Collaboration Agreement - Glaxo Research and Development Ltd., Glaxo Group Ltd. and Diversa Corp.
GLAXO RESEARCH AND DEVELOPMENT LIMITED
And
GLAXO GROUP LIMITED
And
DIVERSA CORPORATION
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COLLABORATION AGREEMENT
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CONTENTS
1 DEFINITIONS 3
2 RESPONSIBILITIES 6
3 PROJECT MANAGEMENT 9
4 IP OWNERSHIP 10
5 DESIGNATION OF BIOMOLECULES 11
6 BIOMOLECULE LICENSING TERMS 11
7 EXCLUSIVITY 15
8 DURATION AND TERMINATION 16
9 DISCLOSURE OF CONFIDENTIAL INFORMATION 17
10 ANNOUNCEMENTS AND PUBLICATIONS 18
11 REPRESENTATIONS AND WARRANTIES 19
12 ASSIGNMENT; AMENDMENT 20
13 ENTIRE AGREEMENT; SEVERABILITY 21
14 RELATIONSHIP OF PARTIES 21
15 FORCE MAJEURE 21
16 GOVERNING LAW AND DISPUTE SETTLEMENT 21
17 NOTICES; MISCELLANEOUS 22
18 MANUFACTURING RIGHTS 23
19 COLLABORATION AND LICENCE AGREEMENT RIGHTS AND
OBLIGATIONS 23
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This Collaboration Agreement (the "Agreement") is made as of 8/th/ December,
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2000 by and between Diversa Corporation of 4955 Directors Place, San Diego,
California 92121 (which together with its Affiliates shall be known as
"Diversa") and Glaxo Research and Development Limited of Glaxo Wellcome House,
Berkeley Avenue, Greenford, Middlesex UB6 ONN ("GRD") and Glaxo Group Limited of
Glaxo Wellcome House, Berkeley Avenue, Greenford, Middlesex UB6 ONN ("GGL," and,
together with Diversa and GRD, the "Parties").
WHEREAS:
A. Diversa and GGL have entered into a Heads of Agreement dated 19th September
2000 setting out the broad principles governing their relationship.
B. Diversa has certain IP (as defined below) which it is prepared to share
with GW and GW has certain screening expertise which it wishes to use with
such IP to identify Biomolecules.
C. For the duration of this Agreement the Parties will share certain
confidential and proprietary information to investigate whether the
Biomolecules are suitable for use in large scale screening programmes and
for further development and potential commercialisation in accordance with
the Project Plan (as defined below).
NOW, therefore, in consideration of the mutual covenants contained herein, and
for other good and valuable consideration, the receipt and sufficiency of which
the Parties hereby acknowledge, the Parties, intending to be legally bound
hereby, agree as follows:
1 DEFINITIONS
1.1 "Affiliate" shall mean any person, company or legal entity then directly or
indirectly controlled by, controlling or under common control with the
party with respect to which this term is associated. The term "control"
means ownership either of record or beneficially of more than fifty per
cent (50%) of the shares of any such person, company or legal entity or in
the absence of share ownership in the case of a non corporate entity the
ability to direct or cause the direction of the management and policies of
such non corporate entity;
1.2 "Annual Net Sales" shall mean the Net Sales achieved in any period
beginning on 1/st/ January and ending on 31/st/ December;
1.3 "Available Biomolecule" shall mean a Biomolecule covered by Joint IP or
Diversa IP and the structure of which has been (a) included on a GW Monthly
Report and (b) that is not the subject of any Third Party contractual
commitment with Diversa relating to Medical Use (existing at the time of
Diversa's receipt of the relevant GW Monthly Report) which would prohibit
it being exclusively made available to GW,
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pursuant to the terms of this Agreement. It is generally assumed that
Available Biomolecules will be [***];
1.4 "Background IP" shall mean the IP owned or licensed (with the right to
grant further rights thereunder) by each Party which exists at the date of
this Agreement and which is contributed to the Project Plan.
1.5 "Biomolecules" shall mean [***]. Notwithstanding the foregoing or anything
to the contrary contained herein, no [***], shall be deemed to be
Biomolecules under this Agreement; provided, however, that this limitation
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shall not apply with respect to [***], if any, [***] delivered by Diversa
to GW pursuant to [***] shall be deemed to be Biomolecules subject to the
first sentence of this Clause 1.5 and all other applicable provisions of
this Agreement).
1.6 "Confidential Information" shall have the meaning given to it in Clause
9.1;
1.7 "Designated Biomolecule" shall mean an Available Biomolecule designated by
GW in accordance with Clause 5.1 and [***];
1.8 "Diversa IP" shall mean all IP in-licensed by Diversa (with the right to
grant further rights thereunder) and all IP invented or discovered solely
by or on behalf of Diversa or Diversa's employees or agents arising under
this Agreement and all IP claiming or covering such inventions;
1.9 "Drug Candidate" shall mean a single Licensed Biomolecule that is approved
by the GW Drug Discovery Group or equivalent future body for preclinical
evaluation against a particular therapeutic target. Such approval will be
based on [***];
1.10 "Exclusive Biomolecules" shall mean (a) any Biomolecules identified by GW
and which are Available Biomolecules and which remain within the periods
of exclusivity granted pursuant to Clause 7.1 and (b) any Licensed
Biomolecules;
1.11 "Finished Product" shall mean any product in a form for use without any
further manipulation or transformation based on or incorporating a
Licensed Biomolecule or a GW Biomolecule;
1.12 "Force Majeure" shall have the meaning set out in Clause 15;
1.13 "FTE" shall mean the equivalent of one full year of work on a full time
basis (determined in accordance with Diversa's normal policies and
procedures relating to, for example, vacation periods) by a scientist or
other professional possessing the necessary skills and experience;
1.14 "GW" shall mean GRD and/or GGL together with all of their Affiliate
companies;
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1.15 "GW Biomolecules" shall mean all Biomolecules which are covered solely by
GW IP. It is generally assumed that GW Biomolecules will be [***];
1.16 "GW IP" shall mean all IP in-licensed by GW (with the right to grant
further rights thereunder) and all IP invented or discovered solely by or
on behalf of GW or GW's employees or agents arising under this Agreement
and all IP claiming or covering such inventions;
1.17 "GW Monthly Report" shall mean the report provided pursuant to Clause 2.4;
1.18 "IP" shall mean patents, trade marks, service marks, trade and service
names, copyrights, topography rights, tooling, database rights and design
rights (whether or not any of them are registered and including
applications for registration of any of them), know how, trade secrets,
confidential information (including the provision of materials hereunder)
and rights of confidence and all rights or forms of protection of a
similar nature or having equivalent or similar effect to them subsisting
anywhere in the world, excluding any information or materials that are in
the public domain and not subject to any form of intellectual property
protection;
1.19 "Joint IP" shall mean all IP invented or discovered jointly by GW and
Diversa arising under this Agreement and all IP claiming or covering such
inventions;
1.20 "Lead Series" shall mean [***] which is approved [***]. Such approval will
be based on [***];
1.21 "Licensed Biomolecules" shall mean Available Biomolecules (a) licensed by
GW under a formal Collaboration and Licence Agreement or (b) for which a
payment is due from GW under Clauses 6.3 and 6.4 (as may be varied by
Exhibit A) but for which no formal Licence Agreement has been entered
into;
1.22 "Major Markets" shall mean the five markets with the greatest number of
Net Sales in any relevant royalty reporting period;
1.23 "Medical Use" shall mean any use as a pharmaceutical, vaccine, or any
other drug for human administration;
1.24 "Net Sales" shall mean the gross amount invoiced by GW or any of its
licensees relating to the sale of Finished Product to external customers,
less goods returned, price discounts, volume discounts, commissions,
freight shown on customer invoices, early settlement discounts (where such
discounts are effectively non discretionary and are given as a matter of
normal commercial practice), rebates and other allowances off the invoiced
price, import, value added and any other sales taxes or withholding taxes
or any other governmental charges imposed and payable by GW to non-
Affiliates, other than income or franchise taxes or other charges based on
the income or franchise of GW. If a Licensed Biomolecule or GW Biomolecule
is sold in physical combination with another active product or products
where one or more of
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such components are not Licensed Biomolecules or GW Biomolecules, Net
Sales under such circumstances shall be calculated by multiplying Net
Sales of the combination product in each relevant market either by (i) the
fraction A/(A+B), in which A is the average selling price of the Licensed
Biomolecule(s) or GW Biomolecule (s) sold separately in the Major Markets
and B is the average selling price of the other active ingredients sold
separately in such markets, where the Licensed Biomolecule(s) or GW
Biomolecule (s) and other active ingredients are sold separately in such
markets or (ii) the fraction 1/N , in which N is the number of active
ingredients in the combination product, where one or more of the Licensed
Biomolecule(s) or GW Biomolecule (s) and other active ingredients are not
sold separately in such markets;
1.25 "Non Medical Use" shall mean any use other than Medical Use;
1.26 "Notification Period" shall mean, with respect to a particular Available
Biomolecule, the period within which GW must identify the Available
Biomolecule as a Designated Biomolecule and which shall begin on the date
of Diversa's receipt of the GW Monthly Report which first identifies that
Biomolecule and which shall end on [***];
1.27 "Project Plan" shall mean the project plan set forth in Exhibit B hereto
as it may be changed by written agreement of the PMC;
1.28 "PMC" shall mean the Project Management Committee as set out in Clause 3;
1.29 "Redesignated Biomolecules" shall mean a Designated Biomolecule that is
redesignated by GW in accordance with Clause 5.2 and [***];
1.30 "Redesignation Fee" shall mean the sum of [***] payable by GW to Diversa
pursuant to Clause 5.2;
1.31 "Third Party" shall mean any party other than GW or Diversa and their
respective Affiliates; and
1.32 "Valid Claims" shall mean, with respect to any country, a claim of an
issued and unexpired patent forming part of IP arising under this
Agreement in such country which has not been held unenforceable,
unpatentable or invalid by a decision of a court or other governmental
agency of competent jurisdiction, unappealable or unappealed within the
time allowed for appeal, and which has not been admitted to be invalid or
unenforceable through reissue or disclaimer or otherwise.
2 RESPONSIBILITIES
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2.1 Both Parties shall at all times carry out their obligations under this
Agreement fully in accordance with the Project Plan, except where such
obligations have been changed with the consent of the PMC.
2.2 In relation to materials provided under this Agreement the following terms
shall apply, provided always that the provisions do not conflict with or
reduce the rights granted in relation to GW's use of Biomolecules or reduce
either Party's other rights granted under this Agreement:-
2.2.1 GW will provide to Diversa specified materials as set forth in
the Project Plan, to be used solely for the research work to be
performed under the Project Plan. Diversa agrees to return to GW
all documents, samples and other tangible items containing or
representing Confidential Information of GW on request.
2.2.2 Diversa has provided to GW specified materials as set forth in
the Materials Transfer Agreement dated 3rd November 2000, as
amended, between Diversa and GRD and will provide to GW certain
materials as set forth in the Project Plan, in each case, to be
used solely for the research work to be performed as set forth in
such Materials Transfer Agreement and under the Project Plan
respectively. Upon execution of this Agreement, such Materials
Transfer Agreement shall terminate, and the Parties' respective
provision and use of all materials shall be governed by the terms
of this Agreement. Except as specifically set forth in this
Agreement, GW shall not modify such materials in any way, reverse
engineer such materials, use such materials for reproduction, or
offer such materials or any derivative thereof for resale. GW
agrees to return to Diversa all documents, samples and other
tangible items containing or representing Confidential
Information of Diversa on request.
2.2.3 The materials provided under Clauses 2.2.1 and 2.2.2, including,
without limitation, the materials provided under the Materials
Transfer Agreement, are of an experimental nature, are for
laboratory research use only and have not been approved for
diagnostic or therapeutic use in humans or animals; are provided
without any warranties, express or implied, INCLUDING ANY
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE,
neither Party makes any representation that the use of the
materials will not infringe any patent or proprietary rights of
Third Parties and neither Party accepts any liability in
connection with their use, storage and disposal.
2.2.4 GW shall retain the sole and absolute ownership of all materials
provided by GW and Diversa shall retain the sole and absolute
ownership of all materials provided by Diversa. Subject to the
payment obligations set forth herein, each Party shall
additionally retain the sole and absolute ownership of all IP
invented solely by them.
2.2.5 Each Party agrees that the other Party's materials shall not be
distributed to
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any Third Party or entity, except to their respective Affiliates,
without the prior written consent of the other Party.
2.2.6 Each Party agrees that it shall not file any patent directed to
or including any claim covering a particular use of the other
Party's materials, other than (a) as it is entitled to under the
terms of this Agreement; or (b) where the disclosing Party gives
its prior written consent.
2.2.7 None of the materials provided hereunder shall be used for any
commercial development directly or indirectly other than as
permitted under the terms of this Agreement.
2.3 Each Party shall submit a written report to the PMC at the end of each
phase of the research as set forth in the Project Plan. Such reports shall
contain the results of the research conducted by such Party.
2.4 It is anticipated that GW's screening and subsequent structure elucidation
will identify active Biomolecules. On a monthly basis, GW shall prepare and
deliver to the PMC the GW Monthly Report. The contents of the GW Monthly
Report shall include:-
2.4.1 [***];
2.4.2 [***];
2.4.3 [***];
2.4.4 [***];
2.4.5 [***].
2.4.6 [***].
2.5 Diversa shall notify the PMC as soon as practicable following Diversa's
receipt of a GW Monthly Report, but in any event within [***] following
such time, whether any of the Biomolecules (excluding the GW Biomolecules)
included in such GW Monthly Report are not Available Biomolecules. Diversa
shall have no obligations, and GW shall have no rights, under this
Agreement with respect to any Biomolecules (excluding the GW Biomolecules)
other than Available Biomolecules. Diversa confirms that it will supply to
GW, upon request, [***]. For the avoidance of doubt, the GW Biomolecules
are excluded from this Clause 2.5 since these are not subject to the
restrictions that apply to Available Biomolecules, and, accordingly, GW
shall be free to use all GW Biomolecules, subject only to those provisions
contained herein that expressly relate to GW Biomolecules.
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3 PROJECT MANAGEMENT
3.1 If such a meeting has not yet been held then, within 2 weeks of the date of
this Agreement, the Parties shall establish and hold the first meeting of
the PMC. The members of the PMC shall be 4 in number with 2 appointees from
GW and 2 appointees from Diversa. A quorum will be at least one member
appointed by GW and at least one member appointed by Diversa.
3.2 At the first meeting of the PMC the members shall appoint one of their
number to be Chairman and one of their number to be Secretary of the PMC.
3.3 Except as mutually agreed by the Parties, the PMC shall meet on a monthly
basis at such venue as the members shall agree and each Party shall be
responsible for all of the costs incurred by their respective appointees in
attending such meetings. Meetings of the PMC may be held by telephone or
video conference, provided that all members are able to hear each other.
3.4 Adequate minutes of the PMC meetings shall be kept by the Secretary who
shall also maintain an official record of the decisions made by the PMC.
Copies of all minutes and other resolutions of the PMC shall be given to
the respective PMC members for approval. The review and approval of the
minutes and other resolutions of the previous meeting and any decisions
taken by written circular shall be a regular item on the agenda of each
meeting. Consensus decisions taken by the PMC within the limits of its
powers may be implemented immediately at the members discretion provided a
copy of the minutes and resolutions are circulated and signed by all
members of the PMC.
3.5 The PMC shall endeavour to reach decisions through consensus but shall take
formal decisions by majority vote. Decisions may be taken at a meeting or
through a written circular signed by all members of the PMC.
3.6 Upon receiving reasonable advance notice from the Diversa appointees to the
PMC, one of the GW appointees shall be required to [***].
3.7 The PMC will be responsible for, among other things:-
3.7.1 strategic guidance of the work under this Agreement,
3.7.2 monitoring the delivery of the Project Plan,
3.7.3 research and development decisions and overseeing the day-to-day
management of the work under this Agreement,
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3.7.4 reviewing the GW Monthly Reports provided by GW and agreeing any
changes to the exclusivity status of Available Biomolecules
contained in the GW Monthly Report. The representatives of either
Party on the PMC may not unreasonably withhold agreement as to
the exclusivity status of such Available Biomolecules.
4 IP OWNERSHIP
4.1 Each Party shall continue to own their own Background IP and shall be free
to exploit it in any way subject to the terms of this Agreement.
4.2 All GW IP whether patentable or not shall be the sole and absolute property
of GW and GW shall have the sole prerogative to seek or not seek at its own
expense patent or other IP protection for any such inventions including but
not limited to Biomolecules, processes, formulations and uses.
4.3 All Diversa IP whether patentable or not shall be the sole and absolute
property of Diversa and Diversa shall have the sole prerogative to seek or
not seek at its own expense patent or other IP protection for any such
inventions including but not limited to Biomolecules, processes,
formulations and uses.
4.4 Each Party undertakes to sign, execute and do and shall sign, execute and
do at their own expense all such deeds, documents and things which in the
other Party's reasonable opinion may be necessary and desirable to vest
such inventions and any patents or patent applications relating thereto in
the relevant Party or their Affiliates. For the avoidance of doubt, the
Party in whom any invention, patent, or patent application is to vest shall
bear all costs associated with such application and the other Party shall
only be responsible for its own costs incurred in assisting the Party who
is applying for such patent or patent application.
4.5 Each Party shall have the right to use the Joint IP for its own use with no
rights to sub-license without the agreement of suitable terms with the
other Party. The following shall apply to all Joint IP:-
4.5.1 The Parties shall be jointly responsible for filing patent
applications relating to Joint IP.
4.5.2 The Parties shall mutually agree in writing which Party shall
file, prosecute and maintain all such patents relating to the
Joint IP and shall mutually agree on the strategy relating to
such filing, prosecution and maintenance, the costs of which
shall be shared equally between the Parties.
4.5.3 In the event that the Parties cannot agree on which Party shall
file, prosecute and maintain Joint IP patents, the Parties shall
select outside Counsel reasonably acceptable to both Parties to
perform such responsibilities, and the Parties shall have equal
control and joint responsibility for costs incurred in connection
with the applicable patents on the Joint IP.
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4.6 During the term of this Agreement, (a) Diversa shall hold GW harmless from
and against claims by Diversa of infringement of Diversa IP and Diversa
Background IP with respect to GW's activities in accordance with this
Agreement (generally consisting of [***]) and (b) GW shall hold Diversa
harmless from and against claims by GW of infringement of GW IP and GW
Background IP with respect to Diversa's activities in accordance with this
Agreement (generally consisting of [***]), in each case solely for the
purposes of carrying out the Project Plan. The provisions of this Clause
4.6 are intended to permit both Parties to carry out their respective
responsibilities and perform their respective obligations under this
Agreement and the Project Plan without fear of being made a party to any
legal action concerning infringing any IP of the other Party that is used
to carry out such responsibilities or perform such obligations. However,
neither Party intends to grant to the other Party any licence to use its
Background IP or, in the case of Diversa, the GW IP and, in the case of GW,
the Diversa IP, to perform any activities beyond the scope of the roles and
responsibilities assigned to the Parties under this Agreement and the
Project Plan.
5 DESIGNATION OF BIOMOLECULES
5.1 Following the first appearance of an Available Biomolecule in any given GW
Monthly Report, GW will undertake as soon as possible (and in any event
within the Notification Period) to notify Diversa whether or not GW has any
interest in such Available Biomolecule. Each Available Biomolecule in which
GW has notified Diversa that it has interest shall be deemed to be a
Designated Biomolecule.
5.2 With respect to each Designated Biomolecule, GW will have an additional
[***] period following the expiry of the Notification Period to decide
whether to continue to pursue investigation of such Designated Biomolecule.
Each Designated Biomolecule which GW has notified Diversa that it will
continue to investigate shall be deemed a Redesignated Biomolecule subject
to payment of the Redesignation Fee by [***]. Such Redesignation Fee will
be payable for [***].
6 BIOMOLECULE LICENSING TERMS
6.1 In the event that GW wishes to develop and commercialise any Available
Biomolecules, GW will have the right to obtain from Diversa an exclusive
licence to [***], subject to the terms of this Agreement.
6.2 GW's use of any Licensed Biomolecule [***], would be:-
6.2.1 solely for Medical Use; and
6.2.2 subject to the milestone and royalty terms specified in Clauses
6.3, 6.4 and 6.6; and
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6.2.3 subject to [***]; and
6.2.4 subject to GW continuing to use all its reasonable efforts to
continue with its development programme and, if applicable,
commercialisation efforts, with respect to each Licensed
Biomolecule.
6.3 The terms of the licence granted to GW would be negotiated in good faith on
a case by case basis, taking into account the relative contributions of GW
and Diversa in the light of the overall costs and risks associated with
bringing a new medicine from discovery to the market. Accordingly, [***].
These payment terms [***] shall also apply to any GW Biomolecules developed
and commercialised by GW. For the avoidance of any doubt, [***].
6.4 Payments shall be made by GW to Diversa [***] once in respect of each
Licensed Biomolecule and/or GW Biomolecule developed by GW upon achievement
of the specified milestones:-
6.4.1 GW's first selection of a Licensed Biomolecule and/or GW
Biomolecule [***];
6.4.2 GW's first selection of a Licensed Biomolecule and/or GW
Biomolecule [***];
6.4.3 GW's first selection of a Licensed Biomolecule and/or GW
Biomolecule [***];
6.4.4 First entry of a Licensed Biomolecule and/or GW Biomolecule into
[***];
6.4.5 First entry of a Licensed Biomolecule and/or GW Biomolecule into
[***]
6.4.6 [***] of a Licensed Biomolecule and/or GW Biomolecule: [***] .
6.5 GW shall notify Diversa as soon as practicable following achievement of any
of the milestones set forth above with respect to a Licensed Biomolecule
and/or GW Biomolecule. Following such notice, Diversa shall issue an
invoice to GW relating to the relevant payment obligation. All payments due
under Clause 6.4 shall be payable as soon as practicable thereafter, but in
no event later than thirty (30) days following GW's receipt of the invoice.
6.6 GW will pay royalties to Diversa on Net Sales of any Finished Product on a
country by country basis for the period in which there is a Valid Claim in
that country which provides patent protection for the Finished Product,
[***]:-
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6.6.1 Annual Net Sales up to [***]: [***]
6.6.2 Annual Net Sales from [***] to [***]: [***]
6.6.3 Annual Net Sales over [***]: [***].
As an example, for the avoidance of doubt (and assuming for this
purely illustrative purpose that [***]) in the event that GW has
Annual Net Sales of a Finished Product equal to [***], the royalty
payment would be [***], calculated as follows: [***].
6.7 All royalties shall be paid quarterly within sixty (60) days of the
end of the relevant quarter on a country by country basis. GW shall
submit to Diversa within sixty (60) days of the end of each year of
this Agreement, a dated statement showing inter alia:-
6.7.1 Net Sales of the Finished Product in United States Dollars
in each country where GW has sold any Finished Product
during that year and the royalties payable thereon in United
States Dollars to Diversa utilising the rate of exchange
methodology set out in Clause 6.8; and
6.7.2 withholding taxes or any cross border transfer funds
withheld or deducted pursuant to applicable law.
6.8 The rate of exchange to be used in calculating the amount of currency
equivalent in United States Dollars payable shall be an average for
the calendar month in which Net Sales of Finished Product are made,
determined by dividing (i) the sum of the rates applying to each
Friday of such month, published in the London edition of the Financial
Times on Mondays by (ii) the number of Fridays in such month for which
such rate information is available. In the event that any payment due
hereunder and not disputed in good faith is not made when due, the
payment shall accrue interest from that date due at the rate of [***]
Citibank, N.A., New York, New York, applicable to such time, to be
compounded on an annual basis; provided however, that in no event
shall such rate exceed the maximum legal annual interest rate. The
payment of such interest shall not limit either Party from exercising
any other rights it may have as a consequence of the lateness of any
payment.
6.9 GW shall keep for rolling three year periods accurate, up to date
books and records of Net Sales of the Finished Product in sufficient
detail and in such form so as to enable the royalties payable by GW to
be properly determined.
6.10 GW shall permit an independent chartered or certified public
accountant appointed by Diversa, at Diversa's expense, to examine all
such books and records as are referred to in Clause 6.9 in respect of
any period pertaining to the Net Sales of the Finished Product for the
sole purpose of verifying the royalties payable during such period
provided:-
6.10.1 reasonable prior written notice is given to GW;
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6.10.2 access is only required during normal working hours; and
6.10.3 Diversa and the auditor shall keep and shall use best
endeavours to procure that any representatives of it shall
keep confidential any information which it may acquire in
the exercise of its rights under this Clause (except to the
extent necessary to enforce Diversa's rights hereunder).
GW shall promptly pay to Diversa the amount of any underpayment of
royalties as determined by such examination. In addition,
notwithstanding the foregoing, in the event that the results of any
such examination demonstrate a discrepancy of greater than [***] of
reported royalties payable, GW shall reimburse Diversa for the expense
of conducting such examination.
6.11 All of the above milestones would be payable [***].
6.12 GW will have no right to develop and commercialise any Available
Biomolecule(s) and/or GW Biomolecule (s) without making the relevant
milestone and royalty payments, if any, that are applicable to such
Available Biomolecule(s) and/or GW Biomolecule (s) as specified in
Clauses 6.3, 6.4 and 6.6.
6.13 The amounts set out in Clauses 5.2, 6.4 and 6.6 represent the maximum
extent of GW's financial obligations under this Agreement. Diversa
agrees that [***].
6.14 Notwithstanding the grant of the exclusive licence to GW pursuant to
Clause 6.1:-
6.14.1 Both Parties shall only be entitled to [***];
6.14.2 Both Parties shall be allowed independently or in
collaboration to [***];
6.14.3 Diversa shall be granted the right to [***].
6.15 In the case of Clause 6.14.1, GW's work shall be solely for the
purpose of [***].
6.16 In the case of Clauses 6.14.1 and 6.14.2:
6.16.1 Diversa's work is likely to include, but not be limited
to, [***], whilst GW's work may include, but not be
limited to, [***]. GW's work shall be carried out
solely by GW and shall not involve Third Parties;
6.16.2 GW's freedom to [***] would be subject to [***];
6.16.3 GW would be free to [***] without [***].
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6.17 In the case of Clauses 6.14.1 through 6.14.3, any work on [***] shall
be restricted to the scope of this Agreement.
7 EXCLUSIVITY
7.1 Diversa shall grant GW the exclusive right to use all Licensed
Biomolecules [***] in accordance with the terms of this Agreement or
the different terms of any applicable licence agreement. In addition,
Diversa shall grant GW the exclusive right to use all Available
Biomolecules [***] in accordance with this Agreement, until:-
7.1.1 Expiry of the Notification Period, without GW electing to
designate such Available Biomolecule as a Designated
Biomolecule; or
7.1.2 Expiry of [***] from the end of the Notification Period
without GW electing to redesignate such Designated
Biomolecule as a Redesignated Biomolecule, subject to the
payment of the Redesignation Fee; or
7.1.3 Expiry [***] from redesignation of any Designated
Biomolecule as a Redesignated Biomolecule, without the
Redesignated Biomolecule becoming a Licensed Biomolecule.
7.1.4 Notification by GW during any of the time periods set out in
Clauses 7.1.1 through 7.1.3, or, consistent with Clause
6.2.4 above, that GW does not intend, or no longer intends,
to pursue investigation of that Available Biomolecule. GW
shall undertake to ensure such notice is given to Diversa in
a timely manner following GW's decision not to pursue
investigation of the Available Biomolecule or following GW
decision not to continue to use all its reasonable efforts
to continue with its development programme with respect to
the Available Biomolecule.
7.2 Where exclusivity lapses, as set forth in Clause 7.1, Diversa shall be
free to use the relevant Available Biomolecule [***] for any purpose,
including research and commercialisation purposes, subject to:-
7.2.1 the Parties agreeing to licensing terms with respect to
Diversa's use of GW Background IP or Joint IP if any and if
required, and
7.2.2 any applicable provisions of a Collaboration and Licence
Agreement regarding [***] and
7.2.3 the PMC agreeing the changed exclusivity status of such
Available Biomolecules.
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At Diversa's request, with respect to the procedure referred to in
Clause 7.2.1 above, GW shall, in good faith, engage in licensing
negotiations with Diversa.
7.3 With respect to GW Biomolecules which have appeared in a GW Monthly
Report and which GW no longer wishes to develop or commercialise,
Diversa shall have the right to obtain a [***] to [***], subject to
[***].
7.4 In the event that Diversa enters into an agreement with a Third Party
in any therapeutic field, all of GW's rights which are not affected by
Diversa's Third Party agreement shall be preserved, including, without
limitation, and if available, the opportunity to obtain access to the
therapeutic field which is the subject of Diversa's agreement with a
Third Party on a non-exclusive basis and/or to any other therapeutic
fields outside the therapeutic field which is the subject of Diversa's
agreement with a Third Party and/or to obtain exclusivity in respect
of [***].
8 DURATION AND TERMINATION
8.1 Subject to Clause 8.2, this Agreement will begin on the date hereof
and will continue unless terminated in accordance with Clause 8.2. For
the avoidance of any doubt the term of the research work as set forth
in the Project Plan shall not exceed one year from the date of this
Agreement, except as mutually agreed to by the Parties.
8.2 This Agreement may be terminated:-
8.2.1 at any time by mutual written agreement of the Parties, and
either Party shall have the right to terminate this
Agreement following [***] from the date hereof upon [***]
written notice to the other Party; or
8.2.2 by either Party if the other Party shall become insolvent or
makes any arrangement or composition with its creditors generally
or if it has a Receiver or Manager or Administrative Receiver or
Administrator appointed to the whole or part of its assets or if
an order shall be made or resolution passed for its winding up
(other than for the purposes of a bona fide scheme for solvent
amalgamation or reconstruction); or
8.2.3 if both Parties agree due to an event of Force Majeure or if
either Party so elects after an event of Force Majeure has
continued for a period greater than three months.
8.3 If GW solely terminates this Agreement for any reason other than related to
Diversa breach or insolvency, then all [***] shall be destroyed or returned
to Diversa at Diversa's request, except any [***] which GW can continue to
use and exploit subject to complying with its obligations under this
Agreement and any formal Licence Agreement under which [***] were licensed
to GW and except any GW Biomolecules which GW can continue to use and
exploit subject to complying with its obligations under this Agreement.
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8.4 Except as set forth in Clause 8.3 above, termination of this Agreement
shall not affect Diversa's and GW's rights and obligations hereunder with
respect to Exclusive Biomolecules and/or GW Biomolecules at the time of
such termination, including, without limitation, GW's rights to [***], and
GW's obligations to make [***] payments under the terms of this Agreement.
9 DISCLOSURE OF CONFIDENTIAL INFORMATION
9.1 For the purpose of this Agreement "Confidential Information" shall mean any
and all information, including but not limited to, the existence of and
terms of this Agreement, data, know-how, and any and all subject matter
(whether patentable or not) pertaining to the Parties' research,
inventions, development, materials, technology, business plans, processes,
protocols, enzymes, the commercial applications of enzymes, accessing
microbial diversity, manipulating and modifying pathways, identifying
bioactive compounds through recombinant techniques, Biomolecules, clones,
and any other elements of the Parties' business, which the Parties consider
to be of value (including, for the avoidance of any doubt, all financial,
sales, royalty and milestone information contained within this Agreement or
to be disclosed pursuant to this Agreement).
9.2 A Party (the "Receiving Party") as recipient of Confidential Information
from the other Party (the "Disclosing Party") shall only disclose such
Confidential Information to those of its employees with a special need to
know such Confidential Information and any of its employees to whom
Confidential Information is disclosed shall be informed of the proprietary
nature of the Confidential Information and shall be bound by this agreement
of confidentiality in the same manner that the Receiving Party is bound. A
Receiving Party shall not disclose to any Third Parties any Confidential
Information received from the Disclosing Party hereunder, except as
required by law or under the provisions of this paragraph of this
Agreement. Each Party shall immediately notify the other upon discovery of
any loss or unauthorized disclosure of the Confidential Information of the
other Party.
9.3 The Receiving Party shall have no obligations to the Disclosing Party with
respect to the use, or disclosure to others not party to this Agreement, of
such information which:-
9.3.1 prior to disclosure was known to or in the possession of the
Receiving Party as evidenced by such Party's written records; or
9.3.2 is or becomes publicly known during the term of this Agreement,
other than through a breach of the Receiving Party's obligations
hereunder; or
9.3.3 is received from a Third Party having no obligations of
confidentiality to the Disclosing Party hereunder; or
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9.3.4 is developed by the Receiving Party independently of any
disclosures made under this Agreement, as evidenced by such
party's written records; or
9.3.5 is required by law or bona fide legal process to be disclosed,
provided that the Party required to make the disclosure takes all
reasonable steps to restrict and maintain the confidentiality of
such disclosure and provides reasonable notice to the Party
providing the Confidential Information; or
9.3.6 is authorized to be released in a written release by the
Disclosing Party.
9.4 Specific items of Confidential Information shall not fall within any
exception merely because they are embraced by more general information
falling within any exceptions and any combinations of specific items of
Confidential Information are themselves within any exceptions, but only if
the combination itself, and its principles or operation, fall within one of
such exceptions.
9.5 The Receiving Party shall not use Confidential Information received from
the Disclosing Party for any purpose other than for discussion and research
work with the Disclosing Party under this Agreement.
9.6 Confidential Information shall not be reproduced in any form except as
required to accomplish the intent of this Agreement. Any reproduction of
any Confidential Information of the Disclosing Party by either Party shall
remain the property of the Disclosing Party unless otherwise authorized in
writing by the Disclosing Party.
9.7 The Receiving Party agrees, upon request, to promptly return all tangible
items relating to Confidential Information of the Disclosing Party,
including but not limited to, all materials, written materials, drawings,
data and records provided or otherwise made available by the Disclosing
Party, and all copies thereof.
9.8 The rights and obligations set forth in this Clause 9 and in Clause 10.2
below shall survive the termination or expiration of this Agreement for a
period of ten (10) years after such termination or expiration.
10 ANNOUNCEMENTS AND PUBLICATIONS
10.1 If Diversa wishes to make any announcement regarding this transaction,
Diversa shall issue a press release regarding this Agreement which shall be
mutually agreed to by the Parties in writing.
10.2 Except for the information disclosed in the joint press release, neither
Party shall use the name of the other Party or reveal the existence of or
terms of this Agreement in any publication, publicity or advertising
without the prior written approval of the other party, except that:-
10.2.1 either Party may use the text of a written statement approved in
advance by both Parties without further approval, and
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10.2.2 either Party shall have the right to identify the other Party and
to disclose the terms of this Agreement as required by applicable
securities laws or other applicable law or regulation, provided
that such Party takes reasonable and lawful actions to minimize
the degree of such disclosure.
11 REPRESENTATIONS AND WARRANTIES
11.1 GW represents and warrants to Diversa that each of GRD and GGL is a
corporation duly organised and validly existing under the laws of the
United Kingdom and that entry into and performance of this Agreement by
each of GRD and GGL has been authorised by all necessary corporate action
and does not conflict with any law or regulation to which either of them
may be subject.
11.2 Diversa represents and warrants to GW that it is a corporation duly
organised and validly existing under the laws of the State of Delaware and
that its entry into and performance of this Agreement has been authorised
by all necessary corporate action and does not conflict with any law or
regulation to which it may be subject.
11.3 Both Parties shall comply at all times with all relevant legislation, laws,
customs, practice, regulations and clinical guidance and best practice in
conducting the Project Plan and in developing and selling Finished Product,
including, but not limited to, complying with export control laws that
apply to them.
11.4 The failure by a Party to exercise or enforce any right conferred upon it
under this Agreement shall not be deemed to be a waiver of such right nor
shall it operate to bar the exercise or enforcement thereof at any time or
times thereafter.
11.5 GW hereby acknowledges that the data and any materials to be provided by
Diversa under this Agreement will be of an experimental nature, provided
without warranties, and Diversa shall accept no liability in connection
with their use, storage and disposal by GW. EXCEPT AS EXPRESSLY SET FORTH
IN THIS AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY TO
THE OTHER PARTY OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING, WITHOUT
LIMITATION, ANY WARRANTY OF NON-INFRINGEMENT, MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT. WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, EACH PARTY ACKNOWLEDGES THAT THIS AGREEMENT
PROVIDES FOR AN INNOVATIVE PROGRAMME USING NEW TECHNOLOGIES AND THAT NO
WARRANTY IS MADE REGARDING THE SUCCESS OF ANY RESEARCH DONE PURSUANT TO
THIS AGREEMENT OR THE UTILITY OF ANY INFORMATION, MATERIALS OR TECHNOLOGY
PROVIDED HEREUNDER. EACH PARTY EXPRESSLY DISCLAIMS ALL WARRANTIES AS TO THE
VALIDITY OR SCOPE OF PATENTS AND PATENT CLAIMS, ISSUED AND PENDING,
PROTECTING ITS TECHNOLOGY OR THAT ANY TECHNOLOGY WILL BE FREE FROM
INFRINGEMENT OF PATENTS OR PROPRIETARY RIGHTS OF THIRD
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PARTIES, OR THAT NO THIRD PARTIES ARE IN ANY WAY INFRINGING PATENT RIGHTS.
11.6 IN NO EVENT WILL EITHER PARTY, ITS DIRECTORS, OFFICERS, EMPLOYEES OR AGENTS
BE LIABLE TO THE OTHER PARTY FOR ANY INDIRECT, INCIDENTAL, EXEMPLARY OR
CONSEQUENTIAL DAMAGES, WHETHER BASED UPON A CLAIM OR ACTION OF CONTRACT,
WARRANTY, NEGLIGENCE, STRICT LIABILITY, TORT OR OTHERWISE, ARISING OUT OF
THIS AGREEMENT.
11.7 GW (the "Indemnitor") shall indemnify, defend, and hold harmless Diversa
and its directors, officers, employees, and agents and their respective
successors, heirs and assigns (the "Indemnitees"), against any liability,
damage, loss, or expense incurred by or imposed upon the Indemnitees or any
one of them in connection with any claims, settlements, suits, actions,
demands, or judgments arising out of any theory of product liability
(including, but not limited to, actions in the form of tort, warranty, or
strict liability) concerning any product (or any process or service) that
is made, used, or sold by the Indemnitor or its Affiliates or sublicensees
pursuant to any right or license granted under this Agreement; provided,
however, that such indemnification right shall not apply to any liability,
damage, loss, or expense to the extent directly attributable to the
negligence, reckless misconduct, or intentional misconduct of the
Indemnitees. An Indemnitee shall not be entitled to indemnification for the
settlement of any claim pursuant to this Agreement unless it obtains the
prior written consent of the Indemnitor to such settlement.
11.8 Any Indemnitee that intends to claim indemnification under Clause 11.7
shall promptly notify the Indemnitor of any claim in respect of which he
intends to claim such indemnification, and the Indemnitor shall assume the
defence thereof with counsel mutually satisfactory to the Parties;
provided, however, that an Indemnitee shall have the right to retain its
own counsel, with the fees and expenses of no more than the law firm
representing all Indemnitees in the proceeding or related proceeding, to be
paid by the Indemnitor, if representation of such Indemnitee by the counsel
retained by the Indemnitor would be inappropriate due to actual or
potential differing interests between such Indemnitee and any other party
represented by such counsel in such proceedings. The indemnity agreement in
Clause 11.7 shall not apply to amounts paid in settlement of any loss,
claim, liability or action if such settlement is effected without the
consent of the Indemnitor. The failure to deliver notice to the Indemnitor
within a reasonable time after the commencement of any such action, shall
not relieve the Indemnitor of any liability to the Indemnitee under Clause
11.7, except to the extent the Indemnitor has been prejudiced by such
failure to give notice. Each Party and its Affiliates and their employees
and agents shall cooperate fully with the other Party and its legal
representatives in the investigation of any action, claim or liability
covered by this indemnification.
12 ASSIGNMENT; AMENDMENT
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12.1 Except as may be otherwise provided herein, no Party may assign (other
than to any Affiliate company) or otherwise delegate any or all of its
rights or obligations under this Agreement without the prior written
consent of the other Party, which consent shall not be unreasonably
withheld. Notwithstanding the foregoing, either Party may, without the
consent of the other Party, assign any or all of its rights and
obligations under this Agreement to a successor to all or substantially
all of the business of such Party to which this Agreement relates, whether
by merger, sale of stock, sale of assets or otherwise; provided that, in
the event of any such transaction, no intellectual property rights of any
Third Party that is an acquiring party in such transaction will be
included in the technology subject to this Agreement and provided that the
acquiring party assumes all obligations of its assignor under this
Agreement. In the event that any assignee of Diversa's is a competitor of
GW's or is an adverse litigant with GW in any litigation, then GW may
terminate this Agreement upon completion of such merger or sale subject to
any licences granted pursuant to this Agreement remaining in full force
and effect.
12.2 No modification or amendment of this Agreement shall be valid or binding
upon the Parties unless made in writing and duly executed by an authorised
representative of each Party.
13 ENTIRE AGREEMENT; SEVERABILITY
13.1 This Agreement and its Schedules constitute the entire agreement between
the Parties with respect to the subject matter hereof and supersedes
entirely any other document, agreement or understanding between Diversa
and GW with respect to the subject matter hereof, including, without
limitation, the non-binding Heads of Agreement dated 19th September 2000
between Diversa and GGL and the Materials Transfer Agreement dated 3rd
November 2000, as amended, between Diversa and GRD.
13.2 If any provision of this Agreement shall be determined to be invalid or
unenforceable, the validity and enforceability of the other provisions of
this Agreement shall not be affected thereby.
14 RELATIONSHIP OF PARTIES
14.1 The Parties are independent contracting parties. Nothing in this Agreement
shall operate to constitute any Party as the agent or partner of any other
Party.
15 FORCE MAJEURE
15.1 If any Party is unable to perform any of its duties under this Agreement
(other than the payment of any monies due and owing) due to the occurrence
of an event of Force Majeure, then performance of such obligation shall be
excused to the extent and for the period required by such cause. For
purposes of this Agreement, "an event of force majeure" shall mean an
event that is unforeseeable and of which the occurrence and consequences
cannot be prevented or avoided by the Parties.
16 GOVERNING LAW AND DISPUTE SETTLEMENT
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16.1 This Agreement shall be governed by and construed in accordance with the
laws of England.
16.2 Any dispute, controversy or claim arising out of or relating to this
Agreement, or the interpretation, breach, termination or validity hereof,
shall be resolved in the first instance through friendly consultation.
Such consultation shall begin immediately after one Party has delivered to
the other Parties a written request for such consultation.
16.3 If within 30 days following the date on which a notice described in Clause
16.2 is given the dispute cannot be resolved, the dispute may be submitted
to any form of alternative dispute resolution as the Parties may agree or
failing such agreement to the non-exclusive jurisdiction of the English
Courts or any other court of competent jurisdiction.
17 NOTICES; MISCELLANEOUS
17.1 All notices and other communications hereunder shall be in writing and
shall be sent by registered mail, courier or facsimile to the following
addresses or to such other addresses as may be designated by a Party
pursuant to a written notice to the other:
17.2 If to Diversa to the address set out above
Fax: 1 858 526 5050
Attention: President
with a copy to:
Cooley Godward LLP
4365 Executive Drive, Suite 1100
San Diego, CA 92121
Attention: L. Kay Chandler, Esq.
Telephone: 1 858 550 6014
Fax: 1 858 453 3555
17.3 If to GW to the address set out above:
Fax: 44 (0)208 966 8837
Attention: The Company Secretary
17.4 The date on which notice shall be deemed to have been effectively given
shall be determined as follows:
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17.4.1 Notice given in letter form shall be deemed effectively given on
the 7th day after the date mailed (as indicated by the postmark)
by registered mail, airmail postage prepaid or the day of actual
delivery if delivered by courier; and
17.4.2 Notice given by fax shall be deemed effectively given on the
first business day following the date of transmission of a notice
requesting confirmation of receipt, as indicated on the fax in
question.
17.5 This Agreement may be executed via facsimile and in one or more
counterparts, each of which shall be deemed an original, and all of which
together shall be deemed to be one and the same instrument.
18 MANUFACTURING RIGHTS
18.1 GW shall grant Diversa [***], provided:-
18.1.1 GW [***];
18.1.2 the manufacturing route is [***];
18.1.3 [***].
For the avoidance of any doubt [***].
18.2 If GW wishes to manufacture [***], GW shall have the right to [***].
For the avoidance of any doubt [***].
19 COLLABORATION AND LICENCE AGREEMENT RIGHTS AND OBLIGATIONS
19.1 The Option. Upon expiration or termination or at anytime during the course
of this Agreement, the Parties will have the option to proceed into a
Collaboration and Licence Agreement. Should the Parties mutually decide to
proceed into a Collaboration and Licence Agreement the terms of the
Collaboration and Licence Agreement would be negotiated in good faith and
in a timely manner, and would include, but not be limited to, the
following terms set forth in Clauses 19.2 through 19.9 in addition to any
applicable terms as contained in this Agreement. For the avoidance of any
doubt, the Parties agree that [***].
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19.2 The PMC. The role of the PMC would be expanded to include, among other
things, [***]. The representatives of either Party on the PMC may not
unreasonably withhold agreement as to [***].
19.3 [***]. GW shall pay Diversa [***], to be agreed to by the Parties, ranging
from [***], depending on the scope and term of the collaboration. The
payments would be phased over the term of the Collaboration and Licence
Agreement as agreed by the Parties.
19.4 Change to Non-Exclusive Collaboration. During the period of the
Collaboration and Licence Agreement, (a) Diversa shall hold GW harmless
from and against claims by Diversa of infringement of Diversa IP and
Diversa Background IP with respect to GW's activities in accordance with
the Collaboration and Licence Agreement and (b) GW shall hold Diversa
harmless from and against claims by GW of infringement of GW IP and GW
Background IP with respect to Diversa's activities in accordance with the
Collaboration and Licence Agreement, in each case solely for the purposes
of carrying out the Collaboration and Licence Agreement. To the extent
that Diversa would be contractually permitted at the time of execution of
the Collaboration and Licence Agreement, the Collaboration and Licence
Agreement shall provide for Diversa and GW to collaborate on a non-
exclusive basis, except that Diversa would agree to work exclusively with
GW on the development of Available Biomolecules for Medical Use in any
field of use as the Parties may agree, subject to GW's payment to Diversa
of [***] and other terms to be agreed to by the Parties.
19.5 Milestone and royalty amendment. Clauses 6.3, 6.4 and 6.6 would continue
to apply in relation to the Collaboration and Licence Agreement for any
[***], as well as any [***]. Payment terms in respect of any Available
Biomolecule, [***] would be negotiated in good faith without reference to
the payment terms specified in this Agreement.
19.6 FTE Contribution. GW will pay FTE costs to Diversa:-
19.6.1 only to the extent that the costs are [***];
19.6.2 FTEs will be reimbursed at the rate to be agreed upon by the
Parties during negotiation of the Collaboration and Licence
Agreement, but in the order of, and at a minimum of, [***] per
annum;
19.6.3 the rate set out in Clause 19.6.2 will be subject to annual
salary inflation, subject to a maximum of [***] per annum;
19.6.4 the minimum number of FTEs [***];
19.6.5 funding by GW of GW funded FTEs for the project will be [***].
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19.7 [***]. In addition to the terms governing the Parties' use of Exclusive
Biomolecules, Diversa [***], Diversa [***].
19.8 Reporting. In addition to the Parties' reporting requirements set out in
this Agreement, on a monthly basis, Diversa shall prepare and deliver to
the PMC a cumulative bi-monthly report ("Diversa Bi-Monthly Report")
setting out [***], as well as a record of [***]. The report will indicate,
among other things, [***].
19.9 Termination. In addition to the termination provisions set out in this
Agreement, if Diversa solely terminates the Collaboration and Licence
Agreement, then subject to any other agreement between GW and Diversa,
Diversa shall at GW's request either [***] or [***].
(signature page follows)
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AS WITNESS the hands of the Parties or their duly authorised representative's
the day and year first above written.
SIGNED by:
/s/ Jay M. Short
___________________________________
Name: Jay M. Short, Ph.D.
Title: President and Chief Executive Officer
a duly authorised representative
for and on behalf of
Diversa Corporation
SIGNED by:
/s/ Allan Baxter
___________________________________
Name: Dr. Allan Baxter
Title: Director, Group Discovery
a duly authorised representative
for and on behalf of
Glaxo Research and Development Limited
SIGNED by:
/s/ S.M. Bicknell
___________________________________
Name: S.M. Bicknell
Title: Assistant Secretary
a duly authorised representative
for and on behalf of
Glaxo Group Limited
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EXHIBIT A
[***]
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EXHIBIT B
Glaxo Wellcome - Diversa Collaboration Agreement
Recombinant Natural Product Screening
Project Plan
[***]
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