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EXECUTION COPY

 

AMENDED AND RESTATED

COLLABORATIVE RESEARCH, DEVELOPMENT

AND MARKETING AGREEMENT

 

Between

 

MITOTIX, INC.

 

and

 

THE DUPONT MERCK PHARMACEUTICAL COMPANY

 

dated as of June 2, 1997


TABLE OF CONTENTS

 

ARTICLE 1.

  DEFINITIONS  1

1.1

  “Affiliate”  1

1.2

  “Allowable Expense”  2

1.3

  “Alternate UBC Plan”  2

1.4

  “Antisense”  2

1.5

  “Annual CDK Research Plan”  2

1.6

  “Annual Research Plan and Budget”  2

1.7

  “Calendar Quarter”  2

1.8

  “Calendar Year”  2

1.9

  “Cdc 27/Cdc 16 License”  2

1.10

  “CDK Collaboration”  2

1.11

  “CDK Research Operating Committee”  2

1.12

  “CDK Development Compounds”  2

1.13

  “CDK-D Development Compounds”  2

1.14

  “CDK-non-D Development Compounds”  2

1.15

  “CDK Field”  3

1.16

  “CDK-D Field”  3

1.17

  “CDK-non-D Field”  3

1.18

  “CDK Patent Rights”  3

1.19

  “CDK Products”  3

1.20

  “CDK Research Program”  3

1.21

  “CDK Targets”  3

1.22

  “CDK-D Targets”  3

1.23

  “CDK-non-D Targets”  4

1.24

  “Collaboration”  4

1.25

  “Collaborative Policy Setting Committee”  4

1.26

  “Cyclin E License”  4

1.27

  “Cyclin D License”  4

1.28

  “Competitive Product”  4

1.29

  “Development Partner”  4

1.30

  “Distributor”  4

1.31

  “DuPont Merck Inventions”  4

1.32

  “Effective Date”  4

1.33

  “Extended UBC Collaboration”  5

1.34

  “Extension Notice”  5

1.35

  “First Commercial Sale”  5

1.36

  “Gene Therapy”  5

1.37

  “Immunoassay Product”  5

1.38

  “IND”  5

1.39

  “Initial UBC Term”  5

1.40

  “Inventions”  5

1.41

  “IPO”  5

1.42

  “Know-how”  5

1.43

  “Mitotix Inventions”  5

 

(i)


1.44

  “Mitotix Pending License Agreements”  5

1.45

  “Mitotix License Agreements”  5

1.46

  “Mitotix Product”  6

1.47

  “Net Sales”  6

1.48

  “New UBC Target”  7

1.49

  “NDA”  7

1.50

  “Percentage Contribution”  7

1.51

  “pl6 License”  7

1.52

  “PRAD1 License”  7

1.53

  “Product Patent Rights”  7

1.54

  “Radiopharmaceutical”  7

1.55

  “Radiopharmaceutical Product”  7

1.56

  “Research Operating Committees”  7

1.57

  “Research Year”  8

1.58

  “Royalty-Bearing Products”  8

1.59

  “Royalty Term”  8

1.60

  “Strategic Countries”  8

1.61

  “Target”  8

1.62

  “Third Party”  8

1.63

  “UBC Collaboration”  8

1.64

  “UBC Deferral Payment”  8

1.65

  “UBC Development Compounds”  8

1.66

  “UBC Extension Payment”  8

1.67

  “UBC Field”  9

1.68

  “UBC Operational Disengagement Plan”  9

1.69

  “UBC Operating Profit”  9

1.70

  “UBC Patent Rights”  9

1.71

  “UBC Pricing Date”  9

1.72

  “UBC Products”  9

1.73

  “UBC Research, Development and Pre-Launch Marketing Costs”  9

1.74

  “UBC Research Operating Committee”  9

1.75

  “UBC Research Program”  9

1.76

  “UBC Targets”  9

1.77

  “UBC9 License”  10

1.78

  “Unique Product”  10

1.79

  “Valid Patent Claim”  10

ARTICLE 2.

  SCOPE AND STRUCTURE OF THE COLLABORATIONS  10

ARTICLE 3.

  CDK COLLABORATION-CDK RESEARCH PROGRAM  10

3.1

  Conduct of the CDK Research Program  10
   3.1.1  General Terms  10
   3.1.2  Annual Research Plan  11
   3.1.3  Transfer of Technical Information and Know-How  11
   3.1.4  DuPont Merck Compounds  11
   3.1.5  Subcontracts  12
   3.1.6  Data  12

 

(ii)


   

3.1.7

  Quarterly Reports by Mitotix and DuPont Merck  12

3.2

  Funding of the CDK Research Program  13
   3.2.1  Annual Payment  13
   3.2.2  Incentive Research Funding  13

3.3

  Expiration or Termination of the CDK Research Program and Result of   
   

Such Termination

  14

ARTICLE 4.

  CDK COLLABORATION: CDK DEVELOPMENT PROGRAM  14

4.1

  Designation of CDK Development Compounds  14

4.2

  Clinical Development and Marketing  14

4.3

  Development Information  14

ARTICLE 5.

  GENERAL DESCRIPTION OF THE UBC COLLABORATION  15

5.1

  Scope of UBC Collaboration  15

5.2

  Initial Term and Option to Extend  15
   5.2.1  Initial Term  15
   5.2.2  Option to Extend; UBC Extension Payment  15
   5.2.3  UBC Deferral Payment  16

5.3

  UBC Research Program  16

5.4

  Research and Development Funding Commitments  16
   5.4.1  First Three Research Years  16
   5.4.2  Fourth Research Year and Thereafter  17
   5.4.3  Changes to Mitotix’s Funding Commitment  17
   5.4.4  Alternate UBC Plan  17
   5.4.5  Invoicing  18
   5.4.6  Records  19

5.5

  Termination of UBC Collaboration if DuPont Merck Does Not Extend the UBC Collaboration and Result of Such Termination  19

5.6

  Certain Royalty Rights  20

5.7

  UBC Operational Disengagement Plan  20

5.8

  New UBC Targets  22

5.9

  Terms of Equity Investment  22
   5.9.1  General Provisions Relating to Price of Equity Investment  22
   5.9.2  Investment Prior to an Initial Public Offering  23
   5.9.3  Investment After an Initial Public Offering  23

ARTICLE 6.

  THE UBC COLLABORATION - UBC RESEARCH PROGRAM  24

6.1

  Conduct of the UBC Research Program  24
   6.1.1  General Terms  24
   6.1.2  Annual UBC Research Plan and Budget  24
   6.1.3  DuPont Merck Compounds  25
   6.1.4  Subcontracts  25
   6.1.5  Data  25
   6.1.6  Quarterly Reports by Mitotix and DuPont Merck  26

6.2

  Expiration or Termination of the UBC Research Program and Result of Such Termination  26
   6.2.1  Termination of Initial UBC Term  26

 

(iii)


   6.2.2  Expiration Following Extension of the UBC Collaboration and Commencement of Alternate UBC Plan  26
   6.2.3  Termination of the UBC Research Program Following Extension of the UBC Collaboration and Prior to the Commencement of the Alternate UBC Plan  26
   6.2.4  Termination of the UBC Research Program Following Commencement of the UBC Operational Disengagement Plan  28

ARTICLE 7.

  UBC COLLABORATION: UBC DEVELOPMENT PROGRAM  28

7.1

  Description of UBC Development Compounds  28

7.2

  Clinical Development and Marketing  28
   7.2.1  When the Alternate UBC Plan is Not in Effect  28
   7.2.2  Clinical Development and Marketing Under the Alternate UBC Plan  28

7.3

  Development Information  29

ARTICLE 8.

  MITOTIX’S RIGHT TO CO-PROMOTE  29

8.1

  Mitotix’s Co-promotion Option  29

ARTICLE 9.

  MANAGEMENT OF THE COLLABORATIONS  30

9.1

  Collaborative Policy Setting Committee  30
   9.1.1  General  30
   9.1.2  Chair  30
   9.1.3  Minutes  30

9.2

  Research Operating Committees  30
   9.2.1  Chairs  31
   9.2.2  Minutes  31

9.3

  Disagreements  31

9.4

  Project Leaders  32

9.5

  Availability of Employees  32

9.6

  Visit of Facilities  32

ARTICLE 10.

  LICENSE GRANTS AND RIGHTS OF FIRST NEGOTIATION  32

10.1

  Grant of License Rights to DuPont Merck in CDK Field  32
   10.1.1  Exclusive License in CDK Field  32
   10.1.2  Conversion to Non-Exclusive  33
   10.1.3  Election to Terminate License Grant  33
   10.1.4  Additional In-Licensed CDK Technology  33
   10.1.5  Release of Certain CDK Targets and Certain Royalty Payments  33

10.2

  Grant of License Rights to DuPont Merck in the UBC Field  34
   10.2.1  Exclusive License in the UBC Field  34
   10.2.2  Conversion to Non-Exclusive  34
   10.2.3  Election to Terminate License Grant  34
   10.2.4  Additional In-Licensed UBC Technology  34

10.3

  Reservation of Rights  36

10.4

  Grant of License Rights to Mitotix  36
   10.4.1  License to Perform Obligations  36

 

(iv)


   10.4.2  License to DuPont Merck Inventions  36

10.5

  DuPont Merck Rights of First Negotiation  37
   10.5.1  Right of First Negotiation with Respect to Antisense and/or Gene Therapy  37
   10.5.2  Right of First Negotiation with Respect to CDK-non-D Targets  37

ARTICLE 11.

  MILESTONES AND ROYALTIES  38

11.1

  Milestone Payments  38
   11.1.1  Development Events  39
   11.1.2  Notice of Achievement of Milestones  41
   11.1.3  Radiopharmaceutical Products and Immunoassay Products  41
   11.1.4  Non-Strategic Countries  41

11.2

  Royalties Payable to Mitotix on Net Sales  41
   11.2.1  Royalty Payable to Mitotix on Net Sales in Strategic Countries  42
   11.2.2  Conditions on Royalty Payments  42

11.3

  Royalties Payable to Mitotix on Net Sales to Distributors in Non-Strategic Countries  43

11.4

  Royalties Payable to Mitotix on Net Sales by Development Partners and other Sublicensees in Japan and Other Non-Strategic Countries  43

11.5

  Profit Sharing on Sales of UBC Products  43

ARTICLE 12.

  ROYALTIES PAYABLE TO DUPONT MERCK  44

12.1

  General  44

12.2

  Royalties Payable to DuPont Merck on Net Sales  44
   12.2.1  Royalty Payable to DuPont Merck on Net Sales in Strategic Countries  44
   12.2.2  Conditions on Royalty Payments  45

12.3

  Royalties Payable to DuPont Merck on Net Sales to Distributors in Non-Strategic Countries  45

12.4

  Royalties Payable to DuPont Merck on Net Sales by Development Partners and other Sublicensees in Japan and Other Non-Strategic Countries  45

ARTICLE 13.

  PAYMENT TERMS  46

13.1

  General  46

13.2

  Royalty Reports, Exchange Rates  46

13.3

  Payment of Profit Sharing Amounts  46

13.4

  Audits  47

13.5

  Payment Terms  48

13.6

  Exchange Controls  48

13.7

  Payment Method  48

13.8

  Interest on Late Payments  48

13.9

  Overriding Provisions of License Agreements  49

ARTICLE 14.

  PATENTS  50

14.1

  Ownership of Inventions  50

 

(v)


14.2

  Provisions Concerning the Filing, Prosecution and Maintenance of CDK Patent Rights, UBC Patent Rights and Inventions  51
   14.2.1  CDK Patent Rights, UBC Patent Rights and Inventions Owned by Each Party  51
   14.2.2  Joint Inventions Relating to CDK Targets and UBC Targets  51
   14.2.3  Joint Inventions Relating to CDK Products and UBC Products  51
   14.2.4  Consultation Regarding Joint Inventions  51
   14.2.5  Patent Costs  52

14.3

  Cooperation  52

14.4

  No Other Technology Rights  52

14.5

  Enforcement of Patent Rights  52

14.6

  Defense of Individual Infringement Actions Involving Use of the Targets  53

14.7

  Defense of Joint Infringement Actions Involving Use of the Targets  53

14.8

  Contribution  54

14.9

  Third Party Patents  54

14.10

  Infringement of Mitotix Inventions or Joint Inventions Covering CDK Products or UBC Products  54

ARTICLE 15.

  CONFIDENTIALITY  55

15.1

  Nondisclosure Obligations  55

15.2

  Samples  56

15.3

  Terms of this Agreement and Existence of UBC Collaboration  56

15.4

  Publications  57

ARTICLE 16.

  REPRESENTATIONS AND WARRANTIES  57

16.1

  Authorization  57

16.2

  License Agreements with Third Parties  58

16.3

  Patent Validity  58

16.4

  Exclusivity and Freedom-to-operate  58

ARTICLE 17.

  INDEMNITY  58

17.1

  DuPont Merck Indemnity Obligations  58

17.2

  Mitotix Indemnity Obligations  59

17.3

  Procedure  59

17.4

  Insurance  60

ARTICLE 18.

  TERM AND TERMINATION  60

18.1

  Expiration  60

18.2

  Termination for Cause  60
   18.2.1  Bankruptcy  60
   18.2.2  Material Breach  60
   18.2.3  Failure to Retain Qualified Scientists  60

18.3

  Effect of Termination  60

18.4

  Failure to Pursue  61

ARTICLE 19.

  MISCELLANEOUS  61

 

(vi)


19.1

 

Force Majeure

  61

19.2

 

Assignment

  62

19.3

 

Severability

  62

19.4

 

Notices

  62

19.5

 

Applicable Law

  63

19.6

 

Dispute Resolution

  63

19.7

 

Entire Agreement

  63

19.8

 

Headings

  64

19.9

 

Independent Contractors

  64

19.10

 

Agreement Not to Solicit Employees

  64

19.11

 

Waiver

  64

19.12

 

Counterparts

  64

19.13

 

Definition and Effect of Change of Control

  64

 

(vii)


APPENDICES

 

Appendix A:

  CDK Patent Rights and Certain Mitotix License Agreements

Appendix B:

  CDK Work Plan

Appendix C:

  CDK Primary and Secondary Screens

Appendix D:

  UBC Patent Rights and Certain Mitotix License Agreements

Appendix E:

  Mitotix Pending License Agreements

Appendix F:

  UBC Work Plan

Appendix G1:

  Co-promotion of CDK Products and Co-promotion of UBC Products when the Alternate UBC Plan has been put into Effect

Appendix G2:

  Co-promotion of UBC Products when the Alternate UBC Plan is not in Effect

Appendix H:

  UBC Products - Definition of Percentage Contribution

Appendix I:

  Definition of UBC Operating Profit

Appendix J:

  Examples of Milestone Payment Obligations

 

(viii)


AMENDED AND RESTATED

COLLABORATIVE RESEARCH, DEVELOPMENT

AND MARKETING AGREEMENT

 

THIS AMENDED AND RESTATED COLLABORATIVE RESEARCH, DEVELOPMENT AND MARKETING AGREEMENT dated as of June 2, 1997 (the “Agreement”) is made between MITOTIX, INC., a Delaware corporation having its principal place of business at One Kendall Square, Building 600, Cambridge, Massachusetts 02139 (“Mitotix”), and THE DUPONT MERCK PHARMACEUTICAL COMPANY, a Delaware general partnership having its principal place of business at 974 Centre Road, Wilmington, Delaware 19807 (“DuPont Merck”).

 

R E C I T A L S

 

Mitotix and DuPont Merck are parties to a Collaborative Research, Development and Marketing Agreement, dated as of December 6, 1995 (the “Initial Agreement”), pursuant to which Mitotix and DuPont Merck agreed, inter alia, (i) to utilize certain biological targets in order to identify and develop small molecules that can be used as active agents in therapeutic products for the treatment of diseases resulting from inappropriate cell division, proliferation, or longevity; and (ii) to collaborate on research with respect to such biological targets and on the discovery, worldwide development, and commercialization of CDK Products and UBC Products (both as defined below) for therapeutic purposes.

 

Mitotix and DuPont Merck desire to amend and restate the Initial Agreement to extend the Initial UBC Term (as defined below) and to make certain other changes as provided herein.

 

NOW THEREFORE, in consideration of the foregoing and of the covenants herein contained, the parties hereto mutually agree to amend and restate the Initial Agreement as follows:

 

ARTICLE 1. DEFINITIONS

 

The terms in this Agreement with initial letters capitalized, whether used in the singular or the plural, shall have meaning set forth below or, if not listed below, the meaning as designated in places throughout this Agreement.

 

1.1 “Affiliate” shall mean any corporation or other entity which controls, is controlled by, or is under common control with a party to this Agreement. A corporation or other entity shall be regarded as in control of another corporation or entity if it owns or directly or indirectly controls more than fifty percent (50%) of the voting stock or other ownership interest of the other corporation or entity, or if it possesses, directly or indirectly,

 


the power to direct or cause the direction of the management and policies of the corporation or other entity or the power to elect or appoint more than fifty percent (50%) of the members of the governing body of the corporation or other entity. For purposes of this Agreement, DuPont Merck shall not be deemed to be an Affiliate of E.I. DuPont de Nemours & Co. or Merck & Co., Inc. or any of their subsidiaries.

 

1.2 “Allowable Expense” shall have the meaning set forth in Appendix I.

 

1.3 “Alternate UBC Plan” shall mean the research, development and marketing plan for the UBC Products that is described in Section 5.4.4.

 

1.4 “Antisense” shall mean inhibiting or preventing in vivo expression of a gene product in a human or animal through the use of an oligonucleotide or modified oligonucleotide which binds to RNA or DNA.

 

1.5 “Annual CDK Research Plan” shall have the meaning set forth in Section 3.1.2 below.

 

1.6 “Annual Research Plan and Budget” shall have the meaning set forth in Section 6.1.2 below.

 

1.7 “Calendar Quarter” shall mean the respective periods of three (3) consecutive calendar months ending on March 31, June 30, September 30 and December 31.

 

1.8 “Calendar Year” shall mean each successive period of twelve (12) months commencing on January 1 and ending on December 31.

 

1.9 “Cdc 27/Cdc 16 License” shall mean the license agreement dated as of July 12, 1995 between Mitotix and Harvard University.

 

1.10 “CDK Collaboration” shall have the meaning set forth in Section 2 below.

 

1.11 “CDK Research Operating Committee” shall mean the joint committee composed of representatives of Mitotix and DuPont Merck described in Section 9.2 of this Agreement.

 

1.12 “CDK Development Compounds” shall mean, collectively, the CDK-D Development Compounds and the CDK-non-D Development Compounds.

 

1.13 “CDK-D Development Compounds” shall mean compounds selected by DuPont Merck through the use of the CDK-D Targets for clinical development in the CDKD Field.

 

1.14 “CDK-non-D Development Compounds” shall mean compounds selected by DuPont Merck through the use of the CDK-non-D Targets for clinical development in the CDK-non-D Field.

 

2


1.15 “CDK Field” shall mean, collectively, the CDK-D Field and the CDK-non-D Field.

 

1.16 “CDK-D Field” shall mean the use of CDK-D Targets for the discovery, identification and development of CDK-D Development Compounds for all therapeutic indications and the use, manufacture, distribution, marketing and sale for all indications of therapeutic and Radiopharmaceutical agents incorporating CDK-D Development Compounds. The use of the CDK-D Targets for Antisense, Gene Therapy and all non-Radiopharmaceutical diagnostic applications is specifically excluded from the CDK-D Field.

 

1.17 “CDK-non-D Field” shall mean the use of CDK-non-D Targets for the discovery, identification and development of CDK-non-D Development Compounds for oncology indications and the use, manufacture, distribution, marketing and sale for oncology indications of therapeutic and Radiopharmaceutical agents incorporating CDK-non-D Development Compounds. The use of CDK-non-D Targets for Antisense, Gene Therapy and all non-Radiopharmaceutical diagnostic applications is specifically excluded from the CDK-non-D Field.

 

1.18 “CDK Patent Rights” shall mean those United States patents and patent applications and the international patent applications owned or licensed by Mitotix which may be useful in the CDK Field and which are identified in Appendix A and any division, continuation, continuation-in-part thereof, any foreign patent applications corresponding to any such applications or any United States or foreign patents or the equivalent thereof issuing thereon or any reissue or extension thereof. CDK Patent Rights shall also include those United States patents and patent applications and the international patent applications which may be useful in the CDK Field for which Mitotix may acquire, from a Third Party during the term of the CDK Research Program, license rights and the right to grant sublicenses (including rights acquired pursuant to the Mitotix Pending License Agreements), and any division, continuation, continuation-in-part thereof, any foreign patent applications corresponding to any such applications or any United States or foreign patents or the equivalent thereof issuing thereon or any reissue or extension thereof.

 

1.19 “CDK Products” shall mean pharmaceutical and Radiopharmaceutical compositions incorporating CDK-D Development Compounds or CDK-non-D Development Compounds whether such compounds are selected for development, developed, marketed or sold during the term of the CDK Research Program or thereafter.

 

1.20 “CDK Research Program” shall mean the research program described generally in Article 3 below and in the research work plan set forth in Appendix B hereto, as revised from time to time as provided in this Agreement.

 

1.21 “CDK Targets” shall mean collectively Targets included within the CDK-D Targets and the CDK-non-D Targets. CDK Targets shall specifically exclude cdc25 phosphatase and complexes thereof and all Targets included within the UBC Targets.

 

1.22 “CDK-D Targets” shall mean the following Targets: all cyclin Ds, associated cyclin dependent kinases, complexes thereof, and functional equivalents (all homologues of

 

3


cyclin Ds and associated cyclin dependent kinases) thereof; physically direct biochemical modulators of cyclin Ds or homologues thereof and of associated cyclin dependent kinases; and any targets of modulation of p16, functional homologues of p16, or other natural cell cycle modulators of cyclin Ds, their functional homologues, associated cyclin dependent kinases or complexes thereof.

 

1.23 “CDK-non-D Targets” shall mean all non-D cyclins, associated cyclin dependent kinases, complexes thereof, and functional equivalents (all non-D cyclin homologues and associated cyclin dependent kinases) thereof; physically direct biochemical modulators of non-D cyclins or homologues thereof and of associated cyclin dependent kinases; and any targets of modulation of natural cell cycle modulators of non-D cyclins, their functional homologues, associated cyclin dependent kinases or complexes thereof.

 

1.24 “Collaboration” shall have the meaning set forth in Section 2 below.

 

1.25 “Collaborative Policy Setting Committee” shall mean the joint committee composed of representatives of Mitotix and DuPont Merck described in Section 9.1 of this Agreement.

 

1.26 “Cyclin E License” shall mean the license agreement dated as of September 5, 1995 between Mitotix and Fred Hutchinson Cancer Research Center.

 

1.27 “Cyclin D License” shall mean the license agreement dated as of October 22, 1992 between Mitotix and Cold Spring Harbor Laboratory.

 

1.28 “Competitive Product” means a product directed at the same Target and having the same mechanism of action as a Royalty-Bearing Product or a Mitotix Product and which together with all other such products sold in a particular country, achieves sales in any Calendar Quarter equal to *** of the total gross sales or gross unit sales in such quarter of the Royalty-Bearing Product or Mitotix Product, as the case may be.

 

1.29 “Development Partner” shall mean a Third Party that is either (i) licensed by DuPont Merck to conduct all or a significant portion of the clinical development with respect to a particular Royalty-Bearing Product and to market and sell such Royalty Bearing-Product in a non-Strategic Country or (ii) licensed by Mitotix to conduct all or a significant portion of the clinical development with respect to a particular Mitotix Product and to market and sell such Mitotix Product in a non-Strategic Country.

 

1.30 “Distributor” shall mean a Third Party that is either (i) engaged by DuPont Merck to market and distribute Royalty-Bearing Products or (ii) engaged by Mitotix to market and distribute Mitotix Products.

 

1.31 “DuPont Merck Inventions” shall have the meaning set forth in Section 14.1 below.

 

1.32 “Effective Date” shall mean December 6, 1995.


***Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

 

4


1.33 “Extended UBC Collaboration” shall have the meaning set forth in Section 5.2 below.

 

1.34 “Extension Notice” shall have the meaning set forth in Section 5.2.2 below.

 

1.35 “First Commercial Sale” shall mean the first sale for use or consumption by the general public of a product in a country after required marketing and pricing approval has been granted by the governing health authority of such country.

 

1.36 “Gene Therapy” shall mean the introduction of a gene, together with associated regulatory elements, if any, into human cells (whether in vivo or ex vivo) in order to treat or prevent disease through the endogenous expression of the gene product in humans. Gene shall mean a DNA or RNA sequence of human or other origin that encodes a protein or other molecule.

 

1.37 “Immunoassay Product” shall mean an assay which contains a Development Compound or a metabolite derived therefrom as a standard reference and is sold by DuPont Merck, its Affiliates, Development Partners, Distributors or sublicensees in connection with a particular CDK Product or UBC Product for use in monitoring the level of the CDK Product or UBC Product, as the case may be, administered to a patient. All Immunoassay Products shall be Royalty Bearing Products.

 

1.38 “IND” shall mean an investigational new drug application filed with the United States Food and Drug Administration prior to beginning clinical trials in humans.

 

1.39 “Initial UBC Term” shall have the meaning set forth in Section 5.2 below.

 

1.40 “Inventions” shall have the meaning set forth in Section 14.1 below.

 

1.41 “IPO” shall have the meaning set forth in Section 5.9.2 below.

 

1.42 “Know-how” shall mean all confidential technical information in the possession of Mitotix or DuPont Merck during the term of this Agreement relating to the CDK Targets, the UBC Targets or relating to the discovery, development, manufacture, marketing and sale of the CDK Products or the UBC Products.

 

1.43 “Mitotix Inventions” shall have the meaning set forth in Section 14.1 below.

 

1.44 “Mitotix Pending License Agreements” shall mean those agreements under negotiation between Mitotix and a Third Party as of the Effective Date under which Mitotix will license patent rights or know-how that may be useful in the CDK Field or the UBC Field. The Mitotix Pending License Agreements are identified in Appendix E. Upon execution, such Mitotix Pending License Agreements shall be deemed to be Mitotix License Agreements.

 

1.45 “Mitotix License Agreements” shall mean those license agreements entered into by Mitotix and a Third Party on or prior to the Effective Date under which Mitotix has

 

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exclusively licensed patent rights or know-now that may be useful in the CDK Field or the UBC Field. The Mitotix License Agreements are listed in Appendix A and Appendix D.

 

1.46 “Mitotix Product” shall mean (i) any Antisense or Gene Therapy product sold by Mitotix for oncology indications incorporating a compound that was discovered or selected for development by Mitotix through the use of the CDK Targets or the UBC Targets and was first identified within *** years following the termination of the CDK Research Program (with respect to the use of the CDK Targets) or within *** years following the termination of the UBC Research Program (with respect to the use of the UBC Targets), and (ii) any products meeting the description of Mitotix Products set forth in Section 5.6, Section 5.8, Section 6.2 3(a)(i) or in Section 10.1.5.

 

1.47 “Net Sales” with respect to any product (UBC Product, Royalty-Bearing Product or Mitotix Product) shall mean the gross invoiced sales price of such product sold to independent Third Party customers, including but not limited to Distributors, in bona fide, arms-length transactions, less actual (to the extent not already deducted in the amount invoiced):

 

(a) quantity, cash, or other trade discounts actually accrued or taken;

 

(b) bad debt expense;

 

(c) custom duties, surcharges and taxes and other governmental charges incurred, if any, directly related to the sale;

 

(e) amounts repaid or credited by reason of rejections, return of goods, or retroactive price reductions;

 

(f) amounts incurred resulting from governmental, or an agency thereof, mandated rebate programs;

 

(g) third party rebates and chargebacks actually accrued or allowed;

 

(h) freight and insurance costs incurred in transporting such product to such customers; and

 

(i) as agreed by the parties, any other specifically identifiable amounts included in gross sales that were or ultimately will be credited and that are substantially similar to those listed herein above.

 

The amount of Net Sales for any period shall be determined on the basis of sales recorded in such period in accordance with generally accepted accounting principles. The transfer of any product by DuPont Merck or Mitotix, or one of their Affiliates, to another Affiliate of such party shall not be considered a sale; in such cases, Net Sales shall be determined based on the invoiced sales price by the Affiliate to an independent Third Party customer, less the deductions allowed under this Section.


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In the case of a Combination Product (said Combination Product being a pharmaceutical or Radiopharmaceutical product which contains one or more pharmacologically active ingredients in addition to the Royalty-Bearing Product, UBC Product, or Mitotix Product as the case may be) only, Net Sales shall be calculated on the basis of the invoice price for the product (Royalty-Bearing Product, UBC Product, or Mitotix Product as the case may be) containing the same weight of product and sold alone without other active ingredients. In the event that the product is not sold alone without other active ingredients, then Net Sales shall be the Net Sales of the Combination Product, determined as set forth above, multiplied by the fraction A/(A+B) where A is the seller’s cost of acquiring or manufacturing the product (Royalty-Bearing Product, UBC Product, or Mitotix Product as the case may be) and B is the seller’s cost of acquiring or manufacturing the other active ingredient(s) in the Combination Product, determined in accordance with generally accepted accounting principles.

 

1.48 “New UBC Target” shall mean a UBC Target that was not identified by Mitotix, DuPont Merck or a Third Party prior to the Effective Date and for which a novel screen and selectivity assays have been developed and validated for a specific therapeutic program as part of the UBC Collaboration. A Target shall not be a New UBC Target until approved by the Collaborative Policy Setting Committee as a New UBC Target as described in Section 5.8.

 

1.49 “NDA” shall mean a new drug application filed with the United States Food and Drug Administration after completion of human clinical trials to obtain marketing approval for a Royalty-Bearing Product, or the corresponding application for authorization for marketing for a Royalty-Bearing Product filed in any other country in accordance with the applicable laws and regulations of that country.

 

1.50 “Percentage Contribution” shall have the meaning set forth in Section 5.4.1 and Appendix H.

 

1.51 “p16 License” shall mean the license agreement dated as of July 1, 1995 between Mitotix and Cold Spring Harbor Laboratory.

 

1.52 “PRAD1 License” shall mean the license agreement dated as of August 25, 1995 between Mitotix and the General Hospital Corporation.

 

1.53 “Product Patent Rights” shall have the meaning set forth in Section 14.10.

 

1.54 “Radiopharmaceutical” shall mean any use for human in vivo medical imaging purposes.

 

1.55 “Radiopharmaceutical Product” shall mean any CDK Product or UBC Product used for human in vivo medical imaging purposes.

 

1.56 “Research Operating Committees” shall mean collectively the CDK Research Operating Committee and the UBC Research Operating Committee.

 

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1.57 “Research Year” shall mean each twelve-month period during the Collaboration, with the first Research Year beginning on January 1, 1996.

 

1.58 “Royalty-Bearing Products” shall mean (i) all CDK Products, (ii) all Radiopharmaceutical Products that are UBC Products, (iii) effective upon the initiation of the Alternate UBC Plan, all UBC Products; (iv) effective upon the deemed commencement of the Alternate UBC Plan for financial purposes following the commencement of the UBC Operational Disengagement Plan pursuant to Section 5.7, all UBC Products and (v) all Immunoassay Products; provided, however, that Royalty Bearing Products shall not include: (i) CDK Products incorporating compounds that are first identified more than *** years following the earlier of (X) the termination of the license grant set forth in Section 10.1.1 pursuant to Section 10.1.3 or (Y) the termination of the Agreement; and (ii) UBC Products incorporating compounds that are first identified more than *** years following the earlier of (X) the termination of the license grant set forth in Section 10.2.1 pursuant to Section 10.2.3 or (Y) the termination of this Agreement. In addition, any product meeting the description of a Royalty Bearing Product set forth in Section 6.2.3(a)(ii) shall be a Royalty Bearing Product.

 

1.59 “Royalty Term” shall mean, with respect to each product in each country, the period of time equal to the longer of (a) ten (10) years from the date of the First Commercial Sale of such product in such country or (b) if the manufacture, use or sale of such product in such country is covered by a Valid Patent Claim owned by or exclusively licensed to the party responsible for the relevant royalty payment, the term for which such Valid Patent Claim or any new Valid Patent Claim remains in effect.

 

1.60 “Strategic Countries” shall mean the United States of America, Canada, France, Germany, Italy, the United Kingdom and Spain.

 

1.61 “Target” shall mean a specific, identified biomolecule, including a protein, polynucleotide, carbohydrate, lipid, or any combination thereof.

 

1.62 “Third Party” shall mean any person or entity other than Mitotix or DuPont Merck and their respective Affiliates.

 

1.63 “UBC Collaboration” shall have the meaning set forth in Articles 2 and 5.

 

1.64 “UBC Deferral Payment” shall have the meaning set forth in Section 5.2.3.

 

1.65 “UBC Development Compounds” shall mean compounds selected by the Collaborative Policy Setting Committee through the use of UBC Targets for clinical development in the UBC Field, unless the Alternate UBC Plan is in effect, in which case “UBC Development Compounds” shall mean compounds selected by DuPont Merck through the use of UBC Targets for clinical development in the UBC Field.

 

1.66 “UBC Extension Payment” shall have the meaning set forth in Section 5.2.3.


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1.67 “UBC Field” shall mean use of the UBC Targets for the discovery, identification and development of UBC Development Compounds and the use, manufacture, distribution, marketing and sale for all indications of therapeutic and Radiopharmaceutical agents incorporating UBC Development Compounds. The use of the UBC Targets for Antisense, Gene Therapy and all non-Radiopharmaceutical diagnostic applications is specifically excluded from the UBC Field.

 

1.68 “UBC Operational Disengagement Plan” shall have the meaning set forth in Section 5.7.

 

1.69 “UBC Operating Profit” shall have the meaning set forth in Appendix I hereof.

 

1.70 “UBC Patent Rights” shall mean those United States patents and patent applications and the international patent applications owned or licensed by Mitotix which may be useful in the UBC Field and which are identified in Appendix D and any division, continuation, continuation-in-part thereof, any foreign patent applications corresponding to any such applications or any United States or foreign patents or the equivalent thereof issuing thereon or any reissue or extension thereof. UBC Patent Rights shall also include those United States patents and patent applications and the international patent applications which may be useful in the UBC Field for which Mitotix may acquire, from a Third Party during the term of the UBC Research Program, license rights and the right to grant sublicenses, and any division, continuation, continuation-in-part thereof, any foreign patent applications corresponding to any such applications or any United States or foreign patents or the equivalent thereof issuing thereon or any reissue or extension thereof.

 

1.71 “UBC Pricing Date” shall have the meaning set forth in Section 5.9.1.

 

1.72 “UBC Products” shall mean pharmaceutical and Radiopharmaceutical compositions incorporating UBC Development Compounds whether such compounds are selected for development, developed, marketed or sold during the term of the UBC Research Program or thereafter.

 

1.73 “UBC Research, Development and Pre-Launch Marketing Costs” shall have the meaning set forth in Appendix H.

 

1.74 “UBC Research Operating Committee” shall mean the joint committee composed of representatives of Mitotix and DuPont Merck described in Section 9.2 of this Agreement.

 

1.75 “UBC Research Program” shall mean the research program described generally in Section 6.1 and in the research workplan set forth in Appendix F hereto, as revised from time to time as provided in this Agreement.

 

1.76 “UBC Targets” shall mean the following Targets: (i) all ubiquitin-mediated proteolytic pathways, including enzymes and ligands involved in the ubiquitin-mediated degradation of proteins and (ii) all HPV-mediated ubiquitinylation, E6, E6AP, binding ligands thereof, associated complexes thereof, and direct biochemical modulators thereof. In

 

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the event that cdc25 proves to be a candidate for a New UBC Target as set forth in Section 1.44, it will be presented to the Collaborative Policy Setting Committee as such for evaluation as described in Section 5.8.

 

1.77 “UBC9 License” shall mean the license agreement dated as of March 8, 1995 between Mitotix and Harvard University.

 

1.78 “Unique Product” shall have the meaning set forth in Section 11.1.1.