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Exhibit 10.23
[CERTAIN MATERIAL (INDICATED BY A [*CON*]) HAS BEEN OMITTED FROM THIS
DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED
MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.]
LICENSE AND ROYALTY AGREEMENT
This LICENSE AND ROYALTY AGREEMENT is entered into as of November 4,
1998 (the "Effective Date") by and between PFIZER INC and its Affiliates
("Pfizer"), a Delaware corporation, having an office at 235 East 42nd Street,
New York, New York 10017 and MITOKOR and its Affiliates ("Mitokor"), a
California corporation, having an office at 11494 Sorrento Valley Road, San
Diego, CA 92121;
WHEREAS, Pfizer desires to obtain an exclusive license under Mitokor's
right, title and interest in the Patent Rights so that Pfizer can manufacture,
use, sell, offer for sale and import the Licensed Products; and
WHEREAS, Mitokor is willing to grant such license;
Therefore, in consideration of the mutual covenants and promises set
forth in this Agreement, the parties agree as follows:
1. DEFINITIONS.
The capitalized terms used in this Agreement and not defined elsewhere
in it shall have the meanings specified for such terms in this Section 1 and in
the Research Agreement.
1.1 "RESEARCH AGREEMENT" means the Collaborative Research and Development
Agreement between Pfizer and Mitokor effective November 4, 1998.
1.2 "NET SALES" means the gross amount invoiced by Pfizer, its Affiliates,
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or any sublicensee of Pfizer for sales to a third party or parties of Licensed
Products, less normal and customary trade discounts actually allowed, rebates,
returns, credits, taxes the legal incidence of which is on the purchaser and
separately shown on Pfizer's or any sublicensee of Pfizer's invoices and
transportation, insurance and postage charges, if prepaid by Pfizer or any
sublicensee of Pfizer and billed on Pfizer's or any sublicensee of Pfizer's
invoices as a separate item.
1.3 "LICENSED PRODUCT" means any Therapeutic Product the manufacture, use,
sale, offer for sale or import would infringe any Valid Claim within the Patent
Rights in the absence of a license.
2. GRANT OF LICENSES, TERM, RIGHTS AND OBLIGATIONS.
2.1 LICENSE GRANTED TO PFIZER UNDER THE PATENT RIGHTS.
Mitokor hereby grants to Pfizer an exclusive, worldwide license,
including the right to grant sublicenses, to manufacture, use, sell, offer for
sale and import Licensed Products under all Mitokor's right, title and interest
in the Patent Rights.
2.2 LICENSE GRANTED TO MITOKOR UNDER THE PATENTS AND PROGRAM TECHNOLOGY.
Section 2.1 to the contrary notwithstanding:
2.2.1 Pfizer hereby grants to Mitokor the exclusive, perpetual,
royalty free license, including the right to grant sublicenses, to manufacture,
use, sell, offer for sale and import Diagnostic Products and products sold
exclusively for research purposes under all Pfizer's right, title and interest
in the Patent Rights and Program Technology.
2.3 TERM OF LICENSES. The term of the grant to Pfizer set forth in Section
2.1 shall commence on the Effective Date and shall terminate on the date of the
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last to expire of the Patent Rights. The term of the grant to Mitokor set forth
in Section 2.2. shall commence on the Effective Date and shall run perpetually
except in those countries of the world in which such term is limited by law.
2.4 PAID-UP LICENSE. Pfizer shall have a paid-up license permitting
royalty free manufacture, use ,sale, offer for sale and import of Licensed
Products in each country after the expiration of Pfizer's last obligation to pay
royalties on Net Sales of each such Licensed Product in each such country.
2.5 PFIZER OBLIGATIONS.
2.5.1 Pfizer shall use reasonably diligent efforts to exploit
Licensed Products commercially employing similar effort to that applied to other
products similarly situated.
2.5.2 If Pfizer grants a sublicense pursuant to this Section 2,
Pfizer shall guarantee that any sublicensee fulfills all of Pfizer's obligations
under this Agreement; provided, however, that Pfizer shall not be relieved of
its obligations pursuant to this Agreement.
2.6 TECHNICAL ASSISTANCE.
Mitokor shall provide to Pfizer or any sublicensee of Pfizer, at
Pfizer's request [ * CON * ], any agreed technical assistance reasonably
necessary to enable Pfizer or such sublicensee to manufacture, use, sell, offer
for sale or import each Licensed Product and to enjoy fully all the rights
granted to Pfizer pursuant to this Agreement; provided, however, that Mitokor is
reasonably capable of providing that assistance. Pfizer shall [ * CON * ]
providing such assistance.
3. MILESTONE PAYMENTS, ROYALTIES, ACCOUNTING , RECORDS.
3.1 PATENT RIGHTS.
3.1.1 Pfizer shall pay Mitokor a royalty based on the Net Sales
of each Licensed Product. Such royalty shall be paid with respect to each
country of
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the world from the date of the first commercial sale (the date of the invoice
of Pfizer or any sublicensee of Pfizer with respect to such sale) of such
Licensed Product in each such country until the expiration of the last Patent
Right to expire with respect to each such country and each such Licensed
Product.
3.1.2 If the manufacture and sale of a Licensed Product takes place
in countries where there are no Patent Rights, Pfizer will pay to Mitokor a
royalty based on the Net Sales of each Licensed Product in each such country for
[ * CON * ] ([ * CON * ]) years after the first commercial sale of such Licensed
Product in such country.
3.2 ADJUSTMENT TO ROYALTY RATES.
3.2.1 Pfizer shall pay Mitokor a royalty for the sale of each
Licensed Product under Section 2.1 as set forth in Section 3.1; provided,
however, that if over a calendar year the average cost of goods (determined in
the same manner as Pfizer determines its cost of goods for any similar
pharmaceutical product for financial reporting purposes in the United States,
consistently applying U.S. generally accepted accounting principles, including
royalties payable to Mitokor, but not third parties) for a Licensed Product
exceeds [ * CON * ] percent ([ * CON * ]%) of Pfizer's direct price (determined
in the same manner as Pfizer determines its direct price to customers for any
similar pharmaceutical product consistently applying generally accepted
accounting principles) for such Licensed Product for such calendar year, the
otherwise applicable royalty rate set forth below shall be reduced by
[ * CON * ] percent ([ * CON * ]%) of the excess above [ * CON * ] percent
([ * CON * ]%) of the Average Net Sales Price; provided, however, that in no
event shall the applicable royalty rates be reduced by an aggregate of more
than [ * CON * ]percent ([ * CON * ]%). Notwithstanding the foregoing, the
adjustment in this Section 3.2 shall not apply with respect to royalties paid
on Net Sales occurring prior to the end of the [ * CON * ] full calendar year
after the first
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commercial sale of the Licensed Product in the United States. As used in this
Section 3.2, the "Average Net Sales Price" shall mean the average invoice price
of all Net Sales in which the Licensed Product was sold worldwide in full
commercial sales during the particular calendar year, it being understood that
such sales shall not include units distributed as samples, for use in clinical
trials or in any other manner other than a full commercial sale; and "average
cost of goods" shall mean the average cost of goods of the Licensed Product
units included in the calculation of Average Net Sales Price.
3.2.2 If Pfizer determines that the foregoing cost formula
entitles Pfizer to a reduced royalty, Pfizer shall, upon request and at a
reasonable place during normal business hours, present to Mitokor its
calculations, books and records of account demonstrating that its cost was
determined by generally acceptable accounting procedures consistently applied.
3.3 ROYALTY RATES. The royalty paid each year shall be based on increments of
worldwide Net Sales with respect to each of the Licensed Products according to
the following schedule:
Annual Net Sales (MM) Royalty Rate (%)
--------------------- ----------------
$0-$[ * CON * ]MM [ * CON * ]%
$[ * CON * ]-[ * CON * ]MM [ * CON * ]%
$>[ * CON * ]MM [ * CON * ]%
3.4. RENEGOTIATION OF ROYALTY RATES. The parties acknowledge that the royalty
rates set forth in Section 3.3 and the milestones in Section 3.8 are based on
the
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expectation that Licensed Products will be administered to human patients. If
Pfizer identifies or develops for animal patients with respect to a Licensed
Product which represents a commercial opportunity for Pfizer in the area of
animal health, the parties will negotiate, as mutually agreed, a new royalty
rate and milestone schedule for such Licensed Product to account for
development costs and changes in the cost of goods, selling price and
projected annual Net Sales. It is understood, however, that the royalty rate
specified in Section 3.3 and the milestones as per Section 3.8 shall be
modified only as Pfizer and Mitokor agree.
3.5 PAYMENT DATES.
Royalties shall be paid by Pfizer on Net Sales within sixty (60)
days after the end of each calendar quarter in which such Net Sales are made.
Such payments shall be accompanied by a statement showing the Net Sales of each
Licensed Product by Pfizer or any sublicensee of Pfizer in each country, the
applicable royalty rate for such Licensed Product, and a calculation of the
amount of royalty due, including any offsets.
3.6 ACCOUNTING.
The Net Sales used for computing the royalties payable to Mitokor by
Pfizer shall be computed and paid in US dollars by wire transfer in immediately
available funds to a U.S. account designated by Mitokor, or by other mutually
acceptable means. For purposes of determining the amount of royalties due, the
amount of Net Sales in any foreign currency shall be computed by (a) converting
such amount into U.S. dollars at the prevailing commercial rate of exchange for
purchasing dollars with such foreign currency as published in the Wall Street
Journal for the close of the last business day of the calendar quarter for which
the relevant royalty payment is to be made by Pfizer and (b) deducting the
amount of any governmental tax, duty, charge, or other fee actually paid in
respect of such conversion into, and remittance of U.S. dollars.
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3.7 RECORDS.
Pfizer shall keep for three (3) years from the date of each payment
of royalties complete and accurate records of sales by Pfizer of each Licensed
Product in sufficient detail to allow the accruing royalties to be determined
accurately. Mitokor shall have the right for a period of three (3) years after
receiving any report or statement with respect to royalties due and payable to
appoint at its expense an independent certified public accountant reasonably
acceptable to Pfizer to inspect the relevant records of Pfizer to verify such
report or statement. Pfizer shall make its records available for inspection by
such independent certified public accountant during regular business hours at
such place or places where such records are customarily kept, upon reasonable
notice from Mitokor, to verify the accuracy of the reports and payments. Such
inspection right shall not be exercised more than once in any calendar year nor
more than once with respect to sales in any given period. Mitokor agrees to hold
in strict confidence all information concerning royalty payments and reports,
and all information learned in the course of any audit or inspection, except to
the extent necessary for Mitokor to reveal such information in order to enforce
its rights under this Agreement or if disclosure is required by law. The failure
of Mitokor to request verification of any report or statement during said
three-year period shall be considered acceptance of the accuracy of such report,
and Pfizer shall have no obligation to maintain records pertaining to such
report or statement beyond said three-year period. The findings of each
inspection, if any, shall be binding on both parties.
3.8 MILESTONE PAYMENTS. Pfizer shall pay Mitokor, within sixty (60) days
of the completion of each event set forth below ("Event"), the payment listed
opposite that Event. Payments shall be made in US dollars by wire transfer in
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immediately available funds to a U.S. bank account designated by Mitokor, or
other mutually acceptable means. Pfizer shall be obligated to make each payment
only once with respect to each Licensed Product affected by an Event; provided,
however, that such payment for such Event shall not be due with respect to any
subsequent Licensed Product directed to a Molecular Target and indication which
has previously been the subject of the same Event. [ * CON * ] payments made by
Pfizer pursuant to this Section 3.8 with respect to a Licensed Product shall be
credited against [ * CON * ] sums due to Mitokor pursuant to Section 3.3 of this
Agreement with respect to Net Sales of such Licensed Product; provided, however,
that the sums due pursuant to Section 3.3 in any calendar year with respect to
such Licensed Product shall not be reduced by virtue of this credit by more THAN
[ * CON * ] percent ([ * CON * ]%):
EVENT AMOUNT
----- ------
1. Submission of IND or initiation
of human clinical testing in any country
(whichever occurs first) $ [ * CON * ]
2. Commencement of Phase III clinical trials
in any country $ [ * CON * ]
3. NDA/PLA Submission in any country $ [ * CON * ]
4. NDA/PLA Approval in any country $ [ * CON * ]
For the purposes of the foregoing, "IND" shall mean an
Investigational New Drug Application filed with the U.S. FDA, or a
similar filing made with a counterpart health regulatory authority
in another country; "NDA/PLA" shall mean a New Drug Application,
Product License Application, or other application for authority to
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market a Licensed Product filed with the U.S. FDA or a counterpart
health regulatory agency in another country.
4. LEGAL ACTION.
4.1 ACTUAL OR THREATENED DISCLOSURE OR INFRINGEMENT.
When information comes to the attention of Pfizer to the effect that
any Patent Rights relating to a Licensed Product have been or are threatened to
be unlawfully infringed, Pfizer shall have the right at its expense to take such
action as it may deem necessary to prosecute or prevent such unlawful
infringement, including the right to bring or defend any suit, action or
proceeding involving any such infringement. Pfizer shall notify Mitokor promptly
of the receipt of any such information and of the commencement of any such suit,
action or proceeding. If Pfizer determines that it is necessary or desirable for
Mitokor to join any such suit, action or proceeding, Mitokor shall, at Pfizer's
expense, execute all papers and perform such other acts as may be reasonably
required to permit Pfizer to commence such action, suit or proceeding in which
case Pfizer shall hold Mitokor free, clear and harmless from any and all costs
and expenses of litigation, including attorneys fees. If Pfizer brings a suit,
it shall have the [ * CON * ], related to such suit or settlement, and
[ * CON * ] percent ([ * CON * ]%) of any funds that shall remain from said
recovery shall be paid to Mitokor and the balance of such funds shall be
retained by Pfizer. If Pfizer does not, within one hundred twenty (120) days
after giving notice to Mitokor of the above-described information, notify
Mitokor of Pfizer's intent to bring suit against any infringer, Mitokor shall
have the right to bring suit for such alleged infringement, but it shall not be
obligated to do so, and may join Pfizer as party plaintiff, if appropriate, in
which event Mitokor shall hold Pfizer free, clear and harmless from any and all
costs and expenses of such litigation, including attorney's fees, and any sums
recovered in any such suit or in its settlement shall belong to Mitokor.
However,
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[ * CON * ] percent ([ * CON * ]%) of any such sums received by Mitokor, after
deduction of all costs and expenses related to such suit or settlement,
including attorney's fees paid, shall be paid to Pfizer. Each party shall always
have the right to be represented by counsel of its own selection and at its own
expense in any suit instituted by the other for infringement under the terms of
this Section. If Pfizer lacks standing and Mitokor has standing to bring any
such suit, action or proceeding, then Mitokor shall do so at the request of
Pfizer and at Pfizer's expense.
4.2 DEFENSE OF INFRINGEMENT CLAIMS.
Mitokor will cooperate with Pfizer at Pfizer's expense in the
defense of any suit, action or proceeding against Pfizer or any sublicensee of
Pfizer alleging the infringement of the intellectual property rights of a third
party by reason of the use of Patent Rights in the manufacture, use or sale of
the Licensed Product. Pfizer shall give Mitokor prompt written notice of the
commencement of any such suit, action or proceeding or claim of infringement and
will furnish Mitokor a copy of each communication relating to the alleged
infringement. Mitokor shall give to Pfizer all authority (including the right to
exclusive control of the defense of any such suit, action or proceeding and the
exclusive right after consultation with Mitokor, to compromise, litigate, settle
or otherwise dispose of any such suit, action or proceeding), at Pfizer's
expense, including by providing information and assistance necessary to defend
or settle any such suit, action or proceeding; provided, however, Pfizer shall
obtain Mitokor's prior consent to such part of any settlement which contemplates
payment or other action by Mitokor or has a material adverse effect on Mitokor's
business. If the parties agree that Mitokor should institute or join any suit,
action or proceeding pursuant to this Section, Pfizer may, at Pfizer's expense,
join Mitokor as a defendant if necessary or desirable, and Mitokor shall execute
all documents and take all other actions,
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including giving testimony, which may reasonably be required in connection with
the prosecution of such suit, action or proceeding.
4.3 HOLD HARMLESS.
Mitokor agrees to defend, indemnify and hold harmless Pfizer and any
sublicensee of Pfizer, from and against any loss or expense arising from any
proven claim of a third party that the third party has been granted rights by
Mitokor and such rights are being infringed upon by reason of Pfizer or any
sublicensee of Pfizer exercising their rights granted to Pfizer by Mitokor
pursuant to this Agreement.
4.4 THIRD PARTY LICENSES.
If the manufacture, use or sale by Pfizer of a Licensed Product in
any country would, in the opinion of both Pfizer and Mitokor, infringe a patent
owned by a third party, Pfizer and Mitokor, upon mutual consent, shall attempt
to obtain a license under such patent at Pfizer's expense. If such license is
obtained under such patent, [ * CON * ] percent ([ * CON * ]%) of any payments
made by Pfizer to such third party shall be deductible from royalty payments due
from Pfizer to Mitokor pursuant to this Agreement; provided, however, that in no
event shall royalties payable to Mitokor be lower than [ * CON * ] of the
royalty due from the Net Sales of such Licensed Product as a result of all such
deductions. All such computations, payments, and adjustments shall be on a
country by country and patent by patent basis.
5. REPRESENTATION AND WARRANTY.
5.1 Mitokor represents and warrants to Pfizer that it has the right to
grant the License granted pursuant to this Agreement, and that the License so
granted does not conflict with or violate the terms of any agreement between
Mitokor and any third party.
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6. TREATMENT OF CONFIDENTIAL INFORMATION.
6.1 CONFIDENTIALITY.
6.1.1 Pfizer and Mitokor each recognize that the other's
Confidential Information constitutes highly valuable, confidential information.
Subject to Pfizer's right and obligations pursuant to this Agreement, Pfizer and
Mitokor each agree that during the term of the Research Agreement and for [ *
CON * ] ([ * CON * ]) years thereafter, it will keep confidential, and will
cause its Affiliates and sublicensees to keep confidential, all Mitokor
Confidential Information or Pfizer Confidential Information, as the case may be,
that is disclosed to it or to any of its Affiliates and sublicensees pursuant to
this Agreement. Neither Pfizer, its Affiliates or sublicensees nor Mitokor shall
use Confidential Information of the other party except as expressly permitted
under this Agreement. For all purposes of this Section 6, it is understood that
Program Technology shall be deemed Confidential Information of both parties.
6.1.2 Subject to Pfizer's rights and obligations pursuant to this
Agreement, Pfizer and Mitokor each agree that any disclosure of the other's
Confidential Information to any officer, employee or agent of the other party or
of any of its Affiliates and sublicensees shall be made only if and to the
extent necessary to carry out its responsibilities under this Agreement and
shall be limited to the maximum extent possible consistent with such
responsibilities. Subject to Pfizer's rights and obligations pursuant to this
Agreement, Pfizer and Mitokor each agree not to disclose the other's
Confidential Information to any third parties under any circumstance without
written permission from the other party. Each party shall take such action, and
shall cause its Affiliates and sublicensees to take such action, to preserve the
confidentiality of each other's
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Confidential Information as it would customarily take to preserve the
confidentiality of its own Confidential Information. Each party, upon the
other's request, will return all the Confidential Information disclosed to it by
the other party pursuant to this Agreement, including all copies and extracts of
documents, within sixty (60) days of the request upon the termination of this
Agreement except for one (1) copy which may be kept for the purpose of complying
with continuing obligations under this Agreement.
6.1.3 Mitokor and Pfizer each represent that all of its employees,
and any consultants to such party, participating in the Research Program who
shall have access to Program Technology, the Technology of the other (Pfizer
Technology or Mitokor Technology, as the case may be) or Confidential
Information of the other (Pfizer Confidential Information or Mitokor
Confidential Information, as the case may be) are bound by agreement to maintain
such information in confidence.
6.2 PUBLICITY. Except as required by law, and except for a mutually
approved press release to be issued upon the signing of this Agreement, neither
party may disclose the terms of this Agreement without the written consent of
the other party; provided, however, that Mitokor may disclose the terms, or
provide copies, of this Agreement as necessary in the normal course of business
to bankers, investors and others in order to obtain financing.
6.3 DISCLOSURE REQUIRED BY LAW. If either party is requested to disclose
the Confidential Information in connection with a legal or administrative
proceeding or is otherwise required by law to disclose the Confidential
Information, such party will give the other party prompt notice of such request.
The disclosing party may seek an appropriate protective order or other remedy or
waive compliance with the provisions of this Agreement. If such party seeks a
protective order or other remedy, the other party will cooperate. If such party
fails to obtain a protective
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order or waive compliance with the relevant provisions of this Agreement, the
other party will disclose only that portion of Confidential Information which
its legal counsel determines it is required to disclose.
6.4 DISCLOSURE OF INVENTIONS. Each party shall promptly inform the other
about all inventions in the Area within Program Technology that are conceived,
made or developed in the course of carrying out the Research Program by
employees of, consultants to, either of them solely, or jointly with employees
of, or consultants to the other.
7. PROVISIONS CONCERNING FILING, PROSECUTION AND MAINTENANCE OF PATENT RIGHTS.
The following provisions relate to the filing, prosecution and maintenance of
Patent Rights during the term of this Agreement:
7.1 FILING, PROSECUTION AND MAINTENANCE BY MITOKOR. With respect to Patent
Rights in which Mitokor employees or consultants, alone or together with Pfizer
employees, or consultants are named as inventors, Mitokor shall have the
exclusive right and obligation :
(a) to file applications for letters patent on patentable inventions
included in Patent Rights; provided, however, that Mitokor shall consult with
Pfizer regarding countries in which such patent applications should be filed and
shall file patent applications in those countries where Pfizer requests that
Mitokor file such applications; and, further provided, that Mitokor, at its
option and expense, may file in countries where Pfizer does not request that
Mitokor file such applications;
(b) to take all reasonable steps to prosecute all pending and new
patent applications included within Patent Rights;
(c) to respond to oppositions, nullity actions, re-examinations,
revocation actions, interference proceedings and similar proceedings filed by
third parties against the grant of letters patent for such applications;
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(d) to maintain in force any letters patent included in Patent
Rights by duly filing all necessary papers and paying any fees required by the
patent laws of the particular country in which such letters patent were granted;
and
(e) to cooperate fully with, and take all necessary actions
requested by, Pfizer in connection with the preparation, prosecution and
maintenance of any letters patent included in Patent Rights.
Mitokor shall notify Pfizer in a timely manner of any decision to not
pursue an action or to abandon a pending patent application or an issued patent
included in Patent Rights. Thereafter, Pfizer shall have the option, at its
expense, of taking such action or continuing to prosecute any such pending
patent application or of keeping the issued patent in force, or all of these.
7.1.1 COPIES OF DOCUMENTS. Mitokor and Pfizer shall provide to each
other copies of all patent applications that are part of Patent Rights prior to
filing, for the purpose of obtaining substantive comment of the other party's
patent counsel. Mitokor and Pfizer shall also provide to the other copies of all
material documents relating to prosecution of all such patent applications in a
timely manner and shall provide to the other every six (6) months a report
detailing the status of all patent applications that are a part of Patent
Rights.
7.1.2 REIMBURSEMENT OF COSTS FOR FILING PROSECUTING AND MAINTAINING
PATENT RIGHTS. Within thirty (30) days of receipt of invoices from Mitokor,
Pfizer shall reimburse Mitokor for all the costs of filing, prosecuting,
responding to opposition and maintaining patent applications and patents in
countries where Pfizer consents to or requests that patent applications be
filed, prosecuted and maintained. Such reimbursement shall be in addition to
other funding payments under this Agreement and shall include such costs of all
activities described in 7.1 (a)-(e) above. However, Pfizer may, upon sixty (60)
days notice, request that Mitokor discontinue filing or prosecution of patent
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applications in any country and discontinue reimbursing Mitokor for the costs of
filing, prosecuting, responding to opposition or maintaining such patent
application or patent in any country. Mitokor shall pay all costs in those
countries in which Pfizer requests that Mitokor not file, prosecute or maintain
patent applications and patents, but in which Mitokor, at its option, elects to
do so.
7.1.3 Patent Extensions. Pfizer shall have the right to file on
behalf of and as an agent for Mitokor all applications for, and take all actions
necessary to obtain patent extensions pursuant to 35 USC Section 156 and foreign
counterparts with respect to the Patent Rights to the extent that such
extensions are available by reason of a Licensed Product under the License
Agreement during the period the License Agreement is in effect. Mitokor agrees,
to sign, such further documents and take such further actions as may be
requested by Pfizer in this regard, at Pfizer's expense.
7.2 FILING, PROSECUTION AND MAINTENANCE BY PFIZER. With respect to Patent
Rights in which Pfizer employees or consultants alone are named as inventors,
Pfizer shall have those rights and duties ascribed to Mitokor in Section 7.1.,
except that Pfizer will bear all related expenses.
7.3 Neither party may disclaim a Valid Claim within Patent Rights without
the consent of the other.
8. OTHER AGREEMENTS.
Concurrently with the execution of this Agreement, Mitokor and Pfizer
shall enter into the Research Agreement of even date and the Stock Purchase
Agreement. This Agreement, the Research Agreement, and the Stock Purchase
Agreement are the sole agreements with respect to the subject matter and
supersede all other agreements and understanding between the parties with
respect to same.
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9. TERMINATION AND DISENGAGEMENT.
9.1 EVENTS OF TERMINATION. The following events shall constitute events of
termination ("Events of Termination"):
(a) If any written representation or warranty by Mitokor or Pfizer,
or any of its officers, made under or in connection with this Agreement shall
prove to have been incorrect in any material respect when made;
(b) Mitokor or Pfizer shall fail in any material respect to perform
or observe any term, covenant or understanding contained in this Agreement or in
any of the other documents or instruments delivered pursuant to, or concurrently
with, this Agreement, and any such failure shall remain unremedied for thirty
(30) days after written notice to the failing party.
9.2 TERMINATION. Upon the occurrence of any Event of Termination, the
party not responsible may, by notice to the other party, terminate this
Agreement.
9.3 Termination of this Agreement by either party, with or without cause,
will not terminate the licenses granted pursuant to Section 5.2 of the Research
Agreement.
9.4 Termination of this Agreement for any reason shall be without
prejudice to:
(a) the rights and obligations of the parties provided in Sections
6, 7 and 10;
(b) Mitokor's right to receive all royalty, milestone or other
payments accrued hereunder; or
(c) any other remedies which either party may otherwise have.
10. INDEMNIFICATION. Pfizer and Mitokor will indemnify, defend and hold each
other harmless for any and all damages, settlements, costs, legal fees and other
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expenses incurred in connection with a claim by a third party against either
party based on any action or omission of the indemnifying party's agents,
employees, or officers related to its obligations under this Agreement;
provided, however, that the foregoing shall not apply (i) if the claim is found
to be based upon the negligence, recklessness or willful misconduct of the party
seeking indemnification; or (ii) if such party fails to give the other party
prompt notice of any claim it receives and such failure materially prejudices
the other party with respect to any claim or action to which its obligation
pursuant to this Section applies. Notwithstanding the foregoing, Pfizer hereby
expressly agrees to indemnify, defend and hold harmless Mitokor (and all
officers, directors, agents and Affiliates of Mitokor) for any and all claims
arising from clinical trials pursued by Pfizer or its Affiliates and/or
sublicensees, the sale of products, the exercise of rights granted to Pfizer
under Section 5.2 of the Research Agreement or the License and Royalty Agreement
(including without limitation product liability claims) and/or claims and to
claims arising from Patent Rights, Pfizer Patent Rights, Program Technology and
Pfizer Technology except for intellectual property claims with respect to
Mitokor Patent Rights, or Mitokor Technology. The indemnifying party, in its
sole discretion, shall choose legal counsel, shall control the defense of such
claim or action and shall have the right to settle same on such terms and
conditions it deems advisable.
11. NOTICES AND REPORTS.
11.1 All notices shall be in writing mailed via certified mail, return
receipt requested, courier, or facsimile transmission addressed as follows, or
to such other address as may be designated from time to time:
If to Pfizer: Pfizer Central Research
235 East 42nd Street
New York, NY 10017
ATTENTION: DR. GEORGE MILNE, PRESIDENT
with copy to: General Counsel
If to Mitokor: MitoKor,
11494 Sorrento Valley Road
San Diego, CA 92121
ATTENTION: DR. WALTER MOOS, CEO
Notices shall be deemed given as of the date received at the above specified
address.
11.2 Reports. Pfizer agrees to keep Mitokor informed with respect to
activities and progress toward further research, development and
commercialization of Licensed Products. Pfizer agrees to provide to Mitokor
every six months a summary of such activities and progress. In addition, Pfizer
will provide to Mitokor copies of any data regarding the Licensed Products
together with copies of any reports or summaries of such data. Mitokor agrees
that all such information will be deemed Pfizer Confidential Information.
12. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York.
13. MISCELLANEOUS.
13.1 BINDING EFFECT. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective legal representatives, successors
and permitted assigns.
13.2 HEADINGS. Paragraph headings are inserted for convenience of
reference only and do not form a part of this Agreement.
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13.3 COUNTERPARTS. This Agreement may be executed simultaneously in two or
more counterparts, each of which shall be deemed an original. Signatures may be
transmitted via facsimile, thereby constituting the valid signature and delivery
of this Agreement.
13.4 AMENDMENT; WAIVER; ETC. This Agreement may be amended, modified,
superseded or canceled, and any of the terms may be waived, only by a written
instrument executed by each party or, in the case of waiver, by the party or
parties waiving compliance. The delay or failure of any party at any time or
times to require performance of any provisions shall in no manner affect the
rights at a later time to enforce the same. No waiver by any party of any
condition or of the breach of any term contained in this Agreement, whether by
conduct, or otherwise, in any one or more instances, shall be deemed to be, or
considered as, a further or continuing waiver of any such condition or of the
breach of such term or any other term of this Agreement.
13.5 NO THIRD PARTY BENEFICIARIES. No third party including any employee
of any party to this Agreement, shall have or acquire any rights by reason of
this Agreement. Nothing contained in this Agreement shall be deemed to
constitute the parties as partners with each other or any third party.
13.6 ASSIGNMENT AND SUCCESSORS. This Agreement may not be assigned by
either party, except that each party may assign this Agreement and the rights
and interests of such party, in whole or in part, to any of its Affiliates, any
purchaser of all or substantially all of its assets or to any successor
corporation resulting from any merger or consolidation of such party with or
into such corporations.
13.7 FORCE MAJEURE. Neither Pfizer nor Mitokor shall be liable for failure
of or delay in performing obligations set forth in this Agreement, and neither
shall be deemed in breach of its obligations, if such failure or delay is due to
natural
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disasters or any causes reasonably beyond the control of Pfizer or Mitokor.
13.8 SEVERABILITY. If any provision of this Agreement is or becomes
invalid or is ruled invalid by any court of competent jurisdiction or is deemed
unenforceable, it is the intention of the parties that the remainder of the
Agreement shall not be affected so long as the essential benefits of this
Agreement remains enforceable and obtainable.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorized representatives.
PFIZER INC MITOKOR
By: By:
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Title: Title:
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