Collaboration Agreement - Seattle Genetics Inc. and Genencor International Inc.
COLLABORATION AGREEMENT
This Agreement is entered into as of January 4, 2002, by and between:
• SEATTLE GENETICS, INC., a Delaware corporation, having its principal place of business at 21823 30th Drive S.E., Bothell, Washington 98021
(hereinafter referred to as "SGI")
and:
• GENENCOR INTERNATIONAL, INC., a Delaware corporation, having its principal place of business at 925 Page Mill Road, Palo Alto, CA 94304-1013.
(hereinafter referred to as "GCOR").
WHEREAS, SGI and GCOR entered into a Mutual Non-Disclosure Agreement dated December 19, 2000 pursuant to which the parties have been discussing a potential relationship relating to the use of enzymes for the activation of prodrugs;
WHEREAS, SGI has developed and/or acquired technology and intellectual property relating to its ADEPT platform, including a lead ADEPT molecule referred to as SGN-17/19, and GCOR has developed technology and intellectual property relating to its TEPT platform, and each intends to continue developing its platform through the collaboration envisioned by this Agreement;
WHEREAS, SGI and GCOR desire to enter into an agreement to exclusively collaborate in the field of targeted enzyme technologies in combination with prodrugs for the treatment of cancer;
WHEREAS, SGI and GCOR each have ongoing research and/or development activities relating to cancer therapies outside the field of the collaboration envisioned by this Agreement and intend that nothing contained in this Agreement will preclude such other activities;
NOW, THEREFORE, in consideration of the foregoing premises and the mutual promises and covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, do hereby agree as follows:
ARTICLE I — DEFINITIONS AND INTERPRETATION
1.1 Definitions: For the purposes of this Agreement the following words and phrases shall have the following meanings:
"ADEPT" means SGI's antibody-directed enzyme prodrug therapy platform covered by SGI ADEPT Patents and the SGI [***] Patents.
"Affiliate" means, with respect to a Party, any person, corporation or business entity that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, a Party. For the purpose of this definition, control shall mean the direct or indirect ownership of at least [***] of the voting interest or equity in such corporation or other business entity.
"Agreement" means this agreement, all amendments and supplements to this Agreement and all exhibits to this Agreement, including the following:
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Exhibit A |
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SGI ADEPT Patents |
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Exhibit B |
- |
SGI [***] Patents |
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Exhibit C |
- |
GCOR TEPT Patents |
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Exhibit D |
- |
GCOR TE Patents |
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Exhibit E |
- |
GCOR Background Patents |
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Exhibit F |
- |
Work Plan |
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Exhibit G |
- |
The Stock Purchase Agreement |
"Applicable Law" means the applicable laws, rules, and regulations, including any rules, regulations, guidelines, or other requirements of the Regulatory Authorities that may be in effect from time to time.
"BLA" means a Biologics License Application, as defined in the U.S. Federal Food, Drug, and Cosmetics Act, as amended, and the regulations promulgated thereunder, and any corresponding foreign or domestic marketing authorization application, registration or certification, necessary or reasonably useful to market a Product, but not including pricing and reimbursement approvals.
"[***]" means the [***].
"[***]" means the [***].
"[***]" means any of the [***] periods beginning [***] in any year.
"Collaboration" means all research, development, manufacture and commercialization activities conducted by or on behalf of the Parties in the Field according to the terms of this Agreement.
"Collaboration Product" means any Product other than a [***] Product or a [***] Product.
"Commercially Reasonable Efforts" means, with respect to the research, development, manufacture or commercialization of Products, efforts and resources commonly used in the biotechnology industry for a product of similar commercial potential at a similar stage in its lifecycle, taking into consideration its safety and efficacy, its cost to develop, the competitiveness of alternative products, its proprietary position, the likelihood of regulatory
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approval, its profitability, and all other relevant factors. Commercially Reasonable Efforts shall be determined on a market-by-market basis for each Product, as applicable.
"Control" means, with respect to any Information and Invention, Patent or other intellectual property right, possession of the right, whether directly or indirectly, and whether by ownership, license or otherwise, to assign, or grant a license, sublicense or other right to or under, such Information and Invention, Patent or right as provided for herein without violating the terms of any agreement with any Third Party.
"Development Decision" means a decision by the Steering Committee regarding whether a Development Program should be commenced for a Collaboration Product and/or whether a Collaboration Product should be advanced to the next stage of a Development Program such as for example, advancing a Collaboration Product from Phase I Clinical Trials to Phase II Clinical Trials or advancing a Collaboration Product to IND filing stage.
"Development Program" means any activities conducted by or on behalf of the Parties with respect to a Collaboration Product pursuant to a Development Decision, commencing upon identification of a [***] for such Collaboration Product, as determined by the Steering Committee, and ending upon First Commercial Sale of such Collaboration Product in a Major Country. The Parties may also agree to initiate a Development Program for a Collaboration Product prior to the above by unanimous decision of the Steering Committee.
"Effective Date" means the date of this Agreement.
"Exploit" or "Exploitation" means to make, have made, import, use, sell, offer for sale, or otherwise dispose of, including all discovery, research, development, registration, modification, enhancement, improvement, manufacture, storage, formulation, exportation, transportation, distribution, promotion and marketing activities related thereto.
"FDA" means the United States Food and Drug Administration and any successor agency thereto or its equivalent in other countries or regulatory jurisdiction.
"Field" means the use of [***] for the treatment and diagnosis of cancer in humans.
"First Commercial Sale" means, in each country, the first commercial sale of a Product following, if required by law, Regulatory Approval and, when Regulatory Approval is not required by law, the first commercial sale in that country, in each case for use or consumption of such Product in such country by the general public; for avoidance of doubt, First Commercial Sale of a given Product cannot occur more than once in any particular country.
"GCOR Background Know-How" means all Information and Inventions in the Control of GCOR as of the Effective Date or at any time during the Term that [***] are deemed necessary or reasonably useful for the Collaboration or for the exercise of the GCOR Background Patents, including without limitation all Information and Inventions relating to [***], but excluding: (a) any [***]; and (b) any [***].
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"GCOR Background Patents" means: (a) all Patents listed in Exhibit E to this Agreement; and (b) any other Patents in the Control of GCOR during the Term that are necessary or reasonably useful for the Collaboration or for the practice of the GCOR Background Know-How, but excluding: (a) any [***]; (b) any [***]; and (c) any [***].
"GCOR Background Technology" means GCOR Background Patents and GCOR Background Know-How.
"GCOR Expression Technology" means GCOR Background Technology relating to microbial production systems for the expression of proteins, peptides or antibodies.
"GCOR i-mune Technology" means GCOR Background Technology relating to its in vitro method used to determine allergenic epitope(s) in a protein.
"GCOR Patents" means GCOR Background Patents and GCOR TEPT Patents.
"GCOR Technology" means GCOR Background Technology and GCOR TEPT Technology.
"GCOR TE Patents" means (a) all Patents listed in Exhibit D to this Agreement; and (b) any other Patents in the Control of GCOR at any time that relate to TE.
"GCOR TEPT Know-How" means all Information and Inventions in the Control of GCOR or its Affiliates as of the Effective Date or at any time during the Term that: (a) relate to [***]; and (b) are necessary or reasonably useful for the Collaboration or for the exercise of the GCOR TEPT Patents.
"GCOR TEPT Patents" means: (a) all Patents listed in Exhibit C to this Agreement; and (b) any other Patents in the Control of GCOR during the Term that: (i) relate to [***]; and (ii) are necessary or reasonably useful for the Collaboration.
"GCOR TEPT Technology" means GCOR TEPT Patents and GCOR TEPT Know-How.
"Improvement" means any modification to an antibody, compound, product or technology or any discovery, device, process or formulation related to such antibody, compound, product or technology, whether or not patented or patentable, including any enhancement in the efficiency, operation, manufacture, ingredients, preparation, presentation, formulation, means of delivery, packaging or dosage of an antibody, compound, product or technology, any discovery or development of any new or expanded indications or applications for an antibody, compound, product or technology, or any discovery or development that improves the stability, safety or efficacy of an antibody, compound, product or technology.
"IND" means an investigational new drug application filed with the FDA for authorization to commence human clinical trials, and its equivalent in other countries or regulatory jurisdictions.
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"Information and Inventions" means all technical, scientific and other know-how and information, trade secrets, knowledge, technology, means, methods, processes, practices, formulas, instructions, skills, techniques, procedures, experiences, ideas, technical assistance, designs, drawings, assembly procedures, computer programs, apparatuses, specifications, data, results and other material, including high-throughput screening, gene expression, genomics, proteomics and other drug discovery and development technology, pre-clinical and clinical trial results, manufacturing procedures, test procedures and purification and isolation techniques, (whether or not confidential, proprietary, patented or patentable) in written, electronic or any other form now known or hereafter developed, and all Improvements, whether to the foregoing or otherwise, and other discoveries, developments, inventions and other intellectual property (whether or not confidential, proprietary, patented or patentable).
"Joint Know-How" means all Information and Inventions made jointly by employees of SGI and GCOR under this Agreement, but excluding any Improvements to either Party's Background Technology which shall remain the sole property of the Party contributing said Background Technology.
"Joint Patents" means any Patents jointly owned by the Parties that relate to Joint Know-How and cover the manufacture, use or sale of Products.
"Joint Technology" means Joint Patents and Joint Know-How, but excluding SGI Technology and GCOR Technology.
"Major Country" means any of [***].
"NDA" means a New Drug Application filed with the FDA and its equivalent in other countries or regulatory jurisdictions.
"Net Sales" shall mean [***] amounts [***] from or in connection with the sale or other disposition of Product [***]:[***]
In the event a Party or its Affiliates or Sublicensees sells or otherwise disposes of a Product in combination with other active ingredients or components which are not Products, Net Sales for purposes of royalty payments on the combination shall be calculated as follows:
In the event the Product is sold [***], the applicable royalty for such Product shall be determined by [***].
"Parties" means GCOR and SGI, and "Party" means either of them.
"Patents" means: (a) patents and patent applications; (b) any substitutions, divisions, continuations, continuations-in-part, reissues, renewals, registrations, confirmations, re-examinations, extensions, supplementary protection certificates and the like, and any
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provisional applications, of any such patents or patent applications; and (c) any foreign or international equivalent of any of the foregoing.
"Phase I Clinical Trial" means a clinical study in subjects to evaluate the pharmacokinetic and pharmacodynamic properties, maximum tolerated dose, dosing interval, and absorption, distribution, metabolism and excretion of a candidate drug.
"Phase II Clinical Trial" means a controlled dose clinical trial to evaluate the efficacy and safety of a candidate drug in the targeted patient population and to define the optimal dosing regimen.
"Phase III Clinical Trial" means a controlled, pivotal, multi-center clinical trial, involving patients with the disease or condition of interest to obtain sufficient efficacy and safety data to support regulatory submission of a BLA or NDA and labeling of a candidate drug.
"Product" means any targeted enzyme plus prodrug combination product(s) developed pursuant to the Collaboration.
"Product Trademarks" means the Trademarks developed for the Products by the Steering Committee and owned jointly be the Parties, all packaging designs and other trade dress used in connection with the Products and such other Trademarks relating thereto and any registrations thereof or any pending applications relating thereto.
"Regulatory Approval" means final regulatory approval (including, where applicable, pricing approval in the event that actual sales do not take place before such approval) required to market a Product for a disease or condition in accordance with the applicable laws and regulations of a given country. In the United States, its territories and possessions, Regulatory Approval means approval of a BLA or its equivalent by the FDA.
"Regulatory Authority" means any applicable government entities regulating or otherwise exercising authority with respect to the Exploitation of the Products.
"Regulatory Documentation" means all applications, registrations, licenses, authorizations and approvals (including all Regulatory Approvals), all correspondence submitted to or received from Regulatory Authorities (including minutes and official contact reports relating to any communications with any Regulatory Authority), all supporting documents and all clinical studies and tests, relating to any Product, and all data contained in any of the foregoing, including all regulatory drug lists, advertising and promotion documents, adverse event files and complaint files.
"Research Program" means the research program conducted pursuant to Section 3.2.
"Royalty Term" means, on a Product-by-Product and country-by-country basis, the period of time equal to the longer of: (a) [***] from the date of First Commercial Sale of the Product in such country; or (b) the expiration of the last to expire of the Valid Patent Claims necessary for the manufacture, use or sale of a Product in such country.
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"SGI ADEPT Know-How" means all Information and Inventions in the Control of SGI as of the Effective Date or at any time during the Term that: (a) relate to SGN-17/19 or ADEPT; and (b) are necessary or reasonably useful for the Collaboration or for the exercise of the SGI ADEPT Patents or SGI [***] Patents.
"SGI ADEPT Patents" means: (a) all Patents listed in Exhibit A to this Agreement; and (b) any other Patents in the Control of SGI during the Term that: (i) relate to SGN-17/19 or ADEPT; and (ii) are necessary or reasonably useful for the Collaboration.
"SGI ADEPT Technology" means SGI ADEPT Patents, SGI [***] Patents and SGI ADEPT Know-How.
"SGI Background Know-How" means all Information and Inventions in the Control of SGI as of the Effective Date or at any time during the Term that [***] are deemed necessary or reasonably useful for the Collaboration or for the exercise of the SGI Background Patents, but excluding: (a) any [***]; and (b) any [***].
"SGI Background Patents" means any Patents in the Control of SGI during the Term that are necessary or reasonably useful for the Collaboration or for the practice of the SGI Background Know-How, but excluding: (a) any [***]; (b) [***]; and (c) any [***].
"SGI Background Technology" means SGI Background Patents and SGI Background Know-How.
"SGI [***] Patents" means [***] and all Patents relating thereto [***] to SGI pursuant to the [***] and all other Patents listed on Exhibit B.
"SGI Patents" means SGI Background Patents, SGI ADEPT Patents and SGI [***] Patents.
"SGI Technology" means the SGI Background Technology and the SGI ADEPT Technology.
"SGN-17" means SGI's proprietary protein containing monoclonal antibody and enzyme components that incorporates the binding site of the monoclonal antibody L49 and the enzyme β-lactamase, as well as [***].
"SGN-19" means SGI's proprietary form of the chemotherapeutic prodrug melphanan that has been inactivated through the addition of a chemical group that can be removed by the enzyme β-lactamase.
"SGN-17/19" means a combination of SGN-17 and SGN-19.
"Stock Purchase Agreement" means the Common Stock Purchase Agreement of even date herewith by and between SGI and GCOR attached hereto as Exhibit G.
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"Sublicensee" means any person acting pursuant to a permitted sublicense granted to it by the Parties pursuant to Section 6.4 or Section 15.6.3(c) and the other terms and conditions of this Agreement.
"Technology" means SGI Technology, the GCOR Technology and/or the Joint Technology, as applicable.
"TE" means GCOR's [***] and covered in GCOR TE Patent(s).
"TEPT" means GCOR's targeted enzyme prodrug therapy platform covered by GCOR TEPT Patents expressly [***].
"Term" means the Initial Term and any Renewal Term(s).
"Therapeutics Field" shall mean the use of [***] for the treatment and diagnosis of diseases in humans.
"Third-Party" means any person or entity other than GCOR, SGI and their respective Affiliates.
"Trademark" means any word, name, symbol, color, designation or device or any combination thereof, including any trademark, trade dress, service mark, service name, brand mark, trade name, brand name, logo or business symbol.
"Valid Patent Claim" means a claim of an issued and unexpired patent included in SGI Patents, GCOR Patents or Joint Patents which has not been held permanently revoked, unenforceable 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.
"Work Plan" means the plan developed by the Parties and attached hereto in draft form setting forth the roles, responsibilities, timelines and deliverables for each of the Parties during the Collaboration, which, when finalized and approved by the Steering Committee no later than ninety (90) days from the Effective Date, shall be attached to this Agreement as Exhibit F, including any amendments or modifications made by agreement of the Steering Committee.
1.2 Terms Defined Elsewhere in this Agreement. In addition to the foregoing definitions, the following terms are defined in the applicable Sections of this Agreement:
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Defined Term |
Section |
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"[***]" |
15.6.3 |
(a) |
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"[***]" |
15.6.3 |
(e) |
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"Collective Opinion of Counsel" |
13.3 |
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"[***] Party" |
7.2 |
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"Confidential Information" |
9.1 |
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"[***] Product" |
7.4 |
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"Indemnified Party" |
16.3.1 |
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"Indemnification Claim Notice" |
16.3.1 |
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"Indemnitee" and "Indemnitiees" |
16.3.1 |
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"Infringement Suit" |
13.4.2 |
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"Initial Term" |
15.1 |
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"Losses" |
16.1 |
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"[***]" |
7.1 |
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"[***] Notice" |
7.1 |
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"[***] Party" |
7.1 |
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"Project Plan" |
3.5 |
(a) |
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"Project Budget" |
3.5 |
(b) |
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"Publication" |
9.5 |
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"Renewal Term" |
15.1 |
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"Reporting Party" |
4.5.2 |
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"Royalty Reports" |
4.5.1 |
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"Steering Committee" |
2.1 |
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"[***]" |
15.6.3 |
(b) |
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"Third Party Claim" |
16.3.2 |
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"[***] Product" |
7.2 |
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"Withholding Taxes" |
5.3 |
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"Working Teams" |
3.1 |
(c) |
1.3 Certain Rules of Interpretation in this Agreement and the Schedules.
(a) Unless otherwise specified, all references to monetary amounts are to United States of America currency (U.S. Dollars);
(b) The descriptive headings of Articles and Sections are inserted solely for convenience of reference and are not intended as complete or accurate descriptions of the content of such Articles or Sections;
(c) The use of words in the singular or plural, or with a particular gender, shall not limit the scope or exclude the application of any provision of this Agreement to such person or persons or circumstances as the context otherwise permits;
(d) The words "include" and "including" have the inclusive meaning frequently identified with the phrases "without limitation" and "but not limited to";
(e) Subject to Article 17, whenever a provision of this Agreement requires an approval or consent by a Party to this Agreement and notification of such approval or consent is not delivered within the applicable time limit, then, unless otherwise specified, the Party whose approval or consent is required shall be conclusively deemed to have withheld its approval or consent;
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(f) Unless otherwise specified, time periods within or following which any payment is to be made or act is to be done shall be calculated by excluding the day on which the period commences and including the day on which the period ends and by extending the period to the next business day following if the last day of the period is not a business day in the jurisdiction of the Party to make such payment or do such act; and
(g) Whenever any payment is to be made or action to be taken under this Agreement is required to be made or taken on a day other than a business day, such payment shall be made or action taken on the next business day following such day to make such payment or do such act.
ARTICLE 2 — STEERING COMMITTEE
2.1 Formation of Steering Committee. Within [***] of the Effective Date, the Parties shall establish a joint committee (the "Steering Committee") to make certain decisions regarding the Collaboration. The Steering Committee will be composed of [***] representatives of each Party, who shall be appointed (and may be replaced at any time) by such Party on written notice to the other in accordance with this Agreement. Such representatives shall possess the requisite experience and seniority to enable them to make decisions on behalf of the Parties with respect to the Collaboration. Development Decisions, and such other decisions as expressly set forth herein, shall be subject to approval of the Parties.
2.2 Responsibilities of the Steering Committee. The Steering Committee will be responsible for, among other things:
(a) determining the overall strategy for the Collaboration in the manner contemplated by this Agreement;
(b) within [***] of the Effective Date, formulating a final Work Plan, which shall be attached to this Agreement as Exhibit F and may be amended from time to time by the Steering Committee;
(c) preparing a Project Plan and Project Budget for each Collaboration Product;
(d) coordinating, expediting, overseeing and controlling all development of Collaboration Products in the Field, including pre-clinical research, clinical research, manufacturing, regulatory filings and post approval development studies;
(e) monitoring, reviewing and directing the commercialization of Collaboration Products within the Field, including developing annual marketing and sales budgets, annual forecasts or sales and production requirements, an annual marketing plan, product positioning, creative campaign strategies, pricing and managed care contract strategies;
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(f) evaluating additional technologies that may be necessary or beneficial to the Collaboration and recommending the acquisition or in-licensing of these technologies;
(g) addressing, financial issues which arise in connection with the Collaboration in the areas of accounting, cost allocation, budgeting and financial reporting
(h) settling disputes or disagreements between the Parties regarding the Collaboration ; and
(i) performing such other functions as appropriate to further the purposes of this Agreement.
2.3. Steering Committee Decision-Making. The Steering Committee will make decisions related to the matters set forth above and such day-to-day matters as necessary to progress the Collaboration. Development Decisions and other decisions deemed extraordinary by a majority of the Steering Committee shall be made by mutual agreement of the Parties within [***] of the Steering Committee presenting such extraordinary matters to the Parties. All decisions of the Steering Committee will be based on a [***] vote of the total number of members of the Steering Committee, regardless of the number of members actually in attendance at a meeting; provided that no decision may be made at any Steering Committee meeting unless there is at least one (1) representative from each Party in attendance at such meeting. The Steering Committee will have an appointed Chairperson who shall hold such position for [***]. The Chairperson shall preside over meetings of the Steering Committee and shall perform such other duties as shall be assigned to him or her from time to time by the Steering Committee. The Chairperson will alternate between SGI and GCOR with the first Chairperson being a GCOR representative. Any member of the Steering Committee may designate a substitute to attend and perform the functions of that member (including voting) at any meeting of the Steering Committee. The Steering Committee will meet, either in person or by teleconference, at least [***], or more frequently upon [***] agreement of the members of the Steering Committee. Face-to-face meetings, unless otherwise agreed, will alternate between Bothell and Palo Alto. The Steering Committee may also act by written consent of [***] of the members of the Steering Committee.
ARTICLE 3 — CONDUCT OF THE COLLABORATION
3.1 General Responsibilities of the Parties. Subject to each Party's internal decisions regarding allocation of its resources, the general responsibilities of the Parties under the Collaboration are intended to be as follows:
(a) SGI Responsibilities. SGI will use Commercially Reasonable Efforts to: (i) perform [***] to determine [***]; (ii) perform [***] on all [***] provided by either Party; and (iii) identify and research potential [***] and/or [***] other than [***], including those that do not relate to [***], for development consideration. Assays will include [***] experiments comparing [***] with [***]. Once [***], SGI will use Commercially Reasonable Efforts to perform [***], using [***] of [***], to assess [***] for consideration to include in a [***]. Prior to [***], SGI will be responsible for the [***] of [***] for use in combination with [***].
(b) GCOR Responsibilities. GCOR will use Commercially Reasonable Efforts to: (i) perform analysis of the [***] using [***]; (ii) determine [***] with the objective of [***] of [***] in humans; (iii) introduce [***] into the [***]; (iv) test [***] using [***] to identify those with [***] to [***]; (v) produce [***] of [***] for each of the best [***] for delivery to SGI for testing in [***]; and (vi) identify and research potential [***] (excluding [***] components thereof) for development consideration. In the event [***] described above are not successful, GCOR will, at its discretion, attempt to provide other [***], either new, or through [***] of [***] provided by SGI, for SGI to test and for the Steering Committee to consider for further development. Additionally, GCOR will attempt to develop a process for [***], or a [***], but [***] form of [***], or other [***] mutually agreed upon, at a level of [***] determined by the Steering Committee.
(c) Reallocation of Responsibilities. Responsibilities set forth in Sections 3.1(a) and (b) reflect the Parties' skills and interests as of the Effective Date, which skills and interests may evolve during the Term, at which time responsibilities may be reallocated [***].
(d) Cooperation. In order to advance the Collaboration SGI and GCOR personnel working on the Collaboration including research, development, pre-clinical and clinical personnel as appropriate ("Working Teams") will periodically and at least [***] exchange information and results relating to their efforts on behalf of the Collaboration. This exchange will be done primarily through telephonic conference calls, but may also include face-to-face meetings, site visits or other methods as deemed appropriate by the Steering Committee.
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(e) Intent. During the term of the Agreement, the Parties intend that each will contribute sufficient resources to the Collaboration to identify and present Collaboration Products to the Steering Committee for consideration in a Development Program.
3.2. Scope of the Research Program. The initial scope of the Research Program shall comprise research efforts relating to [***]. At the discretion of the Steering Committee, the Research Program may be expanded to include research efforts relating to other SGI Technology or GCOR Technology, such as other [***] within the Field. Absent agreement to the contrary, nothing contained in this Agreement shall obligate either SGI or GCOR to provide to the other or to the Collaboration novel cancer targets regardless of whether they might be useful within the Field.
3.3. Conduct of Research Program. Under the direction and supervision of the Steering Committee, the Parties shall use Commercially Reasonable Efforts to conduct their respective research and development activities in accordance with this Agreement. All research work performed by GCOR and SGI pursuant hereto shall be performed in a good scientific manner and in compliance with all applicable laws.
3.4 Research Program Expenses. [***] costs incurred with respect to any Collaboration Product [***] ("Research Costs").
3.5 Development Program. The Steering Committee shall determine whether to advance each Collaboration Product to a Development Program as set forth in Article 2. Upon such advancement, the following terms shall apply:
(a) Project Plans and Project Budgets. The Steering Committee shall develop and implement a project plan (each a "Project Plan") and project budget (each a "Project Budget") for the research, development, manufacture and commercialization of each Collaboration Product that has entered a Development Program. It is understood that the components of each Project Plan and Project Budget will evolve as the applicable Collaboration Product moves through the development, manufacture and commercialization life cycle.
(b) Development Costs. The Parties shall [***] expenses incurred in connection with any Collaboration Products that [***], including without limitation costs associated with [***] and [***] (collectively, "Development Costs"); provided, however, that such costs or expenses may not exceed (or be projected to exceed) the amounts set forth in the relevant Project Budget with respect to such Collaboration Product by more than [***] in any [***] without the approval of the Steering Committee ("Authorized Development Costs"). For the purposes of calculating development costs, each employee of either Party working on a Development Program shall be valued at [***] per FTE per year increasing at a rate of [***] per [***] starting on the [***] of the Effective Date. Within [***] after the end of each [***], each Party shall furnish the Steering Committee with: (a) a statement detailing the Development Costs actually incurred by or on behalf of such Party during such [***]; and (b) a comparison of the actual Development Costs with the projections set forth in the Project Budget. Within [***] after
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the end of each [***], the Parties shall make any necessary re-balancing payments to each another so that [***] shall bear [***] of the total Authorized Development Costs for such [***].
(c) SGN-17/19. The Parties intend that promptly after the Effective Date, SGN-17/19 will be [***]. Accordingly, [***] associated with the [***] of [***], as specified in the Project Budget will be [***].
3.6 Resourcing Development Activities. With respect to any Development Program activities that can be outsourced, including but not limited to activities such as toxicology studies, clinical and commercial supplies of Collaboration Products in a Development Program, and clinical development activities, the Steering Committee may solicit bids from Third Parties. Each Party shall have the right to submit a bid on such terms, as it desires. The Steering Committee shall use its best efforts to enter into appropriate agreement(s) with the Third Party that is best able to meet the Parties' requirements, taking into consideration such factors as price, quality, capacity, quantity, reliability and reputation. In the event the Steering Committee selects a Party to provide such development activities pursuant to this Section 3.6, the price and other terms and conditions of such services shall be based on arm's length negotiations with the Steering Committee.
3.7 Marketing and Sales Responsibilities. The Parties may out license Collaboration Products in a Development Program; however, if the Parties decide to further develop and commercialize a Collaboration Product already in a Development Program, the Parties shall negotiate and conclude a marketing and sales agreement or such other agreement as deemed appropriate and necessary to complement the terms set forth in this Collaboration Agreement promptly after such decision, setting forth the Parties rights and obligations, cost sharing, profit sharing and such other matters as deemed necessary and appropriate.
ARTICLE 4 — FINANCIAL TERMS
4.1 Equity Purchase. GCOR shall purchase Three Million U.S. Dollars ($3,000,000) of common stock of SGI on the terms set forth in the Stock Purchase Agreement.
4.2 Milestone Payments. The Parties shall make the following payments to each other within [***] of the first occurrence of each event set forth below:
(a) SGI will make a payment of U.S. [***] to GCOR upon the [***] by GCOR to SGI of either:
(i) a [***] having all of the following [***] traits: (1) [***] or a mutually agreed upon [***] with a [***]; (2) [***] to other [***] comparable to or less than [***]; (3) [***] of [***] to [***] of at least [***] of [***]; and (4) [***] comprising [***] in the [***] (the [***] to be agreed to by the Steering Committee) that result in a decrease of the [***] of the [***] to less than [***] relative to the [***] of [***]; or
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(ii) a [***] that is not a [***] with an [***] or [***] having traits [***] specified in Section 4.2(a)(i) above and [***] based on [***] over time) [***] to [***] when both are combined with [***].
(b) GCOR shall make a payment of U.S. [***] to SGI upon [***].
(c) SGI shall make a payment of U.S. [***] to GCOR upon the earlier of: (i) the [***] of the first [***] that [***]; or (ii) completion of the [***] that [***] if [***] by the Steering Committee for reasons other than [***].
(d) GCOR shall make a payment of U.S. [***] to SGI on the [***] anniversary of the Effective Date.
(e) If the Steering Committee is [***] on the [***] anniversary of the Effective Date, GCOR shall make a payment of U.S. [***] to SGI.
4.3 Royalties.
4.3.1 Royalties Payable by SGI. During the Royalty Term, SGI shall pay royalties to GCOR on Net Sales of [***] Products for which [***] has [***] pursuant to Section 7.1, determined on a [***] Product-by-[***] Product basis, as follows:
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For [***] Products Incorporating: |
Rate1 |
Rate 2 |
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[***] |
[***] |
% |
[***] |
% |
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|
[***] |
[***] |
% |
[***] |
% |
|
|
[***] |
[***] |
% |
[***] |
% |
Rate 1 shall apply if [***] with respect to such [***] Product prior to completing the [***] of the first [***] in a [***] for such [***] Product. Rate 2 shall apply if [***] with respect to such [***] Product after completing the [***] of the first [***] in a [***] for such [***] Product.
If a [***] Product incorporates [***], the royalties payable by SGI shall be [***]. For purposes of illustration, if a [***] Product incorporates [***], SGI shall pay royalties to GCOR on Net Sales of such [***] Product at the rate of [***] above.
4.3.2. Royalties Payable by GCOR. During the Royalty Term, GCOR shall pay royalties to SGI on Net Sales of [***] Products for which [***] pursuant to Section 7.1, determined on a [***] Product-by-[***] Product basis, as follows:
|
For [***] Products Incorporating: |
Rate 1 |
Rate 2 |
|||
|
[***] |
[***] |
% |
[***] |
% |
Rate 1 shall apply if [***] with respect to such [***] Product prior to completing the [***] of the first [***] in a [***] for such [***] Product. Rate 2 shall apply if [***] with respect
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to such [***] Product after completing the [***] of the first [***] in a [***] for such [***] Product.
4.4 Third-Party Obligations.
4.4.1 Collaboration Products. The Parties shall [***] any royalties, milestones or other payments owed to Third Parties based on a decision made by the Steering Committee on account of Exploitation of Collaboration Products.
4.4.2 [***] Products. The [***] Party electing to [***] a [***] Product shall be responsible for [***] of such [***] Product arising under the [***] or arising after the Effective Date based on a decision made by the Steering Committee. The [***] Party shall remain responsible for [***] of such [***] Product based on agreements existing prior to the Effective Date and to which the [***] Party was a party excluding the [***].
4.5 Royalty Reports.
4.5.1 Reports. During the Royalty Term, any Party commercializing a [***] Product subject to royalty payments pursuant to Section 4.3 shall provide to the other Party, with respect to each [***], a written report showing on a consolidated basis in reasonably specific detail and [***], (a) the gross sales of [***] Products sold by such Party and its Affiliates during the corresponding [***] and the calculation of Net Sales from such gross sales; (b) the royalties payable in U.S. dollars, if any, which shall have accrued hereunder based upon Net Sales of [***] Products; (c) the withholding taxes, if any, required by law to be deducted in respect of such royalties; (d) the dates of the First Commercial Sale of each [***] Product in each country if it has occurred during the corresponding [***]; and (e) the exchange rates (as determined pursuant to Section 5.2 herein) used in determining the royalty amount expressed in U.S. dollars (collectively, "Royalty Reports").
4.5.2 Submission of Reports and Payment. The Party making such Royalty Reports (the "Reporting Party") shall include in each permitted sublicense granted by it pursuant to this Agreement a provision requiring its Sublicensees to make Royalty Reports to the other Party consistent with Section 4.5.1. Royalty Reports and payment shall be due on the [***] day following the close of each [***]. Subject to Section 5.4, the Reporting Party shall keep complete and accurate records in sufficient detail to properly reflect all gross sales and Net Sales and to enable the royalties payable hereunder to be determined.
ARTICLE 5 — PAYMENTS TERMS; RECORDS; AUDITS
5.5 Sales by Affiliates and Sublicensees. Each Party shall include in each permitted sublicense granted by it pursuant to the Agreement a provision requiring its Affiliates and Sublicensees to make reports to the other Party, to keep and maintain records of sales made pursuant to such sublicense and to grant access to such records by the other Party's independent accountant to the same extent required with respect to such Party's records under this Agreement.
ARTICLE 6 — LICENSES
6.1 [***] Licenses.
6.1.1 By SGI. Subject to the terms and conditions of this Agreement, SGI hereby grants to GCOR and its Affiliates a [***], license or sub-license under the SGI ADEPT Patents and Joint Technology, with the limited right to sublicense as permitted in Section 6.4, solely to Exploit Products within the Field.
6.1.2 By GCOR. Subject to the terms and conditions of this Agreement, GCOR hereby grants to SGI and its Affiliates a [***], license under the GCOR TEPT Patents and Joint Technology, with a limited right to sublicense as permitted in Section 6.4, solely to Exploit Products within the Field.
6.2 [***] Licenses.
6.2.2 By GCOR. Subject to the terms and conditions of this Agreement, GCOR hereby grants to SGI and its Affiliates a [***], license under the (a) GCOR Background Technology; and (b) GCOR TEPT Know-How; with a limited right to sublicense as permitted in Section 6.4, solely to Exploit Products within the Field.
6.3 [***] Product Licenses. If one Party [***] with respect to a particular [***] Product pursuant to Article 7, the [***] Party shall thereupon be automatically deemed to have granted to the [***] Party a [***] to the extent [***], license under such Party's Technology, with the right to sublicense, to Exploit the particular [***] Product within the Field.
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6.4 Rights to Sublicense. Neither Party may further sublicense the rights granted to it pursuant to Section 6.1 and 6.2 except as follows: (a) the [***] Party may sublicense the rights granted to it pursuant to Section 6.1 or 6.2 to a Sublicensee solely to Exploit a [***] Product in the Field; and (b) either Party may sublicense to a Third Party under its interest in Joint Technology solely for the Exploitation of products [***]. No approval shall be required for sublicensing conducted by the Parties under this Section 6.4; provided that the Party granting such sublicense shall forward to the other Party a fully executed copy of such sublicense agreement or amendment thereof (either of which may be redacted to remove confidential information) within [***] of execution of such sublicense agreement or amendment. Neither party may grant any rights under the Joint Technology to any Third Party [***] that would restrict the other Party's use of the Joint Technology, except by mutual agreement of the Parties.
6.5 Third Party Licenses. Each Party shall be free to license its respective Background Technology to Third Parties within or outside the Field without notice or approval. Only by decision of the Steering Committee, as approved by the Parties, may licenses or sublicenses to SGI ADEPT Technology, GCOR TEPT Technology and Joint Technology be granted to Third Parties for Exploitation of Products within the Field.
6.6 [***]. All licenses granted by SGI to GCOR herein are subject to the terms and conditions of the [***], including the [***]. GCOR and its Sublicensees agree to comply with the following sections of the [***], and any amendments thereto upon written disclosure thereof to GCOR, as if GCOR were a party to the [***]: Sections [***]. The Parties agree that [***] is a [***] to this Agreement with respect to SGI Technology that includes technology [***]. SGI hereby agrees that it will not amend or otherwise modify the [***] in any manner that negatively impacts GCOR's rights or obligations hereunder without the prior written consent of GCOR. If [***] under the [***] to [***], SGI agrees to [***]. SGI will provide GCOR notice of any other amendment or modification to the [***] including a copy thereof within [***] of execution of such amendment; provided that SGI may redact such amendment to remove confidential information that is not related to GCOR's rights or obligations.
6.7 Restriction on Use. Notwithstanding anything to the contrary in this Agreement, GCOR shall not have any right to [***].
ARTICLE 8 — DISCLOSURE OF INFORMATION
ARTICLE 9 — CONFIDENTIALITY
9.1 Non-Disclosure Obligations. Except as otherwise provided in this Article 9, during the Term and for a period of [***] thereafter, each Party shall maintain in confidence, and use only for purposes as expressly authorized and contemplated by this Agreement, all confidential or proprietary information, data, documents or other materials supplied by the other Party under this Agreement and marked or otherwise identified as "Confidential", including all SGI Technology and GCOR Technology. For purposes of this Agreement, information and data described above shall be hereinafter referred to as "Confidential Information". Each Party shall use at least the same standard of care as it uses to protect its own Confidential Information to ensure that its and its Affiliates' employees, agents, consultants and clinical investigators only make use of Confidential Information for purposes as expressly authorized and contemplated by this Agreement and do not disclose or make any unauthorized use of such Confidential Information.
9.2 Permitted Disclosures. Notwithstanding the foregoing, the provisions of Section 9.1 hereof shall not apply to information, documents or materials that can conclusively be established:
(a) to have become published or otherwise entered the public domain other than by acts of the recipient in contravention of this Agreement;
(b) are permitted to be disclosed by prior consent of the discloser;
(c) have become known to the recipient by a Third Party, provided such Confidential Information was not obtained by such Third Party directly or indirectly from the discloser on a confidential basis;
(d) prior to disclosure under the Agreement, was already in the possession of the recipient or its Affiliates or Sublicensees;
(e) is disclosed in a press release agreed to by both Parties hereto, which agreement shall not be unreasonably withheld; and
(f) are required to be disclosed by the recipient to comply with any applicable law, regulation or court order, or are reasonably necessary to obtain Patents, copyrights or
21
authorizations to conduct clinical trials with, and to commercially market Product(s), provided that the recipient shall provide prior notice of such disclosure to the discloser and take reasonable and lawful actions to avoid or minimize the degree of disclosure.
9.3 Terms of the Agreement. GCOR and SGI shall not disclose any terms or conditions of this Agreement to any Third-Party without the prior consent of the other Party, except as required by applicable laws, the Securities and Exchange Commission ("SEC") or any listing agency on which a Party's stock is traded, regulations or a court order (and in any such case the Recipient shall provide notice to the Discloser and take reasonable and lawful actions to avoid or minimize the degree of such disclosures).
9.4 Press Releases and Other Disclosures to Third-Parties. The Parties shall mutually agree upon press releases to be released announcing the execution of this Agreement and the existence of the Collaboration. For any subsequent press releases or disclosures relating to the Collaboration, each Party shall promptly review and comment or approve any press release proposed by the other Party. Failure to respond or approve within [***] of receipt of a proposed press release shall be deemed acceptance. Neither SGI nor GCOR will, without the prior consent of the other, issue any other press release or make any other public announcement or furnish any statement to any Person concerning the terms of this Agreement and the transactions contemplated thereby, except for: (i) disclosures made in compliance with Sections 9.2 and 9.3 hereof; (ii) disclosures to attorneys, consultants, and accountants retained to represent them in connection with the transactions contemplated hereby; and (iii) occasional, brief comments by the respective officers of GCOR and SGI consistent with such guidelines for public statements as may be mutually agreed by GCOR and SGI made in connection with routine interviews with analysts or members of the financial press.
9.5 Publications Regarding Results of the Collaboration. Neither Party may publish, present or announce results of the Collaboration either orally or in writing (the "Publication") without obtaining the written consent of the other Party. The other Party shall have [***] from receipt of the proposed Publication to provide comments and/or proposed changes to the disclosing Party. The disclosing Party shall take into account the comments and/or proposed changes made by the other Party on any Publication and shall agree to have employees or others acting on behalf of the other Party be mentioned as co-authors on any Publication describing results to which such persons have contributed. If the other Party reasonably determines the Publication would amount to the public disclosure of such Party's Confidential Information and/or of a patentable invention upon which a patent application should be filed prior to any such disclosure, submission of the concerned Publication to Third-Parties shall be delayed for a [***] period from the date of said notice, or for such longer period which may appear necessary for appropriately deleting Confidential Information from the proposed Publication and/or drafting and filing a patent application covering such invention.
ARTICLE 10 — COMMERCIALIZATION OF COLLABORATION PRODUCTS
10.1 Commercialization Efforts. Subject to Section 3.3, the Parties each agree to use Commercially Reasonable Efforts to collaborate diligently on the commercialization of
22
Collaboration Products, including without limitation regulatory, marketing, sales, distribution efforts. The Parties shall be guided by a standard of reasonable in economic terms and of fairness to each of the Parties, striving to balance as best they can the legitimate interests and concerns of the Parties to realize the economic potential of Collaboration Products.
10.2 Product Trademarks. All Collaboration Products shall be sold under Product Trademarks selected by the Steering Committee and owned jointly by the Parties. The Steering Committee shall use its best efforts to select worldwide Product Trademarks. Such Product Trademarks shall not be confusingly similar to, misleading or deceptive with respect to, or dilute any of the Trademarks owned or Controlled by either of the Parties, or any part of such Trademarks. Absent agreement to the contrary, no Party or any of its Affiliates or Sublicensees shall commercialize a Collaboration Product under any Trademark other than the Product Trademarks.
ARTICLE 11 — INTELLECTUAL PROPERTY
11.1 Intellectual Property Ownership. SGI shall retain all its right, title and interest in all SGI Technology and GCOR shall retain all its right, title and interest in all GCOR Technology. All Joint Know-How shall be [***] owned by SGI and GCOR, and [***] Party shall retain [***] in any Joint Patents resulting therefrom, with [***] rights in any field and subject to the licenses granted in Article 6, the right to sublicense pursuant to Sections 6.4 and 15.6.3(c). The laws of the United States with respect to joint ownership of inventions shall apply in all jurisdictions giving force and effect to this Agreement.
11.2 Ownership of Product Trademarks. The Parties shall each own [***] in each Product Trademark with respect to a Collaboration Product. In the event that a Party [***] with respect to a Collaboration Product, it shall, without any additional consideration, assign all of its right, title and interest in and to any Product Trademark with respect to such [***] Product to the [***] Party; provided, however, that each Party shall retain all of its right, title and interest in and to any Product Trademarks with respect to [***] Products.
11.3 Ownership of Regulatory Documentation. The Parties shall [***] own all Regulatory Approvals with respect to a Collaboration Product. Each Party shall, to the extent permitted by law, have [***] in all other Regulatory Documentation; provided, however, that if certain Regulatory Documentation must be held in the name of one Party only, then SGI shall hold title for Regulatory Documentation for SGN-17/19 and variants and GCOR shall hold title to Regulatory Documentation for any TEPT Product. Each [***] Party shall have the right to own all right, title and interest in and to all Regulatory Approvals with respect to its [***] Products. In the event that a Party [***] with respect to a Collaboration Product in a Development Program, it shall assign all of its right, title and interest in and to all Regulatory Documentation with respect to such [***] Product, including any Regulatory Approvals and applications therefore, to the [***] Party (or its designee); provided, however, that each Party shall retain any of its right, title and interest in and to any Regulatory Documentation with respect to a [***] Product. Notwithstanding the ownership of any Regulatory Approval or any other Regulatory Documentation, each Party shall have the right to use and reference any of the
23
Regulatory Documentation in connection with the Exploitation of Collaboration Products as provided in this Agreement.
ARTICLE 12 — PROSECUTION OF PATENTS AND TRADEMARKS
ARTICLE 14 — REPRESENTATIONS AND WARRANTIES
14.1. Representations, Warranties and Covenants. Each of the Parties hereby represents, warrants and covenants as follows:
(a) This Agreement has been duly executed and delivered by such Party and constitutes the valid and binding obligation of such Party, enforceable against such Party in accordance with its terms, except as enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium or other laws relating to or affecting creditors' rights generally and by general equitable principals. The execution, delivery and
27
performance of this Agreement has been duly authorized by all necessary action on the part of such Party, its officers and directors.
(b) The execution, delivery and performance of this Agreement by such Party does not conflict with any agreement, instrument or understanding, oral or written, to which it is a party or by which it is bound, nor violate any law or regulation of any court, governmental body or administrative or other agency having jurisdiction over it.
(c) SGI represents and warrants that it has not, and during the Term of the Agreement will not, grant any right to any Third Party relating to the SGI Technology that would conflict with the rights granted to GCOR hereunder. SGI represents and warrants that it has the right to grant the licenses (including the sublicense under the SGI [***] Patents and SGI ADEPT Know-How) granted herein and that, [***], SGI has no knowledge of any rights of any Third Parties that would interfere with the rights granted to GCOR hereunder or otherwise interfere with the Parties Exploitation of ADEPT-based Collaboration Products and SGN-17/19. SGI represents and warrants that it has disclosed to GCOR all financial obligations existing as of the Effective Date for the Exploitation of ADEPT and SGN-17/19.
(d) GCOR represents and warrants that it has not, and during the Term of the Agreement will not, grant any right to any Third Party relating to the GCOR Technology that would conflict with the rights granted to SGI hereunder. GCOR represents and warrants that it has the right to grant the licenses granted herein and that it has no knowledge of any rights of any Third Parties that would interfere with the practice of the GCOR Patents or other GCOR Technology.
(e) SGI will use diligent efforts to obtain and disclose to GCOR information relating to the rights, if any, [***] to the SGI Technology licensed under the [***] as soon as practicable after the Effective Date.
14.2. Performance by Affiliates. The Parties recognize that each may perform some or all of its obligations under this Agreement through Affiliates, provided, however, that each Party shall remain responsible and be guarantor of the performance by its Affiliates and shall cause its Affiliates to comply with the provisions of this Agreement in connection with such performance.
ARTICLE 15 — TERM AND TERMINATION
15.6.5 Survival. Articles 5, 7, 9, 11, 12, 13, 16, 17, 18, 19, 20, 21 and 22, and Sections 4.3, 4.4.2, 4.5, 6.3, 6.4, 6.6, 6.7, 8.3 and 15.7, of this Agreement and this Section 15.6 shall survive expiration or termination of this Agreement for any reason.
15.7 Termination of [***]. All rights and obligations under the [***] or [***], as the case may be, sublicensed under this Agreement shall terminate upon [***] prior written notice by [***] if [***] breaches any material provision of the [***] or the [***], as the case may be, and fails to cure such breach within [***] after notice thereof; provided, however such cure period
31
may be extended by consent of the Parties. All rights and obligations under the [***] shall automatically terminate if [***] fails to maintain the insurance required under the [***]. All rights and obligations under the [***] or [***], as the case may be, sublicensed under this Agreement shall terminate upon termination of the [***] or [***], as the case may be.
ARTICLE 17 — FORCE MAJEURE
No Party (or any of its Affiliates) shall be held liable or responsible to the other Party (or any of its Affiliates) nor be deemed to have defaulted under or breached the Agreement for failure or delay in fulfilling or performing any term of the Agreement when such failure or delay is caused by or results from causes beyond the reasonable control of the affected Party (or any of its Affiliates) including fire, floods, embargoes, war, acts of war (whether war be declared or not), insurrections, riots, civil commotion, acts of God or acts, acts of terrorism, earthquake, failure of utilities or omissions or delays in acting by any governmental authority (collectively, "Events of Force Majeure"); provided, however, that the affected Party shall exert all reasonable efforts to eliminate, cure or overcome any such Event of Force Majeure and to resume performance of its covenants with all possible speed. Notwithstanding the foregoing, to the extent that an Event of Force Majeure continues for a period in excess of [***], the affected Party shall promptly notify in writing the other Party of such Event of Force Majeure and within [***] of the other Party's receipt of such notice, the Parties agree to negotiate in good faith either (i) to resolve the Event of Force Majeure, if possible, (ii) to extend by mutual agreement the time period to resolve, eliminate, cure or overcome such Event of Force Majeure, (iii) to amend this Agreement to the extent reasonably possible, or (iv) to terminate this Agreement.
ARTICLE 18 — ASSIGNMENT
This Agreement may not be assigned or otherwise transferred, nor, except as expressly provided hereunder, may any right or obligations hereunder be assigned or transferred to any Third-Party by either Party without the consent of the other Party, such consent not to be unreasonably withheld; provided, however, that either Party may, without such consent but with
34
notification, assign this Agreement and its rights and obligations hereunder to any of its Affiliates or in connection with the transfer or sale of all or substantially all of its business, or in the event of its merger or consolidation. Any permitted assignee shall assume all rights and obligations of its assignor under this Agreement.
ARTICLE 19 — SEVERABILITY
Each Party hereby agrees that it does not intend to violate any public policy, statutory or common laws, rules, regulations, treaty or decision of any government agency or executive body thereof of any country or community or association of countries. Should one or more provisions of this Agreement be or become invalid, the Parties hereto shall substitute, by mutual consent, valid provisions for such invalid provisions which valid provisions in their economic effect are sufficiently similar to the invalid provisions that it can be reasonably assumed that the Parties would have entered into this Agreement with such provisions.
In case such provisions cannot be agreed upon, the invalidity of one or several provisions of this Agreement shall not affect the validity of this Agreement as a whole, unless the invalid provisions are of such essential importance to this Agreement that it is to be reasonably assumed that the Parties would not have entered into this Agreement without the invalid provisions.
ARTICLE 20 — INSURANCE
During the term of this Agreement and thereafter for the period of time required below, each Party shall maintain an ongoing basis [***] in the minimum amount of [***] per occurrence and [***] annual aggregate combined single limit for bodily injury and property damage liability; and commencing not later than [***] and thereafter for the period of time required below, each Party shall obtain and maintain on an ongoing basis [***] (including [***] under this Agreement) in the amount of at least [***] per occurrence and annual aggregate combined single limit for [***]. All of such insurance coverage shall be maintained with an insurance company or companies having an [***] and an aggregate deductible not to exceed [***] per occurrence.
Not later than [***] with respect to the [***] coverage, and not later than [***] prior to the [***] with respect to the [***], each Party shall provide to the other a certificate(s) evidencing all such required coverage hereunder. Thereafter each Party shall maintain such insurance coverage without interruption during the term of this Agreement and for a period of at least [***] after the expiration or termination of the term and shall provide certificates evidencing such insurance coverage without interruption on an [***] basis (by no later than the [***] for such coverage) during the period of time for which such coverage must be maintained.
Each Party's insurance shall [***] and shall state that [***] of any cancellation or material change in the insurance policy. The Parties expressly acknowledge that this Article 20 is based on the obligations of [***] and its sublicensees under the [***]. In the event the [***] is terminated or is otherwise irrelevant to the Exploitation of Products pursuant to this Agreement, the Parties will discuss and agree on an appropriate level of insurance coverage and term of such coverage to be obtained and maintained by each of the Parties.
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ARTICLE 21 - DISCLAIMER OF WARRANTIES
EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN ARTICLE 14, THE PARTIES MAKE NO REPRESENTATIONS AND GRANT NO WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, AND THE PARTIES EACH SPECIFICALLY DISCLAIM ANY OTHER WARRANTIES, WHETHER WRITTEN OR ORAL, OR EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR ANY WARRANTY AS TO THE VALIDITY OF ANY PATENTS OR THE NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.
ARTICLE 22 - MISCELLANEOUS
22.1. Notices. Any consent, notice or report required or permitted to be given or made under this Agreement by one of the Parties hereto to the other shall be in writing, delivered personally or by facsimile (and promptly confirmed by personal delivery, first class air mail or courier), first class air mail or courier, postage prepaid (where applicable), addressed to such other Party at its address indicated below, or to such other address as the addressee shall have last furnished in writing to the address or in accordance with this Section 22.1 and (except as otherwise provided in this Agreement) shall be effective upon receipt by the addressee.
If to SGI:
Seattle Genetics, Inc.
21823 30th Drive S.E.
Bothell, WA 98021
Attention: Chief Executive Officer
With copy to:
Venture Law Group
4750 Carillon Point
Kirkland, WA 98033
Attention: Sonya F. Erickson
If to GCOR:
Genencor International, Inc.
925 Page Mill Road
Palo Alto, CA 94304-1013
Attention: Chief Business Officer, Health Care
With copy to:
Genencor International, Inc.
925 Page Mill Road
Palo Alto, CA 94304-1013
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Attention: General Counsel
22.2. Applicable Law. The Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to the conflict of law principles thereof.
22.3. Dispute Resolution. The Parties agree that if any dispute or disagreement arises between GCOR on the one hand and SGI on the other in respect of this Agreement, they shall follow the following procedure in an attempt to resolve the dispute or disagreement.
(a) The Party claiming that such a dispute exists shall give notice in writing ("Notice of Dispute") to the other Party of the nature of the dispute;
(b) Within [***] of receipt of a Notice of Dispute, a nominee or nominees of GCOR and a nominee or nominees of SGI shall meet in person and exchange written summaries reflecting, in reasonable detail, the nature and extent of the dispute, and at this meeting they shall use their reasonable endeavors to resolve the dispute;
(c) If, within a further period of [***], the dispute has not been resolved, the President of SGI and the Chief Business Officer, Health Care of GCOR shall meet at a mutually agreed upon time and location for the purpose of resolving such dispute;
(d) If, within a further period of [***], the dispute has not been resolved or if, for any reason, the required meeting has not been held, then (i) if the dispute relates to a Development Decision, the compound will default to "no go" for any further joint development, subject to Sections 7.4 and 15.6.3; or (b) if the dispute does not relate to a Development Decision, the dispute shall be resolved pursuant to paragraph (e) of this Section 22.3.
(e) The Parties agree that they will mediate such dispute before taking any adversarial action such as litigation. The mediation shall take place in [***] and be conducted by an experienced mediator mutually selected by the Parties or, if the Parties cannot agree on a mediator, shall be asked to propose a list of five qualified people which each Party shall rank in order of preference, the person with the highest total ranking being chosen. The mediation shall proceed through at least one joint mediation session or its equivalent to determine whether the Parties are capable of reaching a mediated agreement. If the mediator is satisfied that the Parties are working to an agreement, the Parties agree to continue the mediation process until an agreement is reached or the mediator is satisfied that the Parties are not progressing in the mediation process. Upon the conclusion of the mediation process the parties shall be free to proceed with litigation according to the terms of this agreement.
(f) In the event of a dispute regarding any payments owing under this Agreement, all undisputed amounts shall be paid promptly when due and the balance, if any, promptly after resolution of the dispute.
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22.4. Entire Agreement. This Agreement contains the entire understanding of the Parties with respect to the subject matter hereof. All express or implied agreements and understandings, either oral or written, heretofore made are expressly superseded by this Agreement. This Agreement may be amended, or any term hereof modified, only by a written instrument duly executed by both Parties hereto.
22.5. Independent Contractors. SGI and GCOR each acknowledge that they shall be independent contractors and that the relationship between the two Parties shall not constitute a partnership, joint venture or agency. Neither SGI nor GCOR shall have the authority to make any statements, representations or commitments of any kind, or to take any action, which shall be binding on the other Party, without the prior consent of the other Party to do so.
22.6. Affiliates. Each Party shall cause its respective Affiliates to comply fully with the provisions of this Agreement to the extent such provisions specifically relate to, or are intended to specifically relate to, such Affiliates, as though such Affiliates were expressly named as joint obligors hereunder.
22.7. Waiver. The waiver by either Party hereto of any right hereunder or the failure to perform or of a breach by the other Party shall not be deemed a waiver of any other right hereunder or of any other breach or failure by said other Party whether of a similar nature or otherwise.
22.8. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first set forth above.
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SEATTLE GENETICS, INC. |
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By: |
/s/ Clay B. Siegall |
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Name: |
Clay B. Siegall |
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Title: |
President & CSO |
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GENENCOR INTERNATIONAL, INC. |
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By: |
/s/ Debby Jo Blank |
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Name: |
Debby Jo Blank, M.D. |
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Title: |
CBO/Sr. V.P. Healthcare |
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