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EXHIBIT 10.42
MULTI-ANTIGEN RESEARCH LICENSE AND OPTION AGREEMENT
This MULTI-ANTIGEN RESEARCH LICENSE AND OPTION AGREEMENT (this
"Agreement"), effective as of January 26, 1999 (the "Effective Date") is made by
and between Abgenix, Inc., a Delaware corporation ("ABX") and Genentech, Inc., a
Delaware corporation ("GNE") with reference to the following facts and
circumstances.
RECITALS
A. WHEREAS, ABX has rights in certain technology relating to certain
strains of XenoMouse(TM) Animals (as defined below);
B. WHEREAS, GNE desires to use such XenoMouse Animals to generate
antibodies to certain Specified Antigens and GNE Program Antigens (each as
defined below);
C. WHEREAS, ABX is willing to grant to GNE, and GNE desires to acquire a
license to use XenoMouse Animals solely for immunization with Specified Antigens
and GNE Program Antigens for research purposes, as described below and on the
terms and conditions set forth herein; and
D. WHEREAS, ABX is willing to grant to GNE, and GNE desires to acquire
an option to obtain a GNE Product License Agreement with respect to Products
derived from immunization of XenoMouse Animals with a particular GNE Program
Antigen, all as described fully below and on the terms and conditions set forth
herein.
NOW THEREFORE, for and in consideration of the covenants, conditions,
and undertakings hereinafter set forth, it is agreed by and between the parties
as follows:
1. DEFINITIONS
For purposes of this Agreement, capitalized terms set forth in this
Agreement and not otherwise defined herein shall have the meaning set forth in
the Common Definitions Exhibit attached hereto as Exhibit A.
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2. RESEARCH LICENSE; SUPPLY OF MICE; MATERIALS OWNERSHIP
2.1 Research License.
2.1.1 License Grant. Subject to the terms and conditions of this
Agreement (including without limitation compliance with the provisions of
Section 9.4.6), ABX agrees to grant, and hereby grants, to GNE a paid up (except
as otherwise provided in Section 2.1.5 below), non-exclusive license and/or
sublicense of its rights, as the case may be, under the Licensed Technology and
any issued U.S. patents owned or controlled by ABX that claim the Specified
Antigen or Antibodies thereto, without right to grant further sublicenses to (a)
immunize the XenoMouse Animals provided by ABX with up to [*] Specified Antigens
per year and (b) to use the Antibodies and materials derived from such immunized
XenoMouse Animals in the Research Field for conducting research and development
work within the scope of the Research Field. The license contemplated in the
preceding sentence shall include the right for GNE to transfer Antibodies to
third parties solely for the purposes of testing and evaluation in the Research
Field, provided, however, that any such transfer is under a material transfer
agreement that is consistent with the terms of this Agreement and that grants no
right, title or interest in or to such Antibody (or any derivative thereof) to
such third party. The parties acknowledge that notwithstanding any license from
ABX to GNE under this Agreement of ABX's rights within the Research Field
(including, without limitation, under Section 3.1.4(c)), ABX's rights may not be
exclusive from ABX's licensors. The license and/or sublicense rights granted
under this Section 2.1.1 shall terminate with regard to a particular Specified
Antigen on the Effective Date (if any) of a GNE Product License Agreement
between ABX and GNE relating to such Specified Antigen. At such time as any
Specified Antigen becomes a GNE Program Antigen under the terms and conditions
of this Agreement (i.e. GNE has taken an Evaluation Position with regard to such
Specified Antigen), the research licenses and/or sublicenses described above
shall become exclusive licenses and/or sublicenses as set forth herein.
Notwithstanding anything contained in this Agreement, immunization of XenoMouse
Animals with any Antigen other than a Specified Antigen (a "Non-Specified
Antigen") in good faith (e.g., as a mistake) shall be considered a breach of
this Agreement; provided, however, that the sole remedy for such breach will be
as provided in Section 6.6 hereof. Immunization of XenoMouse Animals with
Non-Specified Antigens other than in good faith shall be a material breach of
this Agreement.
2.1.2 License Term. The rights and/or (sub)licenses granted under
Section 2.1.1 above shall terminate upon expiration or termination of this
Agreement; provided, however, that such rights and/or (sub)licenses shall also
expire and terminate with respect to each particular GNE Program Antigen on the
date on which ABX duly executes and delivers the GNE Product License Agreement
for such GNE Program Antigen in accordance with the provisions of Section 4.1.5
below.
2.1.3 No Other Rights. No implied licenses or rights are conveyed
to GNE hereunder. GNE shall only be authorized to use the XenoMouse Animals, the
ABX Materials and the materials derived in whole or part from the XenoMouse
Animals (including without limitation Antibodies) solely as expressly provided
in this Article 2 and Section 9.4.6.
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2.1.4 XenoMouse Animals. On the terms and conditions of this
Agreement, ABX will provide free of charge to GNE such types, strains and
quantities, as GNE reasonably requests, of sterilized male XenoMouse Animals of
the highest quality reasonably available for immunization with Specified
Antigens; provided however, that ABX's obligation to provide such XenoMouse
Animals free of charge shall be limited to providing GNE with up to [*]
XenoMouse Animals per month and up to a total of [*] XenoMouse Animals per
calendar year. GNE shall use such XenoMouse Animals solely for the purposes set
forth in this Agreement. Notwithstanding anything to the contrary in this
Agreement, unless ABX otherwise agrees in writing, ABX shall not be required to
provide GNE with more than (a) [*] XenoMouse Animals in any given calendar
month, or (b) [*] XenoMouse Animals in any given calendar year, in the
aggregate. Subject to availability, ABX will provide to GNE reasonable
quantities of XenoMouse Animals requested by GNE hereunder in excess of the
number of XenoMouse Animals set forth in clauses (a) and (b) above at a cost to
GNE of [*] per XenoMouse Animal.
2.1.5 New Strains. If, prior to ABX's delivery to GNE of the
maximum number of XenoMouse Animals which GNE is entitled to receive in any
given calendar year in Section 2.1.4 above, ABX develops and has reasonably
available for licensing and shipment to GNE a strain of transgenic mice that
produce human antibodies that was not available on the Effective Date (a "New
Strain"), ABX shall inform GNE of the availability of such New Strain and any
net Incremental Royalty associated with such New Strain and discuss with GNE
whether GNE would prefer to receive some or all the remaining deliverable
transgenic animals for such calendar year from the New Strain. Notwithstanding
the foregoing, GNE shall have the right to continue to receive XenoMouse Animals
from the strain of XenoMouse Animals available as of the Effective Date (the
"Original Strain"), and ABX shall be required to continue to deliver mice from
the Original Strain. If GNE chooses to receive mice from the New Strain, ABX
shall provide GNE with a reasonable number of transgenic animals from the New
Strain (up to a maximum of the remaining number of XenoMouse Animals deliverable
to GNE under Section 2.1.4), provided that any such animals shall be deemed to
be XenoMouse Animals. In the event that GNE elects to receive mice from the New
Strain, (a) GNE shall agree to be bound by any other obligations, terms or
conditions imposed upon the New Strain, including without limitation any
reporting, indemnification, use restrictions or diligence requirements; (b) any
New Strain Intellectual Property shall become part of the Licensed Technology;
and (c) ABX shall modify Attachment B to reflect New Strain Intellectual
Property with respect to such New Strain. Notwithstanding anything to the
contrary in this Agreement, ABX shall not be obligated to develop any New
Strains. Nothing herein shall prevent GNE from receiving and using XenoMouse
Animals from both the Original Strain and the New Strain simultaneously provided
that the maximum number of XenoMouse Animals provided in Section 2.1.4 is not
exceeded.
2.1.6 Updates Concerning GNE Research. During the term of this
Agreement, GNE shall update ABX, as reasonably requested by ABX, as to the
general status of the activities of GNE in the Research Field under this
Agreement and the results thereof. It is understood that except as the parties
may otherwise agree in writing, ABX shall not be responsible for
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conducting any research and development activities involved in the creation,
research and development of Products, including without limitation immunizations
of XenoMouse Animals with Specified Antigens or GNE Program Antigens, screening
of Antibodies generated from such immunizations, creation of Hybridomas,
production of Antibodies to the Specified Antigens or GNE Program Antigens, or
preclinical evaluation of Antibodies to the Specified Antigens or GNE Program
Antigens.
2.1.7 Supply of XenoMouse Animals and Materials; Material
Transfer Terms. It is understood and agreed that all XenoMouse Animals, and all
materials derived in whole or part from XenoMouse Animals shall be used solely
in accordance with, and subject to the covenants set forth in Section 9.4.6.
2.1.8 Ownership of Materials and Data. It is understood and
agreed that:
(a) ABX shall [*].
(b) Except as expressly set forth in Section 2.1.8(a), GNE shall
[*]
(c) The transfer of physical possession of any materials or data
owned by, and the physical possession and use of such materials and/or data by,
GNE or ABX, as the case may be, shall not be (nor be construed as) a sale,
lease, offer to sell or lease, or other transfer of title of such materials
and/or data to GNE or ABX, as the case may be.
(d) Notwithstanding anything contained in this Agreement to the
contrary (including, without limitation, in Section 6.6), GNE shall [*]
2.1.9 Notice of Specified Antigens. During the term of this
Agreement, if and when GNE desires to immunize a XenoMouse Animal with an
Antigen, GNE shall, prior to GNE's immunization of a XenoMouse Animal with such
Antigen, provide written notice [*] [*] informing ABX [*] that GNE desires to
have such Antigen designated a Specified Antigen. ABX [*] [*] will determine in
accordance with this Section 2.1.9 if the Antigen can be designated a Specified
Antigen of GNE.
(a) Notice. When GNE desires to have an Antigen designated a
Specified Antigen, GNE shall provide written notice [*] [*] of its desire that
such Antigen be designated a Specified Antigen. In such notice, GNE
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shall provide reasonable identification and description of such Antigen (the
"GNE Antigen Information"). The GNE Antigen Information shall be considered
Confidential Information of GNE. Where GNE provides notice pursuant this Section
2.1.9(a) to [*]
(b) [*]
(c) Confidentiality and Non-Use. Where GNE provides notice
pursuant to Section 2.1.9(a) to [*]. Where GNE provides notice pursuant to
Section 2.1.9(a) to ABX, ABX shall not use or disclose the GNE Antigen
Information except as expressly provided under this Agreement. Further, ABX
shall not disclose the GNE Antigen Information to any third party.
(d) Determination. Upon receipt of notice pursuant to Section
2.1.9(a), ABX [*] shall objectively evaluate such request in the context of the
ABX Antigen Information and determine whether the Antigen requested by GNE is
available as a Specified Antigen. Where GNE provides notice pursuant to Section
2.1.9(a) to [*]; provided, however, no Confidential Information of ABX or GNE
shall be provided to the other party. If ABX notifies GNE [*], that such Antigen
is not available as a Specified Antigen, such Antigen shall not be designated as
a Specified Antigen. In the event that GNE is notified that an Antigen requested
by GNE is not available as a Specified Antigen, ABX and GNE agree to discuss the
reasons for such determination.
(e) Default. Where GNE provides notice pursuant to Section
2.1.9(a) to ABX, and ABX fails to notify GNE that such Antigen is not available
as a Specified Antigen within [*] of request by GNE, such Antigen shall be
designated a "Specified Antigen",
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GNE shall have the right to immunize the XenoMouse Animals with such Specified
Antigen, and such Specified Antigen shall be counted as one of the [*]
permitted Specified Antigens under Section 2.1.1 above. Notwithstanding the
foregoing in this Section 2.1.9(e), where GNE provides notice pursuant to
Section 2.1.9(a) to [*] informs GNE that such Antigen is available as a
Specified Antigen.
2.1.10 Third Party Rights. It is understood and agreed that the
grant of rights under this Article 2 shall be subject to and limited in all
respects by the terms of the applicable ABX In-License(s) pursuant to which ABX
acquired or does acquire any Licensed Technology, including, without limitation,
any rights granted to or retained by GenPharm International, Inc. under the
GenPharm Cross License, and that all rights or sublicenses granted under this
Agreement shall be to the extent and only to the extent that ABX shall have the
right to grant such rights and sublicenses under such ABX In-Licenses.
3. EVALUATION POSITIONS
3.1 Evaluation Positions. During the term of this Agreement and subject
to the terms and conditions set forth herein, GNE shall have the right to obtain
evaluation positions ("Evaluation Positions", as further described in Section
3.1.4) from ABX with respect to certain Specified Antigens as set forth in this
Section 3.1. It is understood and agreed by the Parties that, unless and until a
Specified Antigen becomes a GNE Program Antigen as set forth in this Article 3,
[*]
3.1.1 Notice. For each Specified Antigen for which GNE desires to
obtain an Evaluation Position, GNE shall provide ABX with written notice (each
such notice an "Evaluation Notice") stating that GNE desires to obtain an
Evaluation Position on such Specified Antigen and identifying in reasonable
detail such Specified Antigen.
3.1.2 ABX Review. Within [*] days of receiving an
Evaluation Notice from GNE, ABX shall notify GNE as to whether any of the
conditions set forth under Section 3.1.2 (i)-(iii) below (each such condition,
an "Impediment") exist with respect to each Specified Antigen which is the
subject of such Evaluation Notice, and if so, ABX shall provide to GNE a
reasonable description of such Impediment, subject to any confidentiality
restrictions to which ABX may be a party. If ABX notifies GNE that an Impediment
exists with respect to the Specified Antigen that is the subject of the
Evaluation Notice, GNE shall not have the right to obtain an Evaluation Position
for such Specified Antigen, provided, however, that if ABX has Selected a
Specified Antigen for its own account under Section 3.1.2(i) below, ABX agrees
to discuss with GNE the possibility of entering into a collaboration with
respect to such Specified Antigen. Impediments are as follows:
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(i) the Specified Antigen identified by GNE is not
available to GNE for an Evaluation Position and cannot be Selected by ABX
because under the terms of the Xenotech Agreement [*];
(ii) the Antigen so identified by GNE is at the
time that ABX receives the Evaluation Notice for such Specified Antigen, an
Excluded Antigen; or
(iii) as evidenced by written records prior to the
date of the Evaluation Notice relating to such Specified Antigen, ABX or its
Affiliates [*].
3.1.3 Acceptance by ABX; Payment. If ABX gives notice (an
"Acceptance Notice") to GNE that no Impediment exists with respect to the
Specified Antigen identified in the Evaluation Notice, or if ABX does not notify
GNE of an Impediment within [*] of GNE's Evaluation Notice as set forth in
Section 3.1.2, GNE shall have the right to obtain an Evaluation Position with
respect to such Specified Antigen by paying to ABX a payment (the "Evaluation
Position Payment") of [*]. Such payment shall be nonrefundable, except as
provided in Section 4.1.5; provided, however, that such Evaluation Position
Payment may be partially creditable against the License Fee with respect to an
Option for such GNE Program Antigen, as provided in Section 4.1.6 below. Upon
ABX's receipt of the Evaluation Position Payment set forth above, such Specified
Antigen which is subject of such Evaluation Position, shall be designated a "GNE
Program Antigen". Notwithstanding anything to the contrary in this Agreement, no
Antigen shall be a GNE Program Antigen unless such antigen was first a Specified
Antigen.
3.1.4 Effect of Evaluation Position. An Evaluation Position, with
respect to a GNE Program Antigen, shall entitle GNE to the rights set forth
below with respect to such GNE Program Antigen:
(a) Option. To exercise an Option with regard to such
GNE Program Antigen as set forth in Article 4 below.
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(b) Term of Evaluation Positions. With respect to each
Evaluation Position for a GNE Program Antigen, the term of such Evaluation
Position shall begin on the date which ABX receives the Evaluation Position
Payment for such Specified Antigen and shall, unless earlier terminated as
provided under Section 3.1.4(e) below, continue thereafter for a period of [*],
at which time the Evaluation Position on such GNE Program Antigen shall expire
unless extended as provided in Section 3.1.4(d) below.
(c) Exclusivity. During the term of an Evaluation Position
with respect to a GNE Program Antigen, ABX shall not (i) Select such GNE Program
Antigen (except for the sole benefit of GNE); (ii) cause or allow (with regard
to "allow", to the extent that it is within the reasonable control of ABX and
would not cause ABX to take any commercially unreasonable action or incur any
commercially unreasonable expense) any Impediment described in Section 3.1.2
above to arise with respect to such GNE Program Antigen, or (iii) take any other
action that would prevent GNE from obtaining an Exclusive Worldwide Product
License as defined in the Xenotech Agreement.
(d) Extension. With respect to each Evaluation Position
for a GNE Program Antigen, GNE shall have the right to extend the term of such
Evaluation Position for such GNE Program Antigen [*] by (i) notifying ABX
in writing, no later than [*] prior to the then current expiration date of such
Evaluation Position, that GNE desires to extend such Evaluation Position and for
how long and (ii) paying to ABX concurrently with such notice a payment of [*]
extension of such Evaluation Position. GNE may extend the term of such
Evaluation Position all at once or on a [*] basis, up to the maximum aggregate
of [*]. All payments made by GNE to ABX to extend the period of time for an
Evaluation Position shall be nonrefundable, except as provided under Section
4.1.5; provided, however, that GNE shall have the right to partially credit such
payments against the License Fee for such GNE Program Antigen as set forth in
Section 4.1.6 below.
(e) Termination of Evaluation Position by GNE. GNE shall
have the right to terminate an Evaluation Position with respect to a GNE Program
Antigen at GNE's sole discretion at any time by delivering written notice of
such termination to ABX. Such termination of such Evaluation Position shall
become effective upon ABX's receipt of written notice from GNE; provided
however, that any amounts paid by GNE to ABX for such terminated Evaluation
Position (and any extensions thereof) shall not be refundable or creditable
against any other payments due under this Agreement.
(f) Effect of Termination or Expiration of Evaluation
Position. If an Evaluation Position with respect to a GNE Program Antigen
expires or terminates prior to GNE's exercise of an Option with respect to such
GNE Program Antigen (as set forth below) (i) such GNE Program Antigen shall
cease to be a GNE Program Antigen for purposes of this Agreement, (ii) GNE shall
have no right to exercise an Option for such GNE Program Antigen (unless
renominated as provided below under this Section 3.1.4(f)) and (iii) ABX shall
have no
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further obligations with respect to such GNE Program Antigen. After the term of
an Evaluation Position has expired (during the term of this Agreement), GNE
shall have the right to nominate a prior GNE Program Antigen again (if no
Impediment exists) for an Evaluation Position (and designation as a GNE Program
Antigen) on the terms and conditions of this Agreement by following the
Evaluation Position procedures and paying an Evaluation Position Payment with
respect to such Evaluation Position, provided that, such Evaluation Position
shall count as one of the [*] Evaluation Positions which is in effect under
Section 3.1.5.
3.1.5 Number of Evaluation Positions. During the term of this
Agreement, GNE shall have the right to obtain and have in effect a maximum
aggregate of [*] Evaluation Positions (i.e., representing a maximum of [*] GNE
Program Antigens) at any given time. For purposes of this Section 3.1.5, an
Evaluation Position for [*] shall not be counted toward the number of Evaluation
Positions in effect at any given time, nor shall Evaluation Positions that have
terminated or expired pursuant to the terms of this Agreement (except as set
forth in Section 3.1.4(f)). Notwithstanding anything in this Agreement to the
contrary, GNE shall be required to obtain from ABX and make Evaluation Position
Payments for a minimum cumulative number of [*] Evaluation Positions during each
consecutive [*] period (beginning on the Effective Date) during the term of this
Agreement, unless the Agreement is terminated earlier than [*] from the
Effective Date, respectively.
4. OPTION TO OBTAIN GNE PRODUCT LICENSE AGREEMENT
4.1 Option to Nominate GNE Program Antigens.
4.1.1 Option. Subject to the terms and conditions set forth in
this Agreement, ABX hereby grants to GNE exclusive options (an "Option" or
"Options") to obtain the right to enter into GNE Product License Agreements with
respect to particular GNE Program Antigens. Each calendar year during the term
of this Agreement, up to two (2) Options may be exercised by GNE with respect to
a total of two (2) GNE Program Antigens, provided that, such Options for such
GNE Program Antigens must be exercised by GNE prior to the termination or
expiration of the Evaluation Position for such GNE Program Antigen (the "Option
Period"), pursuant to the procedures set forth in this Article 4, and provided,
further, that GNE may not exercise more than [*] Options in any [*] year period
or more than [*] Options in any [*] year period, in each case excluding [*].
4.1.2 Exercise. Pursuant to and subject to Section 4.1.1, GNE may
exercise Options with respect to GNE Program Antigens in accordance with the
following provisions:
(a) Exercise Notice; Timing of Notice. GNE may exercise
its Option with respect to a GNE Program Antigen at any time during the term of
an Evaluation Position for such GNE Program Antigen by giving ABX express
written notice (the "Exercise Notice") stating that GNE is exercising its Option
with respect to such GNE Program Antigen and indicating whether GNE has
intellectual property covering such GNE Program Antigen.
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(b) Selection by ABX. Upon GNE's delivery to ABX of an
Exercise Notice pursuant to Section 4.1.2(a), ABX shall be obligated to Select
the GNE Program Antigen on behalf of GNE on a date (a "Selection Date") within
the particular calendar quarter and in the particular calendar year as
determined in accordance with the following table:
Calendar Quarter If Exercise Notice is "Trigger Date" by "Selection Date"
in which Antigen delivered by GNE: which GNE may by which ABX must
counts towards retract Exercise select the GNE
GNE's limits Notice with no Program Antigen
penalty
1st Calendar [*] [*] [*]
Quarter:
January 1- March
31
2nd Calendar [*] [*] [*]
Quarter:
April 1 - June 30
3rd Calendar [*] [*] [*]
Quarter:
July 1 -
September 30
4th Calendar [*] [*] [*]
Quarter:
October 1 -
December 31
Notwithstanding the foregoing in this Section 4.1.2(b):
(i) in any calendar quarter that GNE has the right
to exercise [*];
(ii) should the event described in Section
4.1.2(b)(i) occur [*]
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[*]; and
(iii) based upon the information contained in the
Exercise Notice, ABX shall take the following actions with respect to Selection
of a GNE Program Antigen:
(1) in the event that GNE notifies ABX that [*]; and
(2) in the event that GNE does not notify ABX that [*].
(c) Retraction of Exercise Notice. Following GNE's
delivery to ABX of an Exercise Notice, GNE shall have the right to retract such
Exercise Notice at any time from the date of such Exercise Notice to the
applicable "Trigger Date" shown in the above table by providing written notice
of such retraction on or before such "Trigger Date." Upon retraction of an
Exercise Notice in compliance with the preceding sentence, GNE shall have no
financial responsibility to ABX under Section 4.1.6. If GNE retracts an Exercise
Notice prior to the "Trigger Date" (as shown in the above table) in a given
calendar quarter in which an Exercise Notice would obligate ABX to Select a GNE
Program Antigen in the same calendar quarter, GNE may substitute a GNE Program
Antigen for the one retracted; provided that an Exercise Notice with respect to
such substitute GNE Program Antigen is delivered to ABX by the "Trigger Date"
and within the same applicable "Exercise Notice Period".
(d) Notification of Selection by ABX. Within [*] of a
Selection Date with regard to a GNE Program Antigen in accordance with Section
4.1.2(b), ABX shall provide written notice (the "Selection Notice") to GNE that
such GNE Program Antigen has been Selected on GNE's behalf by ABX. Such notice
shall include the date such Selection was made and the territory that will be
available to GNE with respect to the particular GNE Program Antigen in the
applicable GNE Product License.
(e) Cancellation of Entry into Product Licenses. After the
date of a Selection Notice, GNE shall have the right to cancel its obligations
to execute a GNE Product License, and ABX's obligations to enter into an XT
Product License on GNE's behalf, only in accordance with the following
provisions:
(i) from the date of such Selection Notice and
until a date [*] after the Selection Date for such GNE Program Antigen, GNE has
the right to inform ABX by written notice that it will not enter into the GNE
Product License with respect to such GNE Program Antigen; provided, however,
regardless of territory of the XT Product License to
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which ABX may be entitled, GNE shall remain obligated to pay the License Fee
pursuant to Section 4.1.6;
(ii) notwithstanding the foregoing in Section
4.1.2(e)(i), GNE [*]; and
(iii) notwithstanding the foregoing Section
4.1.2(e)(i), for a period of thirty (30) days following the date ABX delivers a
Selection Notice, if:
(1) ABX has Selected a particular GNE Program Antigen
[*] and the territory that will be available to GNE with
respect to the particular GNE Program Antigen in the
applicable GNE Product License [*] (as defined in the
Xenotech Agreement); or
(2) ABX has Selected a particular GNE Program Antigen
[*] and the territory that will be available to GNE with
respect to the particular GNE Program Antigen in the
applicable GNE Product License [*] (as defined in the
Xenotech Agreement),
then GNE [*]. If GNE fails to cancel its obligation as set forth in this Section
4.1.2(e)(iii), then GNE is deemed to have accepted the territory obtained by ABX
pursuant to the XT Product License. It is understood and agreed that,
notwithstanding any other provision of this Agreement, in the event that the XT
Product License entered into by ABX with XT is [*] then (a) GNE shall not be
obligated to enter into the GNE Product License Agreement with ABX or pay the
License amount set forth in Section 4.1.6 and (b) ABX shall not, if ABX used
commercially reasonable efforts to obtain [*] be in breach of this Agreement.
[*]
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(f) Entry into Product License. Except as provided in
Section 4.1.2(e), at the end of [*] from the Selection Date of each particular
GNE Program Antigen, ABX shall, in accordance with Section 4.1.4, enter into an
XT Product License with respect to such GNE Program Antigen and provide a copy
to GNE.
(g) It is understood and agreed that nothing in this
Section 4.1.2 shall in any way (i) modify or extend the term of any Evaluation
Position with respect to GNE Program Antigens, (ii) increase the number of
Options with respect to GNE Program Antigens exercisable by GNE, or (iii) modify
the numbers or timing of exercise of Options with respect to GNE Program
Antigens exercisable by GNE under this Agreement.
4.1.3 [Intentionally Left Blank]
4.1.4 Territory and Exclusivity. The territory and exclusivity
provided in a given GNE Product License Agreement shall be the same as the
territory and exclusivity granted to ABX under the XT Product License with
respect to the same Antigen. Accordingly, for example, (i) if ABX obtains a
Co-Exclusive Worldwide Product License related to the GNE Program Antigen, the
terms of the GNE Product License Agreement shall provide for a territory which
is the ABX Home Territory and the Rest of the World and will provide that the
rights granted therein are exclusive in the ABX Home Territory and co-exclusive
with JTI or its assignee or sublicensee in the Rest of the World, (ii) if ABX
obtains an Exclusive Home Territory Product License related to the GNE Program
Antigen, the terms of the GNE Product License Agreement shall provide for a
territory which is the ABX Home Territory and will provide that the rights
granted are exclusive in the ABX Home Territory, (iii) if ABX obtains an
Exclusive Qualified Worldwide Product License related to the GNE Program
Antigen, the terms of the GNE Product License Agreement will provide for a
territory which is the ABX Home Territory and the Rest of the World, and will
provide that the rights granted are exclusive in that territory, and (iv) if ABX
obtains an Exclusive Worldwide Product License related to the GNE Program
Antigen, the terms of the GNE Product License Agreement will provide for a
territory which is worldwide and will provide that the rights granted are
exclusive in that territory. Capitalized terms used in this Section 4.1.4 and
not otherwise defined in this Agreement are used in this Section as defined in
the Xenotech Agreement.
4.1.5 GNE Product License Agreement. Within [*] of GNE's receipt
of the XT Product License with respect to a particular GNE Program Antigen, ABX
and GNE shall enter into the GNE Product License Agreement with regard to such
GNE Program Antigen. If GNE fails to timely pay to ABX the License Fee set forth
in Section 4.1.6 (subject to any applicable cure provision), then (a) the
applicable GNE Product License Agreement shall terminate and ABX shall have no
further obligation to GNE regarding such GNE Product License Agreement and (b)
ABX shall be entitled, in its sole discretion, to exercise ABX's rights under
the Xenotech Agreement and enter into the XT Product License for the GNE Program
Antigen on its own behalf or on behalf of a third party without further
obligation to GNE. Notwithstanding the foregoing, nothing in this Section 4.1.5
shall be implied to grant ABX a license or entitle ABX to license or make any
other use of any technology, know-how, intellectual property, materials
(including, without limitation, any Antibodies, Antibody
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Secreting Cells, Hybridomas, or Genetic Material) or data owned by GNE, ABX,
owned jointly by GNE and ABX, and, in each case generated in whole or in part
from ABX's or GNE's activities under this Agreement in any case without first
obtaining GNE's prior written consent, except as expressly provided in this
Agreement (provided that this sentence is not intended to affect ABX's rights
under Section 6.6 of this Agreement). If GNE timely exercises its Option with
respect to a GNE Program Antigen and ABX fails or is unable to enter into (i) an
XT Product License with XT as provided in Section 4.1.2(f) within the time frame
set therein or (ii) the GNE Product License Agreement with GNE (in each case,
other than due to a breach of this Agreement by GNE), GNE shall be entitled to a
full refund of the Evaluation Position Payment paid by GNE to ABX and all
available remedies conferred on it under this Agreement and by law or in equity.
In connection with the foregoing sentence, (i) it is understood that money
damages would not be a sufficient remedy for GNE and GNE is entitled to specific
performance and injunctive relief in addition to other available remedies [*].
4.1.6 License Fee; Evaluation Position Credit. Subject to Section
4.1.2, within [*] of complete execution of a GNE Product License Agreement by
GNE and ABX with regard to a GNE Program Antigen for which an Option has been
exercised, GNE shall pay ABX a fee (a "License Fee") of [*] for each of the
first [*] GNE Program Antigens for which GNE has exercised its Option and [*]
for each subsequent GNE Program Antigen for which GNE exercises an Option.
Notwithstanding the foregoing, GNE shall have the right to credit the amount of
the Evaluation Position Payments made to ABX for such GNE Program Antigen
against the License Fee for such GNE Program Antigen as set forth in this
Section 4.1.6 as follows: GNE shall have the right to credit the prorated amount
of any Evaluation Position Payment over the remaining term of such Evaluation
Position or extension thereof [*] against such License Fee payable to ABX for
such GNE Program Antigen which was the subject of such Evaluation Position;
provided however, that in no event shall GNE be entitled to credit more than [*]
of such prorated amount against any License Fee. For purposes of example and
illustration only, if GNE were to exercise an Option with respect to a certain
GNE Program Antigen [*] during the term of an Evaluation Position, GNE would
have the right to credit [*] against the License Fee payable to ABX, which
credit amount would be capped at [*]. Subject to applicable cure provisions,
failure to timely pay amounts set forth in this Section shall be a material
breach of this Agreement.
4.1.7 [*]. To the extent and only to the extent that ABX has been
directly informed by GNE of a Specified Antigen pursuant to Section 2.1.9, if
[*] Selects such a Specified Antigen under the Xenotech Agreement during the
term of this Agreement, ABX shall promptly notify GNE in writing (a "[*]
Notice") with respect to [*] Selection of such Specified Antigen and, if a [*]
is available to ABX under the XT Agreement, ABX shall offer to exercise the [*]
regarding such Specified Antigen on behalf of GNE on the terms and conditions
set forth in the Xenotech Agreement; provided however, that ABX shall
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15
not be obligated to have in effect more than [*] for GNE's benefit at any time.
ABX shall inform GNE of ABX's deadlines for taking action with respect to any
such [*] in the [*] Notice. GNE may exercise its rights pursuant to this
Section 4.1.7 as follows:
(a) Request by GNE; Exercise by ABX. In response to a
notification that [*] has Selected a Specified Antigen as described in this
Section, and an offer by ABX to exercise such [*] on GNE's behalf, GNE may, by
written notice to ABX (each such notice a "[*] Exercise Notice"), request that
ABX exercise its [*] with respect to such GNE Antigen. Concurrently with each
such [*] Exercise Notice, GNE shall make a payment to ABX of [*]. If ABX
receives both a [*] Exercise Notice with respect to a particular GNE Antigen and
the appropriate payment before the deadline set forth in the [*] Notice, ABX
shall, to the extent that it has the right to do so, promptly exercise its [*]
with respect to such GNE Antigen. ABX shall promptly notify GNE of its exercise
of a [*] under this Section 4.1.7(a). A [*] exercised by ABX on GNE's behalf,
pursuant to this Section 4.1.7, shall be referred to as a "GNE [*]" from the
date of exercise by ABX.
(b) [*]. Promptly upon GNE's request, but no more than [*]
after ABX exercises the [*] on GNE's behalf, ABX shall enter into an [*] (as
defined in the Xenotech Agreement) with respect to such GNE Program Antigen.
Within [*] of entering into any such [*], ABX will execute and deliver to GNE
for Product License with respect to such GNE Program Antigen and execute and
deliver to GNE the corresponding GNE Product License with respect to such GNE
Program Antigen for execution by GNE. Further, following entry into each such XT
Product License, ABX shall provide written notice to GNE that ABX has entered
into the appropriate XT Product License and provide GNE with a complete copy
(excepting only financial terms) of the fully signed XT Product License.
(c) GNE Product License Agreement. Within [*] of GNE's
receipt of the XT Product License with regard to a particular [*] pursuant to
Section 4.1.7(b), ABX and GNE shall enter into the applicable GNE Product
License Agreement. If GNE fails to timely pay to ABX the [*] License Fee set
forth below, then (a) any applicable GNE Product License Agreement shall
terminate and ABX shall have no further obligation to GNE regarding such GNE
Product License Agreement and (b) ABX shall be entitled, in its sole discretion,
to exercise ABX's rights under the Xenotech Agreement and enter into the XT
Product License for the GNE Program Antigen on its own behalf or on behalf of a
third party without further obligation to GNE. Notwithstanding the foregoing,
nothing in this Section 4.1.7 shall be implied to grant ABX a license or entitle
ABX (a) to license or make any other use of any technology, know-how,
intellectual property, materials (including, without limitation, any Antibodies,
Antibody Secreting Cells, Hybridomas, or Genetic Material) or data owned by GNE,
owned jointly by GNE and ABX, and, in each case generated in whole or in part
from GNE's activities under this Agreement in any case without first obtaining
GNE's prior written consent, except as expressly provided in this Agreement
(provided that this sentence is
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16
not intended to affect ABX's rights under Section 6.6 of this Agreement).
(d) License Fee. Within [*] of execution of a GNE Product
License Agreement with ABX with regard to a GNE Program Antigen for which an
Option has been exercised, GNE shall pay ABX a fee (a "[*] License Fee") of [*]
for each GNE Program Antigen for which ABX exercises a [*] on GNE's behalf. An
exercise by GNE of a [*] shall not affect the number of Options or Licenses
available to GNE under this Agreement. Subject to applicable cure provisions,
failure to timely pay the amounts set fort in this Section shall be a material
breach of this Agreement.
4.1.8 Definition of GNE Program Antigen. ABX shall use
commercially reasonable efforts to establish as the definition of the GNE
Program Antigen under the XT Master Research License and Option Agreement the
same definition of the GNE Program Antigen as is established under this
Agreement, it being understood and agreed, however, that the precise definition
of the GNE Program Antigen defining the rights licensed to ABX under the XT
Product License (and the definition in the corresponding GNE Product License
Agreement) shall be as established in accordance with the XT Master Research
License and Option Agreement.
4.1.9 Previous Agreement Superceded. The Previous Agreement is
hereby superceded in its entirety by this Agreement. [*], as each term is
defined in the Previous Agreement, are deemed to be GNE Program Antigens under
the terms of this Agreement, for which GNE has obtained [*] initial [*]
Evaluation Positions. The initial Evaluation Position with regard to [*] shall
expire on December 10, 1999, unless extended pursuant to the terms of this
Agreement, and the Evaluation Position with regard to [*] shall expire on June
10, 1999, unless extended pursuant to the terms of this Agreement.
5. FINANCING DOCUMENTS
5.1 Financing Documents. Simultaneously with the execution of this
Agreement, ABX and GNE shall execute and deliver a Common Stock Purchase
Agreement and a Registration Rights Agreement, in the forms attached hereto as
Attachment C (collectively, the "Financing Documents"). The execution and
delivery of the Financing Documents by ABX and GNE and the Closing (as defined
in the Common Stock Purchase Agreement) shall be conditions precedent to the
effectiveness of this Agreement.
6. INTELLECTUAL PROPERTY
6.1 GNE Intellectual Property. GNE shall own all right, title and
interest in and to [*] and all intellectual property related to the foregoing.
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17
6.2 ABX Intellectual Property. ABX shall own all right, title and
interest in and to [*] and all intellectual property related to the foregoing.
6.3 Intellectual Property Concerning Other Inventions. Except as
otherwise provided in Sections 6.1 through 6.2 and Section 2.1.8 above, title to
any inventions (and to any patent applications, patents and other intellectual
property rights thereon) by a party or parties under this Agreement, [*].
Designation of inventors on any patent application hereunder is a matter of law
and shall be solely within the discretion of qualified patent counsel of the
party(ies) hereto making such invention.
6.4 Joint Ownership. For purposes of clarification, to the extent that
something is jointly owned under this Agreement, including the exclusive nature
of certain licenses which may be granted by ABX or GNE (but except as otherwise
provided in this Agreement with respect to GNE's obligations with respect to the
[*] thereof as set forth in this Agreement), both
parties shall have the right to use, commercialize, grant and authorize
sublicenses, and otherwise exploit all such jointly-owned patents and inventions
without obligation to account to, or obtain the consent of, the other joint
owner. Both parties hereto agree to promptly disclose to the other all
jointly-owned inventions under this Agreement and, on request of the other
party, will provide such information and assistance as may be reasonably
necessary to assist in the filing and prosecution of patent applications
claiming such inventions. The parties hereto agree to ensure that each employee,
agent, or independent contractor that conducts research using the XenoMouse
Animals, or materials derived in whole or part from the XenoMouse Animals, will
promptly disclose and assign to the parties hereto any and all rights to
jointly-owned inventions. The parties hereto agree to maintain records in
sufficient detail and in good scientific manner appropriate for patent purposes
and so as to properly reflect all work done and results achieved in performing
research under this Agreement.
6.5 Patent Prosecution.
6.5.1 Solely Owned. The party solely owning any invention under
this Article 6 shall have the sole right and responsibility (but not the
obligation), at its expense, to file, prosecute and maintain all patent
applications and patents thereon, and to conduct any interferences, oppositions,
or reexaminations thereon, and to request any reissues or patent term extensions
thereof.
6.5.2 Jointly Owned. In the event of any invention jointly owned
by the parties under this Article 6, ABX shall have the sole right and
responsibility (but not the obligation), at its expense, to file, prosecute and
maintain all patent applications (and to conduct any interferences, oppositions,
or reexaminations thereon, and to request any reissues or patent term extensions
thereof) claiming any XenoMouse Animals or any uses thereof, and GNE shall have
the sole right and responsibility (but not the obligation), at its expense, to
file, prosecute and
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18
maintain all patent applications and patents (and to conduct any interferences,
oppositions, or reexaminations thereon, and to request any reissues or patent
term extensions thereof) claiming a GNE Program Antigen, an Antibody that binds
to a GNE Program Antigen or a Product and/or its development, manufacture, use
or sale. The party having such rights and responsibilities hereunder is referred
to as the "Controlling Party". The Controlling Party shall: (i) provide the
non-Controlling Party with any patent application filed hereunder by the
Controlling Party promptly after such filing; (ii) provide the non-Controlling
Party promptly with copies of all substantive communications received from or
filed in patent office(s) with respect to such filings; (iii) notify the
non-Controlling Party of any interference, opposition, reexamination request,
nullity proceeding, appeal or other interparty action and review it with the
non-Controlling Party as reasonably requested; and (iv) provide the
non-Controlling Party a reasonable time prior to taking or failing to take any
action that would substantially affect the scope of validity of rights under
such patent applications or patents thereon (including substantially narrowing
or canceling any claim without reserving the right to file a continuing or
divisional application, abandoning any patent or not filing or perfecting the
filing of any patent application) with notice of such proposed action so that
the non-Controlling Party has a reasonable opportunity to review and make
comments. If the Controlling Party fails to undertake the filing of a patent
application (or continuing or divisional application) within ninety (90) days
after a written request from the non-Controlling Party to do so, or if the
Controlling Party discontinues the prosecution or maintenance of a patent
application or patent, the non-Controlling Party at its expense may, in its
discretion, undertake such filing, prosecution or maintenance thereof, in which
case such patent application and patent thereon shall be solely owned by the
non-Controlling Party. The parties hereto shall assist each other to the extent
commercially reasonable in securing intellectual property rights resulting from
jointly owned inventions hereunder. As to enforcement of jointly-owned patents,
including actions against an alleged infringer, the parties hereto shall consult
with each other in good faith as to the best manner in which to proceed. In the
case of such actions against alleged infringers, any recovery awarded shall be
first used to reimburse the costs and expenses (including reasonable attorneys'
fees) of the party or parties in the action, second used to reimburse ABX for
any amounts ABX is obligated to pay to third parties (if any) in respect of such
amount pursuant to applicable ABX In-Licenses, with the remainder for the
account of the party or parties that undertake such actions to the extent of
their financial participation therein. To the extent that damages are awarded
for lost sales or lost profits from the sale of Products, such damages shall be
allocated among the parties taking into account royalties that would have been
payable to ABX on the sale of such Products. Either party may withdraw from or
abandon any jointly-owned patent application or patent hereunder, on reasonable
prior written notice to the other party providing a free-of-charge option to
assume the prosecution and/or maintenance thereof.
6.6 Grant Back. (a) In the event that GNE provides proper notice and
immunizes XenoMouse Animals with a Specified Antigen but ultimately does not
exercise an Option to enter into a GNE Product License Agreement with respect to
such Specified Antigen, then GNE agrees to grant to ABX a non-exclusive,
royalty-free, sublicensable, worldwide license to intellectual property directly
created by GNE arising out of GNE's activities under this Agreement using the
XenoMouse Animals with respect to such particular Specified Antigen, including,
but not limited to, Antibodies to such Specified Antigen, cells that express
such
19
Antibodies and Genetic Material encoding such Antibodies; provided, however,
that such license shall be limited to intellectual property which could have
only been created using XenoMouse Animals or with another mouse strain that
contains human antibody genes and is able to produce human antibodies but not
with any other mouse strains (such as wild-type mice); and provided, further,
that if GNE properly exercises an Evaluation Position on the terms and
conditions of this Agreement and then exercises an Option with respect to the
Specified Antigen and ABX for any reason (other than a breach of this Agreement
by GNE or retraction or cancellation by GNE pursuant to Sections 4.1.2(c) or
4.1.2(e), respectively) does not enter into the applicable GNE Product License
Agreement with GNE, no license shall be granted to ABX for intellectual property
covering such Specified Antigen.
(b) In the event that GNE violates the last sentence of Section
2.1.1 by immunizing XenoMouse Animals with a Non-Specified Antigen, then GNE
agrees to grant to ABX a license to intellectual property created by GNE using
XenoMouse Animals and covering only such Non-Specified Antigen, including, but
not limited to, Antibodies to such Non-Specified Antigen, cells that express
such Antibodies and genetic material encoding such Antibodies, as follows:
(i) In the event that GNE would not have been allowed to immunize
the XenoMouse Animals with the Non-Specified Antigen at the time of
immunization because such Antigen had been [*], GNE agrees to grant ABX
an exclusive, royalty-free, sublicensable, worldwide license to all
intellectual property created by GNE using the XenoMouse with such
Non-Specified Antigen; provided, however, that such license shall be
limited to intellectual property which could have only been created
using the XenoMouse Animals or with another mouse strain that contains
human antibody genes and is able to produce human antibodies but not
with any other mouse strains (such as wild-type mice);
(ii) In the event that GNE would have been allowed to immunize
the XenoMouse Animals with such Non-Specified Antigen because such
Antigen had not been [*] but GNE failed to give ABX proper notice prior
to immunization, then, if GNE converts such Non-Specified Antigen into a
Specified Antigen by following the procedures set forth in this
Agreement but does not ultimately exercise an Option with regard to such
Antigen, GNE shall then grant ABX a non-exclusive, royalty-free,
sublicensable, worldwide license to intellectual property created by GNE
using the XenoMouse covering that Non-Specified Antigen; provided,
however, that such license shall be limited to intellectual property
which could have only been created using the XenoMouse Animals or with
another mouse strain that contains human antibody genes and is able to
produce human antibodies but not with any other mouse strains (such as
wild-type mice); and provided, further, that if GNE exercises an
Evaluation Position and then exercises an Option with respect to such
properly converted Specified Antigen and ABX for any reason does not
enter into the applicable GNE Product License Agreement, no license
shall be granted to ABX for intellectual property
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20
covering such Specified Antigen.
(c) If, during GNE's immunization of the XenoMouse Animals with a
Specified Antigen under the terms and conditions of this Agreement, an invention
covering a Non-Specified Antigen arises, and GNE does not convert such
Non-Specified Antigen into a Specified Antigen under Section 6.6(b)(ii) within a
reasonable amount of time, GNE shall grant ABX a non-exclusive, royalty-free,
worldwide, sublicensable license to intellectual property created by GNE using
the XenoMouse covering such Non-Specified Antigen; provided, however, that such
license shall be limited to intellectual property which could have only been
created using XenoMouse Animals or with another mouse strain that contains human
antibody genes and is able to produce human antibodies but not with any other
mouse strains (such as wild-type mice).
(d) None of the licenses contemplated in Section 6.6 shall
require GNE to transfer any know-how or provide any training to ABX.
Notwithstanding the foregoing, GNE agrees to execute such documents and take
such further actions as are reasonably necessary to effectuate any grant of
licenses contemplated by this Section 6.6.
7. CONFIDENTIALITY
7.1 Confidentiality. Except as expressly provided herein, GNE and ABX
each shall keep completely confidential and shall not publish or otherwise
disclose and shall not use for any purpose any Confidential Information during
the term of this Agreement and for five (5) years following the expiration or
termination of this Agreement. ABX may disclose in its promotional material,
information contained in GNE's publicly available documents and attribute
appropriate credit to XenoMouse Technology.
7.2 Permitted Disclosure. Notwithstanding Section 7.1 above, each party
may nevertheless disclose the other party's Confidential Information to the
extent such disclosure is required by applicable law, regulation or court order,
provided that if a party is so required to make any such disclosure of the other
party's Confidential Information, other than pursuant to a confidentiality
agreement, it will give reasonable advance notice to the other party of such
disclosure requirement and will use efforts consistent with prudent business
judgment to secure confidential treatment of such information prior to its
disclosure (whether through protective orders or confidentiality agreements or
otherwise). The expiration of GNE's obligations under Section 7.1 above shall
not limit GNE's obligations under Section 9.4.6 above.
7.3 Terms of Agreement. Except as expressly provided in this Article 7,
each party hereto agrees not to make any public disclosure of the terms of this
Agreement or the identity of the Specified Antigen (unless such Specified
Antigen is an Excluded Antigen)(including, without limitation, any press release
and/or Q&A to be issued on the date of GNE's exercise of any Option), without
first obtaining the written approval of the other party and agreement upon the
nature and text of such public announcement or disclosure. After execution of
this Agreement, either party hereto may issue a press release, the content of
which will be agreed upon by the parties. The party desiring to make any such
public announcement shall provide the other party
21
with a copy of the proposed announcement for review and comment in reasonably
sufficient time prior to public release. Each party agrees that it shall
cooperate fully with the other with respect to all disclosures regarding this
Agreement required under applicable laws and regulations to the United States
Securities Exchange Commission and any other governmental or regulatory
agencies, including requests for confidential treatment of proprietary
information of either party included in any such governmental disclosure. The
parties may publicly disclose information contained in any prior public
disclosure that was in compliance with this Section 7.3 without further
approvals hereunder. In addition, each party agrees not to disclose the identity
of any Specified Antigen to any third party under any circumstances except if
required by law, nor the terms of this Agreement or the GNE Product License
Agreement to any third party, other than to professional advisors and financing
sources, and in that case, only under confidentiality terms at least as
stringent in material respects as this Article. GNE shall have the right to
review and comment on applications for confidential treatment insofar as they
pertain to this Agreement, prior to being filed with the SEC and ABX shall not
unreasonably refuse to consider such comments. GNE shall provide its comments,
if any, on such application as soon as practicable, and in no event later than
four (4) days after such application is provided to GNE.
7.4 Scientific Publications. The parties agree, as a general principle,
that it is desirable to publish the results of the research conducted by the
parties hereto under this Agreement, and agree that both parties will have the
right to publish such results. The following restrictions shall apply with
respect to the disclosure in scientific journals or publications by the parties
hereto regarding any scientific work under this Agreement (but not any
Independent Discovery or other research performed by the parties): (a) the party
publishing, or proposing to publish, such results (the "Publishing Party") shall
provide the other party (the "Non-Publishing Party") with an advance copy of any
proposed submission of a publication arising from such scientific work, not less
than thirty (30) days prior to submission or disclosure of such publication, and
the Non-Publishing Party shall have a reasonable opportunity to recommend any
changes it reasonably believes are necessary to preserve its Patent Rights or
Know-How or to protect its Confidential Information hereunder, and the
incorporation of such recommended changes shall not be unreasonably refused; and
(b) if the Non-Publishing Party informs the Publishing Party, within thirty (30)
days of receipt of an advance copy of a proposed publication hereunder, that
such publication includes Confidential Information of the Non-Publishing Party
the publication of which, in the Non-Publishing Party's sole judgment, could be
expected to have a material adverse effect on any of its Patent Rights or
Know-How, or on the Non-Publishing Party's business affairs which are the
subject of this Agreement, the Publishing Party shall delete such Confidential
Information of the Non-Publishing Party from such publication and, in the case
of inventions made solely by the Publishing Party or jointly by the Publishing
Party and the Non-Publishing Party, delay publication thereof for a reasonable
time period (not to exceed ninety (90) days) sufficient for the preparation and
filing of a patent application or application for a certificate of invention
thereon. The parties agree to confer regarding authorship of such publications,
which shall be determined in accordance with the standards for authorship
customary for peer-reviewed journals. For purposes of this Section 7, the
parties agree that publication of Confidential Information incorporated within a
filed patent application shall not be required to be deleted solely due to such
patent application having reached its 18 month international publication date.
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8. INDEMNIFICATION
8.1 GNE. GNE agrees to save, defend and hold ABX and its directors,
officers, employees, agents and Affiliates harmless from and against any suits,
claims, actions, demands, damages, liabilities, expenses or losses (including
court costs and reasonable attorneys' and experts' fees) (collectively, the
"Liabilities") resulting directly from any third party claims arising from any
negligence or willful misconduct of GNE (or its directors, officers, employees
or agents) or the breach of any representations, warranties or covenants of GNE
under this Agreement; provided, however, that nothing in this Section 8.1 shall
obligate GNE to save, defend or hold harmless ABX for any Liabilities to the
extent arising from the gross negligence or willful misconduct of ABX or its
directors, officers, employees, or agents.
8.2 ABX. ABX agrees to save, defend and hold GNE and its directors,
officers, employees, agents and Affiliates harmless from and against any
Liabilities resulting directly from third party claims arising from any
negligence or willful misconduct of ABX (or its directors, officers, employees,
or agents) or the breach of any representations, warranties or covenants of ABX
under this Agreement; provided, however, that nothing in this Section 8.2 shall
obligate ABX to save, defend or hold harmless GNE for any such Liabilities to
the extent arising from the gross negligence or willful misconduct of GNE or its
directors, officers, employees or agents.
8.3 Indemnification Procedures. If any person or party entitled to
indemnification under this Article 8 (an "Indemnitee") intends to claim
indemnification under this Article 8, it shall promptly notify the indemnifying
party hereunder (the "Indemnitor") in writing of any Liability in respect of
which the Indemnitee intends to claim such indemnification, as soon as
reasonably practicable after the Indemnitee receives notice of such Liability.
Indemnitor's obligations under this Article 8 are conditioned upon the
Indemnitee permitting the Indemnitor to assume direction and control of the
defense of the Liability (including the right to settle it); provided, however,
that an Indemnitee shall have the right to retain its own legal counsel, with
the reasonable fees and expenses thereof to be paid by the Indemnitor, if
representation of such Indemnitee by the legal counsel retained by the
Indemnitor would be inappropriate due to actual or potential conflicts of
interest between such Indemnitee and such Indemnitor. Indemnitor's obligations
under this Article 8 shall not apply to amounts paid in settlement of any loss,
claim, damage, liability or action if such settlement is effected without the
consent of the Indemnitor, which consent shall not be withheld or delayed
unreasonably. The failure to deliver written notice to the Indemnitor within a
reasonable time after the commencement of any third party suit, claim, action or
demand, if prejudicial to Indemnitor's ability to defend such suit, claim,
action or demand, shall relieve the Indemnitor of its obligations under this
Section 8 solely with respect to Liabilities that could have been defended in
such action. The Indemnitee (and its directors, officers, employees and agents)
shall cooperate fully with the Indemnitor and its legal counsel in the
investigation of any such Liability for which indemnification is sought by such
Indemnitee hereunder.
23
9. REPRESENTATIONS, WARRANTIES AND COVENANTS
9.1 Representations and Warranties of ABX. ABX represents and warrants
to GNE as of the Effective Date that:
9.1.1 (i) it has the power and authority to enter into this
Agreement; (ii) to the knowledge of ABX, there are no existing or threatened
actions, suits or claims pending with respect to the subject matter hereof or
the right of ABX to enter into and perform its obligations under this Agreement;
(iii) it has taken all necessary action on its part to authorize the execution
and delivery of this Agreement and the performance of its obligations hereunder;
(iv) this Agreement has been duly executed and delivered on behalf of it, and
constitutes a legal, valid, binding obligation, enforceable against it in
accordance with the terms hereof; and (v) the execution and delivery of this
Agreement and the performance of its obligations hereunder do not conflict with
or violate any requirement of applicable laws or regulations and do not conflict
with, or constitute a default under, any contractual obligation of it;
9.1.2 it has the full right and authority to grant the rights
and licenses granted herein;
9.1.3 it has not previously granted any rights materially
inconsistent or in material conflict with the rights and licenses granted to GNE
herein, including without limitation, any right or license in and to the
Licensed Technology or any portion thereof;
9.1.4 to its knowledge (without the obligation to perform
external due diligence) there are no existing or threatened actions, suits or
claims pending against ABX with respect to the Licensed Technology or the right
of ABX to enter into and perform its obligations under this Agreement;
9.1.5 ABX has no knowledge (without the obligation to perform due
diligence) of any rights of third parties that would materially interfere with
GNE's use of the ABX Know-How or the ABX Patent Rights under this Agreement,
and, as of the Effective Date, ABX has no knowledge (without the obligation to
perform due diligence) that any patents or patent applications within the ABX
Patent Rights are invalid or unenforceable or that their practice as licensed
hereunder would infringe patent rights of third parties; provided, however, that
this representation does not apply to any Liabilities or infringement arising
out of, relating to or with respect to the Specified Antigens or the GNE Program
Antigens;
9.1.6 Cell Genesys, Inc. ("CGI") has assigned to ABX all of CGI's
rights and obligations under the XT Master Research License and Option
Agreement, and ABX is a party to the XT Master Research License and Option
Agreement; and
9.1.7 it has provided to GNE complete copies of all material
applicable ABX In-Licenses setting forth all material applicable limitations or
restrictions on the Licensed Technology and the XenoMouse Animals (it being
understood that the financial terms have been
24
redacted from some or all such copies).
9.2 Covenants of ABX. ABX covenants to GNE that:
9.2.1 ABX will not take any action or fail to take any action
under this Agreement that will cause a material breach of the GenPharm
Cross-License, the XT Master Research License and Option Agreement or any ABX
In-License; provided, however, that it shall not be a breach of this covenant if
ABX cures any breach of such third party agreement pursuant to the cure
provisions contained therein;
9.2.2 ABX shall, at the reasonable request of GNE, discuss with
GNE ABX's interpretation of material terms and conditions of ABX In-Licenses,
including, without limitation, any limitations on ABX's right to further
transfer or grant licenses or sublicenses to GNE to any and all rights to
technology within the scope of the ABX Patent Rights and/or ABX Know-How under
any ABX In-License;
9.2.3 ABX shall not agree to any termination, modifications or
amendments to any ABX In-Licenses that would negatively affect GNE's rights
under this Agreement without first obtaining GNE's reasonable prior written
consent, and ABX shall notify GNE as soon as practicable (if possible) of any
material modification or amendment of any ABX In-License that materially affects
(positively or negatively) GNE's rights or obligations under this Agreement or
the GNE Product License Agreement, and provide a copy of such modification or
amendment, redacted only with regard to financial terms;
9.2.4 ABX shall promptly provide GNE with a copy of any notice of
default by ABX and/or its sublicensee under any ABX In-License, and of any
notice of termination by any other party to any ABX In-License;
9.2.5 ABX shall not use or permit others to use cells created by
ABX from immunization of XenoMouse Animals pursuant to the Previous Agreement in
any way without GNE's prior written consent nor shall ABX directly or indirectly
create, incur, assume or suffer to exist, any lien, security interest or other
similar encumbrance of any kind, or any other type of preference, as such term
is used in bankruptcy law, upon or with respect to such cells or with respect to
cells generated pursuant to this Agreement.
9.2.6 ABX will provide GNE with a complete (excepting only for
financial terms) copy of each Product License entered into by ABX with regard to
a GNE Program Antigen as signed by all parties thereto;
9.2.7 ABX shall notify GNE promptly in writing of assertion by
JTI (if any) that it has any rights anywhere that would prevent ABX from
acquiring an XT Product License with a territory other than that indicated in
the notice provided for in Section 4.1.2(d) with regard to a GNE Program Antigen
or any other right or license under the Licensed Technology to develop, make and
have made, use, sell, lease, offer to sell or lease, import, export, otherwise
transfer physical possession of or otherwise transfer title to Product with
respect to such GNE Program
25
Antigen in the Field, except with respect to rights granted under the research
license set forth in Article 3 of the Xenotech Agreement; and
9.2.8 On the first date on which a Product License for any GNE
Program Antigen between ABX and XT and the corresponding GNE Product License
Agreement between ABX and GNE are both in full force and effect, and thereafter
so long as both are in effect, ABX shall be and remain XT's exclusive licensee
and sublicensee (except with respect to any rights of JT under the Xenotech
Agreement and the licenses granted in the GenPharm Cross License) for all the
uses of the Licensed Technology relating to applicable Products in the Field
throughout the Territory, and GNE shall be ABX's exclusive sublicensee
thereunder for all uses of the Licensed Technology relating to the applicable
Products in the Field throughout the Territory, as more fully set forth in the
applicable GNE Product License Agreement and on the terms and condition set
forth therein.
9.2.9 If ABX becomes aware of any third party intellectual
property that would constitute a Core Third Party Patent under a GNE Product
License Agreement if such a GNE Product License Agreement were in effect, ABX
agrees to inform GNE of such third party intellectual property and discuss with
GNE ways to resolve issues related thereto.
9.3 Representations and Warranties of GNE. GNE represents and warrants
to ABX as of the Effective Date that:
9.3.1 (i) it has the power and authority to enter into this
Agreement; (ii) it has taken all necessary action on its part to authorize the
execution and delivery of this Agreement and the performance of its obligations
hereunder; (iii) this Agreement has been duly executed and delivered on behalf
of it, and constitutes a legal, valid, binding obligation, enforceable against
it in accordance with the terms hereof; (iv) the execution and delivery of this
Agreement and the performance of its obligations hereunder do not conflict with
or violate any requirement of applicable laws or regulations and do not conflict
with, or constitute a default under, any contractual obligation of it; and (v)
it will not knowingly take any action, or fail to take any action, under this
Agreement that will cause a breach of the GenPharm Cross License Agreement or
the XT Master Research and License Agreement;
9.3.2 it has the full right and authority to enter into this
Agreement and grant the rights and licenses granted herein;
9.3.3 to its knowledge, without the obligation to perform due
diligence, there are no existing or threatened actions, suits or claims pending
with respect to the subject matter hereof (including, without limitation, rights
in and to the GNE Program Antigens and/or antibodies to the GNE Program
Antigens) or the right of GNE to enter into and perform its obligations under
this Agreement;
9.3.4 it has no knowledge (without the obligation to perform due
diligence) of any rights of third parties that would interfere with the use of
the GNE Know-How or practice of the GNE Patent Rights as contemplated under this
Agreement; and
26
9.3.5 it has not previously granted any rights inconsistent or in
conflict with the rights and licenses granted under this Agreement.
9.4 Covenants of GNE. GNE covenants to ABX that:
9.4.1 during the term of this Agreement GNE will not grant any
rights inconsistent or in conflict with the rights and licenses granted under
this Agreement;
9.4.2 it will not, to its knowledge, take any action or fail to
take any action that will cause a breach by ABX of the GenPharm Cross License,
the XT Master Research License and Option Agreement, the XT Product License, or
any ABX In-License; and
9.4.3 it will not, in bad faith, immunize the XenoMouse Animals
with any Antigens other than Specified Antigens or GNE Program Antigens; and
9.4.4 it will provide ABX [*] with proper notice with respect to
the Specified Antigens that will be used by GNE to immunize the XenoMouse
Animals.
9.4.5 If any member of GNE's project team involved in use of
XenoMouse Technology becomes aware of any third party intellectual property that
would constitute a Core Third Party Patent under a GNE Product License Agreement
if such a GNE Product License Agreement were in effect, GNE agrees to inform ABX
of such third party intellectual property and discuss with ABX ways to resolve
issues related thereto.
9.4.6 (a) all XenoMouse Animals transferred to GNE and the ABX
Materials shall be the sole property of ABX and are transferred to GNE solely
for the purposes set forth in Section 2.1.1 above, and the transfer of physical
possession to GNE, and/or possession or use by GNE of the XenoMouse Animals or
the ABX Materials shall not be, nor be construed as, a sale, lease, offer to
sell or lease, or other transfer of title to any XenoMouse Animals or the ABX
Materials;
(b) all XenoMouse Animals and all materials derived in whole
or part from the XenoMouse Animals (including the ABX Materials and Antibodies
derived therefrom) shall remain in the control of GNE and shall not be
transferred to GNE's Affiliates, sublicensees or any other party (other than
ABX), except as expressly set forth under Section 2.1.1 or as expressly
permitted under a GNE Product License Agreement (if entered into by the parties
hereto);
(c) GNE shall not directly or indirectly use or attempt to
use the XenoMouse Animals, or any information or biological or chemical
materials derived from the XenoMouse Animals (including without limitation
Products), to reproduce, generate, create or produce, through breeding,
reverse-engineering, genetic manipulation or otherwise, the XenoMouse Animals or
other transgenic mice or other transgenic animals;
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27
(d) GNE shall not sell, have sold, (sub)license, assign,
lease, or offer to sell, lease, (sub)license, or assign, or otherwise transfer
title to any XenoMouse Animals;
(e) Except as expressly set forth under Section 2.1.1, GNE
shall not sell, have sold, (sub)license, assign, lease, or offer to sell,
(sub)license, assign or lease, otherwise transfer title to, or distribute,
commercialize or clinically develop any Antibody, ABX Materials, Product or
materials derived from XenoMouse Animals (or Genetic Materials encoding the
foregoing) without first entering into a GNE Product License Agreement with ABX
with respect to such materials;
(f) Upon expiration or termination of this Agreement for any
reason, GNE shall destroy (or return to ABX as directed by ABX) each XenoMouse
Animal and shall destroy, at ABX's request, all materials derived therefrom
(regardless of title), including without limitation all ABX Materials and any
tissues or Genetic Materials therefrom, and certify such destruction or transfer
within thirty (30) days after written notice by ABX instructing GNE to destroy
or return XenoMouse Animals and/or materials, in each case except as otherwise
expressly provided in an applicable GNE Product License Agreement (if entered
into by the parties);
(g) GNE shall not use the XenoMouse Animals to make or use
antibodies to any antigens other than the Specified Antigens and the GNE Program
Antigens (including without limitation to [*]);
(h) GNE shall grant to ABX an exclusive (even as to GNE),
worldwide, irrevocable, perpetual, sublicensable, royalty free license to GNE's
entire right, title and interest in and to all inventions (whether patentable or
nonpatentable), made or created by GNE (and any of its agents or employees)
using the Licensed Technology and which covers any modification, improvement,
use or adaptation of the XenoMouse Animals, which use is not in accordance with
the terms and conditions set forth in Article 2;
(i) GNE shall use the XenoMouse Animals and all materials
derived from the XenoMouse Animals (including without limitation Products) in
compliance with all applicable national, state, and local laws and regulations,
including all applicable National Institutes of Health guidelines. GNE
acknowledges that the XenoMouse Animals, and all materials derived from the
XenoMouse Animals (including without limitation Products), are experimental in
nature and may have unknown characteristics. GNE shall use reasonable prudence
and care in the use, handling, storage, transportation, disposition and
containment of the XenoMouse Animals and all materials derived from the
XenoMouse Animals (including without limitation Products), and shall not use any
such materials in humans without a Product License;
(j) Unless otherwise agreed by ABX in advance in writing, all
XenoMouse Animals delivered to GNE shall be delivered to GNE's primary research
facility, which is
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28
currently located in South San Francisco, CA, and such XenoMouse Animals shall
not leave such facility (except for return of XenoMouse Animals to ABX or upon
destruction of the XenoMouse Animals by GNE); and
(k) XT shall be a third-party beneficiary of the commitments
by GNE set forth in items (a) through (g) above.
9.5 Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS
AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATIONS OR EXTENDS ANY WARRANTIES OF
ANY KIND TO THE OTHER PARTY, EITHER EXPRESS OR IMPLIED, REGARDING THE MATERIALS,
PRODUCTS OR THE LICENSED TECHNOLOGY, INCLUDING, BUT NOT LIMITED TO, WARRANTIES
OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NONINFRINGEMENT OR
VALIDITY OF INTELLECTUAL PROPERTY RIGHTS. ALL XENOMOUSE ANIMALS AND MATERIALS
DERIVED IN WHOLE OR PART FROM THE XENOMOUSE ANIMALS PROVIDED TO GNE BY ABX ARE
PROVIDED "AS IS," AND ABX SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT WITH
RESPECT TO XENOMOUSE ANIMALS AND MATERIALS DERIVED IN WHOLE OR PART FROM
XENOMOUSE ANIMALS.
10. TERM; TERMINATION
10.1 Term. This Agreement shall commence on the Effective Date and,
unless earlier terminated as provided in this Article 10, shall continue in
effect for a period of six (6) years from the Effective Date; provided that, GNE
shall have the right, at any time during the final year of the initial term of
this Agreement, to extend the term of this Agreement as set forth below in this
Section 10.1. GNE shall have the right to extend the term of this Agreement for
one additional period of three (3) years by (a) notifying ABX in writing that
GNE desires to extend the term of this Agreement prior to the expiration of this
Agreement, and (b) purchasing from ABX (within sixty (60) days of the date of
such notice), on terms (other than price) substantially similar to those of the
Financing Documents, such number of shares of the common stock of ABX (the
"Common Stock") equal to an aggregate purchase price of two million five hundred
thousand dollars ($2,500,000), at a purchase price per share of such Common
Stock of one hundred and fifty percent (150%) of the average closing price per
share of such Common Stock during the twenty (20) day trading period prior to
the date of notice.
10.2 Termination by GNE. GNE may terminate this Agreement at any time
upon thirty (30) days written notice to ABX.
10.3 Termination for Breach. Either party to this Agreement may
terminate this Agreement in the event that the other party shall have materially
breached or defaulted in the performance of any of its material obligations
hereunder, and such breach or default shall have continued for sixty (60) days
after written notice of such breach and intent to terminate this
29
Agreement therefor was provided to the breaching party by the nonbreaching
party. Any such termination shall become effective at the end of such sixty (60)
day period unless the breaching party has cured any such breach or default prior
to the expiration of the sixty (60) day period. Any such termination shall be
without prejudice to any other remedies available to, the nonbreaching party by
law or at equity (including, without limitation under Section 10.4 below). The
right of a nonbreaching party to terminate this Agreement shall not be affected
in any way by its waiver or failure to take action with respect to any previous
default.
10.4 Effect of Expiration or Termination.
10.4.1 Accrued Obligations and Rights. Expiration or any
termination of this Agreement shall not relieve the parties of any obligation
accruing prior to such expiration or termination or release either party hereto
from any liability which at the time of such expiration or termination has
already accrued to such party, nor preclude either party from pursuing any
rights and remedies it may have hereunder or at law or in equity which accrued
to it prior to such expiration or termination, subject to the terms of this
Agreement.
10.4.2 XT. GNE and ABX agree that this Agreement, including,
without limitation, any licenses and/or sublicenses granted to GNE pursuant to
this Agreement or any GNE Product License Agreement entered into between ABX and
GNE, shall survive any dissolution, liquidation or acquisition of XT, and that
such licenses shall remain in full force and effect even after any distribution,
following dissolution, of the intellectual property owned or licensed to XT, to
any entity. GNE and ABX agree that any transfer of such intellectual property to
or following such dissolution shall be subject to the licenses and/or
sublicenses granted herein (and to be granted pursuant to applicable GNE Product
License Agreements, if entered into at all by the parties).
10.4.3 XT Master Research License and Option Agreement. This
Agreement, including without limitation, any license and/or sublicense granted
to GNE hereunder, and any GNE Product License Agreement (if entered into by the
parties) (including without limitation, any licenses and/or sublicenses granted
to GNE thereunder), are, except as otherwise provided in this Agreement,
independent of, and, as between GNE and ABX, shall not be affected by, any
breach or termination of the XT Master Research License and Option Agreement.
10.4.4 Survival. Articles 6, 7, 8, 9, 11 and Sections 2.1.8 and
10.4 shall survive the expiration or termination of this Agreement.
11. MISCELLANEOUS PROVISIONS
11.1 Governing Laws. This Agreement shall be interpreted and construed
in accordance with the laws of the State of California, without regard to
conflicts of law principles.
11.2 Waiver. It is agreed that no waiver by a party hereto of any breach
or default of any of the covenants or agreements herein set forth shall be
deemed a waiver as to any
30
subsequent and/or similar breach or default.
11.3 Assignments. Neither this Agreement nor any right or obligation
hereunder may be assigned or delegated, in whole or part, by either party
without the prior written consent of the other; provided, however, that either
party may, without the written consent of the other, assign this Agreement to
(a) any entity to which it has acquired all or substantially all of the business
or assets of the assigning party, (b) any successor corporation resulting from
any merger or consolidation with another corporation (including, in the case of
GNE, X. Xxxxxxxx-Xx Xxxxx Ltd or any Affiliate thereof) or (c) in the case of
ABX, to XT. Notwithstanding the foregoing, ABX shall not be obligated without
its written consent to send XenoMouse Animals to any party other than GNE. The
terms and conditions of this Agreement shall be binding on and inure to the
benefit of the permitted successors and assigns of the parties.
11.4 Independent Contractors. The relationship of the parties hereto is
that of independent contractors. The parties hereto are not deemed to be agents,
partners or joint venturers of the others for any purpose as a result of this
Agreement or the transactions contemplated thereby.
11.5 Compliance with Laws. In exercising their rights under this
Agreement, the parties shall fully comply with the requirements of any and all
applicable laws, regulations, rules and orders of any governmental body having
jurisdiction over the exercise of rights under this Agreement.
11.6 Further Actions. Each party agrees to execute, acknowledge and
deliver such further instruments and to do all such other acts as may be
necessary or appropriate in order to carry out the purposes and intent of this
Agreement.
11.7 No implied obligations. Except as expressly provided herein,
nothing in this Agreement shall be deemed to require GNE to exploit the Licensed
Technology or to prevent GNE from commercializing products similar to or in
competition with any Product, in addition to or in lieu of such Products.
31
11.8 Notices. Any notice, request, approval or consent required or
permitted to be given between the parties hereto shall be given in writing, and
shall be deemed to have been properly given if delivered in person, transmitted
by telecopy with machine confirmation of transmission and confirmation by
personal delivery, first class certified mail or courier), or mailed by first
class certified mail to the other party at the appropriate address set forth
below, or to such other address as may be designated in writing by a party from
time to time in accordance with this Agreement. Such notice, request, approval
or consent shall be deemed given (i) on the date delivered or transmitted if
delivered in person or transmitted by telecopy prior to 5 p.m. on any business
day, (ii) on the next business day following delivery or transmission if
delivered in person or transmitted by telecopy after 5 p.m. on any business day
or on any non-business day, or (iii) on the fourth business day following the
date deposited in the United States mail if sent mailed by first class certified
mail.
Genentech, Inc.: Genentech, Inc.
Xxx XXX Xxx
Xxxxx Xxx Xxxxxxxxx, XX 00000
Attn: Corporate Secretary
Telecopy: (000) 000-0000
Abgenix, Inc.: Abgenix, Inc.
0000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: President
Telecopy: (000) 000-0000
11.9 Export Laws. Notwithstanding anything to the contrary contained
herein, all obligations of ABX and GNE are subject to prior compliance with
United States export regulations and such other United States laws and
regulations as may be applicable, and to obtaining all necessary approvals
required by the applicable agencies of the government of the United States. GNE
shall be responsible for obtaining such approvals, and shall use efforts
consistent with prudent business judgment to obtain such approvals. ABX agrees
to cooperate reasonably and provide reasonable assistance to GNE as may be
reasonably necessary to obtain any required approvals.
11.10 Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision and the parties shall discuss in good faith appropriate
revised arrangements.
11.11 Force Majeure. Nonperformance of any party (except for payment
obligations) shall be excused to the extent that performance is rendered
impossible by strike, fire, earthquake, flood, governmental acts or orders or
restrictions, failure of suppliers, or any other reason where failure to perform
is beyond the reasonable control and not caused by the negligence, intentional
conduct or misconduct of the nonperforming party.
32
11.7 No Consequential Damages. IN NO EVENT SHALL ANY PARTY HERETO BE
LIABLE FOR SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THIS
AGREEMENT OR THE EXERCISE OF ITS RIGHTS HEREUNDER, INCLUDING WITHOUT LIMITATION
LOST PROFITS ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT,
REGARDLESS OF ANY NOTICE OF SUCH DAMAGES.
11.13 Disputes. The parties recognize that disputes as to certain
matters may from time to time arise during the term of this Agreement which
relate to either party's rights and/or obligations hereunder. It is the
objective of the parties to establish procedures to facilitate the resolution of
disputes arising under this Agreement in an expedient manner by mutual
cooperation and without resort to litigation. To accomplish this objective, it
is agreed that each party will inform the other as soon as possible when it
becomes aware of an area or issue of dispute. Prior to filing or initiating any
legal proceeding, the parties agree in good faith to discuss the dispute at the
organizational level at which such dispute arises. If either party believes
there has been sufficient discussion of the matter at such level, then such
party, by written notice to the other party, may have such dispute referred to
their respective chief executive officers (or, if unavailable, a designee who is
an officer of the party empowered to resolve such disputes) for attempted
resolution by good faith negotiations between such chief executive officers
within fourteen (14) days of such referral. In the event that the chief
executive officers are not able to resolve such dispute within such fourteen
(14) day period, either party may pursue whatever remedies are available to them
under this Agreement or by law.
11.14 Complete Agreement. It is understood and agreed between ABX and
GNE that this Agreement and the GNE Product License Agreement(s) arising under
this Agreement constitute the entire agreement, both written and oral, between
the parties with respect to the subject matter hereof, and supersede and cancel
all prior agreements, understandings and representations respecting the subject
matter hereof, either written or oral, expressed or implied. No amendment or
change hereof or addition hereto shall be effective or binding on either of the
parties hereto unless reduced to writing and executed by the respective duly
authorized representatives of ABX and GNE.
11.15 Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed to be an original and both together shall be deemed to
be one and the same agreement.
11.16 Headings. The captions to the several Articles and Sections hereof
are not a part of this Agreement, but are included merely for convenience of
reference only and shall not affect its meaning or interpretation.
33
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective duly authorized officers as of the day and year
first above written.
ABGENIX, INC.
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------------
(Signature)
Xxxxxxx X. Xxxxx
-------------------------------------
(Printed Name)
Vice-President, Corporate Development
-------------------------------------
(Title)
GENENTECH, INC.
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------------
(Signature)
Xxxxxxx X. Xxxxx
-------------------------------------
(Printed Name)
Chief Operating Officer
-------------------------------------
(Title)
34
EXHIBIT A TO
GNE OPTION AGREEMENT AND
GNE PRODUCT LICENSE AGREEMENT
COMMON DEFINITIONS EXHIBIT
1.1. "ABX Home Territory" shall mean the United States and its
territories, Canada and Mexico.
1.2. "ABX In-Licenses" shall mean any and all licenses, sublicenses or
other agreements, as in effect as of the Effective Date or hereafter during the
term of this Agreement (as the same may be amended from time to time), under
which ABX has rights to technology (whether or not patentable) that is related
to XenoMouse Animals and/or is within the scope of the ABX Patent Rights and/or
the ABX Know-How. The parties agree that any and all such rights pursuant to any
ABX In-License are included in the XenoMouse Animals, ABX Patent Rights or the
ABX Know-How, as the case may be, but only to the extent that ABX is permitted
under the terms of the applicable ABX In-License to further transfer or grant
licenses or sublicenses of such rights. "ABX In-Licenses" shall include, without
limitation, the XT Master Research License and Option Agreement, any XT Product
License for a GNE Program Antigen and the GenPharm Cross License Agreement and
other agreements listed in Attachment A attached to the GNE Option Agreement.
1.3. "ABX Know-How" shall mean any and all processes, techniques, ideas,
technical information and any other information or materials, whether or not any
of the foregoing is patentable, that are owned or controlled by ABX (solely or
jointly, including under any ABX In-License) as of the Effective Date or
hereafter during the term of this Agreement, and as to which ABX has the right
to transfer or grant licenses or sublicenses (including as permitted under any
ABX In-License), to the extent that any of the foregoing relates to the
immunization of XenoMouse Animals with a Specified Antigen to generate any
Antibody hereunder. "ABX Know-How" shall not include any of the foregoing which
is generally ascertainable from publicly available information, or that was
known to GNE prior to disclosure to GNE by ABX, or which GNE obtained
independently (on its own or with partners) and not in violation of any
obligation of confidentiality owed to ABX or any third party, in any case as
demonstrated by competent written records of GNE (and/or its partners) which may
be supported or explained by additional testimonial evidence. All "ABX Know-How"
shall be treated as "Confidential Information" of ABX as provided in Article 7
of the GNE Option Agreement. As of the Effective Date, the parties have agreed
that ABX shall transfer to or provide GNE with the ABX Know-How identified in
Attachment B attached to and incorporated in the GNE Option Agreement.
1.4. "ABX Materials" shall mean [*].
1.5. "ABX Patent Rights" shall mean (a) any and all patent applications
and patents (including inventor's certificates and utility models) throughout
the Territory and (b) all
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35
extensions, reissues, reexaminations, renewals, divisions, continuations and
continuations-in-part of any of the foregoing, that are owned or controlled by
ABX (solely or jointly, including under any ABX In-License) as of the Effective
Date or hereafter during the term of this Agreement, and as to which ABX has the
right to transfer or grant licenses or sublicenses (including as permitted under
any ABX In-License), to the extent that any of the foregoing claims (i) any
XenoMouse Animals and/or any uses thereof to generate Antibodies, or (ii) any
Antibody. "ABX Patent Rights" shall include, without limitation, the patents and
patent applications listed on Attachment B attached to the GNE Option Agreement
and made a part thereof, and ABX shall notify GNE promptly in writing of any
changes to Attachment B (e.g., issuance of new patents, filing of new patent
applications, abandonment of existing filings, etc.), so that the parties may
update Attachment B by amendment of the GNE Option Agreement.
1.6. "Affiliate" shall mean, with respect to any person or entity, any
other person or entity which controls, is controlled by or is under common
control with such person or entity. A person or entity shall be regarded as in
control of another entity if it owns or controls at least fifty percent (50%) of
the equity securities of the subject entity entitled to vote in the election of
directors (or, in the case of an entity that is not a corporation, for the
election of the corresponding managing authority).
1.7. "Antibody" shall mean (i) a composition comprising a whole antibody
or fragment thereof, said antibody or fragment having been generated in whole or
part from the XenoMouse Animals through immunization with a Specified Antigen,
and (ii) any composition comprising a whole antibody or fragment thereof made by
or on behalf of GNE which is derived (directly or indirectly through single or
multiple steps) from an antibody or fragment thereof made under (i) above. ABX
acknowledges that as of the Effective Date, GNE has already undertaken and
thereafter may continue its own research efforts (on its own or with partners)
separate from (and without using any Licensed Technology, Confidential
Information of ABX or ABX Materials) this Agreement, and such efforts may result
in one or more antibodies to the Specified Antigen. ABX agrees that no
composition (or any fragment, variant or derivative thereof or any or nucleotide
sequences encoding, or amino acid sequences of, any of the foregoing) that is an
Independent Discovery shall be considered an "Antibody" for purposes of this
Agreement, even if a homologous sequence might also be generated in whole or in
part from XenoMouse Animals.
1.8. "Antigen" shall mean a single molecular species to be identified by
an appropriate scientific reference sufficient to distinguish it from other
molecular species.
1.9. "BLA" shall mean a Biologics License Application, Product License
Application, New Drug Application, or other equivalent application filed with
the FDA seeking regulatory approval to market and sell a Product in the United
States for a particular indication, including, without limitation, any pricing
and/or reimbursement approvals (if any).
1.10. "[*] Notice" shall have the meaning set forth in Section 4.1.7
of the GNE Option Agreement.
1.11. "[*]" shall mean the right of ABX or JTI under the terms of the
XT Master Research License and Option Agreement to obtain an option for [*].
1.12. "Confidential Information" shall mean, with respect to a party,
all information of any kind whatsoever (including without limitation,
compilations, data, formulae, models, patent disclosures, procedures, processes,
projections, protocols, results of experimentation and testing,
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specifications, strategies and techniques), and all tangible and intangible
embodiments thereof of any kind whatsoever (including without limitation,
apparatus, biological or chemical materials, animals, cells, compositions,
documents, drawings, machinery, patent applications, records, reports), which is
owned or controlled by such party, is disclosed by such party to the other party
pursuant to this Agreement, and (if disclosed in writing or other tangible
medium) is marked or identified as confidential at the time of disclosure to the
receiving party or (if otherwise disclosed) is identified as confidential at the
time of disclosure to the receiving party and described as such in writing
within thirty (30) days after such disclosure. Notwithstanding the foregoing,
Confidential Information of a party shall not include information which the
receiving party can establish by written documentation (a) to have been publicly
known prior to disclosure of such information by the disclosing party to the
receiving party, (b) to have become publicly known, without fault on the part of
the receiving party, subsequent to disclosure of such information by the
disclosing party to the receiving party, (c) to have been received by the
receiving party at any time from a source, other than the disclosing party,
rightfully having possession of and the right to disclose such information free
of confidentiality obligations, (d) to have been otherwise known by the
receiving party free of confidentiality obligations prior to disclosure of such
information by the disclosing party to the receiving party, or (e) to have been
independently developed by employees or agents of the receiving party without
access to or use of such information disclosed by the disclosing party to the
receiving party. The parties acknowledge that the foregoing exceptions shall be
narrowly construed and that the obligations imposed upon each party under
Section 7 below shall be relieved solely with respect to such Confidential
Information of the disclosing party which falls within the above exceptions and
not with respect to related portions, other combinations, or characteristics of
the Confidential Information of the disclosing party including, without
limitation, advantages, operability, specific purposes, uses and the like.
1.13. "Core Third Party Patent" means an issued, unexpired patent not
within the ABX Patent Rights or the patent rights solely owned (but not
licensed) by GNE or its Affiliates (except Roche) that is infringed, or except
for a license would be infringed, by the research, development, manufacture,
use, importation, offering for sale or sale of Products in each case
specifically because such Products were generated from XenoMouse Animals but not
wherein such infringement (i) would nevertheless be found had such Products been
produced from some other source or through some other process (e.g., a patent
that is, or except for a license would be, infringed by the research,
development, manufacture, use, importation, offering for sale or sale of
Products and which would still be infringed by the research, development,
manufacture, use, importation, offering for sale or sale of products derived
from immunization of a mouse that does not contain human antibody genes nor is
able to produce human antibodies with a Product Antigen), or (ii) is founded
solely on the basis of the Products being expressly covered through a
product-by-process claim in such patent; provided, however, that "Core Third
Party Patents" shall not include (a) any patent that has been held invalid,
unpatentable, unenforceable or revoked in a decision of a court or other
governmental body of competent jurisdiction that is unappealable or unappealed
within the time frame allowed for appeal, or (b) any patent that has been
rendered unenforceable or invalid through disclaimer, reissue or otherwise.
1.14. "Derived" or "derived", for purposes of determining when an
antibody or fragment thereof has been "derived" from an Antibody, shall mean:
(a) resulting from a program of synthesis or modification or selection based on
an Antibody; (b) resulting from a program of synthesis or modification or
selection based on nucleotide or amino acid sequence information obtained from
an Antibody (or Genetic Material encoding an Antibody); or (c) incorporating a
functional domain determined by, or selected using, information or data from (i)
structure-activity
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studies of an Antibody or (ii) structure-activity studies of the epitope to
which any Antibody binds that are performed using an Antibody.
1.15. "Europe" shall mean Austria, Belgium, Denmark, Finland, France,
Germany, Greece, Ireland, Italy, Luxembourg, Monaco, Netherlands, Portugal,
Spain, Sweden, Switzerland, and the United Kingdom.
1.16. "Evaluation Position" shall have the meaning set forth in Section
3.1 of the GNE Option Agreement.
1.17. "Excluded Antigen" shall mean an Antigen [*].
1.18. "Excluded Technology" shall mean any intellectual property or
technology or other proprietary rights of ABX in or to [*]
1.19. "Exercise Notice" shall have the meaning set forth in Section
4.1.2(a) of the GNE Option Agreement.
1.20. "FDA" shall mean the United States Food and Drug Administration,
and any successor agencies thereto.
1.21. "Field" shall mean the use of Products for human therapeutic,
prophylactic and diagnostic medical purposes.
1.22. "Financing Documents" shall mean the Common Stock Purchase
Agreement and the Registration Rights Agreement attached to the GNE Option
Agreement as Attachment C.
1.23. "Foreign Marketing Application" shall mean all applications for
regulatory approval filed with any Foreign Regulatory Authority necessary for
the marketing and sale of any Product for a particular indication in the
applicable country or regulatory jurisdiction (other than the FDA in the United
States), including, without limitation, any pricing and/or reimbursement
approvals (if any).
1.24. "Foreign Regulatory Authority" shall mean any applicable agency,
department, bureau or other governmental entity or authority (and any successors
thereto) of any country or regulatory jurisdiction in the Territory (other than
the FDA in the United States) having responsibility in such country or
regulatory jurisdiction over any Foreign Marketing Application in such country
or regulatory jurisdiction.
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1.25. "Genetic Material" shall mean a nucleotide sequence, including
DNA, RNA and complementary and reverse complementary nucleotide sequences
thereto, whether coding or noncoding and whether intact or a fragment.
1.26. "GenPharm Cross License Agreement" shall mean that certain Cross
License Agreement entered into by and between ABX, JTI, XT, Cell Genesys, Inc.,
and GenPharm International, Inc., effective as of March 26, 1997, as the same
may be amended from time to time.
1.27. "GNE [*]" shall have the meaning set forth in Section 4.1.7(a) )
of the GNE Option Agreement.
1.28. "GNE Option Agreement" shall mean that certain Multi-Antigen
Research License and Option Agreement entered into by and between ABX and GNE
effective as of the Effective Date (as defined therein), as the same may be
amended from time to time.
1.29. "GNE Product License Agreement" shall mean a license agreement
with respect to a particular GNE Program Antigen, in the form materially and
substantially set forth in Exhibit B to the GNE Option Agreement.
1.30. "GNE Program Antigen" shall mean a Specified Antigen with respect
to which ABX has provided GNE an Acceptance Notice (defined below) for an
Evaluation Position on such Specified Antigen, pursuant to Section 3.1 of the
GNE Option Agreement.
1.31. "Hybridoma" shall mean all hybridomas that contain, express or
secrete Antibodies or Genetic Materials encoding such Antibodies.
1.32. "Impediment" shall have the meaning defined in Section 3.1.2 of
the GNE Option Agreement.
1.33. "IND" shall mean an Investigational New Drug application filed
with the Food and Drug Administration in the United States, or any similar
filing with any foreign regulatory authority, to commence human clinical testing
of any product in any country.
1.34. "Independent Discovery" shall mean any composition (or any
fragment, variant or derivative thereof or any nucleotide sequences encoding, or
amino acid sequences of, any of the foregoing) or other material, information
and/or development that is discovered, obtained or derived (directly or
indirectly through single or multiple steps) by GNE (on its own or with
partners) through no use of any ABX Materials, Licensed Technology or
Confidential Information of ABX, as demonstrated by competent written records of
GNE (and/or its partners) which may be supported or explained by additional
testimonial evidence.
1.35. "JTI Home Territory" shall mean Japan, Taiwan, and South Korea
(including the territory now comprising North Korea, if reunited with South
Korea after the Effective Date of the GNE Option Agreement).
1.36. "JTI" shall mean Japan Tobacco Inc., a Japanese corporation.
1.37. "Licensed Technology" shall mean ABX's rights in the ABX Patent
Rights and ABX Know-How; provided, however, that the foregoing (a) are all to
the extent and only to the extent that ABX has the right to grant (sub)licenses
thereunder (including without limitation to
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the extent permitted under the applicable ABX In-Licenses); (b) are expressly
subject to the ABX In-Licenses; and (c) shall exclude the Excluded Technology,
unless ABX has agreed to grant a license to GNE for a Specified Antigen which
also meets the definition of an Excluded Antigen, in which case, for the GNE
Product License Agreement with regard to such Specified Antigen, Licensed
Technology shall include ABX Patent Rights and ABX Know-How covering such
Specified Antigen.
1.38. "Major Country" shall mean the United States, Japan, the United
Kingdom, France, Germany, Spain, or Italy.
1.39. "Net Incremental Royalty" shall mean, with regard to a New Strain,
an amount equal to the total royalties owed by ABX with regard to the Original
Strain subtracted from the total royalties owed by ABX with regard to such New
Strain, if a positive number.
1.40. "Net Sales" shall mean the gross sales price charged by GNE and
its Sublicensees for sales of Product to non-Affiliate customers, less: [*]
1.40.1. Sales Among GNE and its Sublicensees. Net Sales shall not
include sales among and between GNE and its Sublicensees for resale, provided
that Net Sales shall include the amounts invoiced by GNE, its Affiliates and its
Sublicensees to third parties on the resale of such Products.
1.40.2. Combination Products. In the event that a Product is sold
in combination as a single product with another product or component, Net Sales
from such combination sales for purposes of calculating the amounts due under
this Agreement shall be calculated by multiplying the Net Sales of that
combination by the fraction A/(A + B), where A is the gross selling price of the
Product sold separately and B is the gross selling price of the other product
sold separately. In the event that no such separate sales are made in the same
quarter by GNE or its Sublicensee, Net Sales for royalty determination shall be
as reasonably allocated in good faith by GNE and ABX, between such Product and
such other product, based upon their relative independent values.
1.41. "New Strain" shall have the meaning set forth in Section 2.1.5 of
the GNE Option Agreement.
1.42. "New Strain Intellectual Property" shall mean any intellectual
property owned or licensed by ABX covering a New Strain that is not also
intellectual property covering the Original Strain.
1.43. "Non-Specified Antigen" shall have the meaning set forth in
Section 2.1.1 of the GNE Option Agreement.
1.44. "Option" and "Option Period" shall have the meanings described in
Section 4.1 of the GNE Option Agreement.
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1.45. "Original Strain" shall have the meaning set forth in Section
2.1.5 of the GNE Option Agreement.
1.46. "Parties" shall mean, collectively, ABX and GNE.
1.47. "Phase II Trial" shall mean a human clinical trial prospectively
designed to generate data evidencing the safety, dose ranging and preliminary
efficacy of a Product for a particular indication sufficient (if successful) to
commence a Phase III trial for the Product for the indication, and that would
otherwise satisfy the requirements of 21 CFR 312.21(b). "Initiation" of a Phase
II Trial shall be deemed to occur upon the administration of such drug or
placebo to the first patient in such trial.
1.48. "Phase III Trial" shall mean a human clinical trial prospectively
designed to demonstrate with statistical significance whether a Product is safe
and effective for use in a particular indication in a manner sufficient (if
successful) to file a BLA with the FDA for the marketing and sale of the Product
for the indication, and would otherwise satisfy the requirements of 21 CFR
312.21(c). "Initiation" of a Phase III Trial shall be deemed to occur upon the
administration of study drug or placebo to the first patient in such trial.
1.49. "Previous Agreement" shall mean that certain Research License and
Option Agreement effective as of April 6, 1998, and amended as of June 18, 1998
by and between the Parties.
1.50. "Product Antigen" shall mean [insert particular molecular entity]
1.51. "Product" shall mean (i) with regard to the GNE Option Agreement,
any composition which incorporates or is derived from (a) an Antibody that binds
a GNE Program Antigen or (b) Genetic Material encoding such an Antibody, wherein
in respect of each Product, said Genetic Material does not encode multiple
Antibodies; and (ii) with regard to a GNE Product License Agreement, any
composition which incorporates or is derived from (a) an Antibody that binds to
the Product Antigen or (b) Genetic Material encoding such an Antibody wherein,
in respect of each Product, said Genetic Material does not encode multiple
Antibodies.
1.52. "Research Field" shall mean the immunization of XenoMouse Animals
with Specified Antigens and the use of materials derived or generated in whole
or in part from such XenoMouse Animals that are so immunized, solely for the
creation, identification, analysis, manufacture, research, and preclinical
development of Products in the Field. For purposes of clarification, the
Research Field shall not include, among other things: (i) the creation,
breeding, reverse-engineering, design or development of mice or any transgenic
animals, (ii) use in humans of materials derived or generated in whole or part
from the XenoMouse Animals (including without limitation, Products), (iii) use
of XenoMouse Animals or materials derived in whole or part from XenoMouse
Animals (including without limitation Products) for any purpose other than the
creation, identification, analysis, manufacture, testing, research and
preclinical development of Products in the Field, (iv) the transfer of XenoMouse
Animals or any Products or materials derived in whole or part from the XenoMouse
Animals, except pursuant to an MTA as set forth in Section 2.1.1 of the GNE
Option Agreement or (v) the use of a plurality of Antibodies or Genetic Material
encoding such Antibodies for the screening of Antigens that are not Specified
Antigens (whether or not in combination with antibodies or Genetic Material
encoding such Antibodies that bind to Specified Antigens) for binding to
Non-Specified Antigens. For purposes of further clarification, it is understood
that "immunization" of XenoMouse Animals with a Specified Antigen includes the
immunization of XenoMouse Animals with any formulation or construction
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of a Specified Antigen, regardless of the three dimensional configuration of
such Specified Antigen, including, but not limited to, cell lines expressing
such Specified Antigen on their cell surface and chimeric molecules containing
such Specified Antigen; provided, however, that any research, development or use
of Antibodies that do not bind to a Specified Antigen (other than to determine
whether they bind to a Specified Antigen) shall be outside of the scope of the
licenses granted hereunder.
1.53. "Rest of the World" shall mean all countries of the world other
than the countries in the ABX Home Territory and JTI Home Territory.
1.54. "Selecting" and "Select" shall mean with respect to an Antigen,
the process whereby JTI or ABX obtains an option to acquire from XT an XT
Product License related to a particular Antigen.
1.55. "Selection Date" shall have the meaning set forth in Section
4.1.2(b) of the GNE Option Agreement.
1.56. "Selection Notice" shall have the meaning set forth in Section
4.1.2(d) of the GNE Option Agreement.
1.57. "Specified Antigen" shall mean an Antigen with regard to which GNE
has notified ABX [*] that it intends to immunize XenoMouse Animals, and with
regard to which ABX has not notified GNE (subject, however, to the last sentence
of Section 2.1.9(e) of the GNE Option Agreement) within thirty (30) days of
GNE's notification, that such Antigen is at such time exclusively optioned or
licensed by ABX, XT or JTI (including, without limitation, those optioned or
licensed by XT to ABX or JTI).
1.58. [*]
1.59. "Sublicensee" shall mean an Affiliate of GNE or a third party that
GNE grants rights to under the Licensed Technology to develop, make, use and/or
sell Products, including, without limitation, a third party to whom GNE grants
the right to distribute Products, provided that such third party also has
responsibility for marketing and promotion of Products within the applicable
territory. As used herein, a "Sublicense" shall mean an agreement or arrangement
between GNE and any Sublicensee pursuant to which such rights of such
Sublicensee have been granted.
1.60. "Territory" shall mean [insert appropriate territory]
1.61. "Therapeutically Active" shall mean that a compound or agent has
activity as a therapeutic agent, or directly or indirectly acts to increase,
enhance, catalyze, enable, protect, target or deliver a Product or the activity
of a Product, but shall not include any diluent, vehicle, adjuvant or other
ingredient (other than a Product) that does not have any therapeutic properties.
1.62. "[*]" shall have the meanings set forth in the Previous Agreement.
1.63. "United States" shall mean the United States of America and its
territories and possessions.
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1.64. "Valid Patent Claim" shall mean a claim [*]
1.65. "XenoMouse Animals" shall mean transgenic mice containing human
immunoglobulin variable heavy and light chain genes provided by ABX to GNE for
immunization with Specified Antigens and GNE Program Antigens under the GNE
Option Agreement.
1.66. "XT Master Research License and Option Agreement" or "Xenotech
Agreement" shall mean that certain Master Research License and Option Agreement
entered into by and among XT, JTI and Cell Genesys, Inc. effective as of June
28, 1996, and subsequently assigned to ABX by Cell Genesys, Inc., as the same
may be amended from time to time.
1.67. "XT Product License" shall mean a license granted from XT to ABX
as set forth in Section 4.1.5 herein pursuant to the terms of the XT Master
Research and License Agreement permitting ABX, among other things, to
commercialize certain products in one or more territories for all human medical
uses.
1.68. "XT" shall mean Xenotech, L.P., a California limited partnership.
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EXHIBIT B
FORM OF GNE PRODUCT LICENSE AGREEMENT
THIS GNE PRODUCT LICENSE AGREEMENT (this "Agreement") effective as of the ____
day of _______________, (the "Effective Date") is made by and between ABGENIX,
INC., a Delaware corporation ("ABX"), and GENENTECH, INC., a Delaware
corporation (hereinafter "GNE") with reference to the following facts and
circumstances.
RECITALS
GNE and ABX have entered into that certain Multi-Antigen Research
License and Option Agreement effective as of January 26, 1999 (as defined below,
the "GNE Option Agreement"), pursuant to which GNE has certain rights to acquire
a license under the Licensed Technology; and
GNE has exercised an option right under the GNE Option Agreement to
acquire from ABX a license or sublicense, as the case may be, under the Licensed
Technology with respect to a particular GNE Program Antigen (defined below) to
commercialize Products in the Field, all as set forth below on the terms and
conditions herein.
NOW, THEREFORE, for and in consideration of the covenants, conditions,
and undertakings hereinafter set forth, it is agreed by and between the parties
hereto as follows:
1. DEFINITIONS.
For purposes of this Agreement, capitalized terms set forth in this
Agreement and not otherwise defined herein shall have the meanings set forth in
the Common Definitions Exhibit set forth as Exhibit A attached hereto and made a
part hereof.
2. LICENSE GRANT.
2.1 Grant of Rights. Subject to the terms and conditions of this
Agreement and with respect to the Product Antigen, ABX hereby grants to GNE an
exclusive (even as to ABX) license or sublicense, as the case may be, under the
Licensed Technology, to research and develop, make and have made Products in the
Field in the Territory and to use, sell, lease, offer to sell or lease, import,
export, otherwise transfer physical possession of or otherwise transfer title to
Products in the Field in the Territory. For purposes of clarification, it is
understood and agreed that the licenses and/or sublicenses granted herein shall
not include any right to make or sell (or lease, or offer to sell or lease, or
otherwise transfer title to) any XenoMouse Animal or transgenic animal or the
right to sell (or lease, or offer to sell or lease, or otherwise transfer title
to) Hybridomas.
2.2 Sublicenses. GNE may grant a Sublicense of any or all of its rights
under Section 2.1 to (a) Affiliates of GNE or (b) to any other third party on
written notice to ABX. It is understood that any such Sublicense shall be
subject and subordinate to the terms and conditions of this Agreement, and that
GNE shall remain responsible for all payments due to ABX hereunder with respect
to Net Sales of Products by any such Sublicensee. It is understood that GNE
shall not have the right to grant any Sublicense except as provided above, and
notwithstanding the foregoing, shall in no event have the right to Sublicense
any right under this Agreement in or to (i) a XenoMouse Animal, or (ii) any
other transgenic animal covered by the Licensed Technology.
2.3 Third Party Rights. It is understood and agreed that the grant of
rights under Sections 2.1 and 2.2 above shall be subject to and limited in all
respects by the terms of the applicable ABX In-License(s) pursuant to which ABX
acquired or does acquire any Licensed Technology, including, without limitation,
any rights
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granted to or retained by GenPharm International, Inc. under the GenPharm Cross
License, and that all rights or sublicenses granted under this Agreement shall
be limited to the extent that ABX may grant such rights and sublicenses under
such ABX In-Licenses. Further, the parties acknowledge that while ABX is
granting GNE an exclusive license to certain of its rights, ABX's rights may not
be exclusive from ABX's licensors.
2.4 Ownership of Materials and Data. It is understood and agreed that:
(a) ABX shall [*].
(b) Except as expressly set forth in Section 2.4(a), GNE shall
[*}.
(c) The transfer of physical possession of any materials or data
owned by, and the physical possession and use of such materials and/or data by,
GNE or ABX, as the case may be, shall not be (nor be construed as) a sale,
lease, offer to sell or lease, or other transfer of title of such materials
and/or data to GNE or ABX, as the case may be.
(d) Notwithstanding anything contained in this Agreement to the
contrary, GNE shall [*].
2.5 No Other Rights; No License to Other Therapeutically Active
Components. No rights other than those expressly set forth in this Agreement are
granted to either party hereunder, and no additional rights shall be deemed
granted to either party by implication, estoppel or otherwise. It is understood
and agreed that, although a Product licensed hereunder may contain other
components (including without limitation, other Therapeutically Active
components) in conjunction with or in addition to an Antibody that binds to a
GNE Program Antigen or Genetic Material encoding such an Antibody, the licenses
and rights granted under this Agreement shall not be construed to convey, and
shall not convey, any licenses or rights under the ABX Patent Rights with
respect to the manufacture, use, or sale of any such component other than an
Antibody that binds to the Product Antigen or Genetic Material encoding such an
Antibody.
3. CONSIDERATION.
3.1 License Fee. In consideration of the license rights granted herein
to GNE with respect to the Product Antigen which is the subject of this
Agreement, GNE shall pay to ABX the license fee (the "License Fee") set forth in
Section 4.1.6 of the GNE Option Agreement under the terms and conditions
therein.
3.2 Milestone Payments.
3.2.1 Amounts. In further consideration of the license rights
granted herein to GNE, within [*] following the first achievement by GNE (or any
of its Sublicensees) of each of the following milestones with respect to any
Product under this Agreement, GNE shall pay to ABX the corresponding milestone
payment set forth herein in accordance with the payment provisions of Section
4.3 below:
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Milestone Payment
--------- -------
A [*] [*]
B [*] [*]
C [*] [*]
D [*] [*]
E [*] [*]
In the event that any of milestones C, D or E are met, and at such time either
milestone A or milestone B has not been met, the payment for such unmet
milestone(s) shall be due. It is understood and agreed that GNE shall not be
obligated to pay to ABX the milestone payments set forth in this Section 3.2.1
more than once for each of milestones A, B, C, D, and E under this Agreement,
irrespective of how many times each such milestone is achieved.
3.2.2 [*]. Capitalized terms used in this Section and not
otherwise defined in this Agreement are used as defined in the Xenotech
Agreement. If, before or during the term of this Agreement, the XT Product
License between ABX and XT is modified for any reason such that the [*] for
purposes of the license granted to GNE under this Agreement [*]
3.2.3 Potential Readjustments. Upon request of either party, the
parties shall discuss in good faith and may agree to amend this Agreement to
provide an option for GNE to make milestone payments for the events set forth in
milestones C, D and/or E above in amounts greater than those set forth in
milestones C, D and/or E above, in exchange for royalties on Net Sales of
Products in the countries and territories covered by such milestones lower than
those set forth in Section 3.3 below.
3.2.4 [*]. The milestone payments set forth in Section 3.2.1
shall be [*] except as
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otherwise provided in Section 3.2.2 above, but may be [*] as set forth in
Section 3.3.5 below.
3.3 Royalties. GNE or its Sublicensee shall notify ABX of the date of
commercial introduction of the first Product into any country in the Territory,
which shall mean on a country-by-country basis in the Territory, the date of
first commercial sale (other than for purposes of obtaining Regulatory Approval)
of the first Product by GNE or its Sublicensees in such Territory. In
consideration of the license rights granted herein, GNE and its Sublicensees
shall pay to ABX a royalty on Net Sales of Products as set forth herein:
3.3.1 [*].
(a) Commencing as to each country in the Territory on the
date of first commercial sale of the first Product in such country (hereinafter,
a "Royalty Commencement Date" for such country), GNE shall pay ABX a running
royalty equal to [*]
(b) In the event that a royalty would be owed under
3.3.1(a) [*]
3.3.2 [*]. Commencing as to each country in the
Territory on the Royalty Commencement Date for the first Product in such
country, GNE shall pay ABX a running royalty equal to three percent (3%) of Net
Sales of any Product by GNE and its Sublicensees [*].
3.3.3 [Section intentionally left blank]
3.3.4 Third Party Royalty Offset.
(a) In the event that GNE or any of its Sublicensees is
required to pay to a third party during the term of this Agreement royalties
with respect to a Product under agreements for patent rights or other
technologies that GNE [*], then GNE may deduct [*] of such royalty amounts
actually paid by GNE or its Sublicensee to such third party on sales of such
Product in a particular country from the royalties owed to ABX for Net Sales of
such Product in such country pursuant to this Section 3.3; provided, however,
that the royalty amount payable to ABX under this Section 3.3 with respect to
such Net Sales for such Product in such country shall not be reduced pursuant to
this Section 3.3.4(a) to an amount below that determined pursuant to Section
3.3.4(b) in accordance with the procedures and table of "Floor Royalty Rates"
set forth therein, which Floor Royalty Rates will be established on a
Region-by-Region basis (as such Regions are defined in Section 3.3.4(c) below);
and provided, further, the third party royalty offset under this Section
3.3.4(a) if any, shall be applied first to determine the applicable royalty
amount on Net Sales of a Product for each quarter and thereafter the applicable
milestone credits described in Section 3.3.5, if any, shall then be applied for
such quarter.
(b) The applicable minimum royalties payable by GNE to ABX
pursuant to Section 3.3.4(a) shall be calculated as follows:
(i) at the end of each calendar quarter, the
countries within a particular Region [*]. The Net Sales in such quarter of all
Products in each subgroup will then be cumulated to determine [*]
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The royalty payable for a particular Region will be the total of the amounts
payable for each subgroup in such Region for such quarter.
(ii) the royalties payable by GNE to ABX in each
subgroup within such Region is calculated by [*]
[*]
(c) For purposes of this Section 3.3.4, a "Region" shall mean [*]
3.3.5 [*]. Certain [*] payments set forth in Section [*] that
have been paid to ABX [*]
(a) [*]. Subject to the limits set forth in Subsection
(b) below, [*]
(b) [*]. Notwithstanding the foregoing, the milestone
credits described in this Section 3.3.5 shall not [*]
A. [*]
B. [*]
C. [*]
However, the foregoing limitation on [*]
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[*]
3.3.6 Length of Term of Royalty Obligations. GNE's obligation to
pay royalties on Net Sales of Products under this Agreement shall commence on a
country-by-country basis on the Royalty Commencement Date for such country as
defined in Section 3.3 above, and continue thereafter on a country-by-country
basis until the later of (a) ten (10) years after the Royalty Commencement Date
in such country or (b) expiration, [*] (as defined in [*], of (i) the
last-to-expire of the Valid Patent Claims [*] in such country or (ii) the
last-to-expire of the Valid Patent Claims [*].
3.3.7 Single Royalty. Only one royalty shall be payable with
respect to any Product hereunder [*].
3.4 Royalties To Be Paid By ABX. Subject to the terms and conditions of
this Agreement, including without limitation GNE's payment of royalties as set
forth herein, ABX shall be responsible for paying all amounts owed to third
parties in respect of Net Sales of Products by GNE and its Sublicensees in
accordance with this Agreement under the agreements set forth in Attachment A to
the GNE Option Agreement. GNE may not offset such payments under Section 3.3.4.
3.5 Core Third Party Patents. If anything is set forth on Schedule A
hereto or if either party becomes aware of any Core Third Party Patent during
the term of this Agreement, such party shall promptly notify the other party
and, except to the extent that such party is prohibited under a duty of
confidentiality from disclosing such information, provide a reasonably detailed
summary of its knowledge regarding such patent (including, by way of example and
without limitation, the identity of the person that owns or controls such
patent, the subject matter of the patent, and any available information about
terms offered or asked with respect to licenses under such patents).
3.5.1 ABX. GNE agrees to [*] under any Core Third Party Patent;
provided, however, that neither ABX nor GNE (nor its Sublicensees) shall be
obligated [*], and provided, further, that if ABX elects not [*] it shall
promptly notify GNE of such election, and GNE [*] on its own behalf. In the
absence of such an election, on and after the date falling [*] after either
party first notifies the other of the Core Third Party Patent, GNE [*] directly
[*]. If ABX [*] such patent, [*], ABX will be responsible [*], as set forth in
this Section 3.5.1, [*]; and provided, further, that if both ABX and GNE [*],
GNE shall [*] as provided in Section 3.5.2 below. ABX shall invoice GNE for any
such amounts [*] on such Net Sales within [*] after receiving the report from
GNE under Section 4.1 setting forth the quarterly Net Sales of Products in each
country and/or any annual reconciliation regarding such royalties, and GNE shall
pay such amounts to ABX within [*] after delivery of such invoice. It is
understood that such invoice will not [*]
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[*] for which the invoice is sent, or the [*]. Such invoice shall be
accompanied by such documentation as GNE reasonably requests to [*].
3.5.2 GNE. If GNE or its Sublicensee [*] under a Core Third Party
Patent, GNE [*]; provided, however, that (a) the [*]. It is understood that the
[*]; provided, however, that in the event that the [*]. ABX shall invoice GNE
for any such amounts [*] on such Net Sales within [*] after receiving the report
from GNE under Section 4.1 setting forth the quarterly Net Sales of Products in
each country and/or any annual reconciliation regarding such royalties, and GNE
shall pay such amounts to ABX within [*] after delivery of such invoice. It is
understood that, to the extent that ABX is contractually prohibited from doing
so, such invoice will not specify [*] for which the invoice is sent or the [*].
Such invoice, in each case, shall be accompanied by such documentation as GNE
reasonably requests to [*].
3.6 New Strain Intellectual Property. GNE [has] [has not] used a
New Strain of XenoMouse Animals in development of the Product Antigen. If GNE
has used such New Strain, GNE shall pay, in addition to the other royalties
contained herein, a Net Incremental Royalty with respect to such New Strain
equal to ___%.
4. ACCOUNTING AND RECORDS.
4.1 Royalty Reports; Payments, Invoices. After the Royalty Commencement
Date in any country in the Territory, GNE agrees to make quarterly written
reports to ABX within [*] after the end of each calendar quarter, stating in
each such report the aggregate Net Sales of Product sold during the calendar
quarter upon which a royalty is payable under Article 3. Concurrently with the
making of such reports, GNE shall pay to ABX all amounts payable pursuant to
Article 3 above, in accordance with the payment provisions of Section 4.3. For
purposes of determining when a sale of any Product occurs under this Agreement,
the sale shall be deemed to occur on the date that GNE books the sale (so long
as GNE books the sale in accordance with GNE's customary practices).
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4.2 Records; Inspection.
4.2.1 GNE. GNE shall keep (and require its Sublicensees to keep)
complete, true and accurate books of account and records for the purpose of
determining the royalty amounts payable to ABX under this Agreement. Such books
and records shall be kept at the principal place of business of GNE or its
Sublicensees, as the case may be, for at least [*] following the end of the
calendar quarter to which they pertain. Such records will be open for inspection
during such [*] by an independent certified public accountant representing ABX
(which representative may also represent XT) and reasonably acceptable to GNE
for the purpose of verifying the royalty statements. GNE shall require each of
its Sublicensees to maintain similar books and records and to open such records
for inspection during the same [*] period by such representative of ABX for the
purpose of verifying the royalty statements. All such inspections may be made no
more than once each calendar year at reasonable times mutually agreed by GNE and
ABX. The representative of ABX will be obliged to execute a reasonable
confidentiality agreement prior to commencing any such inspection. The results
of any inspection hereunder, but not the basis for such results, which ABX's
accountant will not disclose to ABX, shall be provided to both parties, and GNE
shall pay any underpayment to ABX within [*]. Any overpayment may be credited
against future royalty amounts due to ABX hereunder; provided however, that if
there is no further obligation to pay royalties hereunder anywhere in the
Territory, ABX shall refund any such overpayment within [*]. Inspections
conducted under this Section 4.2.1 shall be at the expense of ABX, unless a
variation or error producing an increase exceeding [*] of the amount stated for
any period (after taking into account any applicable annual reconciliation) is
established in the course of any such inspection, whereupon all costs of such
audit of such period will be paid by GNE. Upon the expiration of [*] following
the end of any calendar year, the calculation of royalties payable with respect
to such year shall be binding and conclusive, and GNE shall be released from any
liability or accountability with respect to royalties for such year; provided,
however, that if ABX has demanded payment of additional royalties it claims have
not been properly paid under this Agreement, or if there is a dispute between
the parties regarding the amount of royalties due, prior to the expiration of
the third calendar year following the calendar year in question, then the
calculation of royalties shall not become binding and conclusive (and GNE shall
not be released from liability or accountability with respect to such royalties)
before [*] following the date, if any, that such dispute is finally resolved
between the parties by mutual written agreement. It is understood that nothing
in the preceding sentence shall limit or prohibit the [*].
4.2.2 ABX. ABX shall keep complete, true and accurate books of
account and records for the purpose of determining the royalty amounts payable
to ABX under Section 3.5, including, without limitation, records pertaining to
ABX In-Licenses and Third Party Royalties. Such books and records shall be kept
at the principal place of business of ABX for at least [*] following the end of
the calendar quarter to which they pertain. For any period for which the offsets
under Section 3.5 apply, such records will be open for inspection during such
three-year period by an independent certified public accountant representing GNE
and reasonably acceptable to ABX for the purpose of verifying the invoiced
amounts paid by GNE. All such inspections may be made no more than once each
calendar year at reasonable times mutually agreed by GNE and ABX. The
representative of GNE will be obliged to execute a reasonable confidentiality
agreement prior to commencing any such inspection. The results of any inspection
hereunder shall be provided to both parties as follows: it is understood and
agreed that GNE shall not be informed of the financial terms of any [*] and
shall only be informed whether or not the amounts invoiced by ABX and paid by
GNE accurately represent the amounts to be paid by [*]. ABX shall refund any
overpayment found by the accountant in such an inspection within [*] after
receiving the results, and GNE shall pay to ABX any underpayment found by the
accountant in such an inspection within [*] after receiving notice of such
underpayment. Inspections conducted for payments under Section 3.5 shall be at
the expense of GNE unless a variation or error producing a decrease exceeding
[*] of the amount paid by GNE for any period (after taking into account any
applicable annual reconciliation) is established in the course of any such
inspection, whereupon all costs of such audit of such period will be paid by
ABX. Upon the expiration of [*] following the end of any calendar year, the
calculation of royalties payable with respect to such year shall be binding and
conclusive, and GNE shall be released from any liability or accountability with
respect to
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royalties for such year; provided, however, that if ABX has demanded payment of
additional royalties it claims have not been properly paid under this Agreement,
or if there is a dispute between the parties regarding the amount of royalties
due, prior to the expiration of the [*] calendar year following the calendar
year in question, then the calculation of royalties shall not become binding and
conclusive (and GNE shall not be released from liability or accountability with
respect to such royalties) before [*] following the date, if any, that such
dispute is finally resolved between the parties by mutual written agreement. It
is understood that nothing in the preceding sentence shall limit or prohibit the
[*].
4.3 Payment Method. All payments due hereunder shall be made in U.S.
dollars, and shall be made by bank wire transfer in immediately available funds
to an account designated by ABX in a written notice to GNE. Any payments from
ABX to GNE (if any) shall also be made in U.S. dollars, by bank wire transfer in
immediately available funds to an account designated by GNE in a written notice
to ABX.
4.4 Currency Conversion. If any currency conversion shall be required in
connection with the calculation of royalties hereunder, such conversion shall be
made using the selling exchange rate for conversion of the foreign currency into
U.S. Dollars, quoted for current transactions reported in The Wall Street
Journal for the last business day of the calendar quarter to which such payment
pertains.
4.5 Late Payments. Any payments due from GNE (or from ABX, if any) that
are not paid on the date such payments are due under this Agreement shall bear
interest at the lesser of (i) the prime rate as reported by the Bank of America
in San Francisco, California on the date such payment is due, plus an additional
[*], or (ii) the maximum rate permitted by applicable law, in each case
calculated on the number of days such payment is delinquent. This Section 4.5
shall in no way limit any other remedies available to either party.
4.6 Withholding Taxes. All payments required to be made pursuant to
Article 3 hereof shall be without deduction or withholding for or on account of
any taxes or similar governmental charge imposed by a jurisdiction except for
withholding taxes to the extent applicable ("Withholding Taxes"). GNE shall pay
any applicable Withholding Taxes due on behalf of ABX and shall promptly provide
ABX with written documentation of any such payment sufficient to satisfy the
requirements of the United States Internal Revenue Service related to an
application by ABX for a foreign tax credit for such payment.
4.7 Restrictions on Payment. If by law, regulation or fiscal policy of a
particular country or jurisdiction in the Territory, remittance of funds in U.S.
Dollars is restricted or forbidden such that GNE cannot expatriate funds and
that both ABX and GNE are affected, written notice thereof will promptly be
given to ABX, and payment of such funds that constitute amounts that would be
owing to ABX under this Agreement that cannot be expatriated shall be made by
the deposit thereof in local currency to the credit of ABX in a recognized
banking institution designated by ABX in writing. When in any country or
jurisdiction in the Territory the law, regulation or fiscal policy prohibit both
the transmittal and the deposit of royalties on sales of Products in such
country or jurisdiction, royalty payments shall be suspended for as long as such
prohibition is in effect, and as soon as such prohibition ceases to be in
effect, all royalties that GNE would have been under an obligation to transmit
or deposit but for such prohibition shall forthwith be deposited or transmitted.
5. DUE DILIGENCE.
5.1 Reasonable Commercial Efforts; IND Milestone.
5.1.1 GNE agrees to use commercially reasonable efforts
consistent with prudent business judgment to commercialize Products, by the
filing of an IND by GNE or its Sublicensee in the United States, within such
time period as may be mutually agreed upon by the parties after taking into
account factors relating to the Product Antigen and ABX's obligations under the
XT Product License with XT or, if no such period is agreed upon, [*] from the
Effective Date. [Note: For the GNE Product License with regard to [*], if any,
the [*] period set forth in this sentence shall be replaced with a [*] period.]
ABX agrees that it will, on request of GNE, use reasonable efforts to try to
establish a longer period of time for filing of an IND in the United States
under the terms of the XT Product License.
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5.1.2 Notwithstanding the foregoing, GNE shall be required
actively and continuously to pursue the filing of an IND by GNE or its
Sublicensees, as soon as practicable after the Effective Date using reasonable
commercial efforts consistent with prudent business judgment. After filing of an
IND, GNE or its Sublicensees shall be required to have an active IND and to use
commercially reasonable efforts, consistent with prudent business judgment, to
conduct clinical trials in pursuit of regulatory approval for a Product in the
United States.
5.2 Failure to Meet Due Diligence Obligation. If the diligence
requirements set forth in Section 5.1 are not met by GNE (or its Sublicensees),
ABX shall have the right, at ABX's election (subject to the notice and cure
provisions under Section 10.2, except to the extent that the XT Product License
between ABX and XT is terminated by XT because the diligence requirements set
forth in the XT Product License have not been met), either (a) to convert GNE's
exclusive license to a non-exclusive royalty-bearing license to use the ABX
Know-How and practice the ABX Patent Rights for the purposes set forth in this
Agreement, or (b) to terminate the license rights granted to GNE hereunder.
5.3 GNE Reports. GNE agrees, upon request by ABX, to keep ABX informed
as to the research, development and commercialization of Products hereunder.
Without limiting the foregoing, if ABX makes a written request, then within [*]
of such written request during the term of this Agreement, GNE shall provide to
ABX a report detailing the status and potential timing of any anticipated IND
filings under Section 5.1 above, the status of clinical and preclinical testing
of any Products, and anticipated filings of any BLA and/or Foreign Marketing
Application for any Products in the Territory, provided, however, that ABX may
make only one such written request per twelve (12) month period. All GNE reports
hereunder shall be treated as "Confidential Information" of GNE as provided in
Article 7 of this Agreement.
5.4 Gene Therapy Applications. GNE's intention as of the Effective Date
is to commercialize a Product hereunder for an application other than Gene
Therapy (as defined below) before commercializing a Product hereunder for a Gene
Therapy application. It is understood, however, that GNE may or may not also
intend to develop and sell Products for use in Gene Therapy, and that such Gene
Therapy application may ultimately be commercialized before a Product is
commercialized hereunder for a non-Gene Therapy application. As used herein,
"Gene Therapy" shall mean the treatment or prevention of a disease by means of
[*].
6. INTELLECTUAL PROPERTY.
6.1 GNE Intellectual Property. GNE shall own all right, title and
interest in and to [*] and all intellectual property related thereto.
6.2 ABX Intellectual Property. ABX shall own all right, title and
interest in and to [*] and all intellectual property related thereto.
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6.3 Joint Intellectual Property. GNE and ABX shall jointly own all
right, title and interest in patent or patent applications directed to
inventions jointly made, conceived, reduced to practice or otherwise developed
by GNE and ABX. It is understood and agreed that nothing in this Section 6.3
shall convey, or be construed to convey, title in or to the biological materials
themselves embodying any such jointly owned inventions to GNE or ABX, as the
case may be.
6.4 Intellectual Property Concerning Other Inventions. Except as
otherwise provided in Sections 6.1, 6.2, 6.3 and Section 2.4 above, title to any
inventions (and to any patent applications, patents and other intellectual
property rights thereon) by a party or parties under this Agreement, shall
[*]. Designation of inventors on any patent application hereunder is
a matter of law and shall be solely within the discretion of qualified patent
counsel of the party(ies) hereto making such invention.
6.5 Joint Ownership. For purposes of clarification, to the extent that
something is jointly owned under this Agreement, and except as otherwise
provided in this Agreement (including the exclusive nature of the licenses
granted by ABX hereunder), both parties shall have the right to use,
commercialize, grant and authorize sublicenses, and otherwise exploit all such
jointly-owned patents and inventions without obligation to account to, or obtain
the consent of, the other joint owner. Both parties hereto agree to promptly
disclose to the other all jointly-owned inventions under this Agreement and, on
request of the other party, will provide such information and assistance as may
be reasonably necessary to assist in the filing and prosecution of patent
applications claiming such inventions. The parties hereto agree to ensure that
each employee, agent, or independent contractor that conducts research using the
XenoMouse Animals, or materials derived in whole or part from the XenoMouse
Animals, will promptly disclose and assign to the parties hereto any and all
rights to jointly-owned inventions. The parties hereto agree to maintain records
in sufficient detail and in good scientific manner appropriate for patent
purposes and so as to properly reflect all work done and results achieved in
performing research under this Agreement.
6.6 Patent Prosecution.
6.6.1 Solely Owned. The party solely owning any invention under
this Article 6 shall have the sole right and responsibility (but not the
obligation), at its expense, to file, prosecute and maintain all patent
applications and patents thereon, and to conduct any interferences, oppositions,
or reexaminations thereon, and to request any reissues or patent term extensions
thereof.
6.6.2 Jointly Owned. In the event of any invention jointly owned
by the parties under this Article 6, ABX shall have the sole right and
responsibility (but not the obligation), at its expense, to file, prosecute and
maintain all patent applications (and to conduct any interferences, oppositions,
or reexaminations thereon, and to request any reissues or patent term extensions
thereof) claiming any XenoMouse Animals or any uses thereof, and GNE shall have
the sole right and responsibility (but not the obligation), at its expense, to
file, prosecute and maintain all patent applications and patents (and to conduct
any interferences, oppositions, or reexaminations thereon, and to request any
reissues or patent term extensions thereof) claiming a Product Antigen, an
Antibody that binds to a Product Antigen or a Product and/or its development,
manufacture, use or sale. The party having such rights and responsibilities
hereunder is referred to as the "Controlling Party". The Controlling Party
shall: (i) provide the non-Controlling Party with any patent application filed
hereunder by the Controlling Party promptly after such filing; (ii) provide the
non-Controlling Party promptly with copies of all substantive communications
received from or filed in patent office(s) with respect to such filings; (iii)
notify the non-Controlling Party of any interference, opposition, reexamination
request, nullity proceeding, appeal or other interparty action and review it
with the non-Controlling Party as reasonably requested; and (iv) provide the
non-Controlling Party a reasonable time prior to taking or failing to take any
action that would substantially affect the scope of validity of rights under
such patent applications or patents thereon (including substantially narrowing
or canceling any claim without reserving the right to file a continuing or
divisional application, abandoning any patent or not filing or perfecting the
filing of any patent application) with notice of such proposed action so that
the non-Controlling Party has a reasonable opportunity to review and make
comments. If the Controlling Party fails to undertake the filing of a
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patent application (or continuing or divisional application) within [*] after a
written request from the non-Controlling Party to do so, or if the Controlling
Party discontinues the prosecution or maintenance of a patent application or
patent, the non-Controlling Party at its expense may, in its discretion,
undertake such filing, prosecution or maintenance thereof, in which case such
patent application and patent thereon shall be solely owned by the
non-Controlling Party. The parties hereto shall assist each other to the extent
commercially reasonable in securing intellectual property rights resulting from
jointly owned inventions hereunder. As to enforcement of jointly-owned patents,
including actions against an alleged infringer, the parties hereto shall consult
with each other in good faith as to the best manner in which to proceed,
provided, however, that with regard to any jointly-owned patent covering a
Product, GNE shall have final decision making authority over how to proceed. In
the case of such actions against alleged infringers, any recovery awarded shall
be first used to reimburse the costs and expenses (including reasonable
attorneys' fees) of the party or parties in the action (including any amounts
ABX is obligated to pay to third parties (if any) in respect of such amount
pursuant to applicable ABX In-Licenses (or licenses under any Core Third Party
Patents)), with the remainder for the account of the party or parties that
undertake such actions to the extent of their financial participation therein.
To the extent that damages are awarded for lost sales or lost profits from the
sale of Products, such damages shall be allocated among the parties taking into
account royalties that would have been payable to ABX on the sale of such
Products. Either party may withdraw from or abandon any jointly-owned patent
application or patent hereunder, on reasonable prior written notice to the other
party providing a free-of-charge option to assume the prosecution and/or
maintenance thereof.
6.7 Enforcement of ABX Patent Rights.
6.7.1 If either party learns that a third party is infringing or
allegedly infringing any ABX Patent Rights with regard to any Product, it shall
promptly notify the other party thereof, including available evidence of
infringement. As between GNE, its Sublicensees and ABX, ABX shall have the
exclusive right at its expense, and in its discretion, to bring an enforcement
proceeding, or defend any declaratory judgment action, involving any ABX Patent
Rights. ABX shall keep GNE reasonably informed of the progress of such claim,
suit or proceeding involving enforcement or defense of any ABX Patent Rights. To
the extent such action with respect to the ABX Patent Rights involves claims
directly concerning any Product, GNE shall have the right to join such
proceeding at any time at its own expense, but GNE shall not admit the
invalidity or unenforceability of any ABX Patent Rights without ABX's prior
written consent.
6.7.2 Notwithstanding the foregoing, if ABX notifies GNE that it
does not desire to pursue an enforcement action or defend a declaratory judgment
action hereunder with respect to any infringement of any patent rights described
in Sections 6.1 through 6.4, then to the extent such action involves or affects
any Product, GNE may at its expense bring or defend such action with respect to
such patent rights (and no other patent rights in the ABX Patent Rights) in
consultation with ABX, and in such event ABX agrees to join as party plaintiff
at GNE's expense if necessary to prosecute the action and agrees to give GNE
reasonable assistance and authority to file and prosecute the suit (but neither
party shall be required to transfer title to any property to confer standing on
a party hereunder). In connection with any such action by GNE hereunder. GNE
shall not admit the invalidity or unenforceability of any ABX Patent Rights
without ABX's prior written consent.
6.7.3 Any recovery as a result of any such claim, suit or
proceeding hereunder shall be first used to reimburse the costs and expenses
(including reasonable attorneys' fees) of the party or parties in the action,
second, to reimburse ABX for any amounts ABX is obligated to pay to third
parties in respect of such amount pursuant to applicable ABX In-Licenses, third
to reimburse GNE's and its Sublicensees' lost sales of Products within the Field
because of the infringement, with the remainder for the account of the party or
parties that undertake such actions to the extent of their financial
participation therein. To the extent that damages are awarded for lost sales or
lost profits from the sale of Products, such damages shall be allocated among
the parties taking into account royalties that would have been payable to ABX on
the sale of such Products.
6.8 Infringement Claims Against GNE. If the production, sale or use of
Product pursuant to this Agreement results in any claim, suit or proceeding
alleging patent infringement against GNE (or its Sublicensees) specifically with
respect to GNE's or its Sublicensees' use of the Licensed Technology (but not
otherwise), GNE shall promptly notify ABX thereof in writing setting forth the
facts of such claim in reasonable detail. GNE agrees to keep ABX
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reasonably informed of all material developments in connection with any such
claim, suit or proceeding as it relates to the Licensed Technology.
Notwithstanding the above, GNE shall not admit the infringement,
unenforceability or invalidity of any patent within the Licensed Technology
without prior express written consent from ABX.
6.9 Limitation. Notwithstanding any other provision in this Article 6,
the parties acknowledge and understand that (i) ABX shall not be obligated to
prepare, file, prosecute, and maintain patents and patent applications, or to
bring or pursue enforcement proceedings or defend declaratory judgment actions
regarding the Licensed Technology if, and to the extent that, ABX is not
entitled to do so under one or more ABX In-Licenses, and (ii) any rights
conveyed under this Article 6 permitting GNE to prepare, file, prosecute and
maintain certain patents and patent applications, or to bring and pursue
enforcement proceedings, or defend declaratory judgment actions, regarding the
Licensed Technology, shall be subject to all applicable ABX In-Licenses, and are
conveyed only to the extent permitted under such agreements.
6.10 Patent Marking. GNE agrees to xxxx and have its Sublicensees xxxx
all Products sold pursuant to this Agreement in accordance with the applicable
statutes or regulations in the country or countries of manufacture and sale
thereof.
7. CONFIDENTIALITY.
7.1 Confidentiality. Except as expressly provided herein, GNE and ABX
each shall keep completely confidential and shall not publish or otherwise
disclose and shall not use for any purpose any Confidential Information of the
other until the later of (a) ten (10) years from the Effective Date or (b) five
(5) years following the expiration or termination of this Agreement.
7.2 Permitted Disclosures. Notwithstanding Section 7.1 above and Section
7.3 below, each party hereto may nevertheless disclose the other party's
Confidential Information and the terms of this Agreement to the extent such
disclosure is reasonably necessary in filing or prosecuting patent applications,
prosecuting or defending litigation, complying with applicable laws or
regulations or otherwise submitting information to governmental tax or other
governmental authorities, making a permitted Sublicense or publication or other
exercise of its rights hereunder or conducting clinical trials, provided that if
a party is required by law to make any such disclosure of the other party's
Confidential Information, other than pursuant to a confidentiality agreement, it
will give reasonable advance notice to the other party of such disclosure
requirement and, save to the extent inappropriate in the case of patent
applications, will use efforts consistent with prudent business judgment to
secure confidential treatment of such information prior to its disclosure
(whether through protective orders or confidentiality agreements or otherwise).
It is understood that the obligations set forth in this Article 7 are separate
from GNE's obligations under Section 9.4.6 of the GNE Option Agreement, and the
expiration or nonapplicability of GNE's obligations under Section 7.1 above
shall not be deemed to limit GNE's obligations under Section 9.4.6 of the GNE
Option Agreement.
7.3 Terms of Agreement. Except as expressly provided in this Article 7,
each party hereto agrees not to make any public disclosure of the terms of this
Agreement or the identity of the GNE Program Antigen (including, without
limitation, any press release and/or Q&A to be issued on the Effective Date),
without first obtaining the written approval of the other party and agreement
upon the nature and text of such public announcement or disclosure. The party
desiring to make any such public announcement shall provide the other party with
a copy of the proposed announcement for review and comment in reasonably
sufficient time prior to public release. Each party agrees that it shall
cooperate fully with the other with respect to all disclosures regarding this
Agreement required under applicable laws and regulations to the United States
Securities Exchange Commission and any other governmental or regulatory
agencies, including requests for confidential treatment of proprietary
information of either party included in any such governmental disclosure. The
parties may publicly disclose information contained in any prior public
disclosure that was in compliance with this Section without further approvals
hereunder. In addition, each party agrees not to disclose the identity of the
GNE Program Antigen to any third party under any circumstances except if
required by law, nor the terms of this Agreement or the GNE Option Agreement to
any third party, other than professional advisors and financing sources, and in
that case, only under confidentiality terms that are at least as stringent in
material respects as those in this Article. GNE shall have the right to review
and comment on applications for confidential treatment insofar as they pertain
to this Agreement, prior to being filed
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with the SEC and ABX shall not unreasonably refuse to consider such comments.
GNE shall provide its comments, if any, on such application as soon as
practicable, and in no event later than four (4) days after such application is
provided to GNE.
8. INDEMNIFICATION.
8.1 GNE. GNE agrees to save, defend and hold ABX and its directors,
officers, employees, agents and Affiliates harmless from and against any suits,
claims, actions, demands, damages, liabilities, expenses or losses (including
court costs and reasonable attorneys' and experts' fees) (collectively, the
"Liabilities") resulting directly from (a) third party claims arising from any
negligence or willful misconduct of GNE (or its directors, officers, employees,
agents or Sublicensees) or the breach of any representations, warranties or
covenants of GNE under this Agreement, or (b) any third party claims arising
from GNE's or its Sublicensee's development, making, having made, use, offer for
sale, or sale of any Product developed, manufactured, used, sold or otherwise
distributed by GNE and its Sublicensees under this Agreement; provided, however,
that nothing in this Section 8.1 shall obligate GNE to save, defend or hold
harmless ABX for any Liabilities to the extent arising from the negligence or
willful misconduct of ABX or its directors, officers, employees, or agents.
8.2 ABX. ABX agrees to save, defend and hold GNE and its directors,
officers, employees, agents and Affiliates harmless from and against any
Liabilities resulting directly from (a) third party claims arising from any
negligence or willful misconduct of ABX (or its directors, officers, employees,
or agents) or the breach of any representations, warranties or covenants of ABX
under this Agreement, or (b) any third party claims arising from infringement of
a Core Third Party Patent in the course of using the Licensed Technology in
accordance with this Agreement; provided, however, that indemnification under
Section 8.2(b) shall only be required by ABX in the event that neither ABX nor
GNE enters into a license with the party claiming infringement, under Section
3.5 of this Agreement; provided, further, that indemnification under Section
8.2(b) shall be limited to amounts paid by GNE to ABX under this Agreement; and
provided, further, that nothing in this Section 8.2 shall obligate ABX to save,
defend or hold harmless GNE for any Liabilities to the extent arising from the
negligence or willful misconduct of GNE or its directors, officers, employees,
agents or Sublicensees.
8.3 Indemnification Procedures. If any person or party entitled to
indemnification under this Article 8 (an "Indemnitee") intends to claim
indemnification under this Article 8, it shall promptly notify the indemnifying
party hereunder (the "Indemnitor") in writing of any Liability in respect of
which the Indemnitee intends to claim such indemnification, as soon as
reasonably practicable after the Indemnitee receives notice of such Liability.
Indemnitor's obligations under this Article 8 are conditioned upon the
Indemnitee permitting the Indemnitor to assume direction and control of the
defense of the Liability (including the right to settle it); provided, however,
that an Indemnitee shall have the right to retain its own legal counsel, with
the reasonable fees and expenses thereof to be paid by the Indemnitor, if
representation of such Indemnitee by the legal counsel retained by the
Indemnitor would be inappropriate due to actual or potential conflicts of
interest between such Indemnitee and such Indemnitor. Indemnitor's obligations
under this Article 8 shall not apply to amounts paid in settlement of any loss,
claim, damage, liability or action if such settlement is effected without the
consent of the Indemnitor, which consent shall not be withheld or delayed
unreasonably. The failure to deliver written notice to the Indemnitor within a
reasonable time after the commencement of any third party suit, claim, action or
demand, if prejudicial to Indemnitor's ability to defend such suit, claim,
action or demand, shall relieve the Indemnitor of its obligations under this
Section 8 with respect to Liabilities that could have been defended in such
action. The Indemnitee (and its directors, officers, employees and agents) shall
cooperate fully with the Indemnitor and its legal counsel in the investigation
of any such Liability for which indemnification is sought by such Indemnitee
hereunder.
9. REPRESENTATIONS, WARRANTIES AND COVENANTS.
9.1 Representations and Warranties of ABX. ABX represents and warrants
to GNE as of the Effective Date that:
9.1.1 it has the power and authority to enter into this
Agreement; (ii) to the knowledge of ABX, there
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are no existing or threatened actions, suits or claims pending against ABX with
respect to the subject matter hereof or the right of ABX to enter into and
perform its obligations under this Agreement; (iii) it has taken all necessary
action on its part to authorize the execution and delivery of this Agreement and
the performance of its obligations hereunder; (iv) this Agreement has been duly
executed and delivered on behalf of it, and constitutes a legal, valid, binding
obligation, enforceable against it in accordance with the terms hereof; and (v)
the execution and delivery of this Agreement and the performance of its
obligations hereunder do not conflict with or violate any requirement of
applicable laws or regulations and do not conflict with, or constitute a default
under, any contractual obligation of it;
9.1.2 it has the full right and authority to grant the rights
and licenses granted herein;
9.1.3 it has not previously granted any rights materially
inconsistent or in material conflict with the rights and licenses granted to GNE
herein, including without limitation, any right or license in and to the
Licensed Technology or any portion thereof;
9.1.4 to its actual knowledge (without the obligation to perform
due diligence) there are no existing or threatened actions, suits or claims
pending against ABX with respect to the Licensed Technology or the right of ABX
to enter into and perform its obligations under this Agreement;
9.1.5 Except as set forth on Schedule A, ABX has no knowledge
(without the obligation to perform due diligence) of any rights of third parties
that would materially impair the licenses granted by ABX to GNE under the ABX
Know-How or the ABX Patent Rights as contemplated under this Agreement, and, as
of the Effective Date, ABX has no knowledge (without the obligation to perform
due diligence) that any patents or patent applications within the ABX Patent
Rights are invalid or unenforceable or that their practice under this Agreement
would infringe patent rights of third parties, provided, however, that this
representation does not apply to any Liabilities or infringement arising out of,
relating to or with respect to the Product Antigens;
9.1.6 Cell Genesys, Inc. ("CGI") has assigned to ABX all of CGI's
rights and obligations under the XT Master Research License and Option
Agreement, and ABX is a party to the XT Master Research License and Option
Agreement; and
9.1.7 it has provided to GNE complete copies of all material
applicable ABX In-Licenses setting forth all material applicable limitations or
restrictions on the Licensed Technology and the XenoMouse Animals (it being
understood that the financial terms have been redacted from some or all such
copies).
9.2 Covenants of ABX. ABX covenants to GNE that:
9.2.1 ABX will not take any action or fail to take any action
under this Agreement that will cause a material breach of the GenPharm
Cross-License, the Xenotech Agreement or any ABX In-License; provided, however,
that it shall not be a breach of this covenant if ABX cures any breach of such
third party agreement pursuant to the cure provisions contained therein;
9.2.2 ABX shall, at the reasonable request of GNE, discuss with
GNE ABX's interpretation of material terms and conditions of ABX In-Licenses,
including, without limitation, any limitations on ABX's right to further
transfer or grant licenses or sublicenses to GNE to any and all rights to
technology within the scope of the ABX Patent Rights and/or ABX Know-How under
any ABX In-License with respect to Products;
9.2.3 ABX shall use its commercially reasonable, good faith
efforts to reject any termination, modifications or amendments to any ABX
In-Licenses that would materially and negatively affect GNE's rights under this
Agreement without first obtaining GNE's reasonable prior written consent, and
ABX shall notify GNE as soon as reasonably practicable of any material
modification or amendment of any ABX In-License that materially affects
(positively or negatively) GNE's rights or obligations under this Agreement; and
9.2.4 ABX shall promptly provide GNE with a copy of any notice of
default by ABX and/or its
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sublicensee under any ABX In-License, and of any notice of termination by any
other party to any ABX In-License.
9.2.5 ABX shall not directly or indirectly create, incur, assume or
suffer to exist, any lien, security interest or other similar encumbrance upon
or with respect to cells generated pursuant to this Agreement; and
9.2.6 During the term of this Agreement: (i) ABX will not agree to any
modifications or amendments to the XT Product License that restrict or limit or
otherwise negatively affect the rights and licenses granted to GNE hereunder,
and shall not terminate any licenses therein, in any case without GNE's prior
written consent in its sole discretion; and (ii) ABX shall provide GNE promptly
with a copy of any notice of default by ABX and/or its Sublicensee under such XT
Product License, and of any notice of termination by any other party thereto.
9.3 Representations and Warranties of GNE. GNE represents and warrants
to ABX as of the Effective Date that:
9.3.1 (i) it has the power and authority to enter into this
Agreement; (ii) to the knowledge of GNE, there are no existing or threatened
actions, suits or claims pending with respect to the subject matter hereof or
the right of GNE to enter into and perform its obligations under this Agreement;
(iii) it has taken all necessary action on its part to authorize the execution
and delivery of this Agreement and the performance of its obligations hereunder;
(iv) this Agreement has been duly executed and delivered on behalf of it, and
constitutes a legal, valid, binding obligation, enforceable against it in
accordance with the terms hereof; and (v) the execution and delivery of this
Agreement and the performance of its obligations hereunder do not conflict with
or violate any requirement of applicable laws or regulations and do not conflict
with, or constitute a default under, any contractual obligation of it;
9.3.2 it has the full right and authority to enter into this
Agreement and to grant the rights and licenses granted herein;
9.3.3 to its knowledge without the obligation to perform due
diligence, there are no existing or threatened actions, suits or claims pending
against GNE or its Affiliates with respect to the subject matter hereof
(including, without limitation, rights in and to the Product Antigen and/or
antibodies to the Product Antigen) or the right of GNE to enter into and perform
its obligations under this Agreement;
9.3.4 as of the Effective Date and except as set forth on
Schedule B hereto, it has no knowledge (without the obligation to perform due
diligence) of any rights of third parties that would interfere with the use of
the ABX Know-How or practice of the ABX Patent Rights as contemplated under this
Agreement; and
9.3.5 it has not previously granted any rights inconsistent or in
conflict with the rights and licenses granted under this Agreement.
9.4 Covenants of GNE. GNE covenants to ABX that:
9.4.1 during the term of this Agreement GNE will not grant any
rights inconsistent or in conflict with the rights and licenses granted under
this Agreement; and
9.4.2 it will not, to its knowledge, take any action or fail to
take any action that will cause a breach of the GenPharm Cross License, the
Xenotech Agreement, the XT Product License, or any ABX In-License.
9.5 Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS
AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATIONS OR EXTENDS ANY WARRANTIES TO
THE OTHER PARTY OF ANY KIND, EITHER EXPRESS OR IMPLIED, REGARDING PRODUCTS OR
THE LICENSED TECHNOLOGY, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NONINFRINGEMENT, AND VALIDITY
OF LICENSED TECHNOLOGY CLAIMS, ISSUED OR PENDING. ALL XENOMOUSE ANIMALS AND
MATERIALS DERIVED IN WHOLE OR PART FROM THE XENOMOUSE ANIMALS PROVIDED TO GNE BY
ABX ARE PROVIDED "AS IS," AND ABX SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTIES
OF MERCHANTABILITY OR
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FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO XENOMOUSE ANIMALS AND MATERIALS
DERIVED IN WHOLE OR PART FROM XENOMOUSE ANIMALS.
10. TERM AND TERMINATION.
10.1 Term. The term of this Agreement shall commence on the Effective
Date and, unless earlier terminated as provided in this Article 10, shall
continue in full force and effect on a country-by-country basis until the
expiration of all royalty obligations pursuant to this Agreement for such
country, as provided in Section 3.3.6 above. Following the expiration, but not
earlier termination, of this Agreement on a country-by-country basis, GNE shall
have a fully paid-up, royalty-free, perpetual, sublicensable license under the
rights granted in Article 2, which license shall be a license exclusive as to
ABX (whose interest may be non-exclusive) under the ABX Know-How to research,
develop, make, use, sell and commercialize Products in such country.
10.2 Termination for Breach. Either party to this Agreement may
terminate this Agreement in the event that the other party (or any of its
Sublicensees in the case of GNE), shall have materially breached or defaulted in
the performance of any of its material obligations hereunder, and such breach or
default shall have continued for sixty (60) days after written notice of such
breach and intent to terminate this Agreement therefor was provided to the
breaching party by the nonbreaching party. Any such termination shall become
effective at the end of such sixty (60) day period unless the breaching party
has cured any such breach or default prior to the expiration of the sixty (60)
day period. Any such termination shall be without prejudice to any other rights,
conferred, or remedies available to, the nonbreaching party by law or at equity,
including, without limitation, under Section 8.3 above. The right of a
nonbreaching party to terminate this Agreement pursuant to this Section 10.2
shall not be affected in any way by its waiver or failure to take action with
respect to any previous default.
10.3 Termination for Insolvency or Bankruptcy. Either party may, in
addition to any other remedies available to it by law or in equity, terminate
this Agreement effective on written notice to the other party in the event the
other party shall have become insolvent or bankrupt, or shall have made an
assignment for the benefit of its creditors, or there shall have been appointed
a trustee or receiver of the other party or for all or a substantial part of its
property, or any case or proceeding shall have been commenced or other action
taken by or against the other party in bankruptcy or seeking reorganization,
liquidation, dissolution, winding-up, arrangement, composition or readjustment
of its debts or any other relief under any bankruptcy, insolvency,
reorganization or other similar act or law of any jurisdiction now or hereafter
in effect, or there shall have been issued a warrant of attachment, execution,
distraint or similar process against any substantial part of the property of the
other party, and any such event shall have continued for ninety (90) days
undismissed, unbonded and undischarged. Furthermore, all rights and licenses
granted under this Agreement are, and shall be deemed to be, for purposes of
Section 365(n) of the Bankruptcy Code, licenses of rights to "intellectual
property" as defined under Section 101(56) of the United States Bankruptcy Code.
The parties agree that in the event of the commencement of a bankruptcy
proceeding by or against of party hereunder under the United States Bankruptcy
Code, the other party shall be entitled to complete access, in accordance with
this Agreement, to any such intellectual property, and all embodiments of such
intellectual property, pertaining to the rights licensed to it hereunder of the
party by or against whom a bankruptcy proceeding has been commenced.
10.4 Termination by GNE. GNE may terminate this Agreement and the
license granted herein at any time, by providing ABX ninety (90) days prior
written notice.
10.5 Effect of Termination.
10.5.1 Accrued Obligations. Expiration or any termination of this
Agreement shall not relieve the parties of any obligation accruing prior to such
expiration or termination or release either party hereto from any liability
which at the time of such expiration or termination has already accrued to such
party, nor preclude either party from pursuing any rights and remedies it may
have hereunder or at law or in equity which accrued to it prior to such
expiration or termination, subject to the terms of this Agreement.
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10.5.2 Stock in Hand; Sublicenses. In the event this Agreement
is terminated for any reason (other than due to a material breach of this
Agreement by GNE or its Affiliates), GNE and its Sublicensees shall have the
right to sell or otherwise dispose (consistent with all applicable regulations
and law and subject to Articles 3 and 4 of this Agreement) of the stock of any
Product subject to this Agreement then on hand. No termination of this Agreement
(except by ABX under Section 10.2 above with respect to a Sublicensee of GNE
that is in breach of this Agreement) shall be construed as a termination of any
Sublicenses hereunder, and any Sublicense granted by GNE hereunder shall
survive, provided that upon request by ABX, such Sublicensee promptly agrees in
writing to be bound by the applicable terms of this Agreement.
10.5.3 Return of Know-How; Termination of Licenses. After the
effective date of termination by ABX under Section 10.2 or termination by GNE
under Section 10.4 above, GNE shall have no further obligations to ABX with
respect to the development and commercialization of Products in the Field in the
Territory, all underlying rights to the Licensed Technology (including without
limitation such rights pertaining to the Products in the Field in the Territory)
shall be the sole property of ABX, and all of GNE's license rights to the
Licensed Technology with respect to the Product shall terminate and revert to
ABX. In the event that GNE terminates this Agreement under Section 10.2, above,
after the effective date of such termination, GNE shall have no further
obligations to ABX with respect to the development and commercialization of
Products in the Field in the Territory. Such termination by GNE under Section
10.2 above shall not terminate any rights of GNE under this Agreement, and GNE
shall have an exclusive license under the rights licensed to GNE under Article 2
above to research, develop, make, have made Products in the Field in the
Territory and to use, sell, lease, offer to sell or lease, import, export,
otherwise transfer physical possession of or otherwise transfer title to
Products in the Field in the Territory. Except as otherwise provided in this
Section 10.5.3, such license shall be subject to the same royalty obligations as
set forth under Article 3 above. ABX, at ABX's expense, shall execute all
documents and make any filings necessary to perfect such license rights to GNE.
10.5.4 GNE Option Agreement. This Agreement is independent of,
and shall not be affected by, the expiration or termination of the GNE Option
Agreement.
10.5.5 XT. GNE and ABX agree that this Agreement, including,
without limitation, any licenses and sublicenses granted to GNE pursuant to this
Agreement (including any licenses and sublicenses to be granted to GNE therein)
shall survive any dissolution, liquidation or acquisition of XT, and that such
licenses shall remain in full force and effect even after any distribution,
following dissolution, of the intellectual property owned or licensed to XT, to
any entity. GNE and ABX agree that any transfer of such intellectual property to
or following such dissolution shall be subject to the licenses and sublicenses
granted herein.
10.5.6 ABX In-Licenses. In the event that any ABX In-License is
terminated due to breach by ABX and, as a result of such termination, ABX is
unable to convey to GNE the rights necessary to manufacture, use or sell
Products, ABX agrees that GNE's licenses hereunder shall become fully paid and
royalty free as to ABX and GNE shall step into the shoes of ABX with regard to
such ABX In-License as set forth in, and on the terms and conditions provided
in, such ABX In-License. ABX agrees to use best efforts and to take such actions
as are reasonably necessary to effectuate the foregoing.
10.5.7 Survival. Sections 9.5 and 10.5 and Articles 3, 4, 6, 7, 8
and 11 shall survive the expiration and any termination of this Agreement for
any reason.
11 MISCELLANEOUS.
11.1 Governing Laws. This Agreement shall be interpreted and construed
in accordance with the laws of the State of California, without regard to
conflicts of law principles.
11.2 Waiver. It is agreed that no waiver by any party hereto of any
breach or default of any of the covenants or agreements herein set forth shall
be deemed a waiver as to any subsequent and/or similar breach or default.
11.3 Assignment. Neither this Agreement nor any right or obligation
hereunder may be assigned or delegated,
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in whole or part, by either party without the prior written consent of the
other; provided, however, that either party may, without the written consent of
the other, assign this Agreement to (a) any entity to which it has acquired all
or substantially all of the business or assets of the assigning party, or (b)
any successor corporation resulting from any merger or consolidation with
another corporation (including, in the case of GNE, X. Xxxxxxxx-Xx Xxxxx Ltd or
any Affiliate thereof). Notwithstanding the foregoing, ABX shall not be
obligated without its written consent to send XenoMouse Animals to any party
other than GNE. The terms and conditions of this Agreement shall be binding on
and inure to the benefit of the permitted successors and assigns of each party
hereto.
11.4 Independent Contractors. The relationship of the parties hereto is
that of independent contractors. The parties hereto are not deemed to be agents,
partners or joint venturers of the others for any purpose as a result of this
Agreement or the transactions contemplated thereby.
11.5 Compliance with Laws. In exercising their rights under this
license, the parties shall fully comply with the requirements of any and all
applicable laws, regulations, rules and orders of any governmental body having
jurisdiction over the exercise of rights under this license.
11.6 No Implied Obligations. Except as expressly provided in Article 5
above, nothing in this Agreement shall be deemed to require GNE to exploit the
Licensed Technology nor to prevent GNE from commercializing products similar to
or competitive with any Product, in addition to or in lieu of such Products.
11.7 Notices. Any notice, request, approval or consent required or
permitted to be given between the parties hereto shall be given in writing, and
shall be deemed to have been properly given if delivered in person, transmitted
by telecopy with machine confirmation of transmission, or mailed by first class
certified mail to the other party at the appropriate address set forth below, or
to such other address as may be designated in writing by a party from time to
time in accordance with this Agreement. Such notice, request, approval or
consent shall be deemed given (i) on the date delivered or transmitted if
delivered in person or transmitted by telecopy prior to 5 p.m. on any business
day, (ii) on the next business day following delivery or transmission if
delivered in person or transmitted by telecopy after 5 p.m. on any business day
or on any nonbusiness day, or (iii) on the fourth business day following the
date deposited in the United States mail if sent mailed by first class certified
mail.
Genentech, Inc.: Genentech, Inc.
Xxx XXX Xxx
Xxxxx Xxx Xxxxxxxxx, XX 00000
Attn: Corporate Secretary
Telecopy: (000) 000-0000
Abgenix, Inc.: Abgenix, Inc.
0000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: President
Telecopy: (000) 000-0000
11.8 Export Laws. Notwithstanding anything to the contrary contained
herein, all obligations of ABX and GNE are subject to prior compliance with
United States export regulations and such other United States laws and
regulations as may be applicable, and to obtaining all necessary approvals
required by the applicable agencies of the government of the United States. GNE
shall be responsible for obtaining such approvals, and shall use efforts
consistent with prudent business judgment to obtain such approvals. ABX agrees
to cooperate reasonably with GNE and provide reasonable assistance to GNE as may
be reasonably necessary to obtain any required approvals.
11.9 Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision and the parties shall discuss in good faith appropriate
revised arrangements.
11.10 Force Majeure. Nonperformance of any party (except for payment
obligations) shall be excused to the
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extent that performance is rendered impossible by strike, fire, earthquake,
flood, governmental acts or orders or restrictions, failure of suppliers, or any
other reason where failure to perform, is beyond the reasonable control and not
caused by the negligence, intentional conduct or misconduct of the nonperforming
party.
11.11 No Consequential Damages. IN NO EVENT SHALL ANY PARTY HERETO BE
LIABLE FOR SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THIS
AGREEMENT OR THE EXERCISE OF RIGHTS HEREUNDER.
11.12 Disputes. The parties recognize that disputes as to certain
matters may from time to time arise during the term of this Agreement which
relate to either party's rights and/or obligations hereunder. It is the
objective of the parties to establish procedures to facilitate the resolution of
disputes arising under this Agreement in an expedient manner by mutual
cooperation and without resort to litigation. To accomplish this objective, it
is agreed that each party will inform the other as soon as possible when it
becomes aware of an area or issue of dispute. Prior to filing or initiating any
legal proceeding, the parties agree to discuss the dispute at the organizational
level at which such dispute arises. If either party believes there has been
sufficient discussion of the matter at such level, then such party, by written
notice to the other party, may have such dispute referred to their respective
chief executive officers (or, if unavailable, a designee who is an officer of
the party empowered to resolve such disputes) for attempted resolution by good
faith negotiations between such chief executive officers within fourteen (14)
days of such referral. In the event that the chief executive officers are not
able to resolve such dispute within such fourteen (14) day period, either party
may pursue whatever remedies are available to them under this Agreement or by
law.
11.13 Complete Agreement; Amendment. It is understood and agreed between
ABX and GNE that this Agreement and the GNE Option Agreement constitute the
entire agreement, both written and oral, between the parties with respect to the
subject matter hereof, and supersede and cancel all prior agreements respecting
the subject matter hereof, either written or oral, expressed or implied. No
amendment or change hereof or addition hereto shall be effective or binding on
either of the parties hereto unless reduced to writing and executed by the
respective duly authorized representatives of ABX and GNE.
11.14 Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed to be an original and both together shall be deemed to
be one and the same agreement.
11.15 Headings. The captions to the several Articles and Sections hereof
are not a part of this Agreement, but are included merely for convenience of
reference only and shall not affect its meaning or interpretation.
IN WITNESS WHEREOF, the parties have executed this Agreement, through
their respective officers hereunto duly authorized, as of the day and year first
above written.
ABGENIX, INC. GENENTECH, INC.
By: By:
---------------------------- ---------------------------------
Name: Name:
-------------------------- --------------------------------
Title: Title:
------------------------- -------------------------------
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SCHEDULE A
INFORMATION PURSUANT TO SECTION 9.1.5
64
SCHEDULE B
INFORMATION PURSUANT TO SECTION 9.3.4
65
ATTACHMENT A
ABX IN-LICENSES
I. [*]
II. [*]
--------------
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
66
ATTACHMENT B
ABX KNOW-HOW AND ABX PATENT RIGHTS
ABX KNOW-HOW:
PURSUANT TO PREVIOUS AGREEMENT:
[*]
PURSUANT TO THIS AGREEMENT:
[*]
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* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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ATTACHMENT B
ABX KNOW-HOW AND ABX PATENT RIGHTS
ABX PATENT RIGHTS:
I. PURSUANT TO THE MRLOA
A. Any of the patent applications listed in the following Table:
Ref. No. Application No. Filing Date Inventors Title
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ATTACHMENT B
ABX KNOW-HOW AND ABX PATENT RIGHTS
[*]
B. Pursuant to the License Agreement by and between the [*]
C. Pursuant to the Agreement between the [*]
D. Pursuant to the [*]
E. Pursuant to Agreements [*]
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omitted portions.
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ATTACHMENT B
ABX KNOW-HOW AND ABX PATENT RIGHTS
II. PURSUANT TO THE GENPHARM CROSS LICENSE
A. [*]
B. [*]
C. [*]
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ATTACHMENT C
FINANCING DOCUMENTS
ABGENIX, INC.
COMMON STOCK PURCHASE AGREEMENT
JANUARY 27, 1999
THIS AGREEMENT is made as of the date first written above by and
between ABGENIX, INC., a Delaware corporation having its principal executive
office at 0000 Xxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000 (the "Company"), and
GENENTECH, INC., a Delaware corporation having its principal executive office at
0 XXX Xxx, Xxxxx Xxx Xxxxxxxxx, Xxxxxxxxxx 00000 (the "Purchaser").
RECITALS
A. The parties are entering into a Multi-Antigen Research License and
Option Agreement contemporaneously with this Agreement (the "Multi-Antigen
Agreement"), providing the Purchaser with the right to use the Company's
XenoMouse technology and an option to acquire product licenses to XenoMouse
technology for use in specific fields.
B. In connection with the Multi-Antigen Agreement, the parties desire
that the Purchaser make an $8,000,000 equity investment in the Company pursuant
to the terms and conditions of this Agreement.
C. The shares of Common Stock issued to the Purchaser pursuant to this
Agreement shall have registration rights as evidenced by the Registration Rights
Agreement in the form attached hereto as Exhibit A (the "Rights Agreement").
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and promises set forth in this Agreement, the parties agree as
follows:
1. Sale of Stock. The Company hereby agrees to sell to the Purchaser,
and the Purchaser hereby agrees to purchase from the Company, 495,356 shares of
the Company's Common Stock (the "Shares") at the per share purchase price equal
to the average of the last sale price of one share of the Company's Common Stock
as reported on the Nasdaq National Market for the twenty (20) trading day period
commencing on and including December 24, 1998 (the "Per Share Purchase Price").
2. Closing Date. The closing of the purchase and sale of the Shares
hereunder (the "Closing") will take place as promptly as practicable hereafter,
upon the satisfaction of the conditions to closing set forth in Section 8
hereof, at the offices of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, P.C., 000 Xxxx Xxxx
Xxxx, Xxxx Xxxx, Xxxxxxxxxx, or at such other time and place as the parties
hereto shall agree. The date of the Closing is hereinafter referred to as the
"Closing Date".
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3. Delivery. At the Closing, the Company will deliver a certificate
registered in the Purchaser's name representing the Shares to be purchased by
the Purchaser. Such delivery shall be against payment of the purchase price
therefor in an amount equal to the product of the number of Shares and the Per
Share Purchase Price (the "Purchase Price") by wire transfer to the Company's
bank account at:
Bank Name: Xxxxx Fargo Bank
Bank Address: 000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Bank Contact: Xxx Xxxxxx
ABA#: 000000000
Account Name: WFB Acct
Account Number: 4068-000769
4. Representations and Warranties of the Company. The Company hereby
represents and warrants to the Purchaser as follows:
(a) Corporate Power. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and is qualified to do business as a foreign corporation in each
jurisdiction where failure to qualify would have a material adverse effect on
the business or properties of the Company. The Company has full corporate power
and authority to own its property, to carry on its business as presently
conducted and to carry out the transactions contemplated hereby.
(b) Authorization. The Company has full corporate power to
execute, deliver and perform this Agreement, the Rights Agreement and the
Multi-Antigen Agreement, and each such agreement has been duly executed and
delivered by the Company and is the legal, valid and, assuming due execution by
the Purchaser, binding obligation of the Company, enforceable in accordance with
its terms, subject to applicable bankruptcy, insolvency, moratorium,
reorganization or similar laws affecting creditors' rights generally, and to
general equitable principles. The execution, delivery and performance by the
Company of this Agreement, the Rights Agreement and the Multi-Antigen Agreement,
including the issuance, sale and delivery, of the Shares contemplated by Section
1 hereof, have been duly authorized by all necessary corporate action of the
Company.
(c) Valid Issuance of Stock. The Shares will be duly
authorized, validly issued, fully paid and non-assessable and, based in part
upon the representations of the Purchaser in this Agreement, will be issued in
compliance with all applicable federal and state securities laws. The Shares
will be free of restrictions on transfer other than the restrictions in this
Agreement, the Rights Agreement and under applicable state and/or federal
securities laws, and will not be subject to any preemptive or other similar
rights or any liens or encumbrances with the exception of any liens or
encumbrances created by the Purchaser.
(d) Governmental Approvals. Based in part on the
representations made by the Purchaser in Sections 5 and 6, no authorization,
consent, approval, license, exemption of or filing or
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registration with any court or governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, under any applicable
laws, rules or regulations presently in effect, is or will be necessary to be
made or obtained by the Company for, or in connection with, the execution and
delivery of this Agreement, the Rights Agreement or the Multi-Antigen Agreement
or the consummation of the transactions contemplated hereby or thereby or
performance by the Purchaser of its obligations hereunder or thereunder,
including the offer, sale and issuance of the Shares, except for (i) such
filings under applicable securities laws that will be made by the Company within
the prescribed periods, (ii) such filings with the Securities and Exchange
Commission (the "Commission"), Nasdaq and others pursuant to the Rights
Agreement that will be made by the Company within the prescribed periods and
(iii) any of the foregoing required or contemplated to be made pursuant to the
terms of the Multi-Antigen Agreement.
(e) Offering. Subject to the accuracy of the representations
of the Purchaser made in Sections 5 and 6, the offer, sale and issuance of the
Shares in conformity with the terms of this Agreement constitutes a transaction
exempt from the registration requirements of Section 5 of the Securities Act and
from the qualification requirements of the California Corporate Securities Law
of 1968, as amended (the "California Securities Law").
(f) Litigation. There is no litigation or governmental
proceeding or investigation pending or, to the knowledge of the Company,
threatened against the Company that could, either individually or in the
aggregate, materially and adversely affect (i) the execution and delivery of
this Agreement, the Rights Agreement or the Multi-Antigen Agreement, or (ii) the
performance by the Company of its obligations hereunder or thereunder, or that
could, either individually or in the aggregate, materially and adversely affect
the condition (financial or otherwise), business, property, assets or
liabilities of the Company or result in any change in the current equity
ownership of the Company. The Company is not a party or subject to, and none of
its assets is bound by, the provisions of any order, writ, injunction, judgment
or decree of any court or government agency or instrumentality.
(g) Subsidiaries. Except for Xenotech, L.P. and its general
partner Xenotech, Inc., the Company has no active subsidiaries and does not
otherwise directly or indirectly control any other business entity, and is not a
participant in any joint venture, partnership or similar entity. The Company has
furnished the Purchaser with true, correct and complete copies of its Amended
and Restated Certificate of Incorporation and Bylaws, together with any
amendments thereto as of the date hereof.
(h) Absence of Certain Developments. Since November 24, 1998,
the date of its most recent report filed with the Commission pursuant to the
Securities and Exchange Act of 1934, as amended from time to time (such act,
together with the rules and regulations promulgated thereunder, the "Exchange
Act," and such report, the "Current SEC Filing"), except as disclosed therein,
there has been no (i) material adverse change in the condition, financial or
otherwise, of the Company or its assets, liabilities, properties, business,
operations, intellectual property rights owned or controlled by it, or prospects
generally, (ii) declaration, setting aside or payment of any dividend or other
distribution with respect to the capital stock of the Company, or (iii) loss,
destruction or damage to any property of the Company, whether or not insured,
which has or may have a material adverse effect on the Company.
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(i) Absence of Undisclosed Liabilities. Except as and to the
extent reflected or stated in the Current SEC Filing, the Company has no
material accrued or contingent liability of a type required to be reflected on a
balance sheet in accordance with generally accepted accounting principles or
described in the footnotes thereto, other than liabilities arising in the
ordinary course of its business since the Current SEC Filing, arising out of any
transaction or state of facts existing prior to the date hereof.
(j) Non-Contravention. The execution, delivery and performance
by the Company of this Agreement, the Rights Agreement and the Multi-Antigen
Agreement do not and will not (i) contravene or conflict with the Amended and
Restated Certificate of Incorporation or Bylaws of the Company, or (ii)
contravene or conflict with or constitute a violation of any provision of any
law, regulation, judgment, injunction, order or decree binding upon or
applicable to the Company or its property, or result in a breach of or
constitute a default under any material agreement of the Company (whether upon
notice or passage of time) binding upon or applicable to it or its property, in
any manner which would materially and adversely affect the Purchaser's rights or
its ability to realize the intended benefits under this Agreement, the Rights
Agreement or the Multi-Antigen Agreement, or to require any consent or waiver
under any such material agreement.
(k) Filings. The Company has filed in a timely manner, and has
delivered to the Purchaser copies of, the following report required to be filed
with the Commission under the Exchange Act: (i) the Company's quarterly report
on Form 10-Q for the quarter ended September 30, 1998 filed with the Commission
on November 13, 1998 (the "SEC Report"). As of its filing date, no such report
or statement filed pursuant to the Exchange Act contained any untrue statement
of a material fact or omitted to state any material fact necessary in order to
make the statements made therein, in the light of the circumstances under which
they were made, not misleading.
(l) No Brokers. The Company has not directly or indirectly
employed any broker, finder or other person (including any employee) that might
be entitled to a fee, commission or other compensation upon the execution of
this Agreement, the Rights Agreement or the Multi-Antigen Agreement or the
consummation of the transactions contemplated by this Agreement, the Rights
Agreement or the Multi-Antigen Agreement for which the Purchaser or the Company
is or may be liable.
(m) Current Compliance with Other Instruments. The Company is
not in violation or default of any provision of its Amended and Restated
Certificate of Incorporation or Bylaws, each as in effect on and as of the
Closing, or any material agreement of the Company binding upon or applicable to
the Company or any of its properties or assets, or, to the best of its
knowledge, any provision of any law, regulation, judgment, injunction, order or
decree binding upon or applicable to the Company or any of its properties or
assets, which violation or default in any manner could, either individually or
in the aggregate, materially and adversely affect the condition (financial or
otherwise), business, property, assets or liabilities of the Company or result
in any change in the current equity ownership of the Company.
(n) Patents and Trademarks. The Company has sufficient title
to and ownership of or right to use all patents, trademarks, service marks,
trade names, copyrights, trade secrets, information, processes and other
proprietary rights (collectively, "IP Rights") necessary for its business as
presently
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conducted, without any known infringement of the rights of others. The Company
has not received any communications alleging that the Company has violated any
IP Rights of any other person or entity, nor is the Company aware of any third
party that is infringing or violating any such rights of the Company.
(o) Confidential Information and Invention Assignment
Agreements. Each former and current employee, officer and consultant of the
Company has executed a confidential information and invention assignment
agreement in the form attached hereto as Exhibit B.
(p) Employees. The Company's relations with its employees are
satisfactory. The Company has no collective bargaining agreements with any of
its employees. There is no labor union organizing activity pending or, to the
Company's knowledge, threatened with respect to the Company. To the Company's
knowledge, no employee of the Company, nor any consultant with whom the Company
has contracted, is in violation of any term of any employment contract,
proprietary information agreement or any other agreement relating to the right
of any such individual to be employed by, or to contract with, the Company
because of the nature of the business conducted by the Company; and to the
Company's knowledge the continued employment by the Company of its present
employees, and the performance of the Company's contracts with its independent
contractors, will not result in any such violation. The Company has not received
any notice alleging that any such violation has occurred. The Company is not
aware that any officer or key employee intends to terminate his or her
employment with the Company, and the Company does not have a present intention
to terminate the employment of any officer or key employee. The Company has
complied in all material respects with the applicable state, federal and foreign
equal employment opportunity laws and with other laws related to employment.
(q) Permits. The Company has all franchises, permits, licenses
and any similar authority necessary for the conduct of its business as now being
conducted by it, the lack of which could materially and adversely affect the
business, properties, prospects or financial condition of the Company. The
Company is not in default under any such franchise, permit, license or other
similar authority and neither the execution, delivery nor performance of this
Agreement, the Rights Agreement or the Multi-Antigen Agreement and the
consummation of the transactions contemplated hereby and thereby will result in
any suspension, revocation, impairment, forfeiture or nonrenewal of any of them.
(r) Registration Rights. The Company has not granted or agreed
to grant to any person or entity any registration rights, including piggyback
rights, that can currently or in the future may be exercisable, except for those
pursuant to (i) the Amended and Restated Stockholder Rights Agreement, dated as
of January 12, 1998, among the Company and certain holders of Common Stock and
warrants of the Company, (ii) the Registration Rights Agreement, dated November
18, 1998, between Xxxxxxx Capital Group, LLC and the Company, and (iii) the
Rights Agreement.
(s) Environmental and Safety Laws. The Company, to the best of
its knowledge, is not in violation of any applicable statute, law or regulation
relating to the environment or occupational health and safety, and, based on the
Company's business as currently conducted and to the best of its knowledge, no
material expenditures are or will be required in order to comply with any such
existing statute, law or regulation.
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(t) Insurance. The Company has in full force and effect fire
and casualty insurance policies, with extended coverage, sufficient in amount
(subject to reasonable deductibles) to allow it to replace any of its property
that might be damaged or destroyed. The Company has in full force and effect
product liability insurance in an amount customary for companies similarly
situated.
5. Representations and Warranties of the Purchaser. The Purchaser
hereby represents and warrants to the Company as follows:
(a) Corporate Power. The Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and is qualified to do business as a foreign corporation in each
jurisdiction where failure to qualify would have a material adverse effect on
the business or properties of the Purchaser. The Purchaser has full corporate
power and authority to own its property, to carry on its business as presently
conducted and to carry out the transactions contemplated hereby.
(b) Authorization. The Purchaser has full corporate power to
execute, deliver and perform this Agreement, the Rights Agreement and the
Multi-Antigen Agreement, and each such agreement has been duly executed and
delivered by the Purchaser and is the legal, valid and, assuming due execution
by the Company, binding obligation of the Purchaser, enforceable in accordance
with its terms, subject to applicable bankruptcy, insolvency, moratorium,
reorganization or similar laws affecting creditors' rights generally, and to
general equitable principles. The execution, delivery and performance by the
Purchaser of this Agreement, the Rights Agreement and the Multi-Antigen
Agreement, including the payment of the Purchase Price, have been duly
authorized by all necessary corporate action of the Purchaser.
(c) Risk Factors. The Purchaser acknowledges that an
investment in the Company involves known and unknown risks, uncertainties and
other factors which may result in the Purchaser's loss of its entire investment.
The Purchaser acknowledges that it has received a copy of the SEC Report and
reviewed the "Risk Factors" contained therein, which "Risk Factors" are deemed
incorporated by reference into this Agreement.
(d) No Brokers. The Purchaser has not directly or indirectly
employed any broker, finder or other person (including any employee) that might
be entitled to a fee, commission or other compensation upon the execution of
this Agreement, the Rights Agreement or the Multi-Antigen Agreement or the
consummation of the transactions contemplated by this Agreement, the Rights
Agreement or the Multi-Antigen Agreement for which the Purchaser or the Company
is or may be liable.
6. Compliance with Securities Laws and Restrictions on Transfer of
Securities.
(a) Additional Representations and Warranties and Agreements
of the Purchaser. The Purchaser hereby represents and warrants to, and agrees
with, the Company as follows:
(i) The Purchaser is purchasing the Shares for its
own account for investment only and not with a view to any resale or
distribution thereof, except pursuant to an effective registration
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statement under the Securities Act of 1933, as amended from time to time (such
act, together with the rules and regulations promulgated thereunder, herein the
"Securities Act"), covering the sale, assignment or transfer or an opinion of
counsel satisfactory to the Company (which may be counsel to the Company;
provided that no conflict of interest exists or that the Purchaser and the
Company have waived any such conflict) that such registration is not required,
which opinion will be at the cost of the Company.
(ii) The Purchaser has received and carefully
reviewed the Current SEC Filing, and has had the opportunity to obtain and
receive such other information as it has deemed necessary to understand the
business and financial condition of the Company and to make the investment
decision to purchase the Shares.
(iii) As an investor in companies in the
biopharmaceutical industry and a participant in such industry, the Purchaser has
such knowledge and experience in financial and business matters that it is
capable of evaluating the merits and risks of the investment represented by the
Shares, and it is able to bear the economic risk of such investment.
(iv) The Purchaser is an "accredited investor" as
such term is defined in Rule 501(a) of Regulation D under the Securities Act.
The Purchaser also represents it has not been organized for the purpose of
acquiring the Shares.
(v) The Purchaser understands that the Shares are
being issued in a transaction that is exempt from the registration requirements
of the Securities Act by reason of the provisions of Section 4(2) of the
Securities Act and that the Shares will be subject to transfer restrictions and
must be held indefinitely unless subsequently registered under the Securities
Act or an exemption from such registration is available. The certificate
representing the Shares will be affixed with the following legends:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, ASSIGNED OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT UNDER SAID ACT COVERING THE TRANSFER OR
AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO
THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED."
The restrictions on sale, assignment and transfer of the
Shares contained in this Section 6(a)(v) shall terminate at such time as there
shall be delivered to the Company and the Purchaser an opinion of counsel to the
Purchaser, in form and substance satisfactory to the Company, to the effect
that, due to the lapse of time or otherwise, no registration of such securities
is required under the Securities Act in connection with any distribution of such
securities to the public in the United States. In addition, at any time after
(A) the delivery of such opinion; or (B) such securities are sold pursuant to
and in accordance with an effective registration statement under the Securities
Act covering such sale,
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the Purchaser shall be entitled to exchange its certificate representing such
securities (or any portion thereof as to which (A) or (B) above applies) for a
new certificate not bearing the first legend set forth in Section 6(a)(v).
(vi) The Purchaser understands that the Shares
constitute "restricted securities" within the meaning of Rule 144, promulgated
under the Securities Act. Purchaser is aware that Rule 144, in substance, except
as otherwise provided in subsection (k) of such rule, permits limited public
resale of "restricted securities" acquired, directly or indirectly, from the
issuer thereof (or from an affiliate of such issuer), in a non-public offering
subject to the satisfaction of certain conditions, including, among other
things: (A) the availability of certain public information about the Company;
(B) the resale occurring not earlier than the expiration of the applicable
holding period stated therein; (C) the sale being made through a broker in an
unsolicited "broker's transaction" or in transactions directly with a market
maker (as said term is defined under the Exchange Act) and (D) the amount of
securities being sold during any three-month period not exceeding the specified
limitations stated therein. The Purchaser also understands that the holding
period under Rule 144 will commence on the Closing Date.
(vii) The Purchaser further understands that in the
event all of the applicable requirements of Rule 144 are not satisfied,
registration under the Securities Act, compliance with Regulation A, or some
other registration exemption will be required; and that, notwithstanding the
fact that Rule 144 is not exclusive, the staff of the Commission has expressed
its opinion that persons proposing to sell private placement securities other
than in a registered offering and otherwise than pursuant to Rule 144 will have
a substantial burden of proof in establishing that an exemption from
registration is available for such offers or sales, and that such persons and
their respective brokers who participate in such transactions do so at their own
risk.
(b) Stop Transfer Orders. The Purchaser understands that
notations restricting the transfer of the Shares will be made on the transfer
records of the Company and that a stop transfer order will be entered with the
Company's transfer agent.
(c) Compliance with Section 6. None of the Shares (nor any
interest therein) shall be sold, assigned or offered except in accordance with
the provisions of this Section 6.
7. Additional Covenants of Purchaser Regarding Securities.
(a) Effectiveness and Termination. The provisions of this
Section 7 shall become effective at such time (if any), and from time to time,
as the Purchaser and its Affiliates, taken together, own Voting Securities
representing two percent (2%) or more of the total outstanding Voting Securities
of the Company, and shall continue in effect until the earlier of (i) the fifth
anniversary of the date of this Agreement or (ii) such time as the Purchaser and
its Affiliates, taken together, own less than two percent (2%) of the total
outstanding Voting Securities of the Company, provided that the provision of
this Section 7 shall again become effective if, and at such time, and from time
to time, as the Purchaser and its Affiliates, taken together, own such
percentage of Voting Securities of the Company within the five year period
commencing on the date hereof. For purposes of this Agreement, the term "Voting
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Securities" means any outstanding securities of the Company entitled to vote
generally the election of directors, including the Shares. The provisions of
this Section 7 shall have no effect unless and until they become effective, and
only so long as they are effective, pursuant to this Section 7(a), other than
for purposes of defining certain terms used elsewhere in this Agreement.
Notwithstanding any provision hereof to the contrary, this Section 7 shall not
apply to any Shares assigned, sold or transferred in accordance with Section
6(a)(v).
(b) Additional Stock Purchases by Purchaser. The Purchaser
hereby agrees that neither the Purchaser nor any of its Affiliates nor anyone
acting on its or their behalf will acquire any equity securities (as such term
is used in the Exchange Act) of the Company without the Company's prior written
approval. For purposes of this Agreement, the term "Affiliate" means, when used
with respect to any specified person, any other person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such specified person. For the purposes of this definition, "control," when used
with respect to any person, means the power to direct the management and
policies of such person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise and the terms "affiliated,"
"controlling" and "controlled" have meanings correlative to the foregoing.
(c) [*]
8. Closing Conditions.
(a) Conditions to Purchaser's Obligations at the Closing. The
Purchaser's obligation to purchase the Shares at the Closing is subject to the
fulfillment on or prior to the Closing of the following conditions, any one or
more of which may be waived in whole or in part by the Purchaser:
(i) Compliance with Laws. At the Closing, the sale
and issuance of the Shares shall be legally permitted by all laws and
regulations to which the Purchaser or the Company is subject.
(ii) Representations and Warranties. Each of the
representations and warranties of the Company set forth in Section 4 shall be
true and correct as if made on the Closing Date.
(iii) Performance. The Company shall have performed
and complied with all agreements, obligations and conditions contained in this
Agreement that are required to be performed or complied with by it on or before
the Closing Date.
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the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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(iv) Compliance Certificate. The Chief Executive
Officer of the Company shall deliver to the Purchaser on the Closing Date a
certificate certifying that the conditions set forth in clauses (ii), (iii) and
(vi) of this Section 8(a) have been fulfilled.
(v) Other Agreements. The Company shall have
executed and delivered to the Purchaser the Rights Agreement and the
Multi-Antigen Agreement.
(vi) Consents. The Company shall have obtained all
consents (including all governmental and regulatory consents, approvals, or
authorizations required in connection with the valid execution and delivery of
this Agreement, the Rights Agreement and the Multi-Antigen Agreement), permits
and waivers necessary or required to be obtained on or prior to the Closing Date
for consummation of the transactions contemplated hereby.
(vii) Proceedings and Documents. All corporate and
other proceedings in connection with the transactions contemplated in connection
with the Purchaser's purchase of the Shares and all documents incident thereto
shall be reasonably satisfactory in form and substance to the Purchaser and the
Purchaser's counsel, and they shall have received all such counterpart original
and certified or other copies of such documents as they may reasonably request.
(viii) Delivery of Stock Certificate. The Company
shall have caused the delivery to the Purchaser of a stock certificate
representing the Purchaser's ownership of the Shares.
(ix) Blue Sky. On or before the Closing, the Company
shall have obtained all necessary permits and qualifications, if any, or secured
an exemption therefrom, required by any state or country for the offer and sale
of the Shares.
(x) Opinion of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx. The
Purchaser shall have received from Xxxxxx Xxxxxxx Xxxxxxxx and Xxxxxx, counsel
to the Company, an opinion, dated the Closing Date, in the form attached hereto
as Exhibit C.
(xi) Opinion of Pillsbury Madison & Sutro. The
Purchaser shall have received from Pillsbury Madison & Sutro, counsel to the
Company, an opinion, dated the Closing Date, in the form attached hereto as
Exhibit D.
(b) Conditions to Company's Obligations at the Closing. The
Company's obligation to sell and issue the Shares at the Closing is subject to
the fulfillment on or prior to the Closing of the following conditions, any one
or more of which may be waived in whole or in part by the Company:
(i) Compliance with Laws. At the Closing, sale and
issuance of the Shares shall be legally permitted by all laws and regulations to
which the Purchaser or the Company is subject.
(ii) Representations and Warranties. Each of the
representations and warranties of the Purchaser set forth in Sections 5 and 6
shall be true and correct as if made on the Closing Date.
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(iii) The Purchase Price. The Purchaser shall have
delivered to the Company the Purchase Price in accordance with Section 3 hereof.
(iv) Performance. The Purchaser shall have performed
and complied with all agreements, obligations and conditions contained in this
Agreement that are required to be performed or complied with on or before the
Closing Date.
(v) Other Agreements. The Purchaser shall have
executed and delivered to the Company the Rights Agreement and the Multi-Antigen
Agreement.
(vi) Consents. The Purchaser shall have obtained all
consents (including all governmental and regulatory consents, approvals, or
authorizations required in connection with the valid execution and delivery of
this Agreement, the Rights Agreement and the Multi-Antigen Agreement), permits
and waivers necessary or required to be obtained on or prior to the Closing Date
for consummation of the transactions contemplated hereby.
(vii) Proceedings and Documents. All corporate and
other proceedings in connection with the transactions contemplated in connection
with the sale and issuance of the Shares and all documents incident thereto
shall be reasonably satisfactory in form and substance to the Company and the
Company's counsel, and they shall have received all such counterpart original
and certified or other copies of such documents as they may reasonably request.
9. General Provisions.
(a) Notices. All notices and other communication required or
appropriate to be given hereunder shall be in writing and shall be delivered by
hand or mailed by certified mail, return receipt requested, or sent by telex or
facsimile (in which case a confirming copy shall also be sent by certified mail
or courier), to the following respective addresses or to such other addresses as
may be specified in any notice delivered or mailed as above provided:
(i) If to the Purchaser, to:
Genentech, Inc.
0 XXX Xxx
Xxxxx Xxx Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Corporate Secretary
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(ii) If to the Company to:
Abgenix, Inc.
0000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: President
with a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxx X. Xxxxxxx
Any notice or other communication delivered by hand or mailed shall be deemed to
have been delivered on the date on which such notice or communication is
delivered by hand, or in the case of certified mail deposited with the
appropriate postal authorities on the date when such notice or communication is
actually received, and in any other case shall be deemed to have been delivered
on the date on which such notice or communication is actually received.
(b) Governing Law. The parties have agreed that this Agreement
will be governed by and construed in accordance with the laws of the State of
California.
(c) Amendments. No provision of this Agreement may be waived,
changed or modified, or the discharge thereof acknowledged orally, but only by
an agreement in writing signed by the party against which the enforcement of any
waiver, change, modification or discharge is sought.
(d) Assignment.
(i) Except as set forth in this Section 9(d), none of
the rights or obligations of either party hereto may be assigned or transferred
without the prior written consent of the other party hereto.
(ii) Either party may assign all of its rights and
obligations under this Agreement in connection with a merger or similar
reorganization or the sale of all or substantially all of its assets. This
Agreement shall survive any such merger or reorganization of either party with
or into, or such sale of assets to, another party and no consent for such
merger, reorganization or sale shall be required hereunder.
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(iii) The Purchaser may assign its rights and
obligations to a wholly-owned subsidiary, provided the assignee is not deemed by
the Board of Directors of the Company, in its reasonable judgment, to be a
competitor of the Company and provided further such assignee agrees, prior to
the transfer, in writing with the Company to comply with all the provisions of
this Agreement applicable to the Purchaser. Notwithstanding anything herein to
the contrary, no such assignment shall relieve the Purchaser of its obligations
hereunder and under the Rights Agreement and the Multi-Antigen Agreement.
(iv) This Agreement shall be binding upon and inure
to the benefit of the successors and permitted assigns of the parties. Any
assignment not in accordance with this Agreement shall be void.
(e) Expenses. All fees and expenses incurred in connection
with this Agreement and the transactions contemplated hereby, including without
limitation brokerage, placement agent, attorneys' and accountants' fees and
expenses, shall be paid by the party incurring such expenses, whether or not the
sale and purchase of the Shares is consummated.
(f) Counterparts. This Agreement may be executed in two or
more counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.
(g) Entire Agreement. This Agreement, the Rights Agreement and
the Multi-Antigen Agreement, together with the Exhibits and other documents
attached hereto and thereto, constitute the entire contract between the parties
with respect to the subject matter hereof and thereof, and no party will be
liable or bound to the other in any manner by any representations, warranties or
covenants except as specifically set forth herein and therein.
(h) Titles. The titles of the Sections of this Agreement are
inserted for reference only, and are not to be considered as part of this
Agreement in construing this Agreement.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the day and year first set forth above.
"COMPANY" ABGENIX, INC.
By: /s/ R. Xxxxx Xxxxx
--------------------------------------
R. Xxxxx Xxxxx
President and Chief Executive Officer
"HOLDER" GENENTECH, INC.
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------------
Xxxxxxx X. Xxxxx
Vice President, Business and Corporate
Development
