Patent License Agreement [IL-5] - Protein Design Labs Inc. and SmithKline Beecham Corp.
IL-5 PATENT LICENSE AGREEMENT
between
PROTEIN DESIGN LABS, INC.
and
SMITHKLINE BEECHAM CORPORATION
This IL-5 Patent License Agreement ("Agreement"), effective as of
September 28, 1999 ("Effective Date"), is made by and between PROTEIN DESIGN
LABS, INC., a Delaware corporation having offices at 34801 Campus Drive,
Fremont, CA 94555 (hereinafter "PDL") and SMITHKLINE BEECHAM CORPORATION, a
Commonwealth of Pennsylvania corporation having offices at One Franklin Plaza,
Philadelphia, PA 19101 (hereinafter "SB").
RECITALS
A. SB desires to exclusively license certain patents owned or
controlled by PDL related to humanized antibodies directed against the IL-5
antigen; and
B. PDL and SB are contemporaneously entering into an Patent Rights
Agreement (the "Rights Agreement") that grants SB an option to obtain certain
nonexclusive license rights under patents and patent applications owned or
controlled by PDL and a Development and License Agreement for an antibody
directed against the IL-4 antigen (the "Development and License Agreement").
In consideration of SB's obligations under this Agreement, PDL is willing to
exclusively license to SB certain patents owned or controlled by PDL related
to humanized antibodies directed against the IL-5 antigen under the terms and
conditions of this Agreement.
AGREEMENT
NOW THEREFORE, in consideration of the mutual covenants herein contained
and intending to be legally bound, the parties agree as follows:
1. DEFINITIONS
Except as otherwise expressly provided herein, all references to
Exhibits, Articles and Sections shall be references to Exhibits, Articles and
Sections of this Agreement, and the following terms in this Agreement shall
have the following meanings:
1.01 "Affiliate" shall mean any corporation, firm, partnership or other
entity, whether de jure or de facto, which directly or indirectly owns, is
owned by or is under common ownership with a party to this Agreement to the
extent of at least fifty percent (50%) of the equity (or such lesser
percentage which is the maximum allowed to be owned by a foreign corporation
in a particular jurisdiction) having the power to vote on or direct the
affairs of the entity and any person, firm, partnership, corporation or other
entity actually controlled by, controlling or under common control with a
party to this Agreement; provided however any such person, corporation, firm,
partnership or other entity shall be deemed an Affiliate only for so long as
it meets the requirements of this definition.
1.02 "Antibody" shall mean any antibody, including without limitation,
monospecific and bispecific antibodies; less than full-length antibody forms
such as Fv, Fab, and F(ab')2; single-chain antibodies; and antibody conjugates
bound to a toxin, label or other moiety.
1.03 "Combination Product(s)" shall mean any product containing both a
pharmaceutically active agent or ingredient which constitutes a Licensed
Product and one or more other pharmaceutically active agents or ingredients
which do not constitute Licensed Products.
1.04 "IL-5" shall mean the human cytokine Interleukin 5.
1.05 "Licensed PDL Patents" shall mean all United States and foreign
patents and patent applications identified on Exhibit A (including any and all
continuations, continuations-in-part, divisions, patents of addition,
reissues, renewals or extensions thereof, all SPCs (as defined below) thereof
and all patents issuing thereof. Exhibit A will be updated by PDL on a semi-
annual basis.
1.06 "Licensed Product(s)" shall mean human prophylactic, therapeutic,
and/or palliative products that include an Antibody [CONFIDENTIAL TREATMENT
REQUESTED].
1.07 "Major Countries" shall mean the United States, Japan, the United
Kingdom, France, Italy, Spain and Germany.
1.08 "Marketing Approval" shall mean the first approval or
authorization in a country which is required for the marketing, promotion and
sale of Licensed Product in such country.
1.09 "Net Sales" shall mean the gross invoice price or contract price
from sales of Licensed Products in a form for use by an end user and not
intended for further genetic manipulation or transformation in the Territory
by SB, its Affiliates and sublicensees ("the Selling Party") to Third Parties
less
[CONFIDENTIAL TREATMENT REQUESTED]
Sales between SB, its Affiliates and its or their sublicensees shall be
excluded from the computation of Net Sales and no payments will be payable on
such sales except where such Affiliates or sublicensees are end users, but Net
Sales shall include the subsequent final sales to Third Parties by SB or such
Affiliates or sublicensees. [CONFIDENTIAL TREATMENT REQUESTED]
If SB or any of its Affiliates or sublicensees receive non-cash consideration
for any Licensed Product sold or otherwise transferred to Third Party, the
fair market value of such non-cash consideration on the date of such transfer
as known to SB, or as reasonably estimated by SB if unknown, shall be included
in the definition of Net Sales.
1.10 "SPC" shall mean a right based upon a patent to exclude others
from making, using or selling Licensed Product, such as a Supplementary
Protection Certificate.
1.11 [CONFIDENTIAL TREATMENT REQUESTED].
1.12 "Territory" shall mean worldwide, except in countries where SB's
rights terminate hereunder pursuant to Section 7.02(b) and/or Section 7.02(e).
1.13 "Third Party" shall mean any party other than SB, PDL and their
respective Affiliates.
1.14 "Valid Claim" shall mean [CONFIDENTIAL TREATMENT REQUESTED].
2. LICENSE
2.01 License Grant. Subject to the terms and conditions of this
Agreement and in consideration of SB's fulfillment of its obligations to PDL
under this Agreement, PDL hereby grants and SB hereby accepts a worldwide,
exclusive (except as provided in Sections 2.05 and 5.03) license under the
Licensed PDL Patents, including the right to grant sublicenses with respect to
Licensed Products in accordance with Section 2.02, to make, have made, import,
use and sell Licensed Products in the Territory.
2.02 Limitation on Sublicenses; Notification.
(a) Subject to Section 2.02(b), SB shall have the right to grant
sublicenses of its rights under Section 2.01 with respect to Licensed
Products, provided that (i) SB shall grant such sublicenses only in connection
with the assignment or license by SB to such sublicensee of the right to use,
make, have made, sell or otherwise transfer the Licensed Products in such
country and (ii) [CONFIDENTIAL TREATMENT REQUESTED]. Notwithstanding the
assignment or grant of a sublicense by SB hereunder, SB shall remain obligated
to pay all royalties due to PDL with respect to the sale of Licensed Products
by its assignee or sublicensee. In addition, the grant of any sublicenses
under Section 2.01 shall be on terms and conditions which are subject to and
subordinate to the terms of this Agreement and SB shall remain fully
responsible to PDL for the performance of any and all such terms by its
sublicensees. Promptly following execution of any sublicense hereunder, SB
shall notify PDL of the identity of the sublicensee and the scope of the
sublicense and provide a copy of the sublicense agreement, which copy may be
redacted to protect confidential technical or financial information.
(b) [CONFIDENTIAL TREATMENT REQUESTED]
2.03 Updates to List of Licensed PDL Patents. Not later than December
31 of each year during the term of this Agreement or earlier upon written
request of SB (which request shall not be made more than twice per calendar
year), PDL agrees to provide a written update listing the Licensed PDL
Patents, and such update shall constitute an amendment to Exhibit A.
2.04 No Other License Rights. SB expressly acknowledges and agrees
that, except for the license expressly granted under Section 2.01, no rights
to any other PDL patents or patent applications, or to any know-how, trade
secrets or licenses are included in this Agreement or granted by implication,
estoppel or otherwise.
2.05 [CONFIDENTIAL TREATMENT REQUESTED]
3. PAYMENTS, ROYALTIES, REPORTS
3.01 Signing and Licensing Fee. In consideration for the license
granted by PDL under Article 2 of this Agreement, SB shall pay to PDL a
nonrefundable non-creditable signing and licensing fee within ten (10)
business days of the Effective Date in the sum of [CONFIDENTIAL TREATMENT
REQUESTED].
3.02 Annual Maintenance Fee. In consideration of the rights and
licenses granted under Article 2 of this Agreement, not later than September
15, 2001 and continuing annually thereafter, SB shall pay PDL a nonrefundable
annual maintenance fee in the amount of [CONFIDENTIAL TREATMENT REQUESTED]
within thirty (30) days of each such anniversary. Such annual maintenance fees
shall be [CONFIDENTIAL TREATMENT REQUESTED]against royalties due to PDL in the
calendar year paid.
3.03 Royalties to PDL. In further consideration of the rights and
licenses granted under Article 2 of this Agreement, subject to Section 2.05,
SB shall pay to PDL the following royalties on Net Sales of Licensed Product
sold by SB, its Affiliates or sublicensees, as applicable:
[CONFIDENTIAL TREATMENT REQUESTED]
3.04 Combination Products. Net Sales in a particular country, in the
case of Combination Products for which the pharmaceutically active agent or
ingredient constituting a Licensed Product and each of the other
pharmaceutically active agents or ingredients not constituting Licensed
Products have established market prices in that country when sold separately,
shall be determined by multiplying the Net Sales for each such Combination
Product by a fraction, the numerator of which shall be the established market
price for the Licensed Product(s) contained in the Combination Product and the
denominator of which shall be the sum of the established market prices for the
Licensed Product(s) plus the established market prices for the other
pharmaceutically active agents or ingredients contained in the Combination
Product. When such separate market prices are not established in that
country, then the parties shall negotiate in good faith to determine a fair
and equitable method of calculating Net Sales in that country for the
Combination Product in question.
3.05 Currency Conversion. All amounts payable to PDL under this
Agreement shall be payable in U.S. Dollars by wire transfer to a bank account
designated by PDL. In the case of royalties on Net Sales, all amounts payable
shall first be calculated in the currency of sale and then converted into U.S.
Dollars using the actual average exchange rates for such currency as used by
SB in producing its quarterly and annual accounts, as confirmed by SB's
auditors.
3.06 Reports.
(a) Current Reports. SB agrees to make written reports and royalty
payments to PDL within forty-five (45) days after the close of each calendar
quarter during the term of this Agreement, beginning with the calendar quarter
in which the date of first commercial sale or other transfer for value of a
Licensed Product by SB, its Affiliates or sublicensees in the Territory
occurs. These reports shall be certified by a duly authorized employee in the
Finance Department of SB and shall state for the calendar quarter in question:
(1) identification on a country-by-country basis of each Licensed Product upon
which SB is paying royalties; (2) Net Sales by SB and its Affiliates of such
Licensed Products; (3) Net Sales reported by sublicensees of such Licensed
Products; (4) the place of manufacture of such Licensed Productssold in such
quarter; (5) applicable offsets or deductions and (6) the net royalty due to
PDL thereon pursuant to this Article 3. No later than at the time of the
making of each such report, SB shall make any payment due to PDL of royalties
for the period covered by such report.
(b) Termination Report. For each Licensed Product, SB also agrees to
make a written report to PDL within ninety (90) days after the date on which
SB, its Affiliates or sublicensees last sell or otherwise transfer for value
the Licensed Product anywhere in the Territory stating in such report the same
information required by quarterly reports for all such Licensed Products made,
sold or otherwise disposed of which were not previously reported to PDL.
(c) Notification of Marketing Approval. SB agrees to notify PDL in
writing within ten (10) days after the end of each month of the countries in
the Territory in which SB, its Affiliates or sublicensees obtains Marketing
Approval of a Licensed Product in the preceding month. Such notice shall
specify the country and date of Marketing Approval. SB shall assist PDL and
provide reasonable cooperation (including the execution and timely delivery of
any documents, certifications and the like) in obtaining any extensions of the
Licensed PDL Patents with respect to any Licensed Product in any country in
which SB markets Licensed Products.
3.07 Inspection. SB agrees to keep, and to require any of its
Affiliates or sublicensees to keep, clear, accurate and complete records for a
period of at least three (3) years for each reporting period in which Net
Sales occur showing the manufacture, sales, use and other dispositions for
value of Licensed Products in sufficient detail to enable the royalties
payable hereunder to be determined. SB further agrees to permit its books and
records, and to require any of its Affiliates or sublicensees to permit their
books and records, to be examined by an independent accounting firm selected
by PDL and reasonably acceptable to SB from time-to-time during regular
business hours, but not more than once a year. Such independent accounting
firm shall report to PDL only with respect to the accuracy of Net Sales and
deductions reported and payments made by SB to PDL under this Agreement. All
information disclosed in any such inspection shall be deemed confidential
under the terms of this Agreement. [CONFIDENTIAL TREATMENT REQUESTED]
3.08 Withholding. SB may withhold from royalties due to PDL amounts
for payment of any withholding tax that SB has paid to any taxing authority
with respect to the royalty amounts due to PDL hereunder for which SB does not
receive a refund or credit. SB agrees to reasonably cooperate with PDL in
obtaining a foreign tax credit in the U.S. with respect to royalties due to
PDL on the sale or manufacture of Licensed Products.
3.09 Interest on Overdue Royalties. SB shall be liable for interest on
any overdue royalties, at the rate of [CONFIDENTIAL TREATMENT REQUESTED]per
annum, commencing on the date such royalties are due until paid.
4. LICENSED PDL PATENTS
4.01 Prosecution and Maintenance. PDL shall have the sole right to
prepare, file, prosecute, maintain and extend, at its expense, all Licensed
PDL Patents, provided that SB shall have the right to assume responsibility,
at SB's expense, for preparing, filing, prosecuting, maintaining and extending
any such patent or patent application, or any part thereof, which PDL intends
to abandon or otherwise cause or allow to be forfeited.
4.02 Infringement of Licensed PDL Patents.
(a) Notice. In the event that PDL or SB becomes aware of actual or
threatened infringement of a Licensed PDL Patent anywhere in the Territory,
which infringement relates to an antibody that binds to the IL-5 antigen, that
party shall promptly notify the other party in writing. The notice shall
describe in reasonable detail the facts and circumstances forming the basis
for the determination that there is actual or threatened infringement. In the
event the notice specifies threatened, but not actual infringement, the
parties agree to discuss in good faith the proper course of action; provided,
however, that PDL shall have the final decision making authority with respect
to such course of action. [CONFIDENTIAL TREATMENT REQUESTED]
(b) PDL First Right to Litigate For Actual Infringement. PDL shall
have the first right but not the obligation to bring an infringement action or
file any other appropriate judicial action or claim directly related to actual
infringement of the Licensed PDL Patents against any Third Party that relates
to an antibody that binds to the IL-5 antigen (an "Action") and, if necessary,
to use SB's name in connection therewith and to include SB as a party thereto.
In the event PDL brings an Action, SB shall reimburse PDL for [CONFIDENTIAL
TREATMENT REQUESTED] in enforcing and/or defending the Licensed PDL Patents in
such Action, including without limitation the expenses directly related to the
preparation of such litigation; provided however that SB shall not be required
to reimburse PDL for those expenses that arise from any claims or suits that
are not related to the Licensed PDL Patents or are not related to an antibody
that binds to the IL-5 antigen. Subject to Section 4.04, PDL shall have sole
control over any Action, including without limitation the right to select
counsel for such action; provided, however that PDL shall solicit, and
seriously consider in good faith SB's input with respect to all material
aspects of such Action, including without limitation the development of the
litigation strategy and the execution thereof. In furtherance but not in
limitation of the foregoing, PDL shall keep SB promptly and fully informed of
the status of any such Action, and SB shall have the right to review and
comment upon PDL's activities related thereto. SB shall consult with PDL
concerning such action at no cost to PDL. To the extent PDL elects its first
right to bring an Action in any country of the Territory, PDL shall use
commercially reasonable good faith efforts, in each such country, to
diligently pursue such Action and obtain results that are consistent with the
respective objectives of the parties under this Agreement. In the event that
PDL initiates an Action hereunder but subsequently determines not to proceed,
PDL shall provide SB with prompt written notice of such determination and SB
shall have the right to continue such Action as provided in Section 4.04(c).
(c) SB's Right to Litigate for Actual Infringement. [CONFIDENTIAL
TREATMENT REQUESTED] Subject to Section 4.04, SB shall have sole control over
any Action initiated pursuant to this Section 4.02(c), including without
limitation the right to select counsel for such action; provided, however that
SB shall solicit, and seriously consider in good faith PDL's input with
respect to all material aspects of such Action, including without limitation,
the development of the litigation strategy and the execution thereof. In
furtherance but not in limitation of the foregoing, SB shall keep PDL promptly
and fully informed of the status of any such Action, and PDL shall have the
right to review and comment upon SB's activities related thereto. PDL shall
consult with SB concerning such action at no cost to SB. To the extent SB
elects its right to bring an Action, SB shall use commercially reasonable good
faith efforts to diligently pursue such Action and obtain results in each
country that are consistent with the respective objectives of the parties
under this Agreement.
4.03 Litigation and Settlement Costs. Allocation of costs and expenses
and recoveries shall be as follows: [CONFIDENTIAL TREATMENT REQUESTED]
4.04 Cooperation and Settlement. The parties shall keep one another
informed of the status of and of their respective activities regarding any
Action, including without limitation any discussion concerning the settlement
thereof. No settlement or consent judgment or other voluntary final
disposition of any suit defended or action brought by one party pursuant to
this Article 4 may be entered into without the consent of the non-settling
party if, and only if, such settlement would require the non-settling party to
be subject to an injunction, to make a monetary payment or would adversely
affect the non-settling party's rights under this Agreement, including without
limitation any settlement concerning the validity or scope of the Licensed PDL
Patents or any settlement concerning SB's exclusive license to the Licensed
PDL Patents set forth in this Agreement.
4.05 Infringement of Third Party Intellectual Property Rights.
(a) Notice. In the event of the institution of any suit by a Third
Party against SB or its respective sublicensees or Affiliates for patent
infringement involving the manufacture, use, importation, sale, distribution
or marketing of Licensed Product anywhere in the Territory, SB shall promptly
notify PDL in writing.
(b) Rights to Defend. SB shall have the right but not the obligation
to defend such suit at its own expense, and to use PDL's name in connection
therewith. Notwithstanding the foregoing, the responsibility for any claim
relating to the invalidity or unenforceability of the Licensed PDL Patents
shall be determined in accordance with Section 4.02.
(c) Cooperation and Settlement. SB shall keep PDL fully informed of
the status of its activities regarding any such action, including without
limitation any discussion concerning the settlement thereof. No settlement or
consent judgment or other voluntary final disposition of any suit defended or
action brought by SB pursuant to this Section 4.05 may be entered into without
the prior written consent of PDL if such settlement would require PDL to be
subject to an injunction, to make a monetary payment or would adversely affect
the Licensed PDL Patents.
4.06 [CONFIDENTIAL TREATMENT REQUESTED]
5. REPRESENTATIONS AND WARRANTIES; DISCLAIMERS; INDEMNIFICATION
5.01 Valid Agreement.
(a) Each party represents and warrants to the other that it knows of
no legal reason to prevent it from entering into this Agreement and that the
signatory hereto is duly authorized to execute and deliver this Agreement.
(b) PDL represents and warrants to SB that it has the right to grant
the licenses to SB provided under this Agreement.
5.02 [CONFIDENTIAL TREATMENT REQUESTED]
5.03 Disclaimers. Nothing in this Agreement shall be construed as (a)
a warranty or representation by PDL as to the validity, enforceability or
scope of any Licensed PDL Patents; (b) a requirement that PDL file any patent
application, or secure any patent or patent rights, or maintain any patent in
force, or provide copies of patent applications to SB or its Affiliates or
sublicensees, or disclose any inventions described or claimed in such patent
applications; or (c) a warranty or representation by PDL that any Licensed
Product made, used, sold or otherwise disposed of under the license granted in
this Agreement is or will be free from infringement of patents, copyrights,
trademarks, trade secrets or other rights of third parties. SB acknowledges
and agrees that any royalties or payments that may be due to third parties in
order for SB to make, have made, use, sell or otherwise dispose of Licensed
Products shall be the sole responsibility of SB.
5.04 Existing License. SB acknowledges that PDL has previously granted
a non-exclusive license, with no ability to sublicense, to a Third Party under
the Licensed PDL Patents, the relevant terms of which have been previously
provided to SB.
5.05 No Other Warranties. EXCEPT AS SPECIFICALLY SET FORTH IN ARTICLE
5, PDL MAKES NO REPRESENTATIONS OR WARRANTIES OF ANY KIND, EITHER EXPRESS OR
IMPLIED, WITH RESPECT TO THE LICENSED PDL PATENTS OR ANY CELL LINES,
ANTIBODIES OR LICENSED PRODUCTS DEVELOPED BY SB UNDER THE LICENSE SET FORTH IN
THIS AGREEMENT AND PDL FURTHER MAKES NO EXPRESS OR IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE USE OF
LICENSED PDL PATENTS OR ANY CELL LINES, ANTIBODIES, LICENSED PRODUCTS OR OTHER
MATERIALS DEVELOPED BY SB UNDER THE LICENSE SET FORTH IN THIS AGREEMENT WILL
NOT INFRINGE ANY THIRD PARTY RIGHTS.
5.06 Indemnification. Except as otherwise set forth in Article 4
(which Article governs indemnification regarding Licensed PDL Patents), SB
shall at all times, during the term of this Agreement and thereafter,
indemnify and hold harmless PDL and its Affiliates, sublicensees, directors,
officers, agents and employees from any claim, proceeding, loss, expense, and
liability of any kind whatsoever (including but not limited to those resulting
from death, personal injury, illness or property damage and including legal
expenses and reasonable attorneys' fees) ("PDL Losses") arising out of or
resulting from third party claims based upon the development, manufacture,
holding, use, testing, advertisement, sale or other disposition by SB, its
Affiliates or sublicensees, or any distributor, customer or representative
thereof or any one in privity therewith, of any Licensed Product; provided,
however, that such indemnity shall not apply to the extent any such PDL Losses
result from the negligence or willful misconduct of PDL or breach by PDL of
any representation, warranty or other provision of this Agreement.
In the event PDL is seeking indemnification from SB under this Section
5.06, SB shall have no such obligation unless PDL:
(i) gives SB prompt notice of any claim or lawsuit or other action for
which it seeks to be indemnified under this Agreement;
(ii) cooperates fully with SB and its agents in defense of any such
claim, complaint, lawsuit or other cause of action; and
(iii) SB is granted full authority and control over the defense,
including settlement or other disposition thereof, against such claim or
lawsuit or other action, provided that PDL shall have the right to retain
counsel of its choice to participate in the defense of any such claim or
lawsuit at PDL's own expense, provided that such counsel shall not interfere
with SB's full authority and control.
6. CONFIDENTIALITY
(a) During the term of this Agreement and for five (5) years
thereafter, PDL and SB shall not use or reveal or disclose to Third Parties
any confidential information received from the other in the performance of
activities in furtherance of this Agreement without first obtaining the
written consent of the disclosing party, except (i) as may be otherwise
provided herein, (ii) as may be required for purposes of developing,
manufacturing or marketing Licensed Product, (iii) as may be required for
securing essential or desirable authorizations, approvals, privileges or
rights from governmental agencies or as may be required by law, statute or
regulation to be disclosed to a governmental agency, provided that the party
disclosing such information will use reasonable efforts to ensure that the
confidentiality of such confidential information is maintained by such
government regulatory agencies, (iv) as may be required or as necessary to
file or prosecute patent applications concerning Licensed Product, (v) or as
may be required to carry out any litigation concerning Licensed Product
provided that the party disclosing such information will use reasonable
efforts to ensure that the confidentiality of such confidential information is
maintained. This confidentiality obligation shall not apply to confidential
information which is or becomes a matter of public knowledge through no fault
of the receiving party, or is already in the possession of the receiving
party, or is disclosed to the receiving party by a Third Party having the
right to do so, or is subsequently and independently developed by employees of
the receiving party or Affiliates thereof who had no knowledge of the
confidential information disclosed. The parties shall take reasonable
measures to assure that no unauthorized use or disclosure is made by others to
whom access to confidential information is granted.
(b) Nothing herein shall be construed as preventing either party from
disclosing any information received from the other party to:
(i) an Affiliate, sublicensee or distributor of the receiving party,
provided such Affiliate, sublicensee or distributor has undertaken a similar
obligation of confidentiality with respect to the confidential information;
(ii) the FDA in connection with the approval to conduct clinical
studies, manufacture, market or sell Licensed Product; or
(iii) any securities exchange to which the receiving party may be
subject if necessary to meet the requirements, rules and regulations of such
securities exchange, but only to the extent such disclosure is reasonably
required and subject to obligations of confidentiality wherever possible.
(c) All confidential information disclosed by one party to the other
shall remain the intellectual property of the disclosing party. In the event
that a court or other legal or administrative tribunal, directly or through an
appointed master, trustee or receiver, assumes partial or complete control
over the assets of a party to this Agreement based on the insolvency or
bankruptcy of such party, the bankrupt or insolvent party shall promptly
notify the court or other tribunal (i) that confidential information received
from the other party under this Agreement remains the property of the other
party and (ii) of the confidentiality obligations under this Agreement. In
addition, the bankrupt or insolvent party shall, to the extent permitted by
law, take all steps necessary or desirable to maintain the confidentiality of
the other party's confidential information and to ensure that the court, other
tribunal or appointee maintains such information in confidence in accordance
with the terms of this Agreement.
7. TERM AND TERMINATION
7.01 Term. Unless earlier terminated as provided in this Article 7,
SB's obligations to pay royalties to PDL hereunder shall come into force on
the Effective Date and shall continue, on a country by country basis,
[CONFIDENTIAL TREATMENT REQUESTED]. Unless earlier terminated, this Agreement
shall expire upon the expiration of all SB's royalty obligations to PDL
hereunder. Expiration of this Agreement or expiration of SB's obligation to
pay royalties to PDL in any country hereunder shall not preclude SB from
continuing to market or have marketed Licensed Product in such country without
further payment to PDL.
7.02 Termination.
(a) If either party shall at any time default in the payment of any
royalty, or the making of any report hereunder, or shall commit any material
breach of any covenant or agreement herein contained or shall make any false
report, and shall fail to have initiated and actively pursued remedy of any
such default or breach within (i) fifteen (15) days after receipt of written
notice of failure to pay royalties hereunder, or (ii) forty-five (45) days
after receipt of written notice of any default or breach (other than failure
to pay royalties) by the other party, the non-breaching party may, at its
option, cancel this Agreement and revoke any rights and licenses herein
granted and directly affected by the default or breach by notice in writing to
such effect, but such act shall not prejudice the right of the party giving
notice to recover any royalty or other sums due at the time of such
cancellation, it being understood, however, that if within forty-five (45)
days after receipt of any such notice the receiving party shall have initiated
and actively pursued remedy of its default (other than failure to pay
royalties), then the rights and licenses herein granted shall remain in force
as if no breach or default had occurred on the part of the receiving party,
unless such breach or default is not in fact remedied within a reasonable
period of time.
(b) [CONFIDENTIAL TREATMENT REQUESTED]
(c) This Agreement may be terminated by either party upon the
occurrence of any of the following which is not stayed or vacated within
ninety (90) days of such occurrence: (i) petition in bankruptcy filed by or
against the other party; (ii) adjudication of the other party as bankrupt or
insolvent; (iii) appointment of a liquidator, receiver or trustee for all or a
substantial part of the other party's property; or (iv) an assignment for the
benefit of creditors of the other party. Notwithstanding the bankruptcy of
PDL, or the impairment of performance by PDL of its obligations under this
Agreement as a result of bankruptcy or insolvency of PDL, SB shall be entitled
to retain the licenses granted herein, subject to PDL's rights to terminate
this Agreement for reasons other than bankruptcy or insolvency as expressly
provided in this Agreement. All rights granted under or pursuant to this
Agreement by PDL to SB are, and shall otherwise be deemed to be, for purposes
of Section 365(n) of the U.S. Bankruptcy Code, licenses of rights to
"intellectual property" as defined under Section 101(35A) of the U.S.
Bankruptcy Code. The parties agree that SB, as a licensee of such rights
under this Agreement, shall retain and may fully exercise all of its rights
and elections under the U.S. Bankruptcy Code, subject to performance by SB of
its preexisting obligations under this Agreement.
(d) [CONFIDENTIAL TREATMENT REQUESTED]
(e) SB may terminate the license granted under this Agreement as to
the Licensed PDL Patents in any country of the Territory at any time upon
sixty (60) days prior written notice.
7.03 No Waiver. The right of either party to terminate this Agreement as
provided herein shall not be affected in any way by its waiver of any previous
failure to perform hereunder or by its failure to take action with respect
thereto.
7.04 Survival. Termination for any reason hereunder shall not affect any
accrued rights or obligations of the parties arising in any manner under this
Agreement as of the date of termination. In any event, the confidentiality
and indemnity obligations and any accrued but unpaid payment obligations under
Articles 3, 5 and 6, respectively, shall survive any termination of this
Agreement.
8. MISCELLANEOUS
8.01 Assignment. This Agreement and the licenses herein granted shall
be binding upon and inure to the benefit of the successors in interest of the
respective parties. Neither this Agreement nor any interest hereunder shall
be assignable by either party without the prior written consent of the other;
provided, however, that either party may assign this Agreement or any part of
its rights and obligations hereunder to any Affiliate of such party or to any
corporation with which that party may merge or consolidate, or to which it may
transfer all or substantially all of its assets, without obtaining the consent
of the other party, provided that the party effecting such assignment shall
notify the other promptly following such assignment.
8.02 Entire Agreement. This Agreement, entered into as of the date
written above, constitutes the entire agreement between the parties relating
to the subject matter hereof and supersedes all previous writings and
understandings. No terms or provisions of this Agreement shall be varied or
modified by any prior or subsequent statement, conduct or act of either of the
parties, except that the parties may amend this Agreement by written
instruments specifically referring to and executed in the same manner as this
Agreement.
8.03 Severability.
(a) In the event any portion of this Agreement shall be held illegal,
void or ineffective, the remaining portions hereof shall remain in full force
and effect.
(b) If any of the terms or provisions of this Agreement are in
conflict with any applicable statute or rule of law, then such terms or
provisions shall be deemed inoperative to the extent that they may conflict
therewith and shall be deemed to be modified to conform with such statute or
rule of law.
(c) In the event that the terms and conditions of this Agreement are
materially altered as as provided in Sections 8.03(a) and (b), the parties
will in good faith renegotiate the terms and conditions of this Agreement to
carry out the intent of the parties.
8.04 Notices. Notices required or permitted under this Agreement shall
be in writing in the English language and sent by overnight mail (e.g.,
FedEx), or by facsimile confirmed by overnight mail (e.g., FedEx), and shall
be deemed to have been properly served to the addressee upon receipt of such
written communication, to the following addresses of the parties or to such
address or addresses as may be specified from time to time in a written
notice:
If to PDL: Protein Design Labs, Inc.
34801 Campus Drive
Fremont, California 94555 USA
Attention: General Counsel
Facsimile number: (510) 574-1473
If to SB: SmithKline Beecham Corporation
One Franklin Plaza (Mail Code FP 1930)
P.O. Box 7929
Philadelphia, PA 19101
Attn: Senior Vice President, Business Development
Facsimile number: (215) 751-4253
Copy to: SmithKline Beecham Corporation
One Franklin Plaza (Mail Code FP 2360)
P.O. Box 7929
Philadelphia, PA 19101
Attn: Corporate Law - US
Fax: number: (215)751-3935
8.05 Choice of Law. This Agreement shall be deemed to have been made
in New York and its form, execution, validity, construction and effect shall
be determined in accordance with the laws thereof.
8.06 Dispute Resolution. Any dispute, controversy or claim arising
out of or relating to this Agreement, including without limitation, a dispute
concerning a termination of this Agreement (hereinafter collectively referred
to as "Dispute") shall be attempted to be settled by the parties, in good
faith, by submitting each such Dispute to appropriate senior management
representatives of each party in an effort to effect a mutually acceptable
resolution thereof within thirty (30) days of submission to such
representatives. Within fifteen (15) days after submission of the Dispute to
such senior representatives, each party shall submit a brief, written summary
of the Dispute and their respective position with respect to the Dispute to
such senior representatives. In the event no mutually acceptable resolution
is achieved in such time frame, then each party shall be entitled to seek
relief for such Dispute by using any appropriate judicial mechanism which may
be available in the courts.
8.07 Waiver. None of the terms, covenants and conditions of this
Agreement can be waived except by the written consent of the party waiving
compliance.
8.08 Force Majeure. If the performance of any part of this Agreement
by either party, or of any obligation under this Agreement, is prevented,
restricted, interfered with or delayed by reason of any cause beyond the
reasonable control of the party liable to perform, unless conclusive evidence
to the contrary is provided, the party so affected shall, upon giving written
notice to the other party, be excused from such performance to the extent of
such prevention, restriction, interference or delay; provided that the
affected party shall use its reasonable best efforts to avoid or remove such
causes of non-performance and shall continue performance with the utmost
dispatch whenever such causes are removed. When such circumstances arise, the
parties shall discuss what, if any, modification of the terms of this
Agreement may be required in order to arrive at an equitable solution.
8.09 Publicity. It is contemplated that one or both of the parties
may issue a press release announcing this Agreement, the Development and
License Agreement and the Option Agreement, the form and content of which
shall be mutually agreed upon. No other public announcement or other
disclosure to Third Parties concerning the terms, financial or otherwise, of
this Agreement, the Development and License Agreement or the Option Agreement
shall be made, either directly or indirectly, by any party to this Agreement,
except as may be legally required or as may be required for recording
purposes, without first obtaining the approval of the other Party, which
approval shall not be unreasonably withheld, and agreement upon the nature and
text of such announcement or disclosure. The party desiring to make any such
public announcement or other disclosure shall inform the other party of the
proposed announcement or disclosure in reasonably sufficient time prior to
public release, and shall provide the other party with a written copy thereof,
in order to allow such other party to comment upon such announcement or
disclosure. The party reviewing the release shall use good faith efforts to
promptly review and provide comments upon the proposed public release, which
comments shall be provided as soon as practicable but in any event within
seven (7) days of delivery of the initial draft of the proposed release. Each
party agrees that it shall cooperate fully with the other with respect to all
disclosures regarding this Agreement to the Securities Exchange Commission,
the U.K. Stock Exchange and any other governmental or regulatory agencies,
including requests for confidential treatment of proprietary information of
either party included in any such disclosure.
8.10 Headings. The captions used herein are inserted for convenience
of reference only and shall not be construed to create obligations, benefits,
or limitations.
8.11 Export. Each party acknowledges that the laws and regulations of
the United States restrict the export and re-export of commodities and
technical data of United States origin. Each party agrees that it will not
export or re-export restricted commodities or the technical data of the other
party in any form without the appropriate United States and foreign government
licenses.
8.12 Counterparts. This Agreement may be executed in counterparts, all
of which taken together shall be regarded as one and the same instrument.
8.13 Independent Contractors. The parties are independent contractors
under this Agreement and no other relationship is intended, including, without
limitation, partnership, joint venture or agency relationship. Neither party
shall act in a manner which expresses or implies a relationship other than of
independent contractor, nor bind the other party, except as otherwise
expressly provided in this Agreement. Nothing in this Agreement shall be
deemed to infer any direct relationship between PDL and any Affiliate of SB.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the date first above written.
PROTEIN DESIGN LABS, INC. SMITHKLINE BEECHAM
CORPORATION
By: ______________________ By:
____________________________
Title: Title:
EXHIBIT A
Licensed PDL Patents
The following are patents and patent applications (also known as the "Queen et
al. patents") issued and filed in certain countries in the world and licensed
as part of the Licensed PDL Patents under the Agreement (As of August 25,
1999)
1. The following issued U.S. patents and U.S. patent applications:
No. 5,585,089, "Humanized Immunoglobulins," issued December 17, 1996.
No. 5,693,761, "Polynucleotides Encoding Improved Humanized
Immunoglobulins," issued December 2, 1997.
No. 5,693,762, "Humanized Immunoglobulins," issued December 2, 1997.
[CONFIDENTIAL TREATMENT REQUESTED]
2. The following patents and patent applications outside the U.S.:
Patent No.
Country
Title*
Issued
647383
Australia
"Novel Immunoglobulins, Their Production
and Use"
Issued
671949
Australia
"
Issued
AT E133452
Austria
"
Issued
0451216
Belgium
"
Issued
61095
Bulgaria
"
Issued
970016
Brazil
"
Issued
0451 216B1
European
"
Issued
0682040 B1
European
Issued
FR0451216
France
"
Issued
DE
68925536
Germany
"
Issued
DD 296 964
East Germany
"
Issued
GB 0451216
Great Britain
"
Issued
1001050
Greece
"
Issued
211174
Hungary
"
Issued
IT O451216
Italy
"
Issued
2828340
Japan
"
Issued
LU O451216
Luxembourg
"
Issued
92.2146
Monaco
"
Issued
NL 0451216
Netherlands
"
Issued
231984
New Zealand
"
Issued
132068
Pakistan
"
Issued
29729
Philippines
"
Issued
92758
Portugal
"
Issued
4895847.13
Russia
"
Issued
2126046
Russia
"
Issued
SG O451216
Singapore
"
Issued
89/9956
South Africa
"
Issued
178385
South Korea
"
Issued
2081974 T3
Spain
"
Issued
SE O451216
Sweden
"
Issued
CHO 451216
Switzerland
"
Issued
50034
Taiwan
"
Issued
13349
Uruguay
"
Issued
48700
Yugoslavia
"
Country
Title*
Pending
Argentina
"Novel Immunoglobulins, Their
Production and Use"
Pending
Canada
"
Pending
Chile
"
Pending
China
"
Pending
Croatia
"
Pending
Czech Republic
"
Pending
Ecuador
"
Pending
Europe
"
Pending
Hong Kong
"
Pending
Ireland
"
Pending
Israel
"
Pending
Japan
"
Pending
South Korea
Pending
Romania
"
Pending
Slovak Republic
"
Pending
Venezuela
"
Pending
Denmark
"
Pending
Finland
"
Pending
Norway
"
*Exact titles may differ in different countries.
CONFIDENTIAL TREATMENT REQUESTED WITH RESPECT TO
DESIGNATED PORTIONS OF THIS DOCUMENT
1721
1721
IL-5 PATENT LICENSE AGREEMENT