mean that the making, using, offering for sale,
selling or importing of a given product would infringe a claim of a
Patent Right in the absence of a license under such Patent Right. The
determination of whether a product is Covered by a particular Patent
Right shall be made on a country-by-country basis.
1.7 "Effective Date" means the date that all conditions subsequent under
Section 16.1 have occurred.
1.8 "End of Phase I" means the date that all Phase I clinical trials have
been completed.
1.9 "End of Phase IIa" means the date that all Phase IIa clinical trials
have been completed.
1.10 "Europe" means the United Kingdom, Germany, Italy, France and Spain.
1.11 "Field" means prophylaxis and treatment of diseases, in all
indications, for either human or veterinary use.
1.12 "FTE" means a full-time equivalent scientific person year, consisting
of a total of 1840 hours per year of scientific work on an annualized
basis, in the conduct of the Program.
1.13 "IND" means an Investigational New Drug Application filed with the US
Food and Drug Administration ("FDA") for human clinical testing of a
drug.
1.14 "Initiation of Phase I" means the date that a human is first dosed with
a Product in a Phase I clinical trial.
1.15 "Initiation of Phase IIa" means the date that a patient is first dosed
with a Product in a Phase IIa clinical trial.
1.16 "Initiation of Phase III" means the date that a patient is first dosed
with a Product in a Phase III clinical trial.
1.17 "Invention" means an invention that is made in the conduct of the
Strategic Alliance.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
1.18 "JLT" means the committee organized and operating as provided in
Article 7.
1.19 "Joint Patent Rights" means all Patent Rights that Memory and Roche
jointly own, or otherwise jointly have the right to grant the licenses
herein, during the Agreement Term.
1.20 "Know-How" means data, knowledge and information, including materials,
samples, chemical manufacturing data, toxicological data,
pharmacological data, preclinical data, assays, platforms,
formulations, specifications, quality control testing data, that are
necessary or useful for the discovery, manufacture, development or
commercialization of Product in the Territory.
1.21 "Launch" means, with respect to a Product in a country of the
Territory, the date of the first commercial sale by Roche, its
Affiliate or its sublicensee of the given Product in the given country
after Regulatory Approval in such country.
1.22 "License Exercise Period" means, with respect to any Product, except as
otherwise provided in Section 4.6, the sixty (60) day period
immediately following the later of the End of Phase IIa or the date of
delivery by Memory to Roche of the data and reports specified in
Schedule 1 related to such Product.
1.23 "License Rights Maintenance Fees" means, with respect to any Product,
the payments by Roche to Memory pursuant to Section 4.4 hereof.
1.24 "Major Market Countries" means the US, Canada, Japan and Europe.
1.25 "Memory Compound" means any compound which is a nicotinic alpha-7
agonist with respect to which (i) Memory has commenced a Phase I human
clinical trial within five (5) years after the Effective Date or (ii)
Roche has designated pursuant to Section 2.2 or Section 4.6 hereof.
1.26 "Memory Know-How" means all Know-How that Memory owns, or otherwise has
the right to grant the licenses herein, during the Agreement Term.
1.27 "Memory Patent Rights" means all Patent Rights that Memory owns, or
otherwise has the right to grant the licenses herein, during the
Agreement Term.
1.28 "NDA" means a New Drug Application filed with the FDA, or its foreign
equivalent, for a drug.-
1.29 "NDA Filing" means for a given Product, the date that an NDA is filed
for the Product.
1.30 "Net Sales" " and the related term "Adjusted Gross Sales" mean:
"Adjusted Gross Sales" means the amount of gross sales of the Product
invoiced by Roche, its Affiliates and its sub-licensees to independent
third parties less deductions of returns and return reserves ( such
reserves consistent with Generally Accepted Accounting Principles)
(including allowances actually given for spoiled, damaged, out-dated,
rejected, returned Product sold, withdrawals and recalls), rebates to
the extent consistently applied by Roche to its products (price
reductions, rebates to social and welfare systems, charge backs and
charge back reserves ( such reserves consistent with Generally Accepted
Accounting Principles), cash sales incentives (but only to the extent
it is a sales related deduction which is accounted for within Roche on
a product-by-product basis)), government mandated rebates and similar
types of rebates (e.g., P.P.R.S, Medicaid, each as consistently applied
by Roche to its products), volume (quantity) discounts, each as
consistently applied by Roche to its products, taxes (value added or
sales taxes,
[*] CONFIDENTIAL TREATMENT IS REQUESTED
government mandated exceptional taxes and other taxes directly linked
to the gross sales amount), it being understood that income and capital
gains taxes are not the type of taxes contemplated as a deduction in
this definition of Adjusted Gross Sales.
"Net Sales" means, for the US, the amount calculated by subtracting
from the amount of Adjusted Gross Sales a lump sum deduction of [*]
percent ([*]%) of Adjusted Gross Sales in lieu of those sales related
deductions which are not accounted for within Roche on a product by
product basis (e.g. outward freights, postage charges, transportation
insurance, packaging materials for dispatch of goods, custom duties,
bad debt, discounts granted later than at the time of invoicing, and
cash discounts).
"Net Sales" means, for the ROW Territory, the amount calculated by
subtracting from the amount of Adjusted Gross Sales a lump sum
deduction of [*] percent ([*]%) of Adjusted Gross Sales in lieu of
those sales related deductions which are not accounted for within Roche
on a product by product basis (e.g. outward freights, postage charges,
transportation insurance, packaging materials for dispatch of goods,
custom duties, bad debt, discounts granted later than at the time of
invoicing, and cash discounts).
Notwithstanding the foregoing, amounts received by Roche, its
Affiliates and sublicensees for the sale of Product among Roche, its
Affiliates or sublicensees for resale shall not be included in the
computation of Adjusted Gross Sales and Net Sales."
1.31 "Neurological Indication" means prophylaxis or treatment of Alzheimer's
disease (including management of psychotic symptoms of Alzheimer's
disease), prophylaxis or treatment of mild cognitive impairment ("MCI")
or treatment of vascular dementia.
1.32 "Other Indication" means any indication other than a Neurological
Indication or a Psychiatric Indication.
1.33 "Party" means Roche and/or Memory.
1.34 "Patent Right" means all rights under any patent or patent application
in any country of the Territory, including any substitution, extension
or supplementary protection certificate, reissue, reexamination,
renewal, division, continuation or continuations-in-part thereof,
relating to the discovery, manufacture, development or
commercialization of nicotinic alpha-7 agonist compounds in the
Territory.
1.35 "Phase I" means the first phase of human clinical trials of a drug
required by the US FDA to gain evidence of safety in volunteers, as
described in 21 CFR Part 312, as it may be amended.
1.36 "Phase II" means the second phase of human clinical trials of a drug
required by the US FDA to gain evidence of efficacy in the target
population, determine optimal dosage, and obtain expanded evidence of
safety for Product(s), as described in 21 CFR Part 312, as it may be
amended.
1.37 "Phase IIa" means one or more Phase II trials (at least one of which
trials was conducted in a Major Market Country) collectively designed
to demonstrate (a) in the case of a Neurological Indication, safety and
tolerability in the target population, and (b) in the case of a
Psychiatric Indication, clinical proof of concept.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
1.38 "Phase III" means the third phase of human clinical trials of a drug
required by the US FDA to gain evidence of efficacy in the target
population, and obtain expanded evidence of safety for Product(s), as
described in 21 CFR Part 312, as it may be amended.
1.39 "Product" means any and all products that include, in whole or as a
component thereof, a Memory Compound.
1.40 "Psychiatric Indication" means schizophrenia (including management of
the manifestations of symptoms of schizophrenia), depression, bipolar
disorders, anxiety and ADHD.
1.41 "Regulatory Approval" means any approvals (including pricing and
reimbursement approvals), licenses, registrations or authorizations of
any national or international or local regulatory agency, department,
bureau or other governmental entity, necessary for the manufacture and
sale of a Product in the Field in a regulatory jurisdiction in the
Territory.
1.42 "Roche Patent Rights" means all Patent Rights that Roche owns, or
otherwise has the right to grant the licenses herein, during the
Agreement Term.
1.43 "ROW Territory" means all countries and territories other than the US.
1.44 "Strategic Alliance" means discovery and development by Memory of
pharmaceuticals acting against nicotinic alpha-7 receptor and
development and commercialization of such pharmaceuticals by Roche and
Memory, as contemplated by this Agreement.
1.45 "Territory" means all countries and territories in the world.
1.46 "Third Party" means a person or entity other than (i) Memory or any of
its Affiliates, or (ii) Roche or any of its Affiliates.
1.47 "US" means the United States of America and its possessions and
territories, including Puerto Rico.
1.48 "Valid Claim" means a claim in any (i) unexpired and issued Memory
Patent Right that has not been disclaimed, revoked or held invalid by a
final unappealable decision of a court of competent jurisdiction or
government agency or (ii) pending patent application that is a Memory
Patent Right which application has been on file with the applicable
patent office for no more than ten (10) years and for which there has
been reasonably consistent activity to advance to issuance of a patent.
ARTICLE 2. GRANTS
2.1 Grants. Subject to the terms and conditions of this Agreement, during
the License Exercise Period, Roche shall have the right with respect to
each Product to obtain a sole and exclusive license, including the
right to grant sublicenses pursuant to Section 2.3, under the Memory
Patent Rights and to use the Memory Know-How, to make, use, offer for
sale, sell and import such Product in the Territory for use in the
Field (each, a "License"). The right of Roche to obtain a License as
provided in this Section 2.1 shall be exercisable by Roche giving
written notice to Memory and making or having made payment to Memory of
all License Rights Maintenance Fees for such Product under Section 4.4
with respect to a License for a Product for a Neurological Indication
or a Psychiatric Indication. If Roche exercises such right as provided
herein, Memory
[*] CONFIDENTIAL TREATMENT IS REQUESTED
shall be deemed to have granted such License hereunder without any
requirement for further action by or on behalf of either Party.
Nothing in this Agreement grants to Roche any right or license to use
Memory Know-How for any purpose other than to make, use, offer for
sale, sell and import Products in the Territory for use in the Field.
Further, nothing in this Agreement shall limit the right of Memory to
use Memory Know-How for any purpose not related to the making, using,
offering for sale, selling or importing Products in the Territory for
use in the Field.
2.2 Designation of Additional Compounds. In the event that, as of the date
that is [*] years after the Effective Date, there are fewer than [*]
Memory Compounds for either a Neurological Indication or a Psychiatric
Indication with respect to which Memory has commenced the Initiation of
Phase I, then Roche shall have the right to designate as Memory
Compounds additional compounds which are nicotinic alpha-7 agonists in
preclinical development by Memory, up to the number of compounds fewer
than [*] as to which Memory has then not commenced the Initiation of
Phase I. For example, if Memory has commenced the Initiation of Phase I
with respect to one (1) Product for a Neurological Indication and one
(1) Product for a Psychiatric Indication at the end of such [*] year
period, then Roche shall have the right to designate as Memory
Compounds up to [*] additional compounds which are nicotinic alpha-7
agonists in preclinical development by Memory. If Roche desires to
exercise such right, Roche shall give written notice thereof to Memory
and Memory shall provide to Roche, for evaluation purposes only, all
test results, data (e.g., in vivo data, safety data and
structure-activity relationship data) and applicable Memory Patent
Rights relating to up to [*] compounds which are nicotinic alpha-7
agonists in preclinical development by Memory as may be selected by
Roche. Within the sixty (60) day period following receipt by Roche of
such items, Roche may designate such additional compounds, up to the
number of compounds it is permitted to designate pursuant to this
Section 2.2.
After Roche has designated one or more such compounds as Memory
Compounds, Memory may elect either to (i) continue development of such
Memory Compound through the End of Phase IIa and be entitled to receive
all License Rights Maintenance Fees with respect thereto, as and when
provided in Section 4.4 hereof, or (ii) have Roche assume all
preclinical and clinical development of such Memory Compound(s) and pay
all costs related thereto, in which case the License Rights Maintenance
Fees otherwise payable by Roche with respect to such Memory Compound(s)
shall be reduced by [*] percent ([*]), the events for payments by Roche
specified in Section 4.4 shall not include the delivery of any data or
reports and Roche shall have a License to such Memory Compound(s) as
provided in Section 2.1 effective as of the date Roche assumes the
preclinical and clinical development of such Memory Compound.
2.3 Restrictions on Third Party Rights. Memory shall not grant any license
or rights to a Third Party with respect to any compound that is a
nicotinic alpha-7 agonist unless and until Roche has declined or failed
to exercise its right to obtain a License to such compound pursuant to
Sections 2.1 and 16.4(a) hereof. In the event that Roche so declines or
fails to exercise its right to obtain a License to such compound,
Memory shall be free to license or grant any rights to a Third Party
with respect to such compound.
2.4 Sublicense Rights. The rights and licenses granted to Roche under
Section 2.1 shall include the right to grant sublicenses to its
Affiliates and Third Parties under such rights and licenses, in whole
or in part, solely to the extent necessary to make, use, offer for
sale, sell or import Products in the Territory for use in the Field. If
Roche grants such a sublicense, Roche shall ensure that all of the
applicable terms and conditions of this Agreement shall apply to the
Affiliate or Third Party sublicensee to the same extent as they apply
to Roche for all purposes. Roche assumes full
[*] CONFIDENTIAL TREATMENT IS REQUESTED
responsibility for the performance of all obligations and observance of
all terms so imposed on such Affiliate or Third Party sublicensee and
will itself account to Memory for all payments due under this Agreement
by reason of such sublicense.
Notwithstanding the above, Roche shall not have the right to sublicense
the rights granted to Roche under Section 2.1 to any Third Party with
respect to any Product (i) in a Major Market Country, except upon the
prior written approval of Memory, which approval Memory shall not
unreasonably withhold and (ii) in the US, except upon the prior written
approval of Memory so long as Memory has a co-promotion right for such
Product, which approval may be granted or withheld by Memory in its
sole discretion.
Any sublicense may, at the written election of Memory, continue in full
force and effect after the termination of any of the underlying
licenses granted herein to Roche (the foregoing shall apply to a
termination in whole or in part of such underlying licenses). Upon the
licenses granted herein to Roche becoming fully paid up pursuant to
Section 16.1(b), any and all sublicenses granted by Roche similarly
shall become fully paid up as to Memory.
2.5 Memory Co-Promotion Right. Memory shall have the right to co-promote
each Product in the US, on a Product-by-Product basis, in accordance
with the provisions of Exhibit A hereto. Within forty-five (45) days
after the end of Phase II with respect to each Product, Roche shall
provide Memory with (i) the results and analysis of Phase II studies,
and (ii) Roche's then final, approved Phase III development plan
(including budget). Memory shall exercise its co-promotion right with
respect to each Product by (a) giving written notice thereof to Roche
within forty-five (45) days after receipt of the items described in the
immediately preceding sentence, and (b) making a one-time payment to
Roche in the amount of [*] percent ([*]%) of Roche's budgeted Phase III
global development costs for such Product as set forth in Roche's then
final, approved Phase III development plan (including budget). If
Memory exercises its right to co-promote a Product in the US, the
royalties otherwise payable by Roche to Memory hereunder with respect
to the Net Sales of such Product in the US shall be reduced by [*]
percent ([*]%). Upon Memory's exercise of its co-promotion right with
respect to any Product, the Parties shall negotiate in good faith and
enter into a Co-Promotion Agreement consistent with terms set forth in
Exhibit A hereto.
2.6 Requirement to Divest. If Roche is required by a relevant government
authority in a given country of the Territory to divest rights to a
Memory Compound and/or Product with respect to which Roche has not
commenced the Initiation of Phase III, then Roche shall use its
reasonable best efforts to obtain authority to fulfill such requirement
by returning rights to Memory to the Memory Compound and/or Product in
accordance with Section 16.5.
ARTICLE 3. DILIGENCE
3.1 Diligence. Memory shall use reasonable diligence in proceeding with the
development of Products through the End of Phase IIa, except for (i)
compounds designated by Roche as Memory Compounds with respect to which
Roche has assumed all preclinical and clinical development pursuant to
Section 2.2 hereof and (ii) Products with respect to which Roche has
exercised its rights pursuant to Section 4.6 hereof. Roche shall use
reasonable diligence in proceeding with the development of each
Product, including obtaining required Regulatory Approvals,
manufacturing, marketing and sale of such Product in the Major Market
Countries, from and after the date Roche obtains the License related
thereto.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
Reasonable diligence as used in this Agreement shall mean the same
standard of effort as used by the Parties, or in any case not less than
common in the industry taken as a whole for similarly situated
companies for the activities to be undertaken pursuant to this
Agreement, including, in the case of Roche, the development, clinical
testing, manufacturing, marketing and sale of a product which (i) must
receive regulatory approval in Major Market Countries and (ii) has
similar potential for a Neurological Indication or a Psychiatric
Indication as the compounds for which Roche has obtained a License,
taking into account scientific, business and marketing and return on
investment considerations. It is understood that such compound
potential may change from time to time based upon changing scientific,
business and marketing and return on investment considerations. The
Parties also acknowledge that, even within the Major Market Countries,
Roche and its Affiliates do not always seek to market their own
products in every such country or seek to obtain regulatory approval in
every such country or for every potential indication or every compound
that has potential for an indication. As a result, the exercise by
Roche of reasonable diligence is to be determined by judging its
efforts taken as a whole.
During the [*] year period after the Effective Date, Memory agrees to
devote at least [*] FTEs to the Strategic Alliance. During the [*] year
period after the Effective Date, Memory shall use reasonable diligence
to characterize and advance development of nicotinic alpha-7 agonist
compounds for Alzheimer's disease and schizophrenia, but such diligence
shall be not less than Memory's diligence to develop nicotinic alpha-7
agonist compounds for other specific disease states.
If either Party believes in good faith that the other Party has failed
to utilize reasonable diligence as required by this Section 3.1, then
such Party may give the other Party written notice of such alleged
failure, identifying the Memory nicotinic alpha-7 agonist compound or
Product (if known) and giving specific detailed reasons of such
allegation. Within sixty (60) days following the other Party's receipt
of any such notice ("Response Period"), the other Party shall have the
right to provide such Party with a written response specifying, in
reasonable detail, how it has used reasonable diligence as required
hereby.
If the other Party has failed to provide within the Response Period a
written response, in reasonable detail, indicating the manner in which
it is in compliance with its obligations under this Section 3.1 or in
which it has remedied any breach thereof, or the other Party has failed
within the Response Period to remedy any breach of its obligations
under this Section 3.1, then the non-defaulting Party shall have the
right to terminate this Agreement, in whole or in part, as described in
this Section 3.1, upon written notice to such Party effective as of the
end of the Response Period.
In the event of a dispute between the Parties with respect to whether
either Party has complied with its obligation under this Section 3.1,
then such dispute shall be resolved in accordance with Article 17. The
consequences of any termination under this Section 3.1 are set forth in
Section 16.5 and Article 17.
3.2 3.2 Effect of Merger on Diligence. If (i) substantially all of the
pharmaceutical business of Roche becomes merged or acquired or (ii)
Roche acquires substantially all of the pharmaceutical business of an
entity having an average annual pharmaceutical preclinical research
expenditure in excess of [*] per year, then at any time during the
period from a public announcement by Roche of its intention to effect
such merger or acquisition (each such transaction described in clauses
(i) and (ii) being hereinafter called a "Transaction") through [*]
after the closing of such Transaction, Memory shall have the right to
request in writing to the Head of Global Pharmaceuticals of Roche a
status of and future plans for the progress of development and
[*] CONFIDENTIAL TREATMENT IS REQUESTED
commercialization of Products ("Status Request"). This right may be
exercised by Memory not more than [*].
If, following a Status Request, Memory believes in good faith that
Roche has failed to progress development and commercialization of
Products solely because of the Transaction, then Memory may give Roche
written notice of such alleged failure, identifying the Product and
region at issue and giving specific detailed reasons of such
allegation. Within [*] following Roche's receipt of any such notice
from Memory ("Status Response Period"), Roche shall have the right to
provide Memory with a written response specifying, in reasonable
detail, how the Transaction per se has not had any negative impact on
such development and commercialization progress.
If Roche has failed to provide within the Status Response Period a
written response, in reasonable detail, indicating the manner in which
development and commercialization of Products has not failed to
progress solely because of the Transaction or in which it has remedied
any such failure, or Roche has failed within the Status Response Period
to remedy any such failure to progress, then Memory shall have the
right to terminate this Agreement, in whole or in part, as described
below in this Section 3.2, upon written notice to Roche effective as of
the end of the Status Response Period. Memory shall have the right to
terminate this Agreement as to any region described in Section 3.1 if
development and commercialization of the Products has failed to
progress solely because of the Transaction with respect to the Products
(taken as a whole) in such region. Memory shall have the right to
terminate this Agreement in the Territory with respect to any Product
if development and commercialization of such Product has failed to
progress solely because of the Transaction in at least two of the three
regions described in Section 3.1. Memory shall have the right to
terminate this Agreement in its entirety if development and
commercialization of the Products (taken as a whole) has failed to
progress solely because of the Transaction in at least two of the three
regions described in Section 3.1.
The Parties confirm and agree that nothing in this Section 3.2 limits
the obligations of Roche or the rights of Memory under Section 3.1.
ARTICLE 4. PAYMENT TO MEMORY
4.1 Technology Access Fee. Roche shall pay Memory a technology access fee
of ten million dollars ($10,000,000), which shall be non-refundable and
non-creditable, and due and payable on or before the later of twenty
(20) days after the Effective Date or five (5) days after the closing
of the purchase by Roche of Memory's Series Roche Preferred Stock as
provided in Section 4.2 hereof.
4.2 Purchase of Series Roche Preferred Stock. Contemporaneous with the
execution of this Agreement, Roche shall execute a Securities Purchase
Agreement to purchase from Memory shares of Memory's Series Roche
Preferred Stock in the aggregate amount of ten million dollars
($10,000,000), based on a purchase price of $3.60 per share, upon the
terms and conditions set forth in the Securities Purchase Agreement
attached as Exhibit B hereto.
4.3 Research and Development Support. Roche shall pay to Memory a total of
six million dollars (US $6,000,000) for research and development
support, which amount shall be non-refundable and non-creditable, and
which will be due and payable in eight (8) equal quarterly installments
of seven hundred fifty thousand dollars (US $750,000) per installment,
each installment due and payable within thirty (30) days after (i) the
first day of each calendar quarter after the Effective Date and (ii)
receipt by Roche of an invoice for such sums.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
4.4 Payments to Maintain Roche License Rights.
-----------------------------------------
(a) Neurological Indications. Roche shall pay to Memory, in order
to maintain its license rights pursuant to Section 2.1 and the
other provisions of this Agreement with respect to such
Product, the following non-refundable and non-creditable
payments upon the first occurrence of the following events for
such Product if such Product contains a different Memory
Compound then any Memory Compound contained in the Product for
which any payment has been made under Section 4.4(b):
--------------------------------------------------------------
EVENT PAYMENT (MIO US$)
--------------------------------------------------------------
[*] (or foreign equivalent)] for a [*] *
Neurological Indication and delivery
of the data and reports specified
in Schedule 1
--------------------------------------------------------------
[*] (or foreign equivalent) for a [*]**
Neurological Indication and delivery
of the data and reports specified in
Schedule 1]
--------------------------------------------------------------
[*] (or foreign equivalent) for a [*]***
Neurological Indication and delivery
of the data and reports specified in
Schedule 1
--------------------------------------------------------------
----------------
* Based upon this event occurring on or before [*]. If this event occurs
after such date, the payment shall be reduced to [*] dollars ($[*]).
** Based upon this event occurring on or before [*]. If this event occurs
after such date, the payment shall be reduced to [*] dollars ($[*]).
*** If any Product is for a Neurological Indication other than Alzheimer's
disease, then the payment shall be reduced to [*] dollars ($[*]).
[*] CONFIDENTIAL TREATMENT IS REQUESTED
(b) Psychiatric Indications. Roche shall pay to Memory, in order to
maintain its license rights pursuant to Section 2.1 and the
other provisions of this Agreement with respect to such
Product, the following non-refundable and non-creditable
payments upon the first occurrence of the following events for
such Product if such Product contains a different Memory
Compound than any Memory Compound contained in a Product for
which any payment has been made under Section 4.4(a):
--------------------------------------------------------------
EVENT PAYMENT (MIO US$)
--------------------------------------------------------------
[*] (or foreign equivalent) for [*]*
Psychiatric Indication and delivery
of the data and reports specified in
Schedule 1
--------------------------------------------------------------
[*] (or foreign equivalent) for [*]**
a Psychiatric Indication and delivery
of the data and reports specified in
Schedule 1
--------------------------------------------------------------
[*] (or foreign equivalent) for [*]***
a Psychiatric Indication and delivery
of the data and reports specified in
Schedule 1
--------------------------------------------------------------
Each payment in Section 4.4 (a) and 4.4 (b) shall be due and
payable by Roche within sixty (60) days after occurrence of
the applicable event. Roche will make each of such payments
only once for each Product, for the first occurrence of a
respective event, regardless of how many times the event may
be subsequently achieved with such Product.
For the avoidance of doubt, the Parties confirm and agree that
no amount payable under this Article 4 shall reduce any
royalties payable under Article 5.
(c) Reduction of Milestone Payments. Notwithstanding anything to
the contrary contained in this Section 4.4, if within [*] of
Memory's receipt of a payment pursuant to Section (a) or (b)
with respect to the [*] for a Product for a Neurological
Indication or a Psychiatric Indication, Memory otherwise would
be entitled to receive a payment upon the occurrence of the
same or any other event set forth in Section (a) or (b) for
another Product for a Neurological Indication or a Psychiatric
Indication, respectively, the amount of such payment shall be
reduced by [*] percent ([*]%).
(d) Limitation on Payment Reductions. Notwithstanding anything to
the contrary contained in this Section 4.4, in no event shall
the payment by Roche to Memory with respect to the occurrence
of the [*] be less than [*] dollars ($[*]) for a Product for a
Neurological Indication or [*] dollars ($[*]) for a Product
for a Psychiatric Indication.
4.5 Development Event Based Payments.
---------------------------------
----------------
* Based upon this event occurring on or before [*]. If this event occurs
after such date, the payment shall be reduced to [*] dollars ($[*]).
** Based upon this event occurring on or before [*]. If this event occurs
after such date, the payment shall be reduced to [*] dollars ($[*]).
*** If any Product is for a Psychiatric Indication other than schizophrenia,
then the payment shall be reduced to [*] dollars ($[*]).
[*] CONFIDENTIAL TREATMENT IS REQUESTED
(a) Neurological Indications. Roche shall pay to Memory with
respect to such Product the following non-refundable and
non-creditable payments upon the first occurrence of the
following events for such Product if such Product contains a
different Memory Compound than any Memory Compound contained
in a Product for which any payment has been made under Section
4.4(b) or 4.4(c):
--------------------------------------------------------------
EVENT PAYMENT (MIO US$)
--------------------------------------------------------------
[*] (or a foreign equivalent) [*]
for a Neurological Indication
--------------------------------------------------------------
[*] for a Neurological Indication [*]
--------------------------------------------------------------
[*] for a Neurological Indication [*]
--------------------------------------------------------------
(b) Psychiatric Indications. Roche shall pay to Memory with
respect to such Product the following non-refundable and
non-creditable payments upon the first occurrence of the
following events for such Product if such Product contains a
different Memory Compound than any Memory Compound contained
in a Product for which any payment has been made under Section
4.4(a) or 4.4(c):
--------------------------------------------------------------
EVENT PAYMENT (MIO US$)
--------------------------------------------------------------
[*] (or foreign equivalent) for [*]
a Psychiatric Indication
--------------------------------------------------------------
[*] for a Psychiatric Indication [*]
--------------------------------------------------------------
[*] for a Psychiatric Indication [*]
--------------------------------------------------------------
(c) Other Indications. Roche shall pay to Memory the following
non-refundable, non-creditable payments upon the first
occurrence of the following events for a Product if such
Product contains a different Memory Compound than any Memory
Compound contained in a Product for which any payment has been
made under Sections 4.4(a) or 4.4(b):
--------------------------------------------------------------
EVENT PAYMENT (MIO US$)
--------------------------------------------------------------
[*] (or foreign equivalent) for [*]
an Other Indication
--------------------------------------------------------------
[*] for an Other Indication [*]
--------------------------------------------------------------
[*] for an Other Indication [*]
--------------------------------------------------------------
Each payment in Section 4.5(a) and 4.5(b) shall be due and
payable by Roche within sixty (60) days after occurrence of
the applicable event. Roche will make each of such payments
only once for each Product, for the first occurrence of a
respective event, regardless of how many times the event may
be subsequently achieved with such Product.
For the avoidance of doubt, the Parties confirm and agree that
no amount payable under this Article 4 shall reduce any
royalties payable under Article 5.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
4.6 Early Exercise of Rights. If, at any time after the Initiation of Phase
I with respect to a Product for a Neurological Indication or a
Psychiatric Indication and prior to the earlier of the [*] related
thereto and the date that is five (5) years after the Effective Date,
Roche desires to obtain the license rights as described in Section 2.1
hereof with respect to a compound for a Neurological Indication or
Psychiatric Indication, (i) Roche shall give written notice thereof to
Memory and (ii) Memory shall provide to Roche, during any calendar
year, for evaluation purposes only, all test results, data (e.g., in
vivo data, safety data and structure-activity relationship data) and
applicable Memory Patent Rights relating to up to [*] compounds which
are nicotinic alpha-7 agonists in preclinical development by Memory as
may be selected by Roche. Within the sixty (60) day period following
receipt by Roche of such items with respect to each compound, Roche may
designate such compound to obtain a License to such compound. Roche
shall then pay to Memory a one-time payment of [*] percent ([*]%) all
unpaid License Rights Maintenance Fees with respect to such Product;
and thereupon Roche shall obtain a License with respect to such
Product. Thereafter, Roche shall pay to Memory the remaining [*]
percent ([*]%) of the License Rights Maintenance Fees with respect to
such Product as and when provided in Section 4.4, except the events for
payments by Roche specified in Section 4.4 shall not include the
delivery of any data or reports. From and after the date of such
notice, Roche shall be responsible for and pay all costs and expenses
relating to the continued development of such Product, including
obtaining all Regulatory Approvals with respect thereto.
In the event that, within [*] years after the Effective Date, Memory
has not [*] with respect to any Product, Roche shall thereafter have
the right pursuant to this Section 4.6 to have Memory provide to Roche,
during any calendar year, for evaluation purposes only, all test
results, data (e.g., in vivo data, safety data and structure-activity
relationship data) and applicable Memory Patent Rights relating to an
unlimited number of compounds which are nicotinic alpha-7 agonists in
preclinical development by Memory as may be selected by Roche. Within
the sixty (60) day period following receipt by Roche of such items with
respect to each compound, Roche may designate such compound to obtain a
License to such compound. Roche shall then pay to Memory the License
Rights Maintenance Fees with respect to such Product as and when
provided in Section 4.4, except the events for payments by Roche
specified in Section 4.4 shall not include the delivery of any data or
reports. From and after the date of such notice, Roche shall be
responsible for and pay all costs and expenses relating to the
continued development of such Product, including obtaining all
Regulatory Approvals with respect thereto.
ARTICLE 5. ROYALTIES
5.1 Royalties. Roche shall pay to Memory the following payments for a given
Product having a Regulatory Approval for a Neurological Indication,
based upon the Net Sales of such Product, which such Net Sales shall be
subject to adjustment as provided in this Article 5. Such royalty
payments shall be calculated by multiplying the following percentages
by the following annual Net Sales of such Product (all Net Sales
amounts in $ US million):
--------------------------------------------------------------
ANNUAL NET SALES PERCENT (%) OF NET SALES
--------------------------------------------------------------
[*] [*]
--------------------------------------------------------------
[*] [*]
--------------------------------------------------------------
[*] [*]
--------------------------------------------------------------
[*] [*]
--------------------------------------------------------------
[*] CONFIDENTIAL TREATMENT IS REQUESTED
By way of illustration, assume in calendar year 2012 that (i) Net Sales
of the Product total $[*] and (ii) no adjustments or deductions to
payments under this Article 5 apply. The royalties due and payable by
Roche to Memory for such Net Sales would be $[*], calculated as
follows:
--------------------------------------------------------------
APPLICABLE SALES-
NET SALES BASED PAYMENT AMOUNT PAYABLE
(IN MILLIONS) PERCENTAGE (IN MILLIONS)
--------------------------------------------------------------
US$[*] [*]% US$[*]
--------------------------------------------------------------
US$[*] [*]% US$[*]
--------------------------------------------------------------
US$[*] [*]% US$[*]
--------------------------------------------------------------
US$[*] US$[*]
--------------------------------------------------------------
5.2 Roche shall pay to Memory the following payments for a given Product
having a Regulatory Approval for a Psychiatric Indication, based upon
the Net Sales of such Product, which such Net Sales shall be subject to
adjustment as provided in this Article 5. Such royalty payments shall
be calculated by multiplying the following percentages by the following
annual worldwide Net Sales of such Product (all Net Sales amounts in $
US million):
--------------------------------------------------------------
ANNUAL NET SALES PERCENT (%) OF NET SALES
--------------------------------------------------------------
[*] [*]
--------------------------------------------------------------
[*] [*]
--------------------------------------------------------------
[*] [*]
--------------------------------------------------------------
[*] [*]
--------------------------------------------------------------
5.3 Roche shall pay to Memory royalties for given Product having a
Regulatory Approval for an Other Indication, in an amount equal to [*]
of the royalties payable for a Product having a Regulatory Approval for
a Neurological Indication based upon the Net Sales of such Product,
which royalty rate shall be subject to adjustment as provided in this
Article 5.
5.4 Adjustment Related to Multiple Indications. Notwithstanding anything to
the contrary contained in Section 5.1 hereof, in the event that a
Product has a Regulatory Approval for more than one indication, Roche
shall pay royalties to Memory based upon the royalty schedule providing
the highest applicable royalty rates for which a Regulatory Approval
has been obtained in a Major Market Country. Specifically, if the
Product is approved for (i) a Neurological Indication in a Major Market
Country and for another indication other than a Psychiatric Indication,
the royalties payable by Roche to Memory shall be based upon Net Sales
of such Product in the Territory as if all of such Net Sales occurred
for such Neurological Indication; (ii) a Psychiatric Indication in a
Major Market Country and for another indication, the royalties payable
by Roche shall be based upon Net Sales of such Product in the Territory
as if all of such Net Sales occurred for the Psychiatric Indication;
and (iii) multiple Other Indications, then the royalties payable by
Roche to
[*] CONFIDENTIAL TREATMENT IS REQUESTED
Memory shall be equal to [*] of the royalties payable under the royalty
schedule for a Product approved for a Neurological Indication.
5.5 Term of Royalty Payments. Roche shall calculate and make royalty
payments to Memory under this Article 5 commencing on Launch in any
country. The Net Sales of a given country shall be included for
purposes of calculating royalties under this Section until the later of
(a) expiration of the last to expire of Composition of Matter Claim in
such country and (b) ten (10) years from the Launch of such Product in
such country. With respect to the ten (10) year period, the EU will be
considered as one country.
5.6 Adjustments Related to Valid Claims. For a given Product, if in, or
with respect to, a country of the Territory no Valid Claim Covers such
Product, then Roche may calculate royalties for such Product using only
[*] percent ([*]%) of the amount Roche would have used for such country
to calculate royalties for such Product if a Valid Claim Covered such
Product in such country unless prior to ten years from the Launch of
such Product in, or with respect to, such country (EU considered as one
country) a Valid Claim Covering such Product exists in, or with respect
to, such country in which case Roche shall resume calculating royalties
using [*] percent ([*]%) of such amount.
5.7 Adjustments Related to Third Party Competition. For a given Product in
a given calendar quarter, if in a country of the Territory (a) a Third
Party is selling Bioequivalent Product, and (b) Roche has an obligation
to make payments under this Agreement with respect to Net Sales of the
given Product in such country, and (c) a Valid Claim Covers the given
Product in such country and (d) in such country, sales of units of
Bioequivalent Products in aggregate total at least [*] percent ([*]%)
of the aggregate sales of units of Bioequivalent Products and Products
as measured at the end of such calendar quarter, and (e) Roche has, if
it is reasonable under the circumstances, brought in the country and
continued to diligently prosecute a patent infringement suit under any
relevant Composition of Matter Claims against the Third Party or
another in privity, then Roche shall have the right to calculate
royalties with respect to such calendar quarter by including only [*]
percent ([*]%) of the amount Roche would have otherwise included for
such country to calculate sales-based payments if no Bioequivalent
Product existed in such country.
5.8 Adjustments Related to Third Party Payments. Roche or its Affiliate
shall pay and be responsible for the entire consideration owed to any
Third Party pursuant to the terms of any existing or future patent
licensing agreement relating to a Product. Roche shall have the right
to deduct a maximum of [*] percent ([*]%) of the consideration actually
paid by Roche or its Affiliate to a Third Party (other than [*] or [*]
with respect to any license under a patent which Covers the molecule
per se of the compound which is the nicotinic alpha-7 agonist that is
included in a given Product, from payments otherwise due and payable by
Roche to Memory under this Agreement. In no event as a result of this
Section 5.8 shall Roche reduce the royalties owed to Memory under this
Article 5 by greater than [*] percent ([*]%) of Net Sales in the
Territory for a given calendar quarter (and Roche shall be entitled to
accumulate amounts not permitted to be deducted in a prior period and
deduct such amounts in a future period).
Notwithstanding the above, (i) any payment owed under an agreement
between Memory and The Trustees of Columbia University dated July 22,
1998, as it may be amended, shall be the sole responsibility of Memory,
and (ii) any payment owed under any agreement between Roche or its
Affiliate and any Third Party entered into prior to the Effective Date
shall be the sole responsibility of Roche, for which Roche shall not be
entitled to any deduction from payments due and payable to Memory under
this Agreement.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
5.9 Bonus Payment. Roche shall pay to Memory a one-time, non-refundable and
non-creditable amount after the first occurrence of the following event
with respect to the first Product having Regulatory Approval for a
Neurological Indication:
--------------------------------------------------------------
EVENT PAYMENT (US$)
--------------------------------------------------------------
Net Sales exceed [*] dollars ($[*]) for [*]
a full calendar year (Jan. 1 - Dec. 31)
during the Agreement Term
--------------------------------------------------------------
Net Sales exceed [*] dollars ($[*]) for [*]
a full calendar year (Jan 1 - Dec 31)
during the Agreement Term
--------------------------------------------------------------
Roche shall pay to Memory a one-time, non-refundable and non-creditable
amount after the first occurrence of the following event with respect
to the first Product having a Regulatory Approval for a Psychiatric
Indication:
--------------------------------------------------------------
EVENT PAYMENT (US$)
--------------------------------------------------------------
Net Sales exceed [*] dollars ($[*]) for [*]
a full calendar year (Jan. 1 - Dec. 31)
during the Agreement Term
--------------------------------------------------------------
Net Sales exceed [*] dollars ($[*]) for [*]
a full calendar year (Jan 1 - Dec 31)
during the Agreement Term
--------------------------------------------------------------
Each payment in this Section 5.9 shall be due and payable by Roche
within sixty (60) days after occurrence of the applicable event.
Notwithstanding anything to the contrary, payment shall be made
pursuant to this Section 5.9 with respect to a Product for a
Neurological Indication or a Psychiatric Indication only if such
Product contains a different Memory Compound than any Memory Compound
contained in a Product for which payment previously has been made
pursuant to this Section 5.9.
5.10 Combination Products. In the event Roche or its Affiliates intend to
sell a Combination Product, the Parties shall meet approximately one
(1) year prior to the anticipated commercial launch of such Combination
Product to negotiate in good faith and agree to an appropriate
adjustment to Net Sales to reflect the relative significance and value
(including consideration of relative market share, sales potential and
price potential) of the Product and the other pharmaceutically active
agent(s) contained in the Combination Product. If, after good faith
negotiations (not to exceed ninety (90) days), the Parties cannot agree
to an appropriate adjustment, Net Sales shall equal Net Sales of the
Combination Product multiplied by a fraction, the numerator of which is
the reasonable fair market value of the Product and the denominator
(including consideration of relative market share, sales potential and
price potential) of which is the reasonable fair market value
(including consideration of relative market share, sales potential and
price potential) in the aggregate of all pharmaceutically active agents
contained in the Combination Product.
5.11 Mechanisms for Adjustments. In no event shall any adjustments pursuant
to Sections 5.6, 5.7 and 5.8 result in Memory receiving royalties for a
given calendar quarter pursuant to Sections 5.1, 5.2 and 5.3 in an
amount less than [*] percent ([*]%) of the amounts set forth therein as
if no adjustment(s) had been made. If Roche obtains a license to a
compound which is a nicotinic alpha-7 agonist from a Third Party and
includes such compound in a Product, as a result of which
[*] CONFIDENTIAL TREATMENT IS REQUESTED
the Product becomes a Combination Product, Roche shall not be entitled
to an adjustment pursuant to Section 5.8 as a result of such license.
ARTICLE 6. PAYMENT, REPORTING, AUDITING
6.1 Currency and Conversion.
-----------------------
(a) All payments under this Agreement shall be in U.S. Dollars by
wire transfer of immediately available funds in accordance
with instruction or instructions from the Party being paid.
(b) Whenever calculation of Net Sales requires conversion from any
foreign currency, Roche shall convert the amount of Net Sales
in foreign currencies as computed in Roche's central Swiss
Francs Sales Statistics for the countries concerned, using for
internal foreign currency translation Roche's then current
standard practices actually used on a consistent basis in
preparing its audited financial statements.
(c) For sublicensees in a country, when calculating the Net Sales,
the sublicensee shall report to Roche the amount of such sales
within thirty (30) days from the end of the reporting period,
after having converted each applicable monthly sales in
foreign currency into Swiss Francs using the average rate of
exchange published in the Wall Street Journal (or some other
source agreed upon by the Parties for any particular country)
for each respective month of the reporting period.
6.2 Payments. After the Launch of the Product in any country of the
Territory, Roche shall calculate royalty payments set forth in Article
5 quarterly as of March 31, June 30, September 30 and December 31 (each
being the last day of a reporting period). Roche shall pay such
payments quarterly within sixty (60) days after the end of each
reporting period in which Net Sales occur during the Agreement Term.
With each such payment, Roche shall deliver to Memory the following
information split between the US and the ROW Territory:
(a) Adjusted Gross Sales for each Product;
(b) Net Sales for each Product;
(c) the royalty payments due to Memory for the reporting period;
If Memory reasonably requests additional information relating to gross
sales of the Products in the Major Market Countries, deductions
therefrom to calculate Adjusted Gross Sales or Net Sales and/or
adjustments thereto, Roche agrees to provide such information to Memory
within a reasonable time, provided, that Memory shall have the rights
to exercise such requests not more than once during any period of
twelve (12) consecutive months.
In the event Roche does not pay Memory any amounts due under this
Agreement, including pursuant to Articles 4 and 5, within the
applicable time period set forth herein, without limiting Memory's
rights under Article 16, such payment shall bear interest, to the
extent permitted by applicable law, at the rate of interest (prime
rate) as published from time to time in the weekly Federal Reserve H.15
bulletin (or a successor or similar publication) plus [*]% for the
applicable period calculated on the number of days such a payment is
overdue.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
6.3 Taxes.
-----
(a) Memory shall pay all applicable taxes levied on Memory under
this Agreement.
(b) If provision is made in law or regulation of any country for
withholding of taxes of any type, levies on Memory or other
charges against Memory with respect to any amounts payable
under this Agreement to Memory, Roche shall promptly pay such
tax, levy or charge for and on behalf of Memory to the proper
governmental authority, and shall promptly furnish Memory with
receipt of such payment. Roche shall have the right to deduct
any such tax, levy or charge actually paid from payment due
Memory or be promptly reimbursed by Memory if no further
payments are due Memory. Each Party agrees to assist the other
Party in claiming exemption from such deductions or
withholdings under double taxation or similar agreement or
treaty from time to time in force and in minimizing the amount
required to be so withheld or deducted.
6.4 Blocked Countries. If by reason of law Roche is unable to convert to
U.S. Dollars a portion of the amount due by Roche under this Agreement,
then Roche shall notify Memory in writing and, upon written request
from Memory, Roche shall pay to Memory such portion, in the currency of
any other country designated by Memory and legally available to Roche.
6.5 Accounting.
----------
(a) Roche shall maintain and cause its Affiliates and sublicensees
to maintain books of account containing all particulars that
may be necessary for the purpose of calculating all payments
under this Agreement. Such books of account shall be kept at
their principal place of business. Memory shall have the right
to engage Roche's independent, certified public accountant to
perform, on behalf of Memory, an audit of such books and
records of Roche and its Affiliates and sublicensees as is
necessary to confirm any amounts payable to Memory under this
Agreement for the period or periods requested by Memory and the
correctness of any report or payments made under this
Agreement.
(b) Such audits shall be conducted during normal business hours
upon reasonable prior written notice from Memory (minimum of
thirty (30) days) in such a manner as to not unnecessarily
interfere with Roche's normal business activities, and shall
include results of no more than three (3) preceding calendar
years prior to audit notification.
(c) Such audit shall not occur more frequently than once per
calendar year nor more frequently than once with respect to
records covering any specific period of time. Notwithstanding
the preceding, if Memory reasonably believes, after reviewing
information received from Roche's independent public
accountant, that an additional audit is appropriate to address
an apparent discrepancy between Roche's returns and other
information as is necessary for reporting hereunder, Memory
shall have the right, by an audit specialty firm reasonably
acceptable to Roche, employed by Memory and at Memory's own
expense, to perform such appropriate audit procedures.
(d) The use of all information, data, documents and abstracts
referred above shall be for the sole purpose of verifying
statements or compliance with this Agreement, shall be treated
as Roche Confidential Information subject to Article 15 of this
Agreement and, except in the event of a dispute between the
Parties regarding amounts payable hereunder or the results of
any audit, need not be retained more than three (3) years from
the end of the
[*] CONFIDENTIAL TREATMENT IS REQUESTED
calendar year to which each shall pertain. Audit results shall
be shared by Roche and Memory.
(e) If any audit hereunder reveals an underpayment, Roche shall
promptly make up such underpayment. If any audit hereunder
reveals an overpayment, Memory shall promptly reimburse such
overpayment. Memory shall bear the full cost of any audit under
this Section 6.5, unless such audit discloses an underpayment
by Roche of more than [*] percent ([*]%) of the amount owed
hereunder if Net Sales exceeds [*] dollars ($[*]) in the
Territory for the calendar year, or [*] percent ([*]%) of the
amount owed hereunder if Net Sales are equal to or less than
[*] dollars ($[*]) in the Territory for the calendar year, in
which case Roche shall bear the full cost of such audit as
performed by Roche's independent, certified public accountant
and any audit specialty firm employed by Memory, together with
interest on any such underpayment from the date otherwise due
through the date of payment at the rate set forth in Section
6.2.
(f) The failure of Memory to request verification of any payment
calculation during which corresponding records are required to
be retained under this Section 6.5 shall be considered
acceptance of such reporting by Memory.
ARTICLE 7. GOVERNANCE
7.1 The Strategic Alliance. The Parties hereby establish a Strategic
Alliance with respect to the development of Products and the
determination of licensing rights with respect thereto.
7.2 Joint Liaison Team. A Joint Liaison Team ("JLT") shall govern the
research and development activities of the Strategic Alliance,
including preparing development plans, supervising ongoing research and
development activities, recommending actions in response to unforeseen
events, supervising the transition of development and manufacturing
activities from Memory to Roche and development of preclinical and
clinical strategies (including clinical candidate selection, the
commencement of the Initiation of Phase I and the Initiation of Phase
IIa).
(a) Organization. The JLT shall consist of five (5) members, two
(2) members to be designated by Roche and three (3) members to
be designated by Memory. Each Party shall notify the other
Party of the member(s) designated by such Party, in writing,
within thirty (30) days after the Effective Date. Any Party
may withdraw the designation of any of its members of the JLT
and designate a replacement at any time by giving prior
written notice of the withdrawal and identifying the
replacement to the other Party. The chairperson of the JLT
shall be from Memory.
(b) Meetings. The JLT shall hold semi-annual meetings on mutually
agreeable dates, with the location of the meetings to
alternate between Memory and Roche, or their Affiliate's,
facilities. The frequency and location of such meetings may be
modified by mutual agreement of the Parties. Notwithstanding
the foregoing, one of the semi-annual meetings per year may be
held by videoconference. Each Party shall pay its own expenses
associated with the meeting. Each Party may, in its
discretion, invite non-member employees to attend meetings of
the JLT.
(c) Decision-Making. Decisions of the JLT shall be by consensus,
with each Party having one collective vote. If the JLT is
unable to decide a matter by consensus, the Parties shall
refer such matter for resolution to the Head of Global
Research or the Head of Global Development on behalf of Roche
and the Chief Scientific Officer of Memory ("Alliance
[*] CONFIDENTIAL TREATMENT IS REQUESTED
Executives"). If the Alliance Executives are unable to resolve
any such matter after good faith discussions, then the final
decision shall rest with Memory.
(d) Dissolution. The JLT automatically shall be dissolved upon the
end of the last to expire License Exercise Period, unless the
Parties otherwise agree in writing.
7.3 Research and Development Activities. Subject to the provisions of
Section 3.1 and the oversight of the JLT, Memory shall conduct, at its
cost except as provided in Section 4.3 those research and development
activities through the End of Phase IIa with respect to the Products
that Memory deems necessary or appropriate.
During the five (5) year period after the Effective Date, Memory shall
obtain the prior written consent of Roche (which consent shall not be
unreasonably withheld) before Memory shall commence the Initiation of
Phase I with respect to more than [*] nicotinic alpha-7 agonist
compounds.
7.4 Progress Reports. Within fifteen (15) days after the end of each
calendar quarter, Memory shall prepare and deliver to Roche a written
progress report for the JLT summarizing in reasonable detail the
results to date of the Strategic Alliance, although Memory shall have
no obligation to disclose any compound structures until the Initiation
of Phase I with respect to such compound, except for Memory's
obligation to provide such information to Roche pursuant to Section 2.2
or Section 4.6 hereof. In addition, upon request, Roche shall have the
right to receive copies of the raw data from all test results of
nicotinic alpha-7 agonist compounds. After each meeting, the JLT shall
prepare a report summarizing the discussions held and conclusions
reached and setting forth plans for the Strategic Alliance for the next
six (6) months.
ARTICLE 8. CLINICAL DEVELOPMENT
8.1 Development. Memory, at its sole cost except as provided in Section
2.5, shall pursue clinical development of each Product through the date
that Roche obtains a License with respect to such Product and, subject
to the provisions of Section 3.1 hereof and oversight of the JLT, shall
have sole control of all such clinical development activities. Roche,
at its sole cost except as provided in Section 2.5, shall (1) pursue
clinical development of each Product from and after the date that Roche
obtains a License with respect to such Product and, subject to the
provisions of Section 3.1 hereof and oversight of the DRT, be
responsible for all such clinical development activities, and (2)
obtain all government and health authority approvals which are required
for Products to be manufactured and offered for sale in the Territory,
including authorizations as may be required for the production,
importation, pricing, reimbursement, and sale of Products in the
Territory.
8.2 Development Review Team.
-----------------------
(a) Development Review Team Membership. For a given Product, no
later than sixty (60) days after the End of Phase IIa for a
Product, the Parties shall establish a Development Review Team
(the "DRT") consisting of up to three (3) representatives from
Roche and one (1) representative of Memory. Each Party may
select alternative representatives to replace its DRT members
selected by such Party as necessary, and may have other
representatives attend meetings of the DRT in addition to the
representatives of the Team. All guidance provided by the DRT
shall be based upon the majority opinion of the DRT.
(b) DRT Meetings and Responsibilities. No less than two times per
year for so long as the DRT contemplates clinical development
of a Memory Compound in the Territory for the
[*] CONFIDENTIAL TREATMENT IS REQUESTED
purpose of obtaining Regulatory Approval in a country of the
Territory. Roche shall organize meetings of the DRT.
At its meetings, the DRT shall conduct a peer review of Roche's
development of Products in the Territory and shall provide
Roche with strategic guidance with respect to Roche's
development of Products in the Territory.
Roche shall report to the DRT on all significant clinical and
regulatory issues relating to Products, and the DRT shall make
recommendations and provide strategic guidance with respect to
such issues.
(c) Costs. Each party shall be responsible for bearing its own
costs related to the DRT.
ARTICLE 9. REGULATORY APPROVALS
Memory, at its sole cost, except as provided in Section 4.3, shall pursue all
Regulatory Approvals in the Territory related to each Product through the date
that Roche obtains a License with respect to such Product. Roche, at its sole
cost, shall pursue all Regulatory Approvals in the Territory related to each
Product from and after the date that Roche obtains a License with respect to
such Product, including the preparation and filing of applications for
Regulatory Approvals, as well as any or all governmental approvals required to
manufacture, or have manufactured, and sell Products. Roche shall be responsible
for pursuing, compiling and submitting all regulatory filing documentation, and
for interacting with regulatory agencies, for all Products in all countries in
the Territory. Roche or its Affiliates shall own and file all regulatory filings
and Regulatory Approvals for all Products in all countries of the Territory.
Roche shall supply Memory with a copy of all material communications related to
Product to or from the regulatory agencies for all Major Market Countries. Upon
request of Memory, Roche shall supply Memory with a copy of all such
communications in all countries.
Roche, at its sole cost, shall report to appropriate authorities in accordance
with local requirements all adverse events related to use of Products worldwide.
Adverse events related to the use of Product worldwide shall be in a single
database, centralized, held and owned by Roche. Roche shall notify Memory of
material adverse events related to Products.
ARTICLE 10. MANUFACTURE AND SUPPLY
10.1 Clinical Supplies of Product. Memory shall supply at its own cost all
clinical supply of each Product and placebo to be used in the Territory
through the date that Roche obtains a License with respect to such
Product, either by itself or through a Third Party. Roche shall supply
at its own cost all clinical supply of each Product and placebo to be
used in the Territory from and after the date that Roche obtains a
License with respect to such Product and during the remainder of the
Agreement Term, either by itself or through a Third Party. Roche's
requirements for supplying Product necessary to fill orders for sales
for any particular calendar quarter shall take precedence over
providing clinical supplies of the Product to Memory for that calendar
quarter. The Parties shall cooperate in all reasonable respects
relating to the transition of manufacturing activities from Memory to
Roche. (For example, Roche will need Memory to continue to provide
clinical supplies of the Product during this transition period.)
10.2 Commercial Supply. Roche shall be solely and exclusively responsible at
its own expense for the manufacture and supply of Product for sale in
the Territory, either by itself or through Third Parties.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
ARTICLE 11. COMMERCIALIZATION
Except as expressly set forth in Section 2.5, Roche, at its own expense, shall
have sole responsibility and decision making authority for the marketing,
promotion, sale and distribution of Product in the Territory. During the
Agreement Term, upon written request of Memory not to exceed once per year,
Roche will fully inform Memory regarding the commercialization of Products in
the Territory by Roche, its Affiliates and sublicensees.
ARTICLE 12. TRADEMARKS
Roche shall own worldwide all trademarks on and in connection with Products, and
shall, at its cost, be responsible for procurement, maintenance and enforcement
of all worldwide trademarks registration on and in connection with Products.
ARTICLE 13. OWNERSHIP OF INTELLECTUAL PROPERTY AND PATENT RIGHTS
13.1 Ownership of Intellectual Property. Ownership of any Patent Rights
developed in the course of the Strategic Alliance shall be determined
in accordance with United States federal law. Memory shall own all
Inventions having as inventors only employees, consultants or agents of
Memory or its Affiliate. Memory shall require all of its employees,
consultants and agents to assign all inventions related to Products
made by them to Memory.
13.2 Patent Prosecution and Maintenance.
----------------------------------
(a) General. Memory shall have the right, but not the obligation,
to prepare, file, prosecute (including interference and
opposition proceedings) and maintain (including interferences,
re-examination and opposition proceedings) (collectively,
"Handle") the Memory Patent Rights.
Should Memory decide that it does not desire to Handle a
Memory Patent Right in a given country, it shall provide
written notice to Roche thereof no less than sixty (60) days
prior to the date when the Memory Patent Right would become
abandoned in such country. After receiving such notice, Roche
may, but is not obligated, to Handle the Memory Patent Right
in such country.
(b) Memory Prosecution Obligations Prior to Roche Exercise. Prior
to Roche exercising its right to obtain a License pursuant to
Section 2.1 hereof, Memory shall have no obligation to consult
Roche with respect to prosecution or maintenance of any Memory
Patent Rights. However, Memory shall have an obligation to
keep Roche informed generally as to the status of any pending
patent applications and issued patents. Memory will provide
Roche with updates as to the status of Memory's patent
prosecution on a regular basis (but no less than once per
quarter).
(c) Memory Prosecution Obligations After Roche Exercise. After
Roche has exercised its right to obtain a License pursuant to
Section 2.1 hereof, Roche shall reimburse Memory, on a
patent-by-patent basis, as to any Memory Patent Rights
Covering the Product for which Roche has exercised its right
to a License for fifty percent (50%) of any reasonable and
documented external costs for Handling such patent or patent
application incurred after the date Roche obtained such
License.
If Roche obtains a License with respect to any Patent Rights
Covering a Product, then:
[*] CONFIDENTIAL TREATMENT IS REQUESTED
(A) Memory shall use reasonable efforts to consult with
Roche as to the Handling of any Memory Patent Rights in
sufficient time (for example, thirty (30) days for
instances where actions are due within three (3) months
of a communication from a Patent Office) before any
action is due to allow Roche to provide comments
thereon, which comments Memory must reasonably consider
if provided to Memory at least thirty (30) days before
such action is due.
(B) Memory shall promptly notify and consult with Roche
regarding any priority patent application ("Invention
Priority Application") Covering such Product before
filing said application.
(C) Memory shall promptly prepare and send to Roche a draft
of the Invention Priority Application for the Roche's
comment and approval, which shall be provided within
thirty (30) days after receipt of such draft Invention
Priority Application ("Comment Period").
(D) After reasonably considering Roche's comments, Memory
shall file the Invention Priority Application. If Roche
fails to provide comments on a draft within the Comment
Period, Memory shall be free to file the Application at
the end of the Comment Period or later.
(E) Within nine (9) months after the filing of an Invention
Priority Application, Memory shall provide Roche a
written list of countries ("Country List") in which
Memory intends to file patent applications that claim
priority from the given Invention Priority Application.
Roche, as promptly as practicable, shall notify Memory
in writing of those countries on the Country List and
any additional countries ("Additional Countries") where
Roche requests that patent applications be filed. In
turn, Memory promptly shall notify Roche if it agrees
with the filing of applications in such Additional
Countries selected by Roche.
(F) Memory shall file patent applications at least in those
countries where Roche and Memory agree to the filing of
patent applications ("Mutually Agreed to Countries") as
well as in Additional Countries selected by Roche that
are not within the Mutually Agreed to Countries,
provided that Roche shall reimburse Memory for the
reasonable external prosecution costs in the Additional
Countries. Memory shall have the option of filing an
international application designating at least the
Mutually Agreed to Countries, to be followed by national
filings in the desired countries.
(G) Memory shall be responsible for the filing and
prosecution of the patent applications and the
maintenance of the granted patents as to the Mutually
Agreed to Countries. Memory and Roche each will pay
fifty percent (50%) of the reasonable external costs
relating to the preparation, filing and prosecution of
the patent applications and the maintenance of the
granted patents.
(H) As to those countries where Roche and Memory do not
agree to the filing of patent applications, the Party
requesting the filing in said country shall be
responsible for all costs relating to the filing and
prosecution of the patent applications and the
maintenance of the granted patents in said countries.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
(I) Should Roche not respond to Memory within thirty (30)
days after the date Memory provides the Country List,
then Memory shall be free to initiate patent filings, at
Memory's sole expense and discretion, in the countries
Memory has selected or still selects.
(J) Memory's failure to notify Roche to the contrary within
thirty (30) days after the date upon which Roche
notifies Memory of the Additional Countries will be
deemed an agreement on the part of Memory to file patent
applications in all such Additional Countries and to pay
fifty percent (50%) of the reasonable external costs
associated with such filings.
(K) If, in a country, at any time, Roche decides not to
continue funding the prosecution of a patent application
or maintenance of a patent under this Section 13.2,
Roche shall notify Memory in writing ("Withdrawal
Notice"), and Roche shall be relieved from paying any
further expenses with regard to the patent filing in the
country. After receiving the Withdrawal Notice, Memory
may but is not obligated, at its sole expense and
discretion, to continue to prosecute and maintain the
patent filing in the country.
(L) If, in a country, at any time, Memory decides not to
continue the prosecution of a patent application or
maintenance of a patent under this Section 13.2, and
such patent application or patent is not one as to which
Roche has already sent a Withdrawal Notice, then Memory
shall notify Roche in writing no less than sixty (60)
days prior to the date when the patent application or
patent would become abandoned in such country. At
Roche's written request and no cost to Memory, Memory
shall then assign to Roche such patent application or
patent in such country, and Roche may thereafter
continue to prosecute and maintain the patent filing in
the country, at Roche's own cost and in Roche's name, to
the extent Roche desires to do so.
(M) For the Mutually Agreed to Countries and Additional
Countries, Memory shall consult with Roche as to the
prosecution and maintenance of all patent applications
and patents claiming Inventions in sufficient time (for
example, thirty (30) days for instances where actions
are due within three (3) months of a communication from
a Patent Office) before any action is due to allow Roche
to provide comments thereon, which comments Memory must
reasonably consider.
13.3 Prosecution Costs. Memory shall be solely responsible for payment of
the reasonable costs to Handle the Memory Patent Rights, except as
otherwise provided in Section 13.2 above.
13.4 Cooperation. The Parties agree to cooperate in the preparation,
prosecution and maintenance of all patent applications filed under
Article 13, including obtaining and executing necessary powers of
attorney and assignments by the named inventors, providing relevant
technical reports to Memory concerning the invention disclosed in such
patent application, obtaining execution of such other documents which
shall be needed in the filing and prosecution of such patent
applications, discussing in good faith foreign filing strategy, and, as
requested, updating each other regarding the status of such patent
applications.
13.5 Infringement. Each Party shall promptly provide written notice to the
other Party during the Agreement Term of any known infringement or
suspected infringement of any Memory Patent Right by a Third Party
making, using, offering for sale, selling, or importing a compound
which
[*] CONFIDENTIAL TREATMENT IS REQUESTED
is a nicotinic alpha-7 agonist or a product containing a compound
which is a nicotinic alpha-7 agonist (collectively "NA7 Infringement").
After Roche has exercised its right to obtain a License with respect to
a Product, Roche shall have the first right to bring and control any
action or proceeding with respect to NA7 Infringement relating to a
Memory Patent Right Covering such Product at Roche's own expense and by
counsel of its own choice, and Memory shall have the right, at its own
expense, to be represented in any such action by counsel of its own
choice. If Roche fails to bring any such action or proceeding with
respect to NA7 Infringement within (a) [*] days following the notice of
alleged infringement or (b) [*] days before the time limit, if any, set
forth in the appropriate laws and regulations for the filing of such
actions, whichever comes first, Memory shall have the right to bring
and control any such action at its own expense and by counsel of its
own choice, and Roche shall have the right, at its own expense, to be
represented in any such action by counsel of its own choice.
A Party that elects to bring and control an infringement action
pursuant to this Section 13.5 shall provide prompt written notice to
the other Party of any such suit commenced or action taken by such
Party.
Upon written request, the Party bringing suit or taking action
("Initiating Party") shall keep the other Party informed of the status
of any such suit or action and shall provide the other Party with
copies of all substantive documents and communications filed in such
suit or action. The Initiating Party shall have the sole and exclusive
right to select counsel for any such suit or action.
The Initiating Party shall, except as provided below, pay all expenses
of the suit or action, including, without limitation, the Initiating
Party's attorneys' fees and court costs. Prior to Roche exercising its
right to obtain a License with respect to the Product that is the
subject of the suit or action, Memory shall pay attorneys' fees and
court costs and shall be entitled to retain any damages, settlement
fees or other consideration received as a result of such suit or
action. After Roche has exercised its right to obtain a License with
respect to the Product which is the subject of such suit or action, the
Parties' attorneys' fees and court costs in connection with any such
suit or action shall be deducted from any damages, settlement fees or
other consideration received as a result of such suit or action and the
balance thereof shall belong to the Initiating Party, except to the
extent such damages, settlement fees or other consideration are
attributable to lost profits with respect to Products in the Territory,
in which case the Parties shall share in such recovery as follows: (i)
if Memory has exercised its co-promotion right with respect to such
Product, Memory shall receive [*]% of the lost profits for such Product
and Roche shall receive the remaining [*]%; or (ii) if Memory has not
exercised its co-promotion right with respect to such Product, Memory
shall receive the royalty that it would have pursuant to Article 5 had
the infringing sales been made by the Parties, and Roche would receive
the balance of the recovery.
If the Initiating Party believes it reasonably necessary, upon written
request to the other Party, the other Party shall join as a party to
the suit or action but shall be under no obligation to participate
except to the extent that such participation is required as the result
of its being a named party to the suit or action. At the Initiating
Party's written request, the other Party shall offer reasonable
assistance to the Initiating Party at no charge to the Initiating Party
except for reimbursement of reasonable out-of-pocket expenses incurred
by the other Party in rendering such assistance. The other Party shall
have the right to participate and have its own representation in any
such suit or action at its own expense.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
Prior to Roche obtaining a License with respect to the Product which is
the subject of such suit or action, Memory shall have the sole right to
control any settlement and all negotiations relating thereto. After
Roche has exercised its right to obtain a License with respect to the
Product which is the subject of suit or action, the Initiating Party
shall have the right to control settlement; provided, however, that no
settlement shall be entered into without the written consent of the
other Party, not to be unreasonably withheld.
For the avoidance of doubt, Memory shall have the right, but not the
obligation, to bring and control any action or proceeding with respect
to any Memory Patent Right relating to infringement other than NA7
Infringement, at its own expense, without obligation or notice to
Roche.
13.6 Xxxxx-Xxxxxx. Notwithstanding anything to the contrary, should a Party
receive a certification for a Product pursuant to the Drug Price
Competition and Patent Term Restoration Act of 1984 (Public Law
98-417), as amended, or its equivalent in a country other than the US,
then such Party shall immediately provide the other Party with a copy
of such certification. Prior to Roche exercising its right to obtain a
License which respect to a Product, then Memory shall have the sole
right to enforce Memory Patent Rights Covering such Product. After
Roche has exercised its right to obtain a License with respect to a
Product, then Roche shall have the right to enforce Memory Patent
Rights Covering such Product; and Roche shall have [*] days from the
date on which it receives or provides a copy of such certification to
provide written notice to Memory ("H-W Suit Notice") whether Roche will
bring suit, at its expense, within a [*] day period from the date of
such certification. Should such [*] day period expire without Roche
bringing suit or providing such H-W Suit Notice, then Memory shall be
free to immediately bring suit in its name. If Roche brings suit, at
Roche's written request, Memory agrees to be named as a party to such
suit.
13.7 Patent Notices. All notices provided under this Article 13 to Roche
shall be given to:
X.Xxxxxxxx-Xx Xxxxx Ltd
Xxxxxxxxxxxxxxxxx 000
XX-0000 Xxxxx, Xxxxxxxxxxx
Attn: Head, Patent Law
with copies of all notices relating to U.S. cases to:
Xxxxxxxx-Xx Xxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxx Xxxxxx 00000
Attn: Chief Patent Counsel
All notices provided under this Article 13 to Memory shall be given to:
Memory Pharmaceutical Corp.
000 Xxxxxxx Xxxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attn: Head of Business Development
With copies of all notices to:
Millen, White, Xxxxxx and Xxxxxxxx, P.C.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
Arlington Courthouse, Plaza I
0000 Xxxxxxxxx Xxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx Xxxxxx, Esq.
ARTICLE 14. REPRESENTATIONS AND WARRANTIES
14.1 Representations and Warranties of Both Parties. Each Party warrants and
represents to the other Party that it has the full right and authority
to enter into this Agreement and that it is not aware of any impediment
which would inhibit its ability to perform the terms and conditions
imposed on it by this Agreement.
14.2 Representations and Warranties of Memory.
----------------------------------------
(a) Corporate Action. Memory represents and warrants to Roche that
all corporate action on the part of Memory, its officers,
directors and stockholders necessary for (i) the
authorization, execution and delivery of this Agreement and
(ii) the performance of all obligations of Memory hereunder
has been taken and this Agreement constitutes the legal and
binding obligation of Memory, enforceable against Memory in
accordance with its terms.
(b) No Conflict. Memory represents and warrants to Roche that the
execution of this Agreement and the performance of the
transactions contemplated by this Agreement by Memory will not
conflict with or result in a breach of any of the terms,
conditions or provisions of, or constitute a default under any
agreement or other instrument to which Memory is a party or by
which it or any of its property is bound.
(c) Right to Grant Licenses. Memory represents and warrants to
Roche that it has the right to xxxxx Xxxxx the licenses and
sublicenses that Memory hereby grants to Roche under this
Agreement.
(d) Third Party Patent Infringement. Memory represents and warrants
that as of the Effective Date, to its actual knowledge of its
senior executives, after consultation with patent counsel,
there is no issued patent right owned or controlled by any
Third Party which Covers the lead compounds of the Program
identified by Memory to Roche and would prevent Roche from
selling such Memory Compound in any country of the Territory.
As of the date hereof, the Memory Patent Rights in existence as
of the Effective Date are owned exclusively by Memory; and
Memory's senior executives, after consultation with patent
counsel, have no actual knowledge of any information that
would, in their opinion, render invalid and/or unenforceable
Composition of Matter Claims for the lead compounds of the
Program in such Memory Patent Rights.
(e) No Material Mistatements. Memory warrants and represents to
Roche that (i) its senior executives have not intentionally
failed to disclose any information actually known to them which
in their reasonable opinion, would be material to Roche
entering into this Agreement, and to the actual knowledge of
such senior executives such information does not contain any
untrue statement of material fact or omit to state a material
fact; (ii) it has provided correct and complete copies of all
documents furnished to Roche.
14.3 Representations and Warranties of Roche. Roche represents and warrants
to Memory that all corporate action on the part of Roche, its officers,
directors and stockholders necessary for (i) the
[*] CONFIDENTIAL TREATMENT IS REQUESTED
authorization, execution and delivery of this Agreement and (ii) the
performance of all obligations of Roche hereunder has been taken and
this Agreement constitutes the legal and binding obligation of Roche,
enforceable against Roche in accordance with its terms. The execution
of this Agreement and the performance of the transactions contemplated
by this Agreement by Roche will not conflict with or result in a breach
of any of the terms, conditions or provisions of, or constitute a
default under any agreement or other instrument to which Roche is a
party or by which it or any of its property is bound.
14.4 Disclaimer. THE FOREGOING REPRESENTATIONS AND WARRANTIES ARE IN LIEU OF
ALL OTHER REPRESENTATIONS AND WARRANTIES NOT EXPRESSLY SET FORTH
HEREIN. MEMORY AND ROCHE DISCLAIM ALL OTHER REPRESENTATIONS AND
WARRANTIES, WHETHER EXPRESS OR IMPLIED, WITH RESPECT TO EACH OF THEIR
RESEARCH, DEVELOPMENT AND COMMERCIALIZATION EFFORTS HEREUNDER,
INCLUDING, WITHOUT LIMITATION, WHETHER THE PRODUCTS CAN BE SUCCESSFULLY
DEVELOPED OR MARKETED, THE ACCURACY, PERFORMANCE, UTILITY, RELIABILITY,
TECHNOLOGICAL OR COMMERCIAL VALUE, COMPREHENSIVENESS, MERCHANTABILITY
OR FITNESS FOR ANY PARTICULAR PURPOSE WHATSOEVER OF THE PRODUCTS. IN NO
EVENT SHALL EITHER MEMORY OR ROCHE BE LIABLE FOR SPECIAL, INDIRECT,
INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THIS AGREEMENT BASED
ON CONTRACT, TORT OR ANY OTHER LEGAL THEORY.
ARTICLE 15. CONFIDENTIAL INFORMATION
15.1 Treatment of Confidential Information. In carrying out rights and
obligations under this Agreement, the Parties will be sharing
proprietary information ("Confidential Information") with each other.
Except as permitted by this Agreement, each Party shall and shall cause
its Affiliates to treat Confidential Information received from the
other Party as it treats its own proprietary information. In
particular, it shall not disclose, divulge or otherwise communicate
such Confidential Information to Third Parties, or use it for any
purpose except pursuant to and in order to carry out its obligations
under this Agreement during the Agreement Term and for a period of [*]
years thereafter; provided that, each Party (i) may disclose the
Confidential Information to such of its directors, officers, employees,
Affiliates, consultants, subcontractors, sublicensees or agents to the
extent reasonably necessary to carry out its obligations under this
Agreement, and (ii) hereby agrees to exercise every reasonable
precaution to prevent and restrain the unauthorized disclosure or use
of Confidential Information.
15.2 Release from Restrictions. The provisions of Section 15.1 shall not
apply to any Confidential Information which:
(a) was known or used by the Receiving Party or its Affiliates
prior to its date of disclosure to the Receiving Party or its
Affiliates by the Disclosing Party or its Affiliates, as
evidenced by the prior written records of the Receiving Party
or its Affiliates; or
(b) either before or after the date of the disclosure to the
Receiving Party or its Affiliates, is lawfully disclosed to
the Receiving Party or its Affiliates by a Third Party
rightfully in possession of the Confidential Information; or
(c) either before or after the date of the disclosure to the
Receiving Party or its Affiliates, becomes published or
generally known to the public through no fault or omission on
the
[*] CONFIDENTIAL TREATMENT IS REQUESTED
part of the Receiving Party or its Affiliates, but such
inapplicability applies only after such information is
published or becomes generally known; or
(d) is independently developed by the Receiving Party or its
Affiliates without reference to or reliance upon any
Confidential Information of the Disclosing Party or its
Affiliates; or
(e) is reasonably determined to be required to be disclosed by the
Receiving Party or its Affiliates to comply with applicable
securities or other laws, to defend or prosecute litigation or
to comply with governmental regulations, provided that, the
Receiving Party or its Affiliates uses all reasonable efforts
to provide prior written notice of such disclosure to the
Disclosing Party or its Affiliates and to take reasonable and
lawful actions to avoid or limit such disclosure; or
(f) is disclosed to a Party's financial sources or potential
acquirors of its stock or assets (directly or indirectly) so
long as, with respect to a potential purchase the potential
acquirer or financial source executes a confidentiality
agreement which is at least as restrictive as the provisions of
this Article 15.
15.3 Exceptions. The restrictions set forth in this Article 15 shall not
prevent either Party from (i) preparing, filing, prosecuting or
maintaining a patent application or its resulting patents related to a
Product in accordance with the terms of this Agreement or (ii)
disclosing Confidential Information to governmental agencies to the
extent required or desirable to secure government approval for the
development or marketing of a Product.
15.4 Publications. During the Agreement Term, the following provisions shall
apply with respect to the disclosure in scientific journals,
publications or scientific presentations by any Party relating to any
scientific work performed as part of the Strategic Alliance:
(a) A Party (the "Publishing Party") shall provide the other Party
with a copy of any proposed publication relating to the work
performed and/or the results achieved in the conduct of the
Strategic Alliance at least forty-five (45) days prior to
submission for publication so as to provide such other Party an
opportunity to recommend any changes it reasonably believes are
necessary to preserve the Confidential Information belonging in
whole or in part to such other Party, and the incorporation of
such recommended changes shall not be unreasonably refused;
(b) If such other Party in writing notifies ("Notice") the
Publishing Party, within forty-five (45) days of receipt of the
copy of the proposed publication, that such publication in its
reasonable judgment (i) contains an Invention for which the
other Party reasonably desires patent protection or (ii)
disclosure to competitors could be expected to have a material
adverse effect on the commercial value of any Confidential
Information, the Publishing Party shall prevent such
publication or delay such publication for a mutually agreeable
period of time. In the case of Inventions, a delay shall be for
a period reasonably sufficient to permit the timely preparation
and filing of a patent application(s) or application(s) on the
Invention, and in no event less than ninety (90) days from the
date of Notice.
ARTICLE 16. TERM AND TERMINATION
16.1 Conditions Subsequent. If the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements
Act of 0000 (xxx "XXX Xxx") applies to the transactions contemplated by
this Agreement, the effectiveness of this
[*] CONFIDENTIAL TREATMENT IS REQUESTED
Agreement and the transactions contemplated hereunder shall be subject
to and shall be contingent upon the satisfaction under the following
condition subsequent to the execution of this Agreement. The condition
subsequent shall be the earlier to occur of (i) approval of the
transaction by the Federal Trade Commission or the appropriate US
anti-trust authorities or (ii) the expiration or termination of all
applicable waiting periods, requests for information (and any
extensions thereof) under the HSR Act.
Subject to the terms and conditions of this Agreement, each Party shall
use all reasonable efforts to take, or cause to be taken, all
reasonable actions and to do, or cause to be done, all things necessary
and appropriate to satisfy the condition subsequent and to consummate
the transactions contemplated by this Agreement in accordance with the
terms hereof.
Each Party shall cooperate with the other Party in the preparation,
execution and filing of all documents that are required or permitted to
be filed on or before the Effective Date for the purpose of
consummating this transaction, including, filings pursuant to the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976. Each Party shall
bear its own costs with respect to preparing, executing and filing such
documents.
16.2 Agreement Term. The Agreement Term shall commence on the Effective Date
and end, unless earlier terminated upon the mutual agreement of the
Parties or in accordance with the provisions of this Article 16, on the
date of expiration of all royalty and other payment obligations (the
"Expiration Date") under this Agreement. Upon the occurrence of the
Expiration Date, if any, the Licenses granted to Roche by Memory under
this Agreement to make, have made, use, offer for sale, sell and import
Products shall be fully paid-up.
16.3 Termination for Breach. (a) Each Party ("Non-Breaching Party") shall be
entitled to terminate this Agreement by written notice to the other
Party ("Breaching Party") in the event that the Breaching Party is in
default of any of its material obligations hereunder and fails to
remedy such default within sixty (60) days (thirty (30) days for
payment defaults) after provision of written notice thereof by the
Non-Breaching Party. Any such notice shall specifically state that the
Non-Breaching Party intends to or reserves the right to terminate this
Agreement in the event that the Breaching Party shall fail to timely
remedy the default.
The effective date of termination under this Section for breach of a
material obligation shall be the date sixty (60) days after provision
of written notice thereof by the Non-Breaching Party.
In the event Roche does not pay any full payment by reason of a good
faith dispute as to whether such payment is due pursuant to the terms
of this Agreement, Memory shall not have the right to terminate this
Agreement as a result of such nonpayment until resolution of the
dispute.
16.4 Roche's Right to Terminate.
--------------------------
(a) Roche shall have the unilateral right to elect not to maintain
its license rights with respect to any Product pursuant to
Section 2.1 hereof, on a Product-by-Product basis, upon the
occurrence of each event described in Section 4.4 hereof with
respect to such Product. Roche may exercise such right by
giving written notice thereof to Memory within thirty (30) days
after the occurrence of such event. In the event Roche
exercises such right, Roche shall not have any obligation to
make the payment to Memory related to such event and shall not
have the right to obtain a License with respect to such
Product, and this Agreement shall terminate with respect to
such Product and Roche shall have no
[*] CONFIDENTIAL TREATMENT IS REQUESTED
further obligation to make any payments pursuant to Sections
4.4 and 4.5 and Article 5 hereof relating to such Product.
(b) Roche shall have the unilateral right to terminate this
Agreement on a region-by-region basis (the regions being North
America (US and Canada), Europe and Asia)) or
Product-by-Product, either on a worldwide basis or as to North
America (US and Canada) only or ex-North America only, at any
time by providing six (6) months prior written notice to
Memory; provided, however, that if the Parties do not agree as
to a proposed sublicense for which Memory has withheld consent,
Roche shall have a unilateral right to terminate this Agreement
for the territory to which such proposed sublicense relates.
Notwithstanding the preceding sentence, if there has been a
launch of a Product in a Major Market Country, then such prior
notice must be for twelve (12) months. The effective date of
termination under this Section shall be the date six (6) months
(or twelve (12) months as the case may be) after Roche provides
such written notice to Memory.
16.5 Consequences of Termination.
---------------------------
Upon (a) any termination of this Agreement in its entirety pursuant to
Section 16.2, (b) termination of this Agreement by Roche of this
Agreement in its entirety or in a region or country or in respect of a
Product pursuant to Section 16.4 hereof, or (c) termination of this
Agreement by Memory in its entirety or in a region pursuant to Article
3, any and all rights and licenses of any kind or nature granted by
Memory to Roche under this Agreement (or, as applicable, with respect
to termination of this Agreement as to a country, region or Product,
respectively) shall terminate on the effective date of termination. In
the event of any such termination, the following shall apply.
(a) Roche shall, upon Memory's written request, assign and transfer
to Memory, or its Affiliates as requested by Memory, at no
expense to Memory, or its Affiliates, and free of any liens,
pledges or security interests other than those incurred in the
commercialization of the Product, all of Roche's right, title
and interest in and to (i) all trademarks and trademark
applications used or intended for use specifically for the
relevant Product(s), (ii) all regulatory filings (such as INDs
and drug master files), Regulatory Approvals, and clinical
trial agreements (to the extent assignable and not cancelled)
for the relevant Product(s), and (iii) all data, including
clinical data, materials and information of any kind or nature
whatsoever, in Roche's possession or in the possession of its
Affiliates or its or their respective agents related to the
relevant Product(s) and (iv) all rights relating to the
infringement of Memory Patent Rights and Joint Patent Rights,
related to and necessary for the commercialization of the
relevant Product(s). Without limiting the generality of the
preceding sentence, Memory shall, upon such transfer, have the
right to disclose such filings, approvals and data to (i)
governmental agencies of the country or region to the extent
required or desirable to secure government approval for the
development, manufacturing or sale of Product in the country or
region, (ii) Third Parties acting on behalf of Memory, its
Affiliates or sublicensees, to the extent reasonably necessary
or desirable for the development, manufacture, or sale of
Product in the country or region, and (iii) Third Parties to
the extent reasonably necessary or desirable to market Product
in the country or region. All such filings, approvals and data
transferred to Memory pursuant to this Section 16.4 shall be
deemed to be Memory Confidential Information.
(b) In addition, for a given Product and country or region so
terminated, or for the Territory in the case of termination of
this Agreement in its entirety, Roche hereby grants to
[*] CONFIDENTIAL TREATMENT IS REQUESTED
Memory the right to obtain a sole and exclusive, royalty
bearing license, under Roche Patent Rights and Roche Know-How
Covering the Product and Roche trademarks used or intended for
use in connection with the sale of Product, to make, have made,
use, offer for sale, sell and import such Product(s) in such
country, region or the Territory, as applicable. Memory shall
exercise such right by giving written notice thereof to Roche
within sixty (60) days after the date of termination. In
consideration of such license, Memory shall pay Roche
reasonable milestones and royalties consistent with industry
practices as may be mutually agreed upon by the Parties (such
royalties not to exceed [*] percent ([*]%) of Net Sales); and
if the Parties are unable to agree upon such financial terms,
such matter shall be resolved by arbitration in accordance with
Article 17.
(c) Roche shall supply, or cause to be supplied, to Memory, upon
Memory's written request, Memory or its licensee's clinical
and/or commercial requirements of Product(s), pursuant to a
supply agreement to be negotiated in good faith by the parties,
provided that (i) such requirements shall be supplied to Memory
or its licensee at Roche's direct manufacturing costs and
allocation of manufacturing overhead, and (ii) Roche's supply
obligation shall not continue for more than [*] years after
such termination, and (iii) Roche shall maintain the same
Product(s) quality and specifications as immediately prior to
notice of termination, and (iv) as to other terms, such
agreement shall be reasonably consistent with Roche's other
arm's length supply agreements, and (v) Memory shall use
reasonable best efforts to effect a transfer as soon as
practicable of Product(s) manufacturing activities from Roche
to another supplier. In addition, Roche shall also transfer to
Memory and its designated supplier a manufacturing transfer
package that will enable Memory or such designated supplier to
manufacture the Product(s) in a timely manner.
Roche shall take prompt actions, including the execution of such
instruments, agreements and documents, as are necessary or desirable to
effect the foregoing. It is agreed such transfers and actions shall be
completed in a manner that will permit Memory to continue without
interruption the business of developing, manufacturing, marketing and
selling the Product(s).
16.6 Royalty and Payment Obligations. Termination of this Agreement by
either Party for any reason will not release Roche from any obligation
to pay royalties or make any payments to Memory which were accrued
prior to the effective date of termination (including for sales made
and Events achieved under Article 4, prior to the date of termination).
However, termination of this Agreement by either Party for any reason
will release Roche from any obligation to pay royalties or make any
payments to Memory which would have otherwise become accrued after the
effective date of termination.
16.7 Termination for failure to satisfy the condition subsequent. Either
Party may terminate this Agreement in its entirety, upon ten (10) days
prior written notice to the other Party if the condition subsequent
under Section 16.1 has not been fulfilled by February 8, 2004, in which
case, upon termination there shall be no liabilities for obligations on
the part of either party except that Article 15 shall survive such
termination and except for any breach of Section 16.1.
16.8 Survival of Obligations. Section 2.3, Article 6, Section 13.5, Section
13.6, Section 13.7, Article 14, Article 15, Section 16.5, Section 16.6,
Section 16.8, Article 17 and Article 18, and any definitions used in
such Section or Article, shall survive the termination of this
Agreement in its entirety. Except for obligations which clearly are not
intended to continue in respect of a partial termination (including the
diligence obligation, and except as provided in Section 16.6, royalty
obligations), with respect to the region, country or Product
terminated, all obligations in this Agreement shall survive a partial
termination.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
ARTICLE 17. ARBITRATION
Any dispute, controversy or claim ("Dispute") arising out of or in relation to
this Agreement, or the breach, termination or invalidity thereof, that cannot be
settled amicably by the Parties after a good faith discussion to resolve the
Dispute by the appropriate officers of the Parties, shall be submitted by either
Party to arbitration conducted in accordance with the rules then in effect of
the American Arbitration Association ("AAA"). Arbitration shall take place in
Newark, New Jersey and shall be conducted by three (3) arbitrators, one of whom
shall be designated by each Party, and the third selected by the other two (2)
arbitrators, all within the time limits established by the then existing rules
of the AAA. If the two (2) designated arbitrators are unable to agree upon a
third arbitrator by two (2) months after submission of the matter to
arbitration, the AAA shall select such third arbitrator within three (3) months
of such original submission. The written decision of the arbitrators shall be
final and binding on the parties and may be enforced in any court having
jurisdiction over the Parties or their current assets. The award rendered by the
arbitrators shall include the cost of arbitration, reasonable attorneys' fees
and reasonable costs for expert and other witnesses, and in the event of a
termination, in whole or in part, a transition procedure, including the
performance of transition services by Roche, so as to maintain the value of the
assets being transferred to Memory and, to the extent contemplated by Section
16.4, permit Memory to conduct the business being transferred to it. The parties
shall be entitled to discovery as provided in the Federal Rules of Civil
Procedure then in effect in the District of New Jersey. If the issues in dispute
involve scientific or technical matters, at least one of the arbitrators chosen
hereunder shall have educational training and/or experience sufficient to
demonstrate a reasonable level of knowledge in the Field and pharmaceutical drug
development. Notwithstanding the preceding provisions of this Article 17, with
respect to any breach or threatened breach of this Agreement of Section 15.1,
16.4 or any other provision where a Party would not be appropriately compensated
by the payment of money, a party has a right to seek injunctive relief from any
court of competent jurisdiction to enjoin such breach or threatened breach
and/or to seek specific performance.
In the event of a Dispute, a Party shall have no right to toll or delay any
obligation in this Agreement unrelated to the Dispute as a result of the
Dispute. By way of example, if Roche owes Memory $5,000,000 and claims a
$2,000,000 payment is not due by reason of breach of Memory, then Roche shall
pay the $5,000,000, and the parties will resolve such $2,000,000 Dispute
pursuant to Article 17.
ARTICLE 18. MISCELLANEOUS
18.1 Indemnification.
---------------
(a) Roche agrees to defend Memory and the other Memory Indemnified
Parties at Roche's cost and expense, and will indemnify and
hold Memory and its directors, officers, employees and agents
(the "Memory Indemnified Parties") harmless from and against
any claims, losses, costs, damages, fees or expenses arising
out of or otherwise relating to (i) activities of Roche and its
Affiliates in the conduct of the Strategic Alliance, (ii) the
development, manufacture, use, offer for sale, sale or other
disposition of any Product by Roche, its Affiliates or
sublicensees, and each of their distributors, representatives
or anyone in privity therewith, or (iii) the gross negligence
or willful misconduct of Roche, its Affiliates or sublicensees.
In the event of any such claim against the Memory Indemnified
Parties by a Third Party, Memory shall promptly notify Roche in
writing of the claim (provided that any failure or delay to
notify shall not excuse any obligations of Roche except to the
extent Roche is actually prejudiced thereby) and Roche shall
solely manage and control, at its sole expense, the defense of
the claim and its settlement provided further that Roche shall
not settle any such claim, if such settlement may have an
adverse effect on Memory, without the prior written consent of
Memory, which
[*] CONFIDENTIAL TREATMENT IS REQUESTED
consent shall not be unreasonably withheld. The Memory
Indemnified Parties shall cooperate with Roche and may, at
their option and expense, be represented in any such action or
proceeding. Roche shall not be liable for any litigation costs
or expenses incurred by the Memory Indemnified Parties without
Roche's written authorization.
(b) Memory agrees to defend Roche and the other Roche Indemnified
Parties at Memory's cost and expense, and will indemnify and
hold Roche and its directors, officers, employees and agents
(the "Roche Indemnified Parties") harmless from and against any
claims, losses, costs, damages, fees and expenses arising out
of any claim, arising out of or otherwise relating to (i)
activities of Memory in the conduct of the Strategic Alliance,
(ii) the development, manufacture, use, offer for sale, sale or
other disposition of any Product by Memory, its Affiliates,
licensees other than Roche, sublicensees and each of their
distributors, representatives or anyone in privity therewith
(but only to the extent same is a consequence of Section 2.5,
Article 3 and/or Article 16), and (iii) the gross negligence or
willful misconduct of Memory, its Affiliates, licensees,
distributors, representatives or anyone in privity therewith.
In the event of any such claim against the Roche Indemnified
Parties by an Independent Third Party, Roche shall promptly
notify Memory in writing of the claim (provided that any
failure or delay to notify shall not excuse any obligation of
Memory except to the extent Memory is actually prejudiced
thereby) and Memory shall solely manage and control, at its
sole expense, the defense of the claim and its settlement
provided further that Memory shall not settle any such claim if
such settlement may have an adverse effect on Roche without the
prior written consent of Roche, which consent shall not be
unreasonably withheld. The Roche Indemnified Parties shall
cooperate with Memory and may, at their option and expense, be
represented in any such action or proceeding. Memory shall not
be liable for any litigation costs or expenses incurred by the
Roche Indemnified Parties without Memory's written
authorization.
18.2 Publicity. Neither Party shall originate any publicity, news release or
other public announcement, written or oral, relating to this Agreement,
including its terms, without the prior approval of the other Party
except solely to the extent a Party reasonably believes same is
otherwise required by law. Such approval shall not be unreasonably
withheld. Each Party shall to the extent consistent with applicable
laws and regulations limit the disclosure of the financial terms set
forth in this Agreement (such as by requesting confidential treatment
of such terms in documents required to be filed with the US Securities
and Exchange Commission).
18.3 Force Majeure. Neither Party to this Agreement shall be responsible to
the other Party for nonperformance or delay in performance of the terms
or conditions of this Agreement due to acts of God, acts of
governments, war, riots, strikes, accidents in transportation, or other
causes beyond the reasonable control of such Party, but such force
majeure shall toll any and all obligations and time periods for so long
as such force majeure continues.
18.4 Bankruptcy. All licenses (and to the extent applicable rights) granted
under or pursuant to this Agreement by Memory to Roche are, and shall
otherwise be deemed to be, for purposes of Section 365(n) of Title 11,
US Code (the "Bankruptcy Code"), licenses of rights to "intellectual
property" as defined under Section 101(60) of the Bankruptcy Code.
Unless Roche elects to terminate this Agreement under Article 16, the
Parties agree that Roche, as a licensee or sublicensee of such rights
under this Agreement, shall retain and may fully exercise all of its
rights and elections under the Bankruptcy Code, subject to the
continued performance of its obligations under this Agreement.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
18.5 Governing Law. This Agreement shall be governed by and interpreted in
accordance with the laws of New Jersey, without giving effect to
principles of conflicts of law.
18.6 Waiver. The waiver by a Party of a breach or a default of any provision
of this Agreement by the other Party shall not be construed as a waiver
of any succeeding breach of the same or any other provision, nor shall
any delay or omission on the part of a Party to exercise or avail
itself of any right, power or privilege that it has or may have
hereunder operate as a waiver of any right, power or privilege by such
Party.
18.6 Notices. Any notice or other communication in connection with this
Agreement must be in writing and may be given by any of the following
methods: (i) personal delivery against a signed receipt; (ii)
registered or certified mail, postage prepaid, return receipt
requested; or (iii) by overnight delivery service which obtains a
signed receipt. Notice shall be effective when delivered to the
addressee at the address listed below or such other address as the
addressee shall have specified in a written notice actually received by
the addresser.
If to Memory:
Memory Pharmaceuticals Corp.
000 Xxxxxxx Xxxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attn: Head of Business Development
and
Xxxxx Xxxxxx Xxxxx Tischman Xxxxxxx & Xxxxx, P.A.
Xxx Xxxxxxxxxx Xxxxx
Xxxxxx, Xxx Xxxxxx 00000
Attn: Xxx X. Xxxxxxxxx, Esq.
If to Roche:
X. Xxxxxxxx-Xx Xxxxx Ltd
Xxxxxxxxxxxxxxxxx 000
XX-0000
Xxxxx, Xxxxxxxxxxx
Attn: Legal Department
and
Xxxxxxxx Xx-Xxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn.: Corporate Secretary
18.8 No Agency. Nothing herein shall be deemed to constitute either Party as
the agent or representative of the other Party. Each Party shall be an
independent contractor, not an employee or partner of the other Party.
Each Party shall be responsible for the conduct of activities at its
own facilities and for any liabilities resulting therefrom. Neither
Party shall be responsible for the acts or omissions of the other
Party, and neither Party will have authority to speak for, represent or
obligate the other Party in any way without prior written authority
from the other Party.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
18.9 Entire Agreement. This Agreement and the Schedules hereto (which
Schedules are deemed to be a part of this Agreement for all purposes)
contain the full understanding of the Parties with respect to the
subject matter hereof and supersede all prior understandings and
writings relating thereto. No waiver, alteration or modification of any
of the provisions hereof shall be binding unless made in writing and
signed by the Parties.
18.10 Headings. The headings contained in this Agreement are for convenience
of reference only and shall not be considered in construing this
Agreement.
18.11 Severability. In the event that any provision of this Agreement is held
by a court of competent jurisdiction to be unenforceable because it is
invalid or in conflict with any law of any relevant jurisdiction, the
validity of the remaining provisions shall not be affected, and the
Parties shall negotiate a substitute provision that, to the extent
possible, accomplishes the original business purpose. During the period
of such negotiation, and thereafter if no substituted provision is
agreed upon, any such provision which is enforceable in part but not in
whole shall be enforced to the maximum extent permitted by law.
18.12 Assignment. Neither this Agreement nor any of the rights or obligations
hereunder may be assigned by either Party without the prior written
consent of the other Party, except to an Affiliate of the assigning
Party or to any other party who acquires all or substantially all of
the pharmaceutical business of the assigning Party by merger, sale of
assets or otherwise, so long as such Affiliate or other party agrees in
writing to be bound by the terms of this Agreement. Notwithstanding the
preceding, if Memory assigns its rights and/or obligations under this
Agreement to a party who acquires all or substantially all of the
pharmaceutical business of Memory by merger, sale of assets or
otherwise, then Memory's rights under Section 2.4 shall become null and
void.
18.13 Successors and Assigns. Except as otherwise provided herein, this
Agreement shall be binding upon and inure to the benefit of the Parties
hereto and their successors and permitted assigns under Section 18.12.
18.14 Non-Solicitation. Each party agrees that, during the period from the
Effective Date to the date that is two (2) years after the Effective
Date, it shall not directly or indirectly solicit the services (by way
of employment or otherwise), or employ or otherwise engage the
services, of any of the other Party's personnel involved in the
Strategic Alliance (including, without limitation, any member of the
JLT, any subteam or the DRT). Roche agrees that, during such two (2)
year period and for a period of one (1) year thereafter, it shall not
directly or indirectly solicit the services (by way of employment or
otherwise), or employ or otherwise engage the services, of any member
of senior management of Memory (including, without limitation, any
Director, Associate Director or Assistant Director or any
higher-ranking personnel of Memory).
18.15 Interpretation. The words "include," "includes" and "including" shall
be deemed to be followed by the phrase "without limitation." All
references herein to Articles, Sections, and Schedules shall be deemed
references to Articles and Sections of, and Schedules to, this
Agreement unless the context shall otherwise require. Except as
otherwise expressly provided herein, all terms of an accounting or
financial nature shall be construed in accordance with international
accounting standards ("IAS"), as in effect from time to time. Unless
the context otherwise requires, countries shall include territories.
18.6 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original but all of such
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed in their names by their properly and duly authorized officers or
representatives as of the dates below written.
MEMORY PHARMACEUTICALS CORP. XXXXXXXX-XX XXXXX INC.
By: /s/ Xxxx Xxxxxxxx By: /s/ Xxxxxx X. Xxxxx
----------------------- ---------------------------------------
Title: Chief Executive Officer Title: VP, Global Head of Business Development
----------------------- ---------------------------------------
X. XXXXXXXX-XX XXXXX LTD
By: /s/ Xxxx Xxxxxx
-------------------------------------
Title: EVP, Business Development
Licensing & Alliances
-------------------------------------
By: Illegible
-------------------------------------
Title: VP, Global Head Licensing
-------------------------------------
[*] CONFIDENTIAL TREATMENT IS REQUESTED
SCHEDULE 1
DATA AND REPORTS
[*]
[*] CONFIDENTIAL TREATMENT IS REQUESTED
EXHIBIT A
HEADS OF AGREEMENT FOR CO-PROMOTION OF PRODUCT
1 MEMORY ELECTION TO CO-PROMOTE. Memory shall have the right to elect to
co-promote each Product in the US, on a Product-by-Product basis,
during the Co-Promotion Term beginning on the date of the first
commercial sale of such Product in the Co-Promotion Territory. Within
forty-five (45) days after the end of Phase II with respect to each
Product, Roche shall provide Memory with (i) the results and analysis
of Phase II studies, and (ii) Roche's then final, approved Phase III
development plan (including budget). Memory shall exercise its
co-promotion right with respect to each Product by giving written
notice thereof to Roche within forty-five (45) days after receipt of
the items described in the immediately preceding sentence.
2. CO-PROMOTION TERRITORY. United States of America and its possessions
and territories, including Puerto Rico.
3. TERM AND TERMINATION. The Co-Promotion Term for each Product shall be
for a period of ten (10) years from the first commercialization of such
Product in the first approved co-promotion indication in the
Co-Promotion Territory. Memory shall have the right to terminate the
Co-Promotion Agreement with respect to any Product if the Net Sales
thereof in the US are less than an amount for which a co-promotion
arrangement for such Product would be financially practicable and
profitable.
4. ASSIGNABILITY. Memory may not assign its co-promotion rights without
Roche's express written consent.
5. ADDITIONAL INDICATIONS. The co-promotion by the Parties with respect to
any Product that has received a Regulatory Approval for a Neurological
Indication or a Psychiatric Indication and has been the subject of a
Launch in the US shall extend to any additional Neurological Indication
or Psychiatric Indication which Roche determines to obtain the
applicable Regulatory Approvals to market and sell the Product in the
US for such additional Neurological Indication or Psychiatric
Indication. In such case, Memory shall be responsible for [*] percent
([*]%) of the cost of obtaining such Regulatory Approvals, including
the cost of conducting clinical trials, which shall be paid by Memory
to Roche promptly after Roche obtains all Regulatory Approvals for such
Product in the US to enable Roche and Memory to market and sell such
Product in the US for such additional Neurological Indication or
Psychiatric Indication.
If Roche has received all Regulatory Approvals in the US to market and
sell a Product for a Neurological Indication or a Psychiatric
Indication and an Other Indication and is the subject of co-promotion
by Memory, the Parties shall negotiate in good faith and agree upon an
equitable adjustment to the compensation and cost-sharing provisions
set forth in the Co-Promotion Agreement, to account for the fact that
Memory shall not have any right or obligation to co-promote such
Product for the Other Indication.
6. FINANCIALS. If Memory exercises its right to co-promote a Product in
the Co-Promotion Territory, Memory will be responsible for (i) carrying
out [*] percent ([*]%) of the Product detailing and (ii) [*] percent
([*]%) of the marketing costs of such Product in the US; and Memory
shall be entitled to receive from Roche [*] percent ([*]%) of the gross
profits from the sale of such Product in the US. For avoidance of
doubt, the marketing costs referred to in Section 5(ii) hereto do not
include any direct cost of Roche field force; by way of example, but
not limitation,
[*] CONFIDENTIAL TREATMENT IS REQUESTED
marketing costs include direct to consumer advertising, professional
journal advertising and professional symposia. In addition, if Memory
exercises its right to co-promote a Product, the royalties otherwise
payable by Roche to Memory hereunder with respect to the Net Sales of
such Product in the US shall be reduced by [*] percent ([*]%).
Furthermore, in order to exercise its right to co-promote a Product,
Memory must make a one-time payment to Roche in the amount of [*]
percent ([*]%) of Roche's budgeted Phase III global development costs
for such Product as set forth in Roche's final, approved Phase III
development plan (including budget).
7. GOVERNANCE. Within ninety (90) days after Memory's notice to Roche that
it wishes to co-promote a Product, the Parties shall form a Joint
Promotional Team ("JPT"), which will oversee the co-promotional
activities of the Parties with respect to such Product. Consistent with
prudent business practices, the JPT will discuss co-promotional
activities relating to such Product and establish mechanisms for
achieving an effective co-promotion collaboration. The JPT shall be
comprised of three Roche representatives and one Memory representative,
and a Roche representative will be Chair of the JPT. Each Party shall
have one collective vote, and decisions shall be made by consensus. For
avoidance of doubt, the final decision in all co-promotion matters will
reside with Roche.
8. MEMORY'S OBLIGATIONS. Memory must provide at least [*] percent ([*]%)
of the total promotional effort in a given calendar year as established
by number and type of details in accordance with the Co-Promotion Plan.
Memory may not subcontract its field sales force to fulfill its
co-promotion obligations.
9. ROCHE'S OBLIGATIONS AND AUTHORITY. Roche shall be ultimately
responsible for establishing and modifying the terms and conditions
with respect to the sale of the Product, including, without limitation,
pricing for the Product. Roche shall provide Memory, without charge,
with copies of relevant training materials regarding the detailing and
promotion of the Product. Memory shall then supply such copies of such
training materials to its sales force. Roche may elect, at its
discretion, to make available sales and training personnel to assist
Memory in training Memory's sales force to detail and promote the
Product. For avoidance of doubt, each Party has final responsibility
for the adequate training of its own sales force.
10. NON-SOLICITATION. Neither Party shall recruit sales personnel from the
other Party.
11. REPORTING PROVISIONS. The Parties will negotiate in good faith and
agree to appropriate reporting provisions to be included in the
Co-Promotion Agreement. Memory shall have an obligation to report
adverse events to Roche in a timely fashion.
12. INDEMNIFICATION. Each Party shall indemnify the other Party for all
claims related to the marketing or promotion of the Product to the
extent that such Party is negligent or fails to promote the Product in
accordance with applicable federal and state laws.
13. FULL AGREEMENT. Consistent with the terms of this Heads of Agreement,
the Co-Promotion Agreement shall contain ordinary and customary terms
for an agreement in which a pharmaceutical product of like nature is
jointly co-promoted and detailed in the US, such as insurance,
additional warranties and the like.
[*] CONFIDENTIAL TREATMENT IS REQUESTED
EXHIBIT B
SECURITIES PURCHASE AGREEMENT
[*] CONFIDENTIAL TREATMENT IS REQUESTED
