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COLLABORATION and OPTION AGREEMENT
IL-1 BETA
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This Agreement is entered this 30th day of October, 1998 (the "Effective
Date") into by and between :
CISTRON BIOTECHNOLOGY, INC., a corporation organized and existing
under the laws of the State of Delaware, having its principal place
of business at ▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇
(hereinafter referred to as "CISTRON")
and
PASTEUR MERIEUX Serums & Vaccins - a Pasteur Merieux Connaught
Company, a societe anonyme organized and existing under the laws of
the French Republic, having its registered head office at ▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇,
(hereinafter referred to as "PMC")
WITNESSETH
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WHEREAS, CISTRON has developed intellectual property, including inventions
which are the subject matter of patents and patent applications and secret
and substantial know-how, relating to a cytokine called Interleukin 1 beta
("IL-1b" or the "FACTOR") used as an immuno-adjuvant ;
WHEREAS, PMC wishes to obtain from CISTRON an option for a license to use
CISTRON' inventions relating to the FACTOR for use as an adjuvant in human
vaccines, and CISTRON is shalling to grant such license option to PMC,
subject to the terms of and conditioned upon this Agreement ;
WHEREAS, CISTRON and PMC also want to collaborate in order to identify and
discover vaccine antigens suitable for combination with the FACTOR as an
adjuvant, to be used as either mucosal or parenteral preparations for the
prevention or treatment and/or cure of infectious diseases and cancers,
which shall be used by PMC to evaluate potential vaccine products for use
in humans, thus expanding the intellectual property portfolio with respect
to the use of the FACTOR as an immuno-adjuvant.
NOW, THEREFORE, in consideration of the respective representations and
covenants of each of the Parties as set forth below, CISTRON and PMC,
intending to be legally bound, agree as
follows :
ARTICLE I - DEFINITIONS AND INTERPRETATION
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1.1. Definitions : For the purposes of this Agreement the following words
and phrases shall have the following meanings :
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(a) "Affiliate" means, with respect to any Person, (i) any other
Person of which the securities or other ownership interests
representing fifty per cent (50 %) or more of the equity or fifty
per cent (50 %) or more of the ordinary voting power or fifty per
cent (50 %) or more of the general partnership interest are, at
the time such determination is being made, owned, Controlled or
held, directly or indirectly, by such Person (a "Subsidiary"), or
(ii) any other Person which, at the time such determination is
being made, is Controlling or under common Control with, such
Person. As used herein, the term "Control", whether used as a
noun or verb, refers to the possession, directly or indirectly,
of the power to direct, or cause the direction of, the management
or policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.
(b) "Agreement" means this agreement, all amendments and supplements
to this Agreement and all schedules to this Agreement, including
the following :
Schedule A - OPTIONED PATENTS
Exhibit 1 - RESEARCH PROGRAM
Exhibit 2 - LICENSE AGREEMENT
(c) "Biological Materials" shall mean any biological materials
including but not limited to structural genes, genetic sequences,
promoters, enhancers, probes, linkage probes, vectors, hosts,
plasmids, peptides, polypeptides, transformed cell lines,
transgenic animals, proteins, biological modifiers, antigens,
reagents, hybridomas, antibodies, toxins, lectins, enzymes,
lipids, hormones, viruses, cells or parts of cells, cell lines,
fragments of any of the foregoing and any other biologically
active material or compound, whether or not occurring naturally
or howsoever derived, modified, conjugated, cross-linked,
immobilized, reduced, purified or produces, whether by
recombinant DNA techniques and/or otherwise.
(d) "Calendar Quarter" means any of the three-month periods beginning
January 1, April 1, July 1 and October 1 in any year.
(e) "CISTRON Improvement" means Improvements which are conceived
during the term of this Agreement solely or jointly by employees
or contractors acting on behalf of CISTRON or its Affiliates, to
the extent that CISTRON has now or hereafter shall have the right
to grant licenses, immunities or other rights thereon.
(f) "CISTRON Technology" means the OPTIONED PATENTS, the OPTIONED
KNOW-HOW and the CISTRON Improvements, and shall include
CISTRON's share in any JOINT INVENTIONS and Joint Patent Rights.
(g) "Confidential Information" has the meaning ascribed to it in
Section 4.1. of this Agreement.
(h) "Event of Force Majeure" has the meaning ascribed to it in
Article 4.4. of this Agreement.
(i) "FACTOR" means the cytokine (a protein) called Interleukin 1
beta, or IL-1b, as described in the OPTIONED PATENTS, and any
derivatives thereof, and is intended to refer to both the protein
itself and the gene encoding thereto.
(j) "Field of Preventative Vaccines" means the field comprised of
bio-pharmaceutical products for the prevention through active
immunization against infectious diseases and/or cancers in
humans.
(k) "Field of Therapeutic Vaccines" means the field comprised of bio-
pharmaceutical products for the immunotherapy through active
immunization against infectious diseases and/or cancers in
humans.
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(l) "Field of Use" means either the Field of the Therapeutic Vaccines
or the Field of the Preventative Vacines or both.
(m) "Improvements" means all patentable and non-patentable
inventions, discoveries, technology and information of any type
whatsoever, including without limitation Biological Materials,
methods, processes, technical information, knowledge, experience
and know-how which utilize, incorporate, derive from, or are
based on CISTRON Technology or could not be conceived, developed
or reduced to practice but for the use of the CISTRON Technology.
(n) "JOINT INVENTIONS" and "Joint Patent Rights" have the meaning
ascribed to it in Section 3.7 hereof.
(o) "License Issue Fee" is defined in Section 2.2.3 hereof.
(p) "OPTIONED KNOW-HOW" means any and all technical information,
discoveries, improvements, processes, formulae, data,
engineering, technical and shop drawings, inventions, Biological
Materials, shop-rights, know-how and trade secrets which is
useful or necessary to make, have made, use or sell the FACTOR
and/or PRODUCTS or to practice under the OPTIONED PATENTS in the
Field of Use, which have been, or hereafter are, either developed
reduced to practice by CISTRON or its Affiliates, or the rights
to which in the Field of Use have been acquired by CISTRON or its
Affiliates and to which CISTRON or its Affiliates have a
transferable interest.
(q) "OPTIONED PATENTS" means :
(i) any existing patents and patent applications listed in
Schedule A to this Agreement ;
(ii) any future patents issued from any patent applications
referred to in Paragraph 1.(p).(i) above and any future
patents issued from a patent application filed in any country
in the Territory which corresponds to a patent or patent
application identified in Paragraph 1.(p).(i) above ;
(iii) any reissues, confirmations, renewals, extensions,
counterparts, divisions, continuations, continuations-in-
part, supplemental protection certificates or utility models
issued, assigned or licensed to CISTRON or its Affiliates of
or relating to the patents or patent applications identified
in Paragraph 1.(p).(i) and (ii) above
(iv) any future patents and patent applications covering CISTRON
Improvements, solely or jointly owned by CISTRON or its
Affiliates, or licensed by CISTRON or its Affiliates with the
right to sublicense any JOINT INVENTIONS or Joint Patent
Rights.
(r) "Notice of Dispute" has the meaning ascribed to it in Section
4.7.4.(a) of this Agreement.
(s) "Option" and "Option Period" are defined in Article 2 hereof.
(t) "Parties" means PMC and CISTRON, and "Party" means any one of
them.
(u) "Person" means an individual, corporation, partnership, trust,
business trust, association, joint stock company, pool,
syndicate, sole proprietorship, unincorporated organization,
governmental authority or any other form of entity not
specifically listed herein.
(v) "PMC Improvement" means Improvements which are conceived during
the term of this Agreement solely or jointly by employees or
contractors acting on behalf of PMC
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or its Affiliates, to the extent that PMC has now or hereafter
shall have the right to grant licenses, immunities or other
rights thereon.
(w) "PRODUCTS" means any and all vaccines or other bio-pharmaceutical
products intended for use in the Field of Preventative Vaccines
or the Field of Therapeutic Vaccines which (i) incorporate the
FACTOR as an adjuvant or (ii) more generally utilize any or are
based on any CISTRON Technology.
(x) "Selected Field of Use" is defined in Section 2.2.3 hereof.
(y) "Third-Party" means any Person other than PMC, CISTRON and their
respective Affiliates.
(z) "Valid Patent Claim" means a claim of an issued and unexpired
patent or patent application included in OPTIONED 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. If there should be two or more decisions within the
same country which are conflicting with respect to the invalidity
of the same claim, the decision of the highest tribunal shall
thereafter control. However, should the tribunals be of equal
authority, then the decision or decisions holding the claim valid
shall prevail where the conflicting decisions are equal in number
and the majority of decisions shall prevail where the conflicting
decisions are not equal in number.
1.2. Certain Rules of Interpretation in this Agreement and the Schedules:
(a) An accounting term not otherwise defined has the meaning assigned
to it by, and every accounting matter shall be determined in
accordance with, generally accepted accounting principles in the
United States of America;
(b) Unless otherwise specified, all references to monetary amounts
are to United States dollars currency (US$);
(c) 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 ;
(d) 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 ;
(e) 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 ;
(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 in the jurisdiction of the
Party to make such payment or do such act.
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ARTICLE 2 - OPTION
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2.1. Research License to PMC
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Subject to the provisions of this Agreement, CISTRON hereby grants to
PMC and its Affiliates, and PMC hereby accepts, for the term provided
for in section 2.2.2. hereof (the "Option Period"), the right to use
CISTRON Technology solely for the purpose of conducting research &
development activities (including pre-clinical and clinical studies)
in the Field of Use relating to the FACTOR and PRODUCTS and evaluating
PMC's interest in exercising the Option. PMC shall communicate to
CISTRON an outline of the research work that PMC intends to conduct
during the Option Period and shall keep CISTRON informed of its
progress throughout such term in accordance with Section 3.2 hereof.
CISTRON agrees that promptly following the execution of this Agreement,
it shall make available to PMC and/or a designated PMC Affiliate such
OPTIONED KNOW-HOW (including, but not limited to, non-published patent
applications) and such quantities of research grade FACTOR as
reasonably necessary to enable PMC to conduct its own research &
development activities during the Option Period and to evaluate its
interest in exercising the Option; provided, however, that CISTRON
shall not be obligated to provide PMC with more than One Hundred
milligrams (100 mg) of research grade FACTOR per Calendar Quarter.
PMC hereby covenants to CISTRON that PMC shall not use research grade
FACTOR supplied to it by CISTRON hereunder for the purpose of clinical
trials or any similar experiments in humans. PMC shall be responsible
for manufacturing or having manufactured clinical grade FACTOR, provided
that PMC shall consult with CISTRON in this respect and shall exert
commercially reasonable efforts in organizing such manufacturing so
that there is sufficient supply of FACTOR for use by CISTRON for the
needs of the Research Program and other CISTRON needs in addition to
PMC's needs. CISTRON shall indicate to PMC its best estimates of the
quantities of FACTOR that it may need during the Option Period.
Certain research & development activities to be performed during the
Option Period shall be conducted on a collaborative basis by PMC and
CISTRON in accordance with and subject to the terms & conditions set
forth in Article 3.
2.2. Option
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2.2.1. Grant of the Option.
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Subject to the provisions of this Agreement, CISTRON hereby grants to
PMC, and PMC hereby accepts, an exclusive option (the "Option") to
enter into a license under terms and conditions set forth in the
License Agreement herewith attached as Exhibit 2. Without limiting the
generality of the foregoing, CISTRON covenants that during the Option
Period, neither CISTRON nor its Affiliates shall grant to any Third-
Party any right, license or privilege to use CISTRON Technology in the
Field of Use. PMC may exercise the Option at any time on or before the
expiration of the Option Period in accordance with Section 2.2.3
hereinafter.
2.2.2. Option Period.
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The Option Period shall commence on the Effective Date and shall
continue for a period of three (3) years thereafter, unless otherwise
terminates in accordance with its terms.
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2.2.3. Exercise of the Option.
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PMC may exercise the Option at any time during the Option Period but
in any case no later than the date upon which the Option Period shall
expire by (i) providing written notice to CISTRON not less than thirty
(30) days prior to the expiration of the Option Period specifying the
Selected Field(s) of Use and (ii) by paying to CISTRON a non-
refundable, non-creditable license issue fee of Three Million and Five
Hundred Thousand US Dollars (3,500,000.- US$) per Selected Field of
Use (the "License Issue Fee"), provided, however, that the License
Issue Fee with respect to the Field of Preventative Vaccines shall be
paid at the latest by October 31, 2001 if such field is selected by
PMC, and the License Issue Fee with respect to the Field of
Therapeutic Vaccines shall be paid not later than January 30, 2002,
if such field is selected by PMC. For the purpose of this Agreement,
"Selected Field of Use" shall mean the field in which PMC may choose
to exercise its option right and therefore obtain the LICENSE, which
may be comprised of the Field of the Preventative Vaccines, or the
Field of the Therapeutic Vaccines, or both.
2.2.4. Effect of Failure to Exercise Option.
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Without prejudice to the last paragraph of this Section 2.2.4., in the
event PMC fails to properly and timely exercise the Option in the
Field of Use, PMC shall be deemed to have forfeited all its rights
hereunder, and it shall promptly return to CISTRON all CISTRON
Technology and all embodiments of such technology.
Without prejudice to the last paragraph of this Section 2.2.4., in the
event PMC fails to properly and timely exercise the Option in either
the Field of Preventative Vaccines or the Field of Therapeutic
Vaccines, then PMC shall be deemed to have forfeited its rights
hereunder to the extent such rights pertain to the non-selected field
and it shall promptly return to CISTRON all CISTRON Technology and all
embodiments of such technology.
In both cases, PMC and CISTRON shall remain joint owners of JOINT
INVENTIONS under the terms and conditions of Section 3.7 hereof.
2.2.5. Actions to be Taken upon Option Exercise.
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In the event that PMC exercises the Option in a Field of Use, it shall
send to CISTRON along with the notice provided for in Section 2.2.3.
hereof, two original counterparts of the License Agreement herewith
attached as Exhibit 2, ready for execution, adjusted to reflect the
Selected Field of Use if required. PMC shall also join a term sheet
describing proposed terms and conditions for the continued
commercialization of JOINT INVENTIONS by CISTRON outside the Selected
Field of Use.
ARTICLE 3 - RESEARCH COLLABORATION.
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3.1. Object.
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Pursuant to a mutually agreed upon research program attached hereto as
Exhibit 1 (the "Research Program"), CISTRON agrees to conduct
research works described therein and PMC agrees to support and fund
such Research Program in accordance with the terms and conditions set
forth here below.
3.2. Oversight of the Research Program.
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The Parties shall meet as they deem fit and in any event not less
than once a year during the term of the Research Program, at such
dates and times as agreed to by the Parties. Face to face meetings
shall normally take place at CISTRON's premises or such other place
as may be mutually agreed upon. Meetings may be held by
telecommunication means. At such meetings, CISTRON shall present the
status of performance by CISTRON under the Research Program and
purposes and conditions of any collaboration with a Third-Party that
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CISTRON may intend to enter into in connection with the Research
Program and the Parties shall jointly evaluate the results thereof
and set priorities therefor in accordance with CISTRON's
recommendations. PMC shall have the right to comment on CISTRON's
recommendations, and CISTRON shall give due consideration to such
PMC's comments, but CISTRON shall have the final decision on any
matters relating to the performance of the Research Program.
Similarly, during the above-mentioned meetings, PMC shall present the
status of performance by PMC under its own research program, and the
Parties shall jointly evaluate the results thereof and set priorities
therefor in accordance with PMC's recommendations. CISTRON shall have
the right to comment on PMC's recommendations, and PMC shall give due
consideration to such CISTRON's comments, but PMC shall have the
final decision on any matters relating to the performance of PMC
research in the Field of Use. The Parties shall prepare written
minutes of each meeting and a written record of all decisions whether
made at a formal meeting or not. Such minutes shall incorporate semi-
annual research reports prepared by CISTRON and semi-annual reports
prepared by PMC.
3.3. Conduct of Research Program.
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3.3.1. Good Laboratory Practice. The Research Program shall be conducted
by CISTRON at CISTRON's laboratories and/or at Third-Party research
laboratories contracted by CISTRON. CISTRON shall use all reasonable
efforts to complete research works in accordance with the said
Program. Any research work performed by CISTRON pursuant hereto shall
be in compliance with current Good Laboratory Practices (cGLP) as
applicable in the United States of America.
3.3.2. Laboratory Notebooks. CISTRON shall cause its employees, agents
and subcontractors to maintain laboratory notebooks. Such laboratory
notebooks shall set forth such work in detail, including a clear
description of the purposes for which the work has been undertaken
and the results expected ; sufficient details, diagrams, plans,
sketches and identification of materials (including Biological
Materials) used, formulations and operating conditions under which
the work was conducted as may be necessary to understand and
reproduce the work conducted ; identification of any intermediate or
final results achieved ; and if such laboratory notebooks contain any
interpretations of data, they shall also describe the rough data upon
which such interpretations have been based. CISTRON shall further
cause its employees, agents and subcontractors maintaining such
laboratory notebooks to have their work corroborated periodically,
which corroboration shall include at least personal witnessing of the
notebooks indicating that the witness has read and understood the
material on the page witnessed on the date that he or she signed it.
3.4. Financial conditions.
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3.4.1. Support commitment. In consideration of the work performed by
CISTRON pursuant to and in accordance with the Research Program, PMC
shall pay to CISTRON during the Research Program Three Hundred
Thousand United States dollars (300,000.- US$) per year for three
(3) years. Such payments shall be non-refundable, guaranteed and not
contingent upon any research milestones.
3.4.2. Payments Schedule. Support payments shall be made by PMC to
CISTRON in twelve (12) quarterly payments of Seventy Five Thousand
United States dollars (75,000- US$) in advance with the first
payment to be made within fifteen (15) days of the Effective Date of
this Agreement, and the other payments payable on the first day of
each of the subsequent Calendar Quarters.
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3.4.3. No Conflict With Research Program. CISTRON agrees that the funds
provided by PMC hereunder shall be applied to the Research Program
and to Field of Use-related research and may not, without PMC prior
written approval, be used in support of any r research at CISTRON
which would not be closely related to the Field of Use, the FACTOR or
PRODUCTS.
3.4.4. Title to Equipment. CISTRON shall retain title to any equipment
purchased with funds provided by PMC under this Agreement, if such
purchase is mutually agreed upon to support the Research Program.
3.5. Term of the Research Program.
The term of the Research Program shall be three (3) years as from the
Effective Date.
3.6. Confidentiality.
In order to facilitate the Research Program, either Party may disclose
confidential or proprietary information owned or controlled by it to
the other. It is hereby understood and agreed that such information
shall be deemed "Confidential Information" as defined in Article 4.1.
and treated as such.
3.7. JOINT INVENTIONS.
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3.7.1 Inventions Arising During Option Period. All right, title and
interest in and to any technology or invention, whether or not
patentable, and any patent applications and patents based thereof,
made or conceived by or on behalf of either Party during the Option
Period which are (i) CISTRON Improvements, (ii) PMC Improvements or
(iii) inventions made jointly by CISTRON employees and PMC employees
in the course of the Research Program, shall be deemed to be joint
inventions ("Joint Inventions") and shall be jointly owned by the
Parties on an equal basis. In the event that CISTRON wishes to
commercialize any Joint Invention which does not infringe on any
CISTRON Technology (i) outside the Fields of Use at any time, or
(ii) within either Field of Use following the expiration of the
Option Period (assuming PMC has declined to exercise the PMC Option
in respect of such Field of Use), CISTRON agrees to pay a royalty to
PMC, on the terms provided below. In the event that PMC wishes to
commercialize any Joint Invention (i) outside the Fields of Use at
any time, or (ii) within either Field of Use following the
expiration of the Option Period (assuming PMC has declined to
exercise the PMC Option in respect of such Field of Use), PMC agrees
to pay a royalty to CISTRON, on the terms provided below. In the
event that PMC wishes to commercialize any Joint Invention which
does infringe on any CISTRON Technology, it shall only do so under a
license from CISTRON.
3.7.2. Inventions Arising Subsequent to Option Period. Each of the
Parties hereto shall have the rights set forth below in respect of
any and all inventions, whether or not patentable, made by either
Party following expiration of the Option Period: (a) in the event
that PMC has made an invention, PMC shall own all right, title and
interest in and to such invention and shall be free to use such
invention as it sees fit, provided it does not infringe upon any
CISTRON Technology under which PMC does not have a license (provided
this shall not limit PMC's obligations under that certain license
agreement between the Parties), and (b) in the event that CISTRON
has made an invention which is derived from or based upon any Joint
Invention, CISTRON will own all right, title and interest in and to
such invention, and (i) if PMC has not exercised the PMC Option,
CISTRON shall be free to use such invention as it sees fit, and
shall pay a royalty to PMC on sales of products using such invention
on the terms provided below, and (ii) if PMC has exercised the PMC
Option in respect of either or both Fields of Use, the rights to
such invention shall be automatically included in the
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LICENSE AGREEMENT and licensed thereunder to PMC in the applicable
Field(s) of Use, and CISTRON shall be free to use such invention as
it sees fit outside the applicable Field(s) of Use, and shall pay a
royalty to PMC on sales of products using such invention, on the terms
provided below.
3.7.3 Determination of Royalties. In determining the royalty payable
to the other Party, in the event a royalty is to be paid pursuant to
subparagraph 3.7.1 or 3.7.2 hereof, the Parties agree to negotiate
in good faith a reasonable royalty which reflects the value of the
Joint Invention in relation to all other technology and proprietary
rights included in such product and, in the case of subparagraph
3.7.2 hereof only, the importance of the Joint Invention to the
discovery of the subsequent invention by a Party.
3.7.4 As to any JOINT INVENTIONS made by the Parties during the term of
this Agreement, CISTRON shall have the first right to file patent
applications with respect to such inventions in the name of both
Parties. CISTRON may elect not to file and if it does so, PMC
shall have the right to file the patent application. Any patents
and patent applications covering a JOINT INVENTION are referred
to herein as "Joint Patent Rights". In any case, the filing Party
shall give the non-filing Party an opportunity to review the text
of the application before filing, shall consult with the non-
filing Party with respect thereto and shall supply the non-filing
Party with a copy of the applications as filed, together with
notice of its filing date and serial number and fifty percent
(50%) of the out-of-pocket costs and expenses of the filing Party
shall be reimbursed by the other Party. Both Parties shall keep
the other advised of the status of actual and prospective patent
application filings and upon request, provide advanced copies of
any documents related to such filings and thereafter to the
prosecution and maintenance of all patent applications and
patents pertaining to Joint Patent Rights.
3.8 Commercialization of Inventions.
--------------------------------
CISTRON and PMC each hereby represents that all employees and other
Persons acting on its behalf in performing its obligations under
this Agreement shall be obligated under a binding written
agreement to assign to it, or as it shall direct, all
Improvements conceived or reduced to practice by such employees
or other Persons during the term of this Agreement.
3.8.1 Patent Prosecution and Maintenance.
-----------------------------------
OPTIONED PATENTS. CISTRON shall be responsible for and shall control
the preparation, filing, prosecution, grant and maintenance of all
OPTIONED PATENTS. CISTRON shall prepare, file, prosecute and maintain
such OPTIONED PATENTS in good faith consistent with its customary
patent policy and its reasonable business judgement, and shall
consider in good faith the interests of PMC in so doing.
Costs. With respect to all filings hereunder, the filing Party shall
be responsible for payment of all costs and expenses related to such
filings, prosecution and maintenance, unless relieved of same
pursuant to Section 3.8.2 hereinafter, and except for jointly owned
patents, for which fifty percent (50%) of all such costs and expenses
shall be reimbursed to the filing Party by the other Party.
3.8.2 Option to Prosecute and Maintain Patents.
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CISTRON shall give notice to PMC of any intention to cease prosecution
and/or maintenance, or not to proceed with an extension, of OPTIONED
PATENTS and, in such case, shall permit PMC, at PMC's sole
discretion, to continue prosecution or maintenance or proceed with
the extension at its own expenses. If PMC elects to continue
prosecution or maintenance or to proceed with the extension, CISTRON
shall execute such documents and perform such acts at PMC's expense
as may be reasonably necessary to effect an
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assignment of such OPTIONED PATENTS to PMC in a timely manner, and
more generally to permit PMC to continue such prosecution and
maintenance or to proceed with the extension. Any patents and patent
applications so assigned shall not be considered as OPTIONED PATENTS
as of the date of such assignment. No royalties shall be payable by
PMC on sales of PRODUCTS covered only by a Valid Patent Claim of a
OPTIONED PATENT which has been assigned to PMC pursuant to this
Section 3.8.
3.8.3 Interference, Opposition, Reexamination and Reissue.
----------------------------------------------------
(i) The Parties shall use their respective best efforts to within
ten (10) days of learning of any interference, opposition,
reexamination or reissue event, inform the other Party of any
request for, or filing or declaration thereof relating to
OPTIONED PATENTS. The Parties shall thereafter consult and
cooperate fully to determine the course of action with respect
to any such proceeding. Both Parties shall have the right to
review and comment on any submission to be made in connection
with any such proceeding.
(ii) CISTRON shall not institute any reexamination or reissue
proceeding relating to OPTIONED PATENTS without having first
consulted PMC.
(iii) In connection with any interference, opposition, reissue or
reexamination proceeding relating to OPTIONED PATENTS, the
Parties shall cooperate fully and shall provide each other
with any information or assistance that either Party may
reasonably request. CISTRON shall keep PMC informed of
developments in any such action or proceeding, including,
to the extent permissible, the status of any settlement
negotiations and the terms of any offer related thereto.
(iv) CISTRON shall bear the expense of any interference, opposition,
reexamination or reissue proceeding relating to OPTIONED
PATENTS.
3.8.4 Enforcement and Defense.
------------------------
(i) Each Party shall give the other notice of either (a) any
infringement of OPTIONED PATENTS, or (b) any misappropriation
or misuse of OPTIONED KNOW-HOW that has come to its attention.
The Parties shall thereafter consult and cooperate fully to
determine a course of action, including but not limited to the
commencement of legal action by either or both Parties to
terminate any infringement of OPTIONED PATENTS or any
misappropriation or misuse of OPTIONED KNOW-HOW.
(ii) In the event that OPTIONED PATENTS are infringed by any Third-
Party with respect to a PRODUCT in the Field of Use, CISTRON,
upon notice to PMC, shall have the first right, but not the
obligation, to institute and prosecute any action or proceeding
under OPTIONED PATENTS with respect to such infringement, by
counsel of its choice, or to control the defense of any
declaratory judgment action arising from such infringement or
from the misappropriation or misuse of OPTIONED KNOW-HOW, at its
own expense and in the name of both Parties. CISTRON shall not
settle, compromise or take any action in such litigation which
diminish, limit or inhibit the scope, validity or enforceability
of OPTIONED PATENTS without the express permission of PMC.
CISTRON shall keep PMC advised of the progress of such
proceedings.
(iii) In the event that a Third-Party is infringing any OPTIONED
PATENTS with respect to a PRODUCT in the Field of Use and CISTRON
does not elect to institute an action, PMC, upon notice to
CISTRON, shall have the right, but not the obligation, to
institute and prosecute any action or proceeding under OPTIONED
PATENTS with respect to such infringement, by counsel of its
choice, or to control the defense of any declaratory judgment
action arising from such infringement or from the
misappropriation or misuse of OPTIONED KNOW-HOW, at its own
expense and in the name of both Parties. PMC shall not settle,
compromise or take any action in such litigation which diminish,
limit or
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inhibit the scope, validity or enforceability of OPTIONED
PATENTS without the prior approval of CISTRON, which
shall not be unreasonably withheld.
(iv) With respect to any action to terminate any infringement of
OPTIONED PATENTS or any misappropriation or misuse of OPTIONED
KNOW-HOW, the Parties shall cooperate fully and shall provide
each other with any information and assistance that either Party
may reasonably request. In particular, either Party shall execute
such documents necessary for the other Party to initiate and
prosecute the action or proceeding and cause its Affiliates and
Sublicensees to execute all such documents, if required. In the
event that either Party is unable to initiate or prosecute an
action solely in its own name, the other Party shall then join
such action voluntarily. Each Party shall keep the other
informed of the development of any action or proceeding
including, to the extent permissible by law, the status of any
settlement negotiations and the terms of any offer related
thereto.
(v) Any recovery obtained by either or both Parties in connection
with or as a result of any action or proceeding contemplated by
this Section 3.8, whether by settlement or otherwise, shall be
allocated in order as follows:
(a) The Party which initiated and prosecuted the action shall
recoup all of its costs and expenses incurred in connection
with the action (provided that if PMC was the initiating
Party and that the action proceeds were not sufficient for
PMC to recoup all its costs and expenses, then PMC shall be
allowed to deduct the balance of its unrecovered costs and
expenses from royalties payable to CISTRON under Article 3
hereof) ;
(b) The other Party shall then, to the extent possible, recover
its costs and expenses incurred in connection with the
action; and
(c) The amounts of any recovery remaining shall then be
allocated between the Parties with PMC receiving all amounts
in respect of damages in the Field of Use and CISTRON
receiving all amounts in respect of damages out of the Field
of Use, except that any amounts recovered in connection with
infringement actions relating to jointly-owned patents shall
be equally shared between the Parties.
(vi) CISTRON shall inform PMC of any certification regarding any
OPTIONED PATENTS it has received pursuant to ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Code 355(b)(2)(A)(iv) or (j)(2)(A)(vii)(IV), or any similar
provision in other countries, and shall provide PMC with a copy
of such certification within five (5) days of receipt. Both
Parties rights with respect to the initiation and prosecution of
any legal action as a result of such certification or any
recovery obtained as a result of such legal action shall be as
defined in paragraphs (a) to (c) of this Section 3.8.4(v).
3.8.5 Notice of Patent Events.
------------------------
CISTRON shall promptly give notice to the other Party of the grant,
lapse, revocation, surrender or invalidation of any OPTIONED PATENTS.
3.8.6 Patent Term Restoration.
------------------------
CISTRON shall notify PMC of (a) the issuance of each U.S. patent
included within the OPTIONED PATENTS, giving the date of issue and
patent number for each such patent, and (b) each notice pertaining to
any patent included within the OPTIONED PATENTS which it receives as
patent owner pursuant to the United Sates Drug Price Competition and
Patent Term Restoration Act of 1984 (hereinafter called the "Act"),
including notices pursuant
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12
to 101 and 103 of the Act from Persons who have filed a biological
license application ("BLA") or an abbreviated new drug application
("ANDA"), whichever is applicable. Such notices shall be given
promptly, but in any event within five (5) calendar days of each such
patent's date of issue or receipt of each such notice pursuant to the
A
ct, whichever is applicable. CISTRON shall notify PMC of each filing
for patent term restoration under the Act, any allegations of failure
to show due diligence and all awards of patent term restoration
(extensions) with respect to the OPTIONED PATENTS.
Likewise, CISTRON or PMC, as the case may be, shall inform the other
Party of patent extensions and periods of data exclusivity in the rest
of the world regarding any PRODUCTS and more generally the Parties
shall diligently cooperate with respect to any procedures for patent
and period of data exclusivity extensions, such as but not limited to
Supplementary Protection Certificates, the above-mentioned Patent
Term Restoration and corresponding GATT regulations.
ARTICLE 4 - GENERAL PROVISIONS
------------------------------
4.1. Confidentiality
---------------
(a) - General
-------
Except as expressly set forth in this Section 4.1., each Party
shall cause its respective Affiliates, officers, directors,
employees, agents and subcontractors (collectively,
"Representatives") to keep confidential any and all technical,
commercial, scientific and other data, processes, documents or
other information (whether in oral or written form) or physical
object (including, without limitation, Biological Materials,
intellectual property, marketing data, agreements between any
Party and a Third-Party, license applications, and business
plans and projections of any Party) acquired from the other
Party (the "Other Party"), its Affiliates or its
Representatives prior to or after the date of this Agreement
and which relates (in the case of a Party) to the Other Party
or any of its Affiliates or their respective businesses
("Confidential Information"), and each Party shall not disclose
directly or indirectly, and shall cause its Representatives not
to disclose directly or indirectly, any Confidential
Information to anyone outside such Person, such Affiliates and
their respective Representatives, except that the foregoing
restriction shall not apply to any information disclosed
hereunder to any Party, if such Person (the "Receiving Person")
can demonstrate that such Confidential Information:
(i) is or hereafter becomes generally available to the trade
or public other than by reason of any breach or default
by the Receiving Person, any of its Affiliates or any
Representative of the foregoing with respect to a
confidentiality obligation under this Agreement;
(ii) was already known to the Receiving Person or such
Affiliate or Representative;
(iii) is disclosed to the Receiving Person or such Affiliate
or Representative by a Third-Party who has the right to
disclose such information;
(iv) based on such Person's good faith judgement with the
advice of counsel, is otherwise required to be disclosed
in compliance with applicable legal requirements to a
public authority such as, without limitation, the US
Food & Drug Administration (FDA), the European Medicine
Evaluation Agency (EMEA), the French Agence du Medicament
or any comparable authority of any country having
jurisdiction.
Whenever the Receiving Person becomes aware of any state of
facts which would or might result in disclosure of Confidential
Information pursuant to subparagraph (iv)
-12-
13
above with the exception of the case here below referred to
in Section 4.1.(g) in fine, it shall, if possible, promptly
notify the Person making disclosure (the "Disclosing Person")
prior to any such disclosure so that the Disclosing Person may
seek a protective order or other appropriate remedy and/or
waive compliance with the provisions of this Agreement.
In any event, if the Receiving Person is unable to promptly
notify the Disclosing Person or if such protective order or
other remedy is not obtained, or if the Disclosing Person
waives compliance with the provisions of this Agreement, the
Receiving Person shall furnish only that portion of the
information which it is advised by counsel is legally required
and shall exercise reasonable efforts to obtain assurance that
confidential treatment shall be accorded the Confidential
Information.
Each Party shall be entitled, in addition to any other right or
remedy it may have, at law or in equity, to an injunction,
without the posting of any bond or other security except as
required by the relevant laws, enjoining or restraining the
other Party from any violation or threatened violation of this
Section 4.1.
(b) - Use of Confidential Information
-------------------------------
Each Party agrees that no Confidential Information shall:
(i) be used in its own business except as necessary to the
fulfilment of the rights and obligations of such Party
under this Agreement;
(ii) be assigned, licensed, sublicensed, marketed, transferred
or loaned, directly or indirectly to any Third-Party
other than a Representative or an Affiliate
Representative of such Party, except as necessary to the
fulfilment of the rights and obligations of the Parties
under this Agreement;
(iii) be used or exploited by such Party or any of its
Affiliates or their Representatives for its or their
respective benefit or the benefit of any other
relationships with customers of such Party and its
Affiliates.
Without limiting the generality of the foregoing, each Party
agrees that, it shall not (and shall not permit any of its
Affiliates) at any time use any Confidential Information in
the conduct of its business without the prior written consent
of the Other Party.
The obligations set forth in this Section 4.1. shall extend to
copies, if any, of Confidential Information made by any
Representatives referred to in paragraph (a) and to documents
prepared by such Persons which embody or contain Confidential
Information.
(c) - Protection of Confidential Information
--------------------------------------
Each Party shall deal with Confidential Information so as to
protect it from disclosure with a degree of care not less than
that used by it in dealing with its own information intended
to remain exclusively within its knowledge and shall take
reasonable steps to minimise the risk of disclosure of
Confidential Information which shall include, without
limitation, ensuring that only its Affiliates and its and
their Representatives who have a bona fide "need to know" such
Confidential Information for purposes permitted or contemplated
by this Agreement shall have access thereto. Each Party, shall
notify all of its Representatives who have access to
Confidential Information of its confidentiality and the care
therefor required, and shall obtain from any Affiliate or any
agent or subcontractor who is a Representative that is
permitted access to such Confidential Information in accordance
with this Section 4.1. an agreement of confidentiality
incorporating the restrictions set forth herein.
-13-
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(d) - Survival of Obligations
-----------------------
The obligations set forth in this Section 4.1. shall survive
the termination of this Agreement for a period of five (5)
years.
(e) - Return of Confidential Information
----------------------------------
Within thirty (30) days after the termination of this
Agreement, the Receiving Person shall (and shall cause its
Affiliates' Representatives and its Affiliates to) return to
the Disclosing Person or destroy all related documents and
tangible items (including but not limited to unused Biological
Materials) then in its possession which it has received from
the Disclosing Person or any Affiliate or Representative
thereof pertaining, referring or relating to the Disclosing
Person's Confidential Information, as well as all copies,
summaries, records, descriptions, modifications, and
duplications that it, or any of its Affiliates or
Representatives, has made from the documents or tangible items
received from the Disclosing Person or any Affiliate or
Representative thereof; provided, however, that the Receiving
Person may retain one copy of each document in its legal files
solely to permit the Receiving Person to continue to comply
with its obligations hereunder and, in addition, may upon
notice to the Disclosing Person, retain in its legal files
or in the office of outside legal counsel one copy of any
document solely for use in any pending legal proceeding to
which such document relates.
(f) - Publications
------------
Each Party shall have the right to publish or present the
results of the Research Program or of any research related
to the Field of Use and announce scientific progress of the
Research Program, provided such publication, presentation or
announcement (and any revisions thereof, a "Publication") is
submitted to the other Party at least sixty (60) days prior
to submitting it to any Third-Party (including any editing
Person). The other Party shall have sixty (60) days after
receipt of the draft Publication to review and comment on
such draft. Upon notice within such sixty (60) day period by
the other Party that such Party reasonably believes the
Publication would amount to the public disclosure of a
patentable JOINT 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 ninety (90) day period from the date of said notice, or
for such longer period which may appear necessary for
appropriately drafting and filing a patent application covering
such invention. In addition, each Party shall duly take into
account comments made by the other Party on any Publication and
shall accept 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 shall have
contributed. The terms of this paragraph may be modified from
time to time in accordance with the Sponsored Research
Agreement with Duke University dated September 1, 1998.
(g) - Press Releases and other Disclosures to Third Parties.
--------------
Neither CISTRON nor PMC shall, without the prior written
consent of the other, issue any press release or make any other
public announcement or furnish any statement to any Person
(other than either Party's respective Affiliates) concerning
the existence of this Agreement and the transactions
contemplated by this Agreement, except for (i) general
statements referring to the existence of this Agreement,
specifying its nature (Research Collaboration and License
Option), the Field of Use and identity of the Parties but no
other details, (ii) disclosures made in compliance with
Section 4.1.(a) hereof, (iii) attorneys, consultants, and
accountants retained to represent them in connection with the
transactions contemplated hereby or as may be reasonably
necessary to either Party's bankers, investors, attorneys or
other professional advisers in connection with a merger or
acquisition, provided such advisors are bound by
confidentiality obligations essentially identical to those
provided for herein, and (iv) occasional, brief comments by
the respective executive officers of both Parties consistent
with such guidelines for public statements as may be mutually
agreed by the Parties made in connection with routine
interviews with analysts or members of
-14-
15
the financial press. In addition, either Party (after
consultation with counsel) in its own right may make such
further announcements and disclosures, if any, as may be
required by applicable security laws and regulations (such as,
without limitation, regulations of the US Securities &
Exchange Commission (SEC) or the French Commission des
Operations de Bourse (COB), or any equivalent authority of any
country having jurisdiction), in which case the Party making
the announcement or disclosure shall use its best efforts to
give advance notice to, and discuss such announcement or
disclosure with, the other Party and such other Party's
attorneys.
4.2. Term and termination.
---------------------
4.2.1. Expiration.
-----------
This Agreement shall terminate on the third (3rd) anniversary of the
Effective Date.
4.2.2. Termination for Cause.
----------------------
(i) Either Party may terminate this Agreement, at its option, upon
or after the breach of any material provision of the Agreement
by the other Party, if such breaching Party has not cured such
breach within ninety (90) days after written notice thereof from
the other Party.
(ii) Subject to any applicable bankruptcy law of public order, PMC or
CISTRON may terminate this Agreement upon written notice to the
other Party if the other Party makes a general assignment for
the benefit of creditors, is the subject of proceedings in
voluntary or involuntary bankruptcy or has a receiver or trustee
appointed for substantially all of its property ; provided that
in the case of an involuntary bankruptcy proceeding such right
to terminate shall only become effective if the other Party
consents thereto or such proceeding is not dismissed within
ninety (90) days after the filing thereof.
4.2.4. Effect of Expiration and Termination.
-------------------------------------
Expiration or termination of the Agreement shall not relieve the
Parties of any obligation accruing prior to such expiration or
termination. The provisions of Sections 2.2.4, 2.2.5, 3.6, 3.7, 3.8,
4.3, 4.4, 4.7.1, 4.7.2, 4.7.4 and 4.7.6 to 4.7.9 included, and
Articles 1 and 4, shall survive the expiration or termination of the
Agreement for their own term or for so long as such provisions have
to remain operative so as to give full effect to the intent of the
Parties with respect thereto.
4.3. Indemnity.
----------
4.3.1. Direct Indemnity.
-----------------
4.3.1.1. Each Party shall indemnify and hold harmless the other Party, its
Affiliates, and their respective directors, officers, shareholders,
agents, consultants and employees from and against all Third-Party
claims, demands, liabilities, damages (including damages directly or
indirectly suffered by the other Party and/or its Affiliates and
their respective directors, officers, shareholders, agents,
consultants and employees) and expenses, including attorneys' fees
and costs (collectively, the "Liabilities") arising out of the breach
of any material provision of this Agreement by the indemnifying Party
or caused by an intentional act or omission of the indemnifying
Party.
-15-
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4.3.1.2. PMC shall defend, indemnify and hold harmless CISTRON, its
Affiliates, and their respective directors, officers, shareholders,
agents, consultants and employees, from and against all Liabilities
suffered or incurred arising out of any Third-Party claims in
connection with the manufacture, design, testing, possession,
distribution, use, sale or other disposition by or through PMC, its
Affiliates or Sublicensees of any PRODUCTS, except in each case to
the extent such Liabilities resulted from the gross negligence,
recklessness or intentional acts or omissions by CISTRON.
4.3.2. Procedure.
----------
A Party (the "Indemnitee") that intends to claim indemnification
under this Section 4.3. shall promptly notify the other Party (the
"Indemnitor") of any Liability or action in respect of which the
Indemnitee intends to claim such indemnification, and the Indemnitor
shall have the right to participate in, and, to the extent the
Indemnitor so desires, jointly with any other Indemnitor similarly
noticed, to assume the defense thereof with counsel selected by the
Indemnitor ; provided, however, that the Indemnitee shall have the
right to retain its own counsel, with the fees and expenses to be
paid by the Indemnitor, if representation of such Indemnitee by the
counsel retained by the Indemnitor would be inappropriate due to
actual or potential differing interests between such Indemnitee and
any other Party represented by such counsel in such proceedings.
The indemnity obligations under this Section 4.3. shall not apply to
amounts paid in settlement of any loss, claim, damage, liability or
action if such settlement is effected without the consent of the
Indemnitor, which consent shall not be withheld unreasonably. The
failure to deliver notice to the Indemnitor within a reasonable time
after the commencement of any such action, if prejudicial to its
ability to defend such action, shall relieve such Indemnitor of any
liability to the Indemnitee under this Section 4.3. The Indemnitee,
its Affiliates, employees and agents, shall cooperate fully with the
Indemnitor and its legal representatives in the investigation of any
action, claim or liability covered by this indemnification.
4.4. 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 but not limited to fire, floods, embargoes, war, acts of
war (whether war be declared or not), insurrections, riots, civil
commotions, strikes, lockouts or other labor disturbances, acts of
God or acts, omissions or delays in acting by any governmental
authority or the other Party (collectively, "Events of Force
Majeure") ; provided, however, that the affected Party (i) shall
immediately notify the other Party of the occurrence of any such
Event of Force Majeure and (ii) 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 ; and
provided, further, that nothing contained herein shall require any
Party to settle on terms unsatisfactory to such Party any strike,
lockout or other labor difficulty, any investigation or proceeding by
any governmental authority or any litigation by any Third-Party.
Notwithstanding the foregoing, to the extent that an Event of Force
Majeure continues for a period in excess of six (6) months, the
affected Party shall promptly notify in writing the other Party of
such Event of Force Majeure and within four (4) months 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.
-16-
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4.5. Assignment.
-----------
This Agreement in its entirety may not be assigned or otherwise
transferred, nor, except as expressly provided hereunder, may any
right or obligations pertaining to the Field of Use hereunder be
assigned or transferred to any Third-Party by either Party without the
consent of the other Party ; provided, however, that either Party may,
without such consent, 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 or change in control or
similar transaction. Any permitted assignee shall assume all
obligations of its assignor under this Agreement. Without limiting the
generality of the foregoing, without the prior written consent of PMC,
CISTRON shall not under any circumstances assign or transfer any
CISTRON Technology in the Field of Use unless (i) all of the rights
and obligations of CISTRON under this Agreement are assigned to the
same transferee(s) concurrently therewith, and (ii) such transferee(s)
expressly assume(s) in writing the performance of all terms and
conditions of this Agreement to be performed by CISTRON and such
assignment shall not relieved the assignor of any of its obligations
under this Agreement. Each Party acknowledges that the other Party
would suffer irreparable injury in the event of any breach of this
Article 4.5. that therefore the remedy at law for any breach or
threatened breach hereof by any Party shall be inadequate.
Accordingly, upon a breach or threatened breach hereof by any Party,
the other Party shall, in addition and without prejudice to any other
rights and remedies it may have, be entitled as a matter of right,
without proof of actual damages, to seek specific performance hereof
and to such other injunctive or equitable relief to enforce, or
prevent any violations (whether anticipatory, continuing or future)
hereof.
4.6. 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.
4.7. Miscellaneous.
--------------
4.7.1. 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 addressor and (except as otherwise
provided in this Agreement) shall be effective upon receipt by the
addressee.
If to CISTRON :
Cistron Biotechnology, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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Attention: Chairman
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Green, PC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
If to PMC :
Pasteur Merieux Serums & Vaccins, S.A.
▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇
Attention: Senior Vice President, Legal and Corporate Affairs
Telecopier: 011 33 4 72 73 77 84
Pasteur Merieux Connaught - USA
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Vice President, Business Development
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
and
Akin, Gump, Strauss, ▇▇▇▇▇ & ▇▇▇▇, LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: L. ▇▇▇▇▇ ▇'▇▇▇▇, ▇▇., Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
4.7.2. Applicable Law.
---------------
The Agreement shall be governed by and construed in accordance with
the laws of State of New-York., without regard to the conflict of law
principles thereof.
4.7.3. Representations, warranties and covenants.
------------------------------------------
4.7.3.1. Representations and Warranties of PMC.
--------------------------------------
(a) PMC is a Societe Anonyme duly organized and existing under the
laws of France, with the corporate power to own, lease and operate
its properties and to carry on its business as now conducted.
(b) PMC has all necessary corporate power and authority to enter into
this Agreement and to consummate the transactions contemplated
hereby.
(c) The execution, delivery and performance of this Agreement by PMC
does not conflict with or contravene the statuts of PMC nor shall
the execution, delivery or performance of this Agreement conflict
with or result in a breach of, or entitle any Party thereto to
terminate, any material agreement or instrument to which PMC is a
Party, or by which any of its assets or properties is bound.
-18-
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(d) This Agreement has been duly authorized, executed and delivered
by PMC and constitutes a legal, valid and binding agreement of
PMC, enforceable against PMC in accordance with its terms, except
as enforceability may be limited by bankruptcy, insolvency,
moratorium, reorganization or other similar laws affecting
creditors' rights generally.
4.7.3.2. Representations, Warranties and Covenants of CISTRON.
-----------------------------------------------------
(a) CISTRON is a corporation duly incorporated and validly existing
as a corporation in good standing under the laws of the State of
Delaware with the corporate power to own, lease and operate its
properties and to carry on its business as now conducted.
(b) CISTRON has all necessary corporate power and authority to enter
into this Agreement and to consummate the transactions
contemplated hereby.
(c) The execution, delivery and performance of this Agreement by
CISTRON does not conflict with or contravene its certificate of
incorporation or by-laws, nor shall the execution, delivery or
performance of this Agreement conflict with or result in a breach
of, or entitle any Party thereto to terminate, any material
agreement or instrument to which CISTRON is a Party, or by which
any of its assets or properties is bound.
(d) This Agreement has been duly authorized, executed and delivered
by CISTRON and constitutes a legal, valid and binding agreement of
CISTRON, enforceable against CISTRON in accordance with its terms,
except as enforceability may be limited by bankruptcy, insolvency,
moratorium, reorganization or other similar laws affecting
creditors' rights generally.
(e) All OPTIONED PATENTS listed on Schedule A as amended from time to
time, but for the purpose of this Section 4.7.3.2 and for such
purpose only excluding any Joint Patent Rights, have been
registered in, filed in or issued by the appropriate patent
offices of each jurisdiction as indicated on such Schedule A, and
in each case is currently in effect and all maintenance fees and
renewals thereof have been duly made with respect thereto. CISTRON
owns or has full and exclusive rights to use and exploit under
licenses (and to license or sublicense) all its rights under such
OPTIONED PATENTS and the OPTIONED KNOW-HOW. Except as set forth on
Schedule 4.7.3(e) hereto, there have been no material claims made
against CISTRON asserting the invalidity or non-enforceability of,
or with respect to such OPTIONED PATENTS , the misuse of such
OPTIONED PATENTS or the OPTIONED KNOW-HOW, nor is CISTRON aware
that any such claims exist. Except as set forth on Schedule
4.7.3(e) hereto, CISTRON has not received a notice of conflict of
such OPTIONED PATENTS or the OPTIONED KNOW-HOW with the asserted
rights of others, or otherwise challenging its rights to use any
of such OPTIONED PATENTS, or the OPTIONED KNOW-HOW.
None of the rights of CISTRON under the OPTIONED PATENTS or
OPTIONED KNOW-HOW shall be adversely affected by the execution,
delivery or performance of this Agreement, or the consummation of
the transaction contemplated herein. EXCEPT AS OTHERWISE EXPRESSLY
SET FORTH IN THIS SECTION, NEITHER PARTY MAKES ANY REPRESENTATION
OR EXTENDS ANY WARRANTIES OF ANY KIND EITHER EXPRESS OR IMPLIED,
INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT, OR VALIDITY OF
ANY PATENT RIGHTS ISSUED OR PENDING.
-19-
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4.7.4. Dispute Resolution.
-------------------
The Parties agree that if any dispute or disagreement arises between
PMC on the one hand and CISTRON 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 twenty eight (28) business days of receipt of a Notice of
Dispute, a nominee or nominees of PMC and a nominee or nominees
of CISTRON 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
endeavours to resolve the dispute ;
(c) If, within a further period of twenty eight (28) business days,
the dispute has not been resolved or if, for any reason, the
required meeting has not been held, then the Parties agree that
any dispute shall be referred to an arbitrator appointed by
agreement of CISTRON and PMC or, if no such agreement is reached
within sixty (60) business days after a Party commences the
arbitration, then by a panel of three arbitrators, with each of
PMC and CISTRON to select one arbitrator and those two
arbitrators to select the third. If all three arbitrators have
not been selected within sixty (60) business days after a Party
commences the arbitration, then the Parties agree to abide by the
selection of the remaining arbitrator to be named by a
representative of the International Chamber of Commerce.
The Parties agree that the Rules of the International Chamber of
Commerce shall govern such arbitration and that any decision of
the arbitrators shall be final and binding and shall be
enforceable in any court of competent jurisdiction worldwide
(regardless of whether one of the Parties fails or refuses to
participate in the arbitration). The Parties agree that all
arbitrations shall be conducted in the English language and that
the exclusive venue of all arbitrations shall be in Zurich,
Switzerland. The Party determined by the arbitrators to be the
Party substantially prevailing in the arbitration shall be
entitled to recover its legal and consultants' fees and other
costs reasonably incurred in connection with the arbitration (as
determined by the arbitrators) ; and
(d) 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.
4.7.5. 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, including but not limited to Option Agreements to the extent,
but only to the extent, they are inconsistent with any provisions of
this Agreement (in which case the relevant provision of this
Agreement shall prevail) 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.
4.7.6. Independent Contractors.
------------------------
CISTRON and PMC 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
CISTRON nor PMC 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.
-20-
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4.7.7. 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.
4.7.8. 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.
4.7.9. No Implied License.
-------------------
Nothing in this Agreement shall be deemed to constitute, by
implication or otherwise, the grant by PMC to CISTRON, or by CISTRON
to PMC, of any license to, or interest in, or other rights under any
patent, patent application, proprietary know-how, trade secrets or
other intellectual property rights owned or possessed by PMC or
CISTRON, whichever is applicable, except as expressly provided for
herein.
4.7.10. 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.
-21-
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first set forth above.
For CISTRON BIOTECHNOLOGY, INC.
By : /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------
Name : ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title : Chairman of the Board and
Chief Executive Officer
For PASTEUR MERIEUX Serums & Vaccins S.A.
By : /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------
Name : ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title : President and
Chief Operating Officer
-----------------------
-22-
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EXHIBIT-2
---------
Confidential treatment has been requested for portions of the exhibit. The
copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as ["xxxxx"]. The portions omitted have
been filed separately with the Securities and Exhange Commission pursuant
to such request for confidential information.
--------------------------------------
LICENSE AGREEMENT
IL-1 BETA
--------------------------------------
This Agreement is entered this 30th day of October, 1998 (the "Effective
Date") into by and between :
CISTRON BIOTECHNOLOGY, INC., a corporation organized and existing under
the laws of the State of Delaware, having its principal place of
business at ▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
(hereinafter referred to as "CISTRON")
and
---
PASTEUR MERIEUX Serums & Vaccins - a Pasteur Merieux Connaught Company
-, a societe anonyme organized and existing under the laws of the
French Republic, having its registered head office at ▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇,
(hereinafter referred to as "PMC")
WITNESSETH
----------
WHEREAS, CISTRON has developed intellectual property, including inventions
which are the subject matter of patents and patent applications and secret
and substantial know-how, relating to a cytokine called Interleukin 1 beta
("IL-1b" or the "FACTOR") used as an immunoadjuvant ;
WHEREAS, PMC and CISTRON are parties to the Collaboration & Option
Agreement dated October 30th, 1998, under which PMC has exercised its option
to obtain from CISTRON a license in order to have the right to use CISTRON'
inventions relating to the FACTOR for use as an adjuvant in human vaccines,
and CISTRON has agreed to grant such licenses to PMC, subject to the terms
of and conditioned upon this Agreement ;
NOW, THEREFORE, in consideration of the respective representations and
covenants of each of the Parties as set forth below, CISTRON and PMC,
intending to be legally bound, agree as
follows :
-23-
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ARTICLE I - DEFINITIONS AND INTERPRETATION
------------------------------------------
1.1. Definitions : For the purposes of this Agreement the following words
and phrases shall have the following meanings :
(a) "Affiliate" means, with respect to any Person, (i) any other
Person of which the securities or other ownership interests
representing fifty per cent (50 %) or more of the equity or
fifty per cent (50 %) or more of the ordinary voting power or
fifty per cent (50 %) or more of the general partnership
interest are, at the time such determination is being made,
owned, Controlled or held, directly or indirectly, by such
Person (a "Subsidiary"), or (ii) any other Person which, at
the time such determination is being made, is Controlling or
under common Control with, such Person. As used herein, the
term "Control", whether used as a noun or verb, refers to the
possession, directly or indirectly, of the power to direct, or
cause the direction of, the management or policies of a
Person, whether through the ownership of voting securities,
by contract or otherwise.
(b) "Agreement" means this agreement, all amendments and
supplements to this Agreement and all schedules to this
Agreement, including the following :
Schedule A - LICENSED PATENTS.
----------
Exhibit 1 - Tax Form re. French Withholding Tax.
---------
(c) "Biological Materials" shall mean any biological materials
including but not limited to structural genes, genetic
sequences, promoters, enhancers, probes, linkage probes,
vectors, hosts, plasmids, peptides, polypeptides, transformed
cell lines, transgenic animals, proteins, biological modifiers,
antigens, reagents, hybridomas, antibodies, toxins, lectins,
enzymes, lipids, hormones, viruses, cells or parts of cells,
cell lines, fragments of any of the foregoing and any other
biologically active material or compound, whether or not
occurring naturally or howsoever derived, modified, conjugated,
cross-linked, immobilized, reduced, purified or produces,
whether by recombinant DNA techniques and/or otherwise.
(d) "Calendar Quarter" means any of the three-month periods
beginning January 1, April 1, July 1 and October 1 in any year.
(e) "CISTRON Improvements" means Improvements which are conceived
during the term of this Agreement solely or jointly by
employees and/or contractors (other than PMC) acting on behalf
of CISTRON or its Affiliates, to the extent that CISTRON has
now or hereafter shall have the right to grant licenses,
immunities or other rights thereon.
(f) "CISTRON Technology" means the LICENSED PATENTS, the LICENSED
KNOW-HOW and the CISTRON Improvements, and shall include
CISTRON's interest in any Joint Inventions as such latter term
is defined under the Collaboration & Option Agreement and under
this Agreement .
(g) "Collaboration & Option Agreement" means the Collaboration &
Option Agreement signed by the Parties hereto on October 30th,
1998.
(h) "Confidential Information" has the meaning ascribed to it in
Section 8.1. of this Agreement.
-24-
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(i) "Event of Force Majeure" has the meaning ascribed to it in
Article 8.4. of this Agreement.
(j) "FACTOR" means the cytokine (a protein) called Interleukin 1
beta, or IL-1b, as described in the LICENSED PATENTS, and any
derivatives thereof, and is intended to refer to both the
protein itself and the gene encoding thereto.
[OPTIONAL : will depend on how Option is exercised.
(k) "Field of Preventative Vaccines" means the field comprised of
bio-pharmaceutical products for the prevention through active
immunization against infectious diseases and/or cancers in
humans.
(l) "Field of Therapeutic Vaccines" means the field comprised of
bio-pharmaceutical products for the immunotherapy through
active immunization against infectious diseases and/or cancers
in humans.
(m) "Field of Use" means either the Field of the Therapeutic
Vaccines or the Field of the Preventative Vacines or both.]
(n) "First Commercial Sale" means, in each country of the
Territory, the first sale of a PRODUCT by PMC, its Affiliates
or Sublicensees, to Third-Parties, in each case for use or
consumption of such PRODUCT in such country by the general
public.
(o) "Improvements" means all patentable and non-patentable
inventions, discoveries, technology and information of any type
whatsoever, including without limitation Biological Materials,
methods, processes, technical information, knowledge,
experience and know-how which are made during the term of this
Agreement and which utilize, incorporate, are derived from or
are based on, CISTRON Technology, or could not be conceived,
developed or reduced to practice but for the use of the CISTRON
Technology.
(oo) "Joint Inventions" have the meaning ascribed to them in Section
7.2. hereof.
(p) "LICENSE" has the meaning ascribed to it in Section 2.1.1. of
this Agreement.
(q) "LICENSED KNOW-HOW" means any and all technical information,
discoveries, improvements, processes, formulae, data,
engineering, technical and shop drawings, inventions,
Biological Materials, shop-rights, know-how and trade secrets
which is useful or necessary to make, have made, use or sell
the FACTOR and/or PRODUCTS or to practice under the LICENSED
PATENTS in the Field of Use, which have been, or hereafter are,
either developed by CISTRON or its Affiliates, or the rights to
which in the Field of Use have been acquired by CISTRON or its
Affiliates and to which CISTRON or its Affiliates have a
transferable interest. LICENSED KNOW-HOW expressly includes any
and all technology developed in the Field of Use by the Parties
pursuant to and in accordance with the Collaboration & Option
Agreement and which constitutes Joint Inventions as such term
is defined in such agreement.
(r) "LICENSED PATENTS" means :
(i) any existing patents and patent applications listed in
Schedule A to this Agreement, including any Joint Patent
Rights as such term is defined in the Collaboration &
Option Agreement ;
(ii) any future patents issued from any patent applications
referred to in Paragraph 1.(r).(i) above and any future
patents issued from a patent application filed in any
country in the Territory which corresponds to a patent or
patent application identified in Paragraph 1.(r).(i)
above;
-25-
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(iii) any reissues, confirmations, renewals, extensions,
counterparts, divisions, continuations, continuations-in-
part, supplemental protection certificates or utility
models issued, assigned or licensed to CISTRON or its
Affiliates of or relating to the patents or patent
applications identified in Paragraph 1.(r).(i) and (ii)
above ;
(iv) any future patents and patent applications covering
CISTRON Improvements, solely or jointly owned by CISTRON
or its Affiliates, or licensed by CISTRON or its
Affiliates with the right to sublicense, and CISTRON's
interest in any Joint Inventions.
(rr) "Net Sales" shall mean gross invoice price of PRODUCTS sold by
PMC, its Affiliates and Sublicensees to the first Third-Party
(including unaffiliated Third-Party distributors, except in the
circumstances referred to in Section 6.3 hereof, and provided
further that where a distributor is an Affiliate, but not a
Subsidiary of PMC, such distributor shall be deemed a Third-
Party for the purpose of calculating Net Sales hereunder) less,
to the extent actually incurred or allowed and if not already
deducted in the amount invoiced :
(i) normal or customary trade and/or quantity discounts,
credits, allowances, rebates, returns (including, but not
limited to, wholesaler and retailer returns) ;
(ii) retroactive price reductions ;
(iii) excise taxes, other consumption taxes, customs duties and
compulsory payments made to governmental authorities ;
(iv) sales commissions that are actually paid to Third-Party
distributors and selling agents ; and
(v) transportation, transit and insurance for transportation
each to the extent separately invoiced and paid by PMC.
(s) "Notice of Dispute" has the meaning ascribed to it in Section
8.8.4.(a) of this Agreement.
(t) "Parties" means PMC and CISTRON, and "Party" means any one of
them.
(u) "Person" means an individual, corporation, partnership, trust,
business trust, association, joint stock company, pool,
syndicate, sole proprietorship, unincorporated organization,
governmental authority or any other form of entity not
specifically listed herein.
(v) "Phase III" means the first large scale safety and efficacy
clinical trial relating to a PRODUCT.
(w) "PMC Improvements" means Improvements which are conceived
during the term of this Agreement solely or jointly by
employees and/or contractors (other than CISTRON) acting on
behalf of PMC or its Affiliates, to the extent that PMC has now
or hereafter shall have the right to grant licenses, immunities
or other rights thereon.
(ww) "PRODUCTS" means any and all vaccines or other bio-
pharmaceutical products intended for use [in the Field of
Preventative Vaccines or the Field of Therapeutic Vaccines or
both - OPTIONAL : will depend on how Option is exercised]
which (i) incorporate the FACTOR as an adjuvant or (ii) more
generally utilize any or are based on any CISTRON Technology.
-26-
27
(x) "Royalty Term" means, with respect to each PRODUCT in each
country in the Territory, the period of time equal to the
longer of (a) fifteen (15) years from the date of First
Commercial Sale of such PRODUCT in such country or (b) the term
for which a Valid Patent Claim in such country remains in
effect and, but for a license granted by this Agreement, would
be infringed by the manufacture, use or sale of such PRODUCT in
the Field of Use in such country.
(xx) "Sublicensee" means any Person acting pursuant to a sublicense
granted to it by PMC under the terms of this Agreement.
(y) "Territory" means all countries in the world.
(yy) "Third-Party" means any Person other than PMC, CISTRON and
their respective Affiliates.
(z) "Valid Patent Claim" means a claim of an issued and unexpired
patent or patent application included in LICENSED 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. If there should be two or more decisions within the
same country which are conflicting with respect to the
invalidity of the same claim, the decision of the highest
tribunal shall thereafter control. However, should the
tribunals be of equal authority, then the decision or decisions
holding the claim valid shall prevail where the conflicting
decisions are equal in number and the majority of decisions
shall prevail where the conflicting decisions are not equal in
number.
1.2. Certain Rules of Interpretation in this Agreement and the Schedules:
--------------------------------------------------------------------
(a) An accounting term not otherwise defined has the meaning
assigned to it by, and every accounting matter will be
determined in accordance with, generally accepted accounting
principles in the United States of America ;
(b) Unless otherwise specified, all references to monetary amounts
are to United States dollars currency (US$) ;
(c) 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 ;
(d) 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 ;
(e) 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 ;
(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
-27-
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(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 in the jurisdiction
of the Party to make such payment or do such act.
ARTICLE 2 - LICENSE.
--------------------
2.1. Grant.
------
Subject to and conditioned upon the provisions of this Agreement,
CISTRON hereby grants to PMC, and PMC hereby accepts, a license
(the "LICENSE") in the Territory to make, have made, use and sell
PRODUCTS and FACTOR under the LICENSED PATENTS in the Field of Use
and by using LICENSED KNOW-HOW, CISTRON Improvements and Joint
Inventions in the Field of Use.
2.2. Exclusivity
-----------
(i) Subject to and conditioned upon the provisions of this
Agreement, the LICENSE granted pursuant to this Article II
shall be exclusive (exclusive even as to CISTRON and CISTRON
Affiliates) to PMC in the Field of Use. Without limiting the
generality of the foregoing, CISTRON covenants that during the
term of this Agreement, neither CISTRON nor its Affiliates shall
grant to any other Person any right , license or privilege to
make, have made, use or sell PRODUCTS or to otherwise exploit
CISTRON Technology (including for the manufacturing of the
FACTOR) and Joint Inventions in connection with such PRODUCTS in
the Field of Use.
(ii) For greater certainty, CISTRON has and retains all rights in
and to the CISTRON Technology outside the Field of Use and PMC
has no rights in the CISTRON Technology outside the Field of Use.
2.3. PMC 's Rights to Sublicense
---------------------------
(i) PMC shall have the right, with CISTRON's prior written consent
(which consent shall not be unreasonably withheld), to
sublicense in the Field of Use to Third-Parties all or any
portion of the rights to LICENSED PATENTS and LICENSED KNOW-
HOW and CISTRON Improvements granted to PMC pursuant to this
Agreement under the LICENSE. No permitted Sublicensee pursuant
hereto shall have the right to grant further sublicenses to any
Third-Party.
(ii) PMC shall have the right, without obtaining the further consent
of CISTRON, to sublicense in the Field of Use all or any
portion of the rights to the LICENSED PATENTS, the LICENSED
KNOW-HOW and CISTRON Improvements granted to it pursuant to
this Agreement under the LICENSE (i) to any of its Affiliates,
and (ii) to any Person in any country of the Territory if
required to do so by any governmental authority having
jurisdiction in such country. No permitted Sublicensee pursuant
hereto shall have the right to grant further sublicenses to any
Third-Party.
(iii) PMC agrees that all sublicenses granted by PMC hereunder
shall expressly bind Sublicensees to the terms of Article 8.1.,
"Confidentiality" and to all other relevant provisions of this
Agreement. In the event PMC grants sublicenses, PMC shall still
be under the obligation to pay Milestone Payments to CISTRON as
provided for in
-28-
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Section 4.6. hereof, and PMC shall pay royalties to CISTRON as
if Net Sales of the Sublicensees were Net Sales of PMC and
CISTRON shall be expressly made a Third-Party beneficiary
thereof. PMC shall be responsible for the performance by any
sub-PMC of all such terms, conditions and obligations. In
addition PMC shall pay to CISTRON Twenty Five percent (25%) of
any incremental consideration that PMC may receive from any
Third-Party Sublicensee such as but not limited to license
issue fees and milestone payments.
(iv) Any sublicenses granted by PMC shall include a requirement that
the Sublicensee maintains records and permit inspection on
terms essentially identical to Sections 5.1. and 5.2 hereof. At
CISTRON's request, PMC shall arrange for an independent
certified public accountant selected by CISTRON to inspect the
records of Sublicensees for the purpose of verifying royalties
due to CISTRON and shall cause such accountant to report the
results thereof to CISTRON.
(v) Any sublicenses granted by PMC shall provide for the
termination of the sublicense, or, if the Sublicensee is a
Third-Party, at the option of such Sublicensee, the conversion
to a license directly between such Sublicensee and CISTRON,
upon termination of this Agreement under Article 8.2. (other
than expiration under Section 8.2.1 or a termination by PMC
further to a breach by CISTRON pursuant to Section 8.2.3). Such
conversion shall be subject to CISTRON's approval and
contingent upon acceptance by the Sublicensee of the remaining
provisions of this Agreement.
(vi) PMC shall notify CISTRON of each sublicense granted to Third-
Parties and shall provide CISTRON with the name and address of
each Sublicensee and a description of the PRODUCTS and
territory covered by each sublicenses.
2.4. Sublicenses to PMC.
-------------------
To the extent LICENSED PATENTS have been, or shall be, licensed by
CISTRON from a Third-Party under an agreement with such Third-Party
(a "Third-Party License"), PMC understands and agrees as follows :
(i)- The rights sub-licensed to PMC by CISTRON are subject to the
terms and conditions, restrictions, limitations and obligations
of the relevant Third-Party License ;
(ii)- PMC shall comply with the terms and conditions,
restrictions, limitations and obligations of such Third-Party
License(s) to the extent PMC has been permitted to review such
terms, conditions, restrictions, limitations and obligations.
CISTRON shall give PMC, upon request, a reasonable opportunity
to review the same except to the extent that confidentiality
obligations towards Third-Parties may prevent CISTRON from
doing so. In any event, CISTRON shall act reasonably in
advising PMC of the scope of PMC's obligations pursuant to any
relevant Third-Party License.
2.5. Licenses to CISTRON.
--------------------
In the event that CISTRON wishes to commercialize any PMC
Improvements outside the Field of Use at any time during the term of
this Agreement, CISTRON shall so notify PMC and the Parties agree to
then negotiate in good faith the terms and conditions of a license
to be granted by PMC to CISTRON covering such PMC Improvements,
including a reasonable royalty which shall reflect the value of the
PMC Improvements in relation to all other
-29-
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technology and proprietary rights included in the product and/or
process that CISTRON wishes to commercialize.
2.5 Subcontracting.
---------------
Notwithstanding anything herein provided for to the contrary, PMC
shall be allowed to (i) sub-contract in whole or in part PRODUCTS
development to Third-Parties such as, without limitation, clinical
research organizations, (ii) appoint sales agents and distributors
to market and distribute PRODUCTS and (iii) sub-contract
manufacturing of PRODUCTS and FACTOR with Third-Parties or with
PMC's Affiliates.
2.6. Procedures for Provision of Know-How.
-------------------------------------
2.6.1. Disclosure of Technology.
-------------------------
From time to time during the term of this Agreement, CISTRON shall
disclose or cause its Affiliates to disclose to PMC such CISTRON
Technology as may be reasonably necessary to enable PMC to develop,
manufacture and commercialize PRODUCTS in the Field of Use on the
terms and subject to the conditions of this Agreement. In addition,
during the term of this Agreement, CISTRON shall, upon PMC's
reasonable request and with adequate notice to CISTRON, make
available to PMC at PMC's or its Affiliates' manufacturing
facilities or the facility of a Third-Party manufacturer who shall
have contracted with PMC to manufacture PRODUCTS, CISTRON's or
CISTRON Affiliate's Personnel to provide technical assistance to
PMC's Personnel, or PMC Affiliates' Personnel or Third-Party
manufacturer's Personnel. PMC shall pay or have paid by its
concerned Affiliates all expenses incurred by CISTRON or its
Affiliates in connection with such technical assistance.
2.6.2. Communication among Parties.
----------------------------
Each of PMC and CISTRON shall appoint (a) specific individual(s) who
shall be available and shall act as (a) liaison Person(s) to
facilitate the day-to-day communications among the Parties. The
names and addresses of the liaison Persons who shall act on behalf
of each of the Parties shall be provided by each of the Parties to
the other immediately following the execution of this Agreement.
Each of PMC and CISTRON agrees to notify the other in accordance
with the terms of Section 8.8.1. of this Agreement in the event of a
change in liaison Person.
2.6.3. Identification of Know-How.
---------------------------
The Parties agree that all information and Biological Materials
comprised in the LICENSED KNOW-HOW to be transferred to PMC pursuant
to this Agreement shall be so transferred in the case of written
information, by memoranda bearing the mention "Confidential", and,
in the case of Biological Materials, by clearly marked and numbered
containers. PMC shall designate an individual who shall be
responsible for receiving information and Materials
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from CISTRON and/or its Affiliates and the Parties agree that such
information and Materials shall in all cases (except where the Parties
agree otherwise) be sent solely to the attention of such individual.
Upon receipt of information and/or Biological Materials, the designated
individual shall, on behalf of PMC, send an acknowledgement to
CISTRON and/or its Affiliates confirming receipt of information
and/or Biological Materials. The Parties agree that they shall in
good faith work together to establish and maintain a system to
record the transmission of information and/or materials under this
Agreement and make all commercially reasonable efforts to ensure
such system is followed.
2.6.4. Confidentiality.
----------------
All information transferred pursuant to this Agreement shall be
deemed to be "Confidential Information" in accordance with Section
8.1 hereof.
ARTICLE 3 - DEVELOPMENT AND COMMERCIALIZATION.
----------------------------------------------
3.1. Development and Commercialization Efforts.
------------------------------------------
PMC (i) shall use commercially reasonable efforts to diligently
conduct such preclinical and clinical trials that are necessary or
desirable to obtain all regulatory approvals to develop and
commercialize such PRODUCTS, (ii) shall diligently develop and
obtain necessary approval to market such PRODUCTS (including, as the
case may be, pricing approval), and (iii) shall commence marketing
and market such PRODUCTS in each country in which PMC has received
all applicable regulatory approvals therefor. PMC shall comply with
all applicable good laboratory, clinical and manufacturing practices
in the development and commercialization of such PRODUCTS, and shall
cause its Affiliates and subcontractors to do the same. PMC shall be
solely responsible for funding all costs of the development and
commercialization of each such PRODUCTS.
PMC and CISTRON agree to negotiate in good faith PRODUCT development
milestones within ninety (90) days following execution of this
Agreement.
3.2. Development and Commercialization Reports.
------------------------------------------
During the term of this Agreement, PMC shall keep CISTRON reasonably
informed as to the progress of the development of PRODUCTS by
notifying CISTRON of completion of each significant step. All
information disclosed by PMC pursuant to this Section 3.2 shall be
subject to Article 8 hereof.
PMC shall send to CISTRON at the latest before the end of the first
Calendar Quarter of each year during the term of this Agreement a
report describing in sufficient details all development and
commercialization efforts made by PMC pursuant hereto during the
preceding year.
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ARTICLE 4 - ROYALTIES AND MILESTONES.
-------------------------------------
4.1. Earned Royalties.
-----------------
During the Royalty Term, PMC shall pay to CISTRON a royalty of
["xxxxx"] of Net Sales of PRODUCTS ; provided, however, that the
royalty shall be reduced to ["xxxxx"] of Net Sales of PRODUCTS in
countries where there is no Valid Patent Claim and there is a
competitor of PMC using a formulation or formulations of the same
antigen(s) than PMC with an IL-1b.
4.2. Third-Party Royalties.
----------------------
If PMC, its Affiliates or Sublicensees is required to pay royalties
to any Third-Party in order to make, have made, use or sell a
PRODUCT in a country, then the royalty set-forth in Section 6.1
hereof for such PRODUCT in such country shall be reduced by fifty
percent (50%) of the amount paid by PMC to such Third-Parties ;
provided, however, that in no event the rate of the royalty payable
by PMC to CISTRON pursuant hereto shall be less than ["xxxxx"] of
Net Sales of such PRODUCT in such country.
4.3. Single Royalty : Non-Royalty Sales.
-----------------------------------
In no event shall more than one royalty be payable under Sections
4.1. and 4.2. with respect to a particular unit of PRODUCTS. No
royalty shall be payable under this Article 6 with respect to sales
of PRODUCTS among PMC and its Subsidiaries, or among Sublicensees
and their Affiliates, or among PMC and its Sublicensees, but a
royalty shall be due upon the subsequent sale of the PRODUCTS to a
Third-Party. No royalty shall be payable for (i) PRODUCTS used in
clinical trials, or (ii) PRODUCTS used by PMC, its Affiliates or
Sublicensees, for research, (iii) customary quantities of PRODUCTS
distributed as free samples or (iv) reasonable quantities of
PRODUCTS disposed by PMC as donations to Third-Parties (such as
humanitarian and charitable organizations).
4.4. Royalties for Sale of Bulk Products.
------------------------------------
In those cases where PMC, its Subsidiaries or Sublicensees sell
PRODUCTS in bulk to a Third-Party, the royalty due to CISTRON
hereunder shall be calculated on the Net Sales of bulk PRODUCTS to
said Third-Party.
4.5. Compulsory Licenses.
--------------------
If a compulsory license is granted with respect to a PRODUCT in any
country in the Territory with a royalty rate lower than the royalty
rates provided within this Article 4, then the rate of the royalty
to be paid on Net Sales in that country under Article 4 shall be
reduced to the rate paid by the compulsory licensee.
4.6. Milestone Payments.
-------------------
As additional consideration for the LICENSE, rights and privileges
granted to it hereunder, PMC shall pay to CISTRON the following
milestone payments within thirty (30) days of the occurrence of each
event set forth below, whether such events are achieved by PMC, its
Affiliates or Sublicensees :
[OPTIONAL : will depend on how Option is exercised.
---------------------------------------------------------------------------
Confidential treatment has been requested for portions of this page of this
exhibit. The copy filed herewith omits the information subject to the
confidentiality request. Omissions are designated as ["xxxxx"]. The
portions omitted have been filed separately with the Securities and
Exchange Commission pursuant to such request for confidential information.
---------------------------------------------------------------------------
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a) Upon commencement of the first Phase III clinical trial with
respect to each of the first (1st) and second (2nd) PRODUCT
belonging to the Field of Preventative Vaccines (provided such
field is included in the Selected Field of Use), ["xxxxx"] for
each;
(b) Upon receipt of the product registration in [either] the United
States of America [or the European Union] with respect to each
of the first (1st) and the second (2nd) PRODUCT belonging to
the Field of Preventative Vaccines, ["xxxxx"] for each ;
(c) Upon commencement of the first Phase III clinical trial with
respect to each the first (1st) and the second (2nd) PRODUCT
belonging to the Field of Therapeutic Vaccines (provided such
field is included in the Selected Field of Use), ["xxxxx"] for
each ;
(d) Upon receipt of the product registration in [either] the United
States of America [or European Union] with respect to each of
the first (1st) and the second (2nd) PRODUCT belonging to the
Field Therapeutic Vaccines, ["xxxxx"] for each.]
ARTICLE 5 - ROYALTY REPORTS AND ACCOUNTING.
-------------------------------------------
5.1. Reports, Exchange Rates.
------------------------
During the term of this Agreement following the First Commercial
Sale, PMC shall furnish to CISTRON, with respect to each Calendar
Quarter, a written report showing in reasonably specific detail, on
a country-by-country basis, (a) the gross sales of PRODUCTS sold by
PMC, its Affiliates and its Sublicensees in the Territory during the
corresponding Calendar Quarter and the calculation of Net Sales from
such gross sales ; (b) the royalties payable in United States
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 date of
the First Commercial Sale of PRODUCTS having occurred in each
country in the Territory during the corresponding Calendar Quarter
and (e) the exchange rates used in determining the royalty amount
expressed in United States dollars.
With respect to sales (if any) of PRODUCTS invoiced in United States
dollars, the gross sales, Net Sales, and royalties payable shall be
expressed in United Sates dollars. With respect to sales of PRODUCTS
invoiced in a currency other than United Sates dollars, the gross
sales, Net Sales and royalties payable shall be expressed in the
currency of the invoice issued by the Party making the sale together
with the United States dollars equivalent of the royalty payable,
calculated using the rate of exchange published in the Wall Street
Journal for such currency on the last business day of the concerned
Calendar Quarter. Reports and payments shall be due on the forty
fifth (45th) day following the close of each Calendar Quarter. PMC
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.
5.2. Audits.
-------
5.2.1. Upon the written request of CISTRON and not more than once in each
calendar year, PMC shall permit an independent certified public
accounting firm of internationally recognized standing, selected by
CISTRON and reasonably acceptable to PMC, at CISTRON's
---------------------------------------------------------------------------
Confidential treatment has been requested for portions of this page of this
exhibit. The copy filed herewith omits the information subject to the
confidentiality request. Omissions are designated as ["xxxxx"]. The
portions omitted have been filed separately with the Securities and
Exchange Commission pursuant to such request for confidential information.
---------------------------------------------------------------------------
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expense, to have access during normal business hours to such of the
records of PMC as may be reasonably necessary to verify the accuracy
of the royalty reports hereunder for any year ending not more than
three (3) years prior to the date of such request. The accounting
firm shall disclose to CISTRON only whether the records are correct
or not and the specific details concerning any discrepancies. No
other information shall be shared.
5.2.2. If such accounting firm concludes that additional royalties were
owed during such period, PMC shall pay the additional royalties
within thirty (30) days of the date CISTRON delivers to PMC such
accounting firm's written report so concluding. The fees charged by
such accounting firm shall be paid by CISTRON ; provided, however,
if the audit discloses that the royalties payable by PMC for the
audited period are more than one hundred and twenty percent (120%)
of the royalties actually paid for such period, then PMC shall pay
the reasonable fees and expenses charged by such accounting firm.
5.2.3. PMC shall include in each permitted sublicense granted by it
pursuant to the Agreement a provision requiring the SUBLICENSEE to
make reports to PMC, to keep and maintain records of sales made
pursuant to such sublicense and to grant access to such records by
CISTRON's independent accountant to the same extent required with
respect to PMC's records under this Agreement.
5.2.4. Except in the case of circumstances which would have prevented an
error or anomaly from being disclosed during the audit hereabove
mentioned, such as fraud or other failure to provide accurate
information, upon the expiration of three (3) years following the
end of any calendar year, the calculation of royalties payable with
respect to such year shall be binding and conclusive upon CISTRON,
and PMC, its Affiliates and Sublicensees shall be released from any
liability or accountability with respect to royalties for such year.
5.3. Confidential Financial Information.
-----------------------------------
CISTRON shall treat all financial information subject to review
under this Article 6 or under any sublicense agreement as
confidential, and shall cause its accounting firm to retain all such
financial information in confidence.
ARTICLE 6 - PAYMENTS.
---------------------
6.1. Payment Term.
-------------
Royalties shown to have accrued by each royalty report provided for
under Article 5 of this Agreement shall be due on the date such
royalty report is due. Payment of royalties in whole or in part may
be made in advance of such due date.
6.2. Payment Method.
---------------
All payments by PMC to CISTRON under this Agreement shall be paid in
United States dollars, and all such payments shall be made without
deduction of bank transfer fees by bank wire transfer in immediately
available funds to the following bank account :
Account No. 6101198381
Bank : Bank of New York, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇.,
▇. ▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇-▇▇▇▇
Code : 021202719
Addressee : Cistron Biotechnology, Inc.
or to any other bank account designated in writing from time to
time, to PMC, by CISTRON.
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6.3. Withholding Taxes.
------------------
Royalties and milestone payments shall be paid by PMC to CISTRON,
after deduction of any applicable withholding taxes. Prior to any
payment by PMC to CISTRON, PMC shall provide to CISTRON any forms
required to attest CISTRON's fiscal domiciliation in order to allow
PMC to claim application of the reduced rate of withholding tax
provided for in any applicable bilateral fiscal convention. CISTRON
shall promptly return such forms to PMC. In the event CISTRON fails
to promptly return such forms duly filled and signed, PMC shall
declare and pay withholding tax at the common law rate of the
applicable corporate income tax, and such tax shall then be deducted
from the corresponding payment by PMC to CISTRON. PMC shall pay
withholding tax to the proper taxing authority and proof of payment
of such tax shall be secured and sent to CISTRON as evidence of such
payment. If, in the opinion of either Party, the provisions of this
section become extremely burdensome, the Parties agree to meet and
discuss such other options as may be available to them.
In order to properly document the tax file, CISTRON shall file or
have filed, and sign or have signed, the tax form herewith attached
as Exhibit 1 prior to each milestones or royalty payment owing from
PMC to CISTRON hereunder.
ARTICLE 7 - INVENTIONS AND PATENTS.
-----------------------------------
7.1. Ownership and Commercialization of Inventions.
----------------------------------------------
Ownership of Inventions : All rights, title and interest in and to
any technology or invention, whether or not patentable, and any
patent applications and patents based thereon, made or conceived (i)
by employees or others acting solely on behalf of CISTRON or its
Affiliates, including but not limited to CISTRON Improvements, shall
be owned solely by CISTRON or its Affiliates ; (ii) by employees or
others acting solely on behalf of PMC or its Affiliates, including
but not limited to PMC Improvements, shall be owned solely by PMC or
its Affiliates and (iii) by both employees or others acting on
behalf of CISTRON or its Affiliates and on behalf of PMC or its
Affiliates, shall be jointly owned by CISTRON and PMC (the "Joint
Inventions").
CISTRON and PMC each hereby represents that all employees and other
Persons acting on its behalf in performing its obligations under
this Agreement shall be obligated under a binding written agreement
to assign to it, or as it shall direct, all Improvements conceived
or reduced to practice by such employees or other Persons during the
term of this Agreement.
Commercialization of Joint Inventions : During the term of this
Agreement PMC shall have the exclusive right to commercialize Joint
Inventions in the Field of Use and shall pay royalties to CISTRON in
accordance with this Agreement in consideration for such right. In
the event that CISTRON wishes to commercialize any Joint Invention
outside the Field of Use, CISTRON agrees to pay a royalty.
The Parties agree to negotiate in good faith such royalty so that it
reflects the value of the Joint Invention in relation to all other
technology and proprietary rights included in the product and/or
process embodying such Joint Invention.
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7.2. Patent Prosecution and Maintenance.
-----------------------------------
Licensed Patents. CISTRON shall be responsible for and shall control
the preparation, filing, prosecution, grant and maintenance of all
LICENSED PATENTS. CISTRON shall prepare, file, prosecute and
maintain such LICENSED PATENTS in good faith consistent with its
customary patent policy and its reasonable business judgement, and
shall consider in good faith the interests of PMC in so doing.
Joint Inventions. As to any Joint Inventions, CISTRON shall have the
first right to file patent applications with respect to such
inventions in the name of both Parties. CISTRON may elect not to
file and if it does so, PMC shall have the right to file the patent
applications in the name of both Parties. In each case, the filing
Party shall give the non-filing Party an opportunity to review the
text of the applications before filing, shall consult with the non-
filing Party with respect thereto and shall supply the non-filing
Party with a copy of all applications as filed, together with notice
of their filing dates and serial numbers and fifty percent (50%) of
the out-of-pocket costs and expenses of the filing Party shall be
reimbursed by the other Party. Both Parties shall keep the other
advised of the status of actual and prospective patent application
filings and upon request, provide advanced copies of any documents
related to such filings and thereafter to the prosecution and
maintenance of all patent applications and patents.
Costs. With respect to all filings hereunder, the filing Party shall
be responsible for payment of all costs and expenses related to such
filings, prosecution and maintenance, unless relieved of same
pursuant to Section 7.3 hereinafter, and except for jointly owned
patents, for which fifty percent (50%) of all such costs and
expenses shall be reimbursed to the filing Party by the other Party.
7.3. Option to Prosecute and Maintain Patents.
-----------------------------------------
CISTRON shall give notice to PMC of any intention to cease
prosecution and/or maintenance, or not to proceed with an extension,
of LICENSED PATENTS and, in such case, shall permit PMC, at PMC's
sole discretion, to continue prosecution or maintenance or proceed
with the extension at its own expenses. If PMC elects to continue
prosecution or maintenance or to proceed with the extension, CISTRON
shall execute such documents and perform such acts at PMC's expense
as may be reasonably necessary to effect an assignment of such
LICENSED PATENTS to PMC in a timely manner, and more generally to
permit PMC to continue such prosecution and maintenance or to
proceed with the extension. Any patents and patent applications so
assigned shall not be considered as LICENSED PATENTS as of the date
of such assignment. No royalties shall be payable by PMC on sales of
PRODUCTS covered only by a Valid Patent Claim of a LICENSED PATENT
which has been assigned to PMC pursuant to this Section 7.3.
7.4. Interference, Opposition, Reexamination and Reissue.
----------------------------------------------------
(i) The Parties shall use their respective best efforts to within
ten (10) days of learning of any interference, opposition,
reexamination or reissue event, inform the other Party of any
request for, or filing or declaration thereof relating to
LICENSED PATENTS. The Parties shall thereafter consult and
cooperate fully to determine the course of action with respect
to any such proceeding. Both Parties shall have the right to
review and comment on any submission to be made in connection
with any such proceeding.
(ii) CISTRON shall not institute any reexamination or reissue
proceeding relating to LICENSED PATENTS without having first
consulted PMC.
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(iii) In connection with any interference, opposition, reissue
or reexamination proceeding relating to LICENSED PATENTS, the
Parties shall cooperate fully and shall provide each other with
any information or assistance that either Party may reasonably
request. CISTRON shall keep PMC informed of developments in any
such action or proceeding, including, to the extent permissible,
the status of any settlement negotiations and the terms of any
offer related thereto.
(iv) CISTRON shall bear the expense of any interference, opposition,
reexamination or reissue proceeding relating to LICENSED PATENTS.
7.5. Enforcement and Defense.
------------------------
(i) Each Party shall give the other notice of either (a) any
infringement of LICENSED PATENTS, or (b) any misappropriation or
misuse of LICENSED KNOW-HOW that has come to its attention. The
Parties shall thereafter consult and cooperate fully to determine
a course of action, including but not limited to the commencement
of legal action by either or both Parties to terminate any
infringement of LICENSED PATENTS or any misappropriation or
misuse of LICENSED KNOW-HOW.
(ii) In the event that LICENSED PATENTS are infringed by any Third-
Party with respect to a PRODUCT in the Field of Use, CISTRON,
upon notice to PMC, shall have the first right, but not the
obligation, to institute and prosecute any action or proceeding
under LICENSED PATENTS with respect to such infringement, by
counsel of its choice, or to control the defense of any
declaratory judgment action arising from such infringement or
from the misappropriation or misuse of LICENSED KNOW-HOW, at its
own expense and in the name of both Parties. CISTRON shall not
settle, compromise or take any action in such litigation which
diminish, limit or inhibit the scope, validity or enforceability
of LICENSED PATENTS without the express permission of PMC.
CISTRON shall keep PMC advised of the progress of such
proceedings.
(iii) In the event that a Third-Party is infringing any LICENSED
PATENTS with respect to a PRODUCT in the Field of Use
and CISTRON does not elect to institute an action, PMC, upon
notice to CISTRON, shall have the right, but not the obligation,
to institute and prosecute any action or proceeding under
LICENSED PATENTS with respect to such infringement, by counsel of
its choice, or to control the defense of any declaratory judgment
action arising from such infringement or from the
misappropriat on or misuse of LICENSED KNOW-HOW, at its own
expense and in the name of both Parties. PMC shall not settle,
compromise or take any action in such litigation which diminish,
limit or inhibit the scope, validity or enforceability of
LICENSED PATENTS without the prior approval of CISTRON, which
shall not be unreasonably withheld.
(iv) With respect to any action to terminate any infringement of
LICENSED PATENTS or any misappropriation or misuse of LICENSED
KNOW-HOW, the Parties shall cooperate fully and shall provide
each other with any information and assistance that either Party
may reasonably request. In particular, either Party shall execute
such documents necessary for the other Party to initiate and
prosecute the action or proceeding and cause its Affiliates and
Sublicensees to execute all such documents, if required. In the
event that either Party is unable to initiate or prosecute an
action solely in its own name, the other Party shall then join
such action voluntarily. Each Party shall keep the other informed
of the development of any action or proceeding including, to the
extent permissible by law, the status of any settlement
negotiations and the terms of any offer related thereto.
(v) Any recovery obtained by either or both Parties in connection
with or as a result of any action or proceeding contemplated by
this Section 7.5, whether by settlement or otherwise, shall be
allocated in order as follows :
(a) The Party which initiated and prosecuted the action shall
recoup all of its costs and expenses incurred in connection
with the action (provided that if PMC was the
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initiating Party and that the action proceeds were not
sufficient for PMC to recoup all its costs and expenses,
then PMC shall be allowed to deduct the balance of its
unrecovered costs and expenses from royalties payable to
CISTRON under Article 4 hereof) ;
(b) The other Party shall then, to the extent possible, recover
its costs and expenses incurred in connection with the
action; and
(c) The amounts of any recovery remaining shall then be
allocated between the Parties with PMC receiving all amounts
in respect of damages in the Field of Use and CISTRON
receiving all amounts in respect of damages out of the Field
of Use, except that any amounts recovered in connection with
infringement actions relating to jointly-owned patents shall
be equally shared between the Parties.
(vi) CISTRON shall inform PMC of any certification regarding any
LICENSED PATENTS it has received pursuant to ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Code 355(b)(2)(A)(iv) or (j)(2)(A)(vii)(IV), or any similar
provision in other countries, and shall provide PMC with a copy
of such certification within five (5) days of receipt. Both
Parties rights with respect to the initiation and prosecution of
any legal action as a result of such certification or any
recovery obtained as a result of such legal action shall be as
defined in paragraphs (a) to (c) of this Section 7.5.
7.6. Notice of Patent Events.
------------------------
CISTRON shall promptly give notice to the other Party of the grant,
lapse, revocation, surrender or invalidation of any LICENSED
PATENTS.
7.7. Patent Term Restoration.
------------------------
CISTRON shall notify PMC of (a) the issuance of each U.S. patent
included within the LICENSED PATENTS, giving the date of issue and
patent number for each such patent, and (b) each notice pertaining
to any patent included within the LICENSED PATENTS which it receives
as patent owner pursuant to the United Sates Drug Price Competition
and Patent Term Restoration Act of 1984 (hereinafter called the
"Act"), including notices pursuant to 101 and 103 of the Act
from Persons who have filed a biological license application ("BLA")
or an abbreviated new drug application ("ANDA"), whichever is
applicable. Such notices shall be given promptly, but in any event
within five (5) calendar days of each such patent's date of issue or
receipt of each such notice pursuant to the Act, whichever is
applicable. CISTRON shall notify PMC of each filing for patent term
restoration under the Act, any allegations of failure to show due
diligence and all awards of patent term restoration (extensions) with
respect to the LICENSED PATENTS.
Likewise, CISTRON or PMC, as the case may be, shall inform the other
Party of patent extensions and periods of data exclusivity in the
rest of the world regarding any PRODUCTS and more generally the
Parties shall diligently cooperate with respect to any procedures
for patent and period of data exclusivity extensions, such as but
not limited to Supplementary Protection Certificates, the above-
mentioned Patent Term Restoration and corresponding GATT
regulations.
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ARTICLE 8 - GENERAL PROVISIONS
------------------------------
8.1. Confidentiality
---------------
(a) - General
-------
Except as expressly set forth in this section 8, each Party
shall cause its respective affiliates, officers, directors,
employees, agents and subcontractors (collectively,
"Representatives") to keep confidential any and all technical,
commercial, scientific and other data, processes, documents or
other information (whether in oral or written form) or
physical object (including, without limitation, Biological
Materials, intellectual property, marketing data, agreements
between any Party and a Third-Party, license applications, and
business plans and projections of any Party) acquired from the
other Party (the "Other Party"), its affiliates or its
Representatives prior to or after the date of this Agreement
and which relates (in the case of a Party) to the Other Party
or any of its Affiliates or their respective businesses
("Confidential Information"), and each Party shall not disclose
directly or indirectly, and shall cause its Representatives not
to disclose directly or indirectly, any Confidential
Information to anyone outside such Person, such affiliates and
their respective Representatives, except that the foregoing
restriction shall not apply to any information disclosed
hereunder to any Party, if such Person (the "Receiving Person")
can demonstrate that such Confidential Information :
(i) is or hereafter becomes generally available to the trade
or public other than by reason of any breach or default
by the Receiving Person, any of its affiliates or any
Representative of the foregoing with respect to a
confidentiality obligation under this Agreement ;
(ii) was already known to the Receiving Person or such
affiliate or Representative ;
(iii) is disclosed to the Receiving Person or such affiliate
or Representative by a Third-Party who has the right
to disclose such information ;
(iv) based on such Person's good faith judgement with the
advice of counsel, is otherwise required to be disclosed
in compliance with applicable legal requirements to a
public authority such as, without limitations, the U.S.
Food & Drug Administration (FDA), the European Medicines
Evaluation Agency (EMEA), the French Agence du Medicament
or any comparable authority of any country having
jurisdiction.
Whenever the Receiving Person becomes aware of any state of
facts which would or might result in disclosure of Confidential
Information pursuant to subparagraph (iv) above with the
exception of the case here below referred to in Section 4.1.(g)
in fine, it shall, if possible, promptly notify the Person
making disclosure (the "Disclosing Person") prior to any such
disclosure so that the Disclosing Person may seek a protective
order or other appropriate remedy and/or waive compliance with
the provisions of this Agreement.
In any event, if the Receiving Person is unable to promptly
notify the Disclosing Person or if such protective order or
other remedy is not obtained, or if the Disclosing Person
waives compliance with the provisions of this Agreement, the
Receiving Person will furnish only that portion of the
information which it is advised by counsel is legally required
and will exercise reasonable efforts to obtain assurance that
confidential treatment will be accorded the Confidential
Information.
Each Party shall be entitled, in addition to any other right
or remedy it may have, at law or in equity, to an injunction,
without the posting of any bond or other security except as
required by the relevant laws, enjoining or restraining any
other Party from any violation or threatened violation of
this Section 8.
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(b) - Use of Confidential Information
-------------------------------
Each Party agrees that no Confidential Information shall :
(i) be used in its own business except as necessary to the
fulfilment of the rights and obligations of such Party
under this Agreement ;
(ii) be assigned, licensed, sublicensed, marketed,
transferred or loaned, directly or indirectly to any
third Party other than a Representative or an Affiliate
Representative of such Party, except as necessary to the
fulfilment of the rights and obligations of the parties
under this Agreement ;
(iii) be used or exploited by such Party or any of its
Affiliates or their Representatives for its or their
respective benefit or the benefit of any other
relationships with customers of such Party and its
affiliates.
Without limiting the generality of the foregoing, each Party
agrees that, it shall not (and shall not permit any of its
Affiliates) at any time use any Confidential Information in the
conduct of its business without the prior written consent of
the Other Party.
The obligations set forth in this Section 8.1. shall extend to
copies, if any, of Confidential Information made by any
Representatives referred to in paragraph (a) and to documents
prepared by such Persons which embody or contain Confidential
Information.
(c) - Protection of Confidential Information
--------------------------------------
Each Party shall deal with Confidential Information so as to
protect it from disclosure with a degree of care not less than
that used by it in dealing with its own information intended to
remain exclusively within its knowledge and shall take
reasonable steps to minimize the risk of disclosure of
Confidential Information which shall include, without
limitation, ensuring that only its affiliates and its and their
Representatives who have a bona fide "need to know" such
Confidential Information for purposes permitted or contemplated
by this Agreement shall have access thereto.
Each Party, shall notify all of its Representatives who have
access to Confidential Information of its confidentiality and
the care therefor required, and shall obtain from any Affiliate
or any agent or subcontractor who is a Representative that is
permitted access to such Confidential Information in accordance
with this Section 8.1., an agreement of confidentiality
incorporating the restrictions set forth herein.
(d) - Survival of Obligations
-----------------------
The obligations set forth in this Section 8.1. shall survive
the termination of this Agreement for a period of five (5)
years.
(e) - Return of Confidential Information
----------------------------------
Within thirty (30) days after the termination of this
Agreement, the Receiving Person shall (and shall cause its
Affiliates' Representatives and its Affiliates to) return to
the Disclosing Person or destroy all related documents and
tangible items (included but not limited to unused Biological
Materials) then in its possession which it has received from
the Disclosing Person or any affiliate or Representative
thereof pertaining, referring or relating to the Disclosing
Person's Confidential Information, as well as all copies,
summaries, records, descriptions, modifications, and
duplications that it, or any of its affiliates
or Representatives, has made from the documents or tangible
items received from the Disclosing Person or any affiliate or
Representative thereof; provided, however, that the Receiving
Person may retain one copy of each document in its legal files
solely to permit the Receiving Person to continue to comply
with its obligations hereunder and, in addition, may upon
notice to the Disclosing Person, retain in its legal files or
in the
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41
office of outside legal counsel one copy of any document
solely for use in any pending legal proceeding to which such
document relates.
(f) - Publications
------------
Each Party shall have the right to publish or present the
results of the Research Program or of any research related to
the Field of Use and announce scientific progress of the
Research Program, provided such publication, presentation or
announcement (and any revisions thereof, a "Publication") is
submitted to the other Party at least ninety (90) days prior
to submitting it to any Third-Party (including any editing
Person). The other Party shall have ninety (90) days after
receipt of the draft Publication to review and comment on such
draft. Upon notice within such ninety (90) day period by the
other Party that such Party reasonably believes the
Publication would amount to the public disclosure of
a patentable invention (including but not limited to a Joint
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 ninety (90)
day period from the date of said notice, or for such longer
period which may appear necessary for appropriately drafting
and filing a patent application covering such invention. In
addition, each Party shall take into account comments made by
the other Party on any Publication and shall accept 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 shall have contributed. The Parties
acknowledge the provisions relating to publications as set
forth in the Research Agreement between CISTRON and Duke
University dated September 1, 1998, and agree that such
provisions shall prevail and control any publication
proposed under such Research Agreement.
(g) Press Releases and other Disclosures to Third-Parties.
Neither CISTRON nor PMC shall, without the prior written
consent of the other, issue any press release or make any
other public announcement or furnish any statement to any
Person (other than either Party's respective Affiliates)
concerning the existence of this Agreement and the
transactions contemplated by this Agreement, except for
(i) general statements referring to the existence of this
Agreement, specifying its nature (Research Collaboration and
License Option), the Field of Use and identity of the Parties
but no other details, (ii) disclosures made in compliance with
Section 4.1.(a) hereof, (iii) attorneys, consultants, and
accountants retained to represent them in connection with the
transactions contemplated hereby or as may be reasonably
necessary to either Party's bankers, investors, attorneys or
other professional advisers in connection with a merger or
acquisition, provided such advisors are bound by
confidentiality obligations essentially identical to those
provided for herein, and (iv) occasional, brief comments by
the respective executive officers of both Parties consistent
with such guidelines for public statements as may be mutually
agreed by the Parties made in connection with routine
interviews with analysts or members of the financial press.
In addition, either Party (after consultation with counsel) in
its own right may make such further announcements and
disclosures, if any, as may be required by applicable security
laws and regulations (such as, without limitation, regulations
of the US Securities & Exchange Commission (SEC) or the French
Commission des Operations de Bourse (COB), or any equivalent
authority of any country having jurisdiction), in which case
the Party making the announcement or disclosure shall use its
best efforts to give advance notice to, and discuss such
announcement or disclosure with, the other Party and such other
Party's attorneys.
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8.2. Term and termination.
---------------------
8.2.1. Expiration.
-----------
Unless terminated earlier pursuant to this Section 8.2. or Section
8.4. hereof, the Agreement shall expire on the expiration of PMC's
obligations to pay royalties under the Agreement in accordance with
the Royalty Term. Thereafter, PMC and its permitted Sublicensees (if
any) shall have a perpetual, fully paid-up, royalty-free, non-
cancellable, worldwide license or sub-license (whichever is
applicable) to the CISTRON Technology.
8.2.2. Termination by PMC.
-------------------
PMC shall have the right at any time, in its sole discretion, to
terminate this Agreement, by giving not less than three (3) months'
prior written notice to CISTRON of such termination.
8.2.3. Termination for Cause.
----------------------
(i) Either Party may terminate this Agreement, at its option, upon
or after the breach of any material provision of the Agreement
by the other Party, if such breaching Party has not cured such
breach within ninety (90) days after written notice thereof
from the other Party.
(ii) PMC or CISTRON may terminate this Agreement upon written
notice to the other Party if the other Party makes a general
assignment for the benefit of creditors, is the subject of
proceedings in voluntary or involuntary bankruptcy or has a
receiver or trustee appointed for substantially all of its
property ; provided that in the case of an involuntary
bankruptcy proceeding such right to terminate shall only
become effective if the other Party consents thereto or such
proceeding is not dismissed within ninety (90) days after the
filing thereof.
(iii) Each of the parties hereto acknowledges and agrees that this
Agreement (i) constitutes a license of Intellectual Property
(as such term is defined in the United States Bankruptcy Code,
as amended (the "Code"), and (ii) is an executory contract,
with significant obligations to be performed by each Party
hereto. The parties agree that PMC as LICENSEE may fully
exercise all of its rights and elections under the Code,
including, without limitation, those set forth in Section 365
(n) of the Code. The parties further agree that, in the event
that PMC elects to retain its rights as a licensee under the
Code, PMC shall be entitled to complete access to the CISTRON
Technology licensed to it hereunder and all embodiments of
such technology. Such embodiments of the CISTRON Technology
shall be delivered to PMC not later than (a) the commencement
of bankruptcy proceedings against CISTRON, unless CISTRON
elects to perform its obligations under the Agreement, or (b)
if not delivered under (a) above, upon the rejection of the
Agreement by or on behalf of CISTRON.
8.2.4. Effect of Expiration and Termination.
-------------------------------------
Expiration or termination of the Agreement shall not relieve the
Parties of any obligation accruing prior to such expiration or
termination. The provisions of Sections [TO BE COMPLETED] and
Articles [TO BE COMPLETED] shall survive the expiration or
termination of the Agreement.
Upon termination of this Agreement pursuant to Sections 8.2.2 or
8.2.3, and in the latter case, provided it is terminated as a
result of a breach of a material obligation of PMC hereunder, all
rights granted to PMC hereunder shall revert to CISTRON, PMC shall
return the entire CISTRON Technology and all embodiments of such
technology to CISTRON and shall cease any use of it forthwith.
CISTRON shall have a right of first refusal on PMC's
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intellectual property rights pertaining to any PRODUCT that was
developed by PMC at the date of termination (including PMC rights on
Joint Inventions), and CISTRON and PMC shall negotiate in good faith
the Terms and conditions of a license from PMC to CISTRON on such
PMC's rights relating to such PRODUCT(S) provided, however, that such
rights shall not include any intellectual property relating solely
to antigens or to any compound other than the FACTOR and provided,
further, that PMC shall be under no obligation neither to provide
any technical assistance nor to supply any product or Biological
Material. In the event that after termination and reversal of rights
and/or license to CISTRON hereunder, CISTRON either alone or in
collaboration with any Third-Party or through licenses and sub-
licenses eventually commercialize a PRODUCT, CISTRON shall pay to
PMC an amount equal to one half (50%) of any compensation received,
either in kind or in cash, by CISTRON with respect to or in
connection with such PRODUCT(S).
Upon termination of this Agreement pursuant to Section 8.2.3 further
to a breach of a material obligation of CISTRON hereunder, the
LICENSE shall be deemed terminated and replaced by a perpetual,
fully paid-up, royalty-free, non-cancelable, exclusive and worldwide
license to the CISTRON Technology to PMC, with the right to grant or
maintain sub-licenses.
8.3. Indemnity.
----------
8.3.1. Direct Indemnity.
-----------------
8.3.1.1. Each Party shall indemnify and hold harmless the other Party,
its Affiliates, and their respective directors, officers,
shareholders, agents, consultants and employees from and against all
Third-Party claims, demands, liabilities, damages (including damages
directly or indirectly suffered by the other Party and/or its
Affiliates and their respective directors, officers, shareholders,
agents, consultants and employees) and expenses, including
attorneys' fees and costs (collectively, the "Liabilities") arising
out of the breach of any material provision of this Agreement by the
indemnifying Party or caused by an intentional act or omission of
the indemnifying Party.
8.3.1.2. PMC shall defend, indemnify and hold harmless CISTRON, its
Affiliates, and their respective directors, officers, shareholders,
agents, consultants and employees, from and against all Liabilities
suffered or incurred arising out of any Third-Party claims in
connection with the manufacture, design, testing, possession,
distribution, use, sale or other disposition by or through PMC, its
Affiliates or Sublicensees of any PRODUCTS, except in each case to
the extent such Liabilities resulted from the gross negligence,
recklessness or intentional acts or omissions by CISTRON.
8.3.2. Procedure.
----------
A Party (the "Indemnitee") that intends to claim indemnification
under this Article 8.3. shall promptly notify the other Party (the
"Indemnitor") of any Liability or action in respect of which the
Indemnitee intends to claim such indemnification, and the Indemnitor
shall have the right to participate in, and, to the extent the
Indemnitor so desires, jointly with any other Indemnitor similarly
noticed, to assume the defense thereof with counsel selected by the
Indemnitor ; provided, however, that the Indemnitee shall have the
right to retain its own counsel, with the fees and expenses to be
paid by the Indemnitor, if representation of such Indemnitee by the
counsel retained by the Indemnitor would be inappropriate due to
actual or potential differing interests between such Indemnitee and
any other Party represented by such counsel in such proceedings.
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The indemnity obligations under this Article 8.3. shall not apply to
amounts paid in settlement of any loss, claim, damage, liability or
action if such settlement is effected without the consent of the
Indemnitor, which consent shall not be withheld unreasonably. The
failure to deliver notice to the Indemnitor within a reasonable time
after the commencement of any such action, if prejudicial to its
ability to defend such action, shall relieve such Indemnitor of any
liability to the Indemnitee under this Article 8.3. The Indemnitee,
its Affiliates, employees and agents, shall cooperate fully with the
Indemnitor and its legal representatives in the investigation of any
action, claim or liability covered by this indemnification.
8.4. 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 but not limited to fire, floods, embargoes, war, acts of
war (whether war be declared or not), insurrections, riots, civil
commotions, strikes, lockouts or other labor disturbances, acts of
God or acts, omissions or delays in acting by any governmental
authority or the other Party (collectively, "Events of Force
Majeure") ;
provided, however, that the affected Party (i) shall immediately
notify the other Party of the occurrence of any such Event of Force
Majeure and (ii) 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 ; and provided,
further, that nothing contained herein shall require any Party to
settle on terms unsatisfactory to such Party any strike, lockout or
other labor difficulty, any investigation or proceeding by any
governmental authority or any litigation by any Third-Party.
Notwithstanding the foregoing, to the extent that an Event of Force
Majeure continues for a period in excess of six (6) months, the
affected Party shall promptly notify in writing the other Party of
such Event of Force Majeure and within four (4) months 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.
8.5. Assignment.
-----------
This Agreement in its entirety may not be assigned or otherwise
transferred, nor, except as expressly provided hereunder, may any
right or obligations pertaining to the Field of Use hereunder be
assigned or transferred to any Third-Party by either Party without
the consent of the other Party ; provided, however, that either Party
may, without such consent, 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 or change in control or
similar transaction. Any permitted assignee shall assume all
obligations of its assignor under this Agreement. Without limiting
the generality of the foregoing, without the prior written consent of
PMC, CISTRON shall not under any circumstances assign or transfer any
CISTRON Technology in the Field of Use unless (i) all of the rights
and obligations of CISTRON under this Agreement are assigned to the
same transferee(s) concurrently therewith, and (ii) such
transferee(s) expressly assume(s) in writing the performance of all
terms and conditions of this Agreement to be performed by CISTRON and
such assignment shall not relieved the assignor of any of its
obligations under this Agreement. Each Party acknowledges that the
other Party would suffer irreparable injury in the event of any
breach of this Article 8.5. and that therefore the remedy at law for
any breach or threatened breach hereof by any Party shall be
inadequate. Accordingly, upon a breach or threatened breach hereof by
any Party, the other Party shall, in addition and without prejudice
to any other rights and remedies it may have, be entitled as a matter
of right, without proof of
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actual damages, to seek specific performance hereof and to such other
injunctive or equitable relief to enforce, or prevent any violations
(whether anticipatory, continuing or future) hereof.
8.6. Adverse Experience Reporting.
-----------------------------
During the term of the Agreement, each Party shall notify the other
immediately of any information (howsoever obtained and from whatever
source) concerning any unexpected side effect, injury, toxicity or
sensitivity reaction, or any unexpected incidence, and the severity
thereof, associated with the clinical uses, studies, investigations,
tests and marketing of a PRODUCTS. For purposes of this Article 8.6.,
"unexpected" shall mean (x) for a non-marketed PRODUCTS, an
experience that is not identified in nature, severity or frequency in
the current clinical investigator's confidential information
brochure, and (y) for a marketed PRODUCTS, an experience which is not
listed in the current labeling for such PRODUCTS, and includes an
event that may be symptomatically and patho-physiologically related
to an event listed in the labeling but differs from the event because
of increased frequency or greater severity or specificity. Each Party
further shall immediately notify the other of any information
received regarding any threatened or pending action by an agency
which may affect the safety and efficacy claims of a Product. Upon
receipt of any such information, the Parties shall consult with each
other in an effort to arrive at a mutually acceptable procedure for
taking appropriate action ; provided, however, that nothing contained
herein shall be construed as restricting either Party's right to make
a timely report of such matter to any government agency or take other
action that it deems to be appropriate or required by applicable law
or regulation.
8.7. 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.
8.8. Miscellaneous.
--------------
8.8.1. 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 addressor and (except as otherwise
provided in this Agreement) shall be effective upon receipt by the
addressee.
If to CISTRON :
CISTRON BIOTECHNOLGY, Inc.
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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Attention : Chairman
Telecopier : (▇▇▇) ▇▇▇-▇▇▇▇
Telephone : (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to :
▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Green, PC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier : (▇▇▇) ▇▇▇-▇▇▇▇
Telephone : (▇▇▇) ▇▇▇-▇▇▇▇
If to PMC :
PASTEUR MERIEUX Serums & Vaccins, S.A.
▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇
Attention : Senior Vice President, Legal & Corporate Affairs
and General Counsel
Telecopier : ▇▇▇ ▇▇ ▇ ▇▇ ▇▇ ▇▇ 61
Telephone : ▇▇▇ ▇▇ ▇ ▇▇ ▇▇ ▇▇ 84
CONNAUGHT LABORATORIES Inc.
▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention : Vice President, Business Development
Telecopier : (▇▇▇) ▇▇▇-▇▇▇▇
Telephone : (▇▇▇) ▇▇▇-▇▇▇▇
8.8.2. Applicable Law.
---------------
The Agreement shall be governed by and construed in accordance with
the laws of the State of New York, without regard to the conflict of
law principles thereof.
8.8.3. Representations, warranties and covenants.
------------------------------------------
8.8.3.1. Representations and Warranties of PMC.
--------------------------------------
(a) PMC is a Societe Anonyme duly organized and existing under the
laws of France, with the corporate power to own, lease and
operate its properties and to carry on its business as now
conducted.
(b) PMC has all necessary corporate power and authority to enter into
this Agreement and to consummate the transactions contemplated
hereby.
(c) The execution, delivery and performance of this Agreement by PMC
does not conflict with or contravene the statutes of PMC nor will
the execution, delivery or performance of this Agreement conflict
with or result in a breach of, or entitle any Party thereto to
terminate, any material agreement or instrument to which PMC is a
Party, or by which any of its assets or properties is bound.
(d) This Agreement has been duly authorized, executed and delivered
by PMC and constitutes a legal, valid and binding agreement of
PMC, enforceable against PMC in accordance with its terms, except
as enforceability may be limited by bankruptcy, insolvency,
moratorium, reorganization or other similar laws affecting
creditors' rights generally.
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8.8.3.2. Representations, Warranties and Covenants of CISTRON.
-----------------------------------------------------
(a) CISTRON is a corporation duly incorporated and validly existing
as a corporation in good standing under the laws of the State of
Delaware with the corporate power to own, lease and operate its
properties and to carry on its business as now conducted.
(b) CISTRON has all necessary corporate power and authority to enter
into this Agreement and to consummate the transactions
contemplated hereby.
(c) The execution, delivery and performance of this Agreement by
CISTRON does not conflict with or contravene its certificate of
incorporation or by-laws, nor will the execution, delivery or
performance of this Agreement conflict with or result in a breach
of, or entitle any Party thereto to terminate, any material
agreement or instrument to which CISTRON is a Party, or by which
any of its assets or properties is bound.
(d) This Agreement has been duly authorized, executed and delivered
by CISTRON and constitutes a legal, valid and binding agreement
of CISTRON, enforceable against CISTRON in accordance with its
terms, except as enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization or other similar laws
affecting creditors' rights generally.
(e) All LICENSED PATENTS listed on Schedule A as amended from time to
time, have been registered in, filed in or issued by the
appropriate patent offices of each jurisdiction as indicated on
such Schedule A, and in each case is currently in effect and all
maintenance fees and renewals thereof have been duly made with
respect thereto. CISTRON owns or has full and exclusive rights to
use and exploit under licenses (and to license or sublicense) all
its rights under such LICENSED PATENTS and the LICENSED KNOW-HOW.
Except as set forth on schedule 8.8.3.2.(e) hereto, there have
been no material claims made against CISTRON asserting the
invalidity or non-enforceability of, or with respect to such
LICENSED PATENTS , the misuse of such LICENSED PATENTS or the
LICENSED KNOW-HOW, nor is CISTRON aware that any such claims
exist. Except as set forth on schedule 8.8.3.2.(e) hereto,
CISTRON has not received a notice of conflict of such LICENSED
PATENTS or the LICENSED KNOW-HOW with the asserted rights of
others, or otherwise challenging its rights to use any of such
LICENSED PATENTS, or the LICENSED KNOW-HOW. None of the rights of
CISTRON under the LICENSED PATENTS or LICENSED KNOW-HOW shall be
adversely affected by the execution, delivery or performance of
this Agreement, or the consummation of the transaction
contemplated herein. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN
THIS SECTION, NEITHER PARTY MAKES ANY REPRESENTATION OR EXTENDS
ANY WARRANTIES OF ANY KIND EITHER EXPRESS OR IMPLIED, INCLUDING
BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, NON-INFRINGEMENT, OR VALIDITY OF ANY PATENT
RIGHTS ISSUED OR PENDING.
8.8.4. Dispute Resolution.
-------------------
The Parties agree that if any dispute or disagreement arises between
PMC on the one hand and CISTRON 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 twenty eight (28) business days of receipt of a Notice
of Dispute, a nominee or nominees of PMC and a nominee or
nominees of CISTRON 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 endeavours to resolve the dispute ;
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(c) If, within a further period of twenty eight (28) business days,
the dispute has not been resolved or if, for any reason, the
required meeting has not been held, then the Parties agree that
any dispute shall be referred to an arbitrator appointed by
agreement of CISTRON and PMC or, if no such agreement is
reached within sixty (60) business days after a Party commences
the arbitration, then by a panel of three arbitrators, with
each of PMC and CISTRON to select one arbitrator and those two
arbitrators to select the third. If all three arbitrators have
not been selected within sixty (60) business days after a Party
commences the arbitration, then the Parties agree to abide by
the selection of the remaining arbitrator to be named by a
representative of the International Chamber of Commerce. The
Parties agree that the Rules of the International Chamber of
Commerce shall govern such arbitration and that any decision of
the arbitrators shall be final and binding and shall be
enforceable in any court of competent jurisdiction worldwide
(regardless of whether one of the Parties fails or refuses to
participate in the arbitration). The Parties agree that all
arbitrations shall be conducted in the English language and
that the exclusive venue of all arbitrations shall be in
Zurich, Switzerland. The Party determined by the arbitrators to
be the Party substantially prevailing in the arbitration shall
be entitled to recover its legal and consultants' fees and
other costs reasonably incurred in connection with the
arbitration (as determined by the arbitrators) ; and
(d) 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.
8.8.5. 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.
8.8.6. Independent Contractors.
------------------------
CISTRON and PMC 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
CISTRON nor PMC 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.
8.8.7. 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.
8.8.8. 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.
8.8.9. No Implied Licence.
-------------------
Nothing in this Agreement shall be deemed to constitute, by
implication or otherwise, the grant by PMC to CISTRON, or by CISTRON
to PMC, of any license to, or interest in, or other rights under any
patent, patent application, proprietary know-how, trade secrets or
other intellectual property rights owned or possessed by PMC or
CISTRON, whichever is applicable, except as expressly provided for
herein.
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8.8.10. 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.
For CISTRON BIOTECHNOLOGY, INC.
By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name : ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title : Chairman of the Board
and Chief Executive Officer
For PASTEUR MERIEUX Sewrums & Vaccins S.A.
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name : ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title : President and
Chief Operating Officer
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50
SCHEDULE A
____________
LICENSED PATENTS
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51
SCHEDULE B -
PROVISIONS GOVERNING OWNERSHIP
AND MANAGEMENT OF JOINT INVENTIONS.
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