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CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. EACH SUCH OMISSION IS DESIGNATED [***].
CORN BORER-PROTECTED CORN
LICENSE AGREEMENT
This Agreement (the "Agreement") is made and effective as of the 31st
day of January, 1996 by and between Monsanto Company, and DEKALB Genetics
Corporation regarding the non-exclusive, cross-license of certain patent rights
and proprietary technology of Monsanto and of DEKALB for use in producing
lepidopteran insects-protected corn plants. Based on the mutual consideration
between the parties recited below, and in partial consideration for entering
into the Investment Agreement of even date herewith, the parties agree and
covenant as set forth below.
SECTION 1- BACKGROUND AND PARTIES
1.01 Monsanto Company ("MONSANTO") is a corporation of the
State of Delaware with principal offices at 800 N. Lindbergh Boulevard, St.
Louis, Missouri 63167.
1.02 DEKALB Genetics Corporation ("DEKALB") is a
corporation of the State of Delaware with principal offices at 3100 Sycamore
Road, DeKalb, Illinois 60115.
1.03 MONSANTO has certain rights relating to Genetic
Element(s), Germplasm, Plasmid(s), Methods and Gene(s), including technical
information and Know-How relating to, among other things, transformed plants
and seeds, useful for lepidopteran insects protection in corn plants and has
rights in and to patents and/or patent applications covering the Genetic
Element(s), Germplasm, Plasmid(s), Methods and Gene(s) and their use.
1.04 DEKALB has certain rights relating to Genetic
Element(s), Germplasm, Plasmid(s), Methods and Gene(s), including technical
information and Know-How relating to, among other things, transformed plants
and seeds, useful for lepidopteran insects protection in corn plants and has
rights in and to patents and/or patent applications covering the Genetic
Element(s), Germplasm, Plasmid(s), Methods and Gene(s) and their use.
1.05 DEKALB is interested in the commercialization of
lepidopteran insects-protected corn and DEKALB seeks to obtain a limited
license under MONSANTO's proprietary rights, and MONSANTO desires to grant such
license, all upon the terms and conditions provided herein.
1.06 MONSANTO is interested in obtaining a limited license
under DEKALB's proprietary rights, and DEKALB desires to grant such license,
all upon the terms and conditions provided herein.
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SECTION 2 - DEFINITIONS
For purposes of this Agreement, the following words and phrases shall
have the following meanings:
2.01 The term "Affiliate(s)," as used herein, means with
respect to an entity, any person that is at least fifty percent (50%) owned by,
or, directly or indirectly, is controlled by, under common control with or in
control of, that entity. The term "control" shall mean the possession, direct
or indirect, of the power to direct or cause the direction of the management
and policies of an entity whether through the ownership of securities, by
contract or otherwise.
2.02 The term "DEKALB Germplasm" as used herein, means
transgenic corn germplasm supplied to MONSANTO by DEKALB.
2.03 The term "MONSANTO Germplasm" as used herein, means
transgenic corn germplasm supplied to DEKALB by MONSANTO.
2.04 The term "Confidential Information," as used herein,
means any proprietary information, including technical, economic, financial or
marketing information, which either party considers confidential and which is
disclosed to the other party.
2.05 The term "Effective Date" is defined in Subsection
8.01 of this Agreement.
2.06 The term "Fiscal Year" shall mean a twelve-month
period ending August 31st.
2.07 The term "DEKALB Gene(s)," as used herein, shall mean
DNA encoding an insect control protein from Bacillus thuringiensis or
derivative thereof which is supplied to MONSANTO by DEKALB prior to or during
the term of this Agreement, and derivatives or modifications thereof, which
protein, upon expression in corn plants, results in protection against
lepidopteran insects.
2.08 The term "MONSANTO Gene(s)," as used herein, shall
mean DNA encoding an insect control protein from Bacillus thuringiensis or
derivative thereof which is supplied to DEKALB by MONSANTO prior to or during
the term of this Agreement, and derivatives or modifications thereof, which
protein, upon expression in corn plants, results in protection against
lepidopteran insects.
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2.09 The term "DEKALB Genetic Element(s)," as used herein,
means any DNA sequence or sequences including any DNA containing promoters, 5'
non-translated regions, introns, 3' non-translated termination/polyadenylation
regions and markers that are useful in expressing recombinant genes in corn,
which is supplied to MONSANTO by DEKALB prior to or during the term of this
Agreement, and replicates thereof, which are useful for the expression of
insect control proteins of Bacillus thuringiensis or are useful for the
selection of transgenic plants from tissue culture.
2.10 The term "MONSANTO Genetic Element(s)," as used
herein, means any DNA sequence or sequences including any DNA containing
promoters, 5' non-translated regions, introns, 3' non-translated
termination/polyadenylation regions and markers that are useful in expressing
recombinant genes in corn, which is supplied to DEKALB by MONSANTO prior to or
during the term of this Agreement, and replicates thereof which are useful for
the expression of insect control proteins of Bacillus thuringiensis or are
useful for the selection of transgenic plants from tissue culture.
2.11 The term "Hybrid Seed Corn," as used herein, means
seed which a grower would plant to produce a single crop of commercial corn.
2.12 The term "Hybrid Seed Company," as used herein, means
an entity, other than DEKALB and MONSANTO, [***]
2.13 The term "Hybrid Seed Company [***]"
as used herein, means a Hybrid Seed Company that sold or licensed in the United
States in Fiscal Year 1995 [***] Hybrid Seed Corn than [***] in the United
States in Fiscal Year 1995.
2.14 The term "International Associate," as used herein,
means any foreign-based person that has been licensed by DEKALB or MONSANTO to
sell or otherwise distribute DEKALB- or MONSANTO-branded seed products. The
International Associates of DEKALB or MONSANTO include, but are not limited to,
those listed in Exhibits A and B, respectively. A third party shall not be
considered to be an International Associate solely on the basis of the granting
of a license pursuant to this Agreement.
2.15 The term "MONSANTO Know-How," as used herein, means any
knowledge and proprietary information disclosed to DEKALB by MONSANTO prior to
or during the term of this Agreement, which information is not generally
publicly known, including, without limitation, all chemical, biochemical,
toxicological, manufacturing, formulation, molecular and
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plant pathology, and scientific research information, whether or not capable of
precise separate description but which alone or when accumulated gives to the
one acquiring it an ability to develop and commercialize a product through
study, testing, production, formulation or marketing which that party would
otherwise not have been able to develop and commercialize in the same manner.
2.16 The term "DEKALB Know-How," as used herein, means any
knowledge and proprietary information disclosed to MONSANTO by DEKALB prior to
or during the term of this Agreement, which information is not generally
publicly known, including, without limitation, all chemical, biochemical,
toxicological, manufacturing, formulation, molecular and plant pathology, and
scientific research information, whether or not capable of precise separate
description but which alone or when accumulated gives to the one acquiring it
an ability to develop and commercialize a product through study, testing,
production, formulation or marketing which that party would otherwise not have
been able to develop and commercialize in the same manner.
2.17 The term "Licensed Field," as used herein, means
transgenic corn (including sweet corn) which exhibits protection against
lepidopteran insects by expression of an insect control protein derived from
Bacillus thuringiensis.
2.18 The term "Licensed MONSANTO Method" shall mean any
method the use or practice of which would, in the absence of a license,
infringe one or more Valid MONSANTO Claims of an unexpired patent included in
the Licensed MONSANTO Patent Rights or which involves the use of MONSANTO
Know-How or Licensed MONSANTO Non-Patent Proprietary Materials.
2.19 The term "Licensed DEKALB Method" shall mean any
method the use or practice of which would, in the absence of a license,
infringe one or more Valid DEKALB Claims of an unexpired patent included in the
Licensed DEKALB Patent Rights or which involves the use of DEKALB Know-How or
Licensed DEKALB Non-Patent Proprietary Materials.
2.20 The term "Licensed MONSANTO Non-Patent Proprietary
Materials," as used herein, means all MONSANTO Genetic Element(s), MONSANTO
Germplasm, MONSANTO Plasmid(s) and MONSANTO Gene(s).
2.21 The term "Licensed DEKALB Non-Patent Proprietary
Materials," as used herein, means all DEKALB Genetic Element(s), DEKALB
Germplasm, DEKALB Plasmid(s) and DEKALB Gene(s).
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2.22 The term "Licensed MONSANTO Patent Rights," shall
mean all patent licenses and sublicenses for use in the Licensed Field to which
MONSANTO and/or a wholly-owned Affiliate of MONSANTO is a licensee or
sublicensee (to the extent allowed by such licenses or sublicenses) and all
patents and patent applications within the Licensed Field, including but not
limited to those listed in Appendix A-M for use in the Licensed Field and owned
by MONSANTO and/or a wholly-owned Affiliate of MONSANTO, filed prior to or
during the term of this Agreement, and any and all patents maturing from these
applications or maturing from applications that are divisionals, continuations
or continuations-in-part of these applications, foreign (i.e., ex-U.S.)
equivalents of the foregoing and any and all reissues or extensions of any of
the foregoing.
2.23 The term "Licensed DEKALB Patent Rights," shall mean
all patent licenses and sublicenses for use in the Licensed Field to which
DEKALB and/or a wholly-owned Affiliate of DEKALB is a licensee or sublicensee
(to the extent allowed by such licenses or sublicenses) and all patents and
patent applications within the Licensed Field, including but not limited to
those listed in Appendix A-D for use in the Licensed Field and owned by DEKALB
and/or a wholly-owned Affiliate of DEKALB, filed prior to or during the term of
this Agreement, and any and all patents maturing from these applications or
maturing from applications that are divisionals, continuations or
continuations-in-part of these applications, foreign (i.e., ex-U.S.)
equivalents of the foregoing and any and all reissues or extensions of any of
the foregoing.
2.24 The term "Licensed DEKALB Corn Product(s)" shall mean corn
material including, but not limited to, cells, plants, or seeds and products
thereof, which is produced by a Licensed MONSANTO Method or which, in the
course of its manufacture, use, or sale would, in the absence of a license,
infringe a Valid MONSANTO Claim or the production of which involves the use of
MONSANTO Know-How or Licensed MONSANTO Non-Patent Proprietary Materials, all in
the Licensed Field.
2.25 The term "Licensed MONSANTO Corn Product(s)" shall
mean corn material including, but not limited to, cells, plants, or seeds and
products thereof, which is produced by a Licensed DEKALB Method or which, in
the course of its manufacture, use, or sale would, in the absence of a license,
infringe a Valid DEKALB Claim or the production of which involves the use of
DEKALB Know-How or Licensed DEKALB Non-Patent Proprietary Materials, all in
the Licensed Field.
2.26 The term "Net Units," as used herein, means the
number of Units sold of all Licensed DEKALB Corn Products and Licensed MONSANTO
Corn Products in arm's length sales to third parties after deduction of credits
or allowances given or made for rejection or return of previously sold Licensed
DEKALB Corn Products and Licensed MONSANTO Corn
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Products. Where the product is covered under the present Agreement and under
licenses that evolve from the Collaboration Agreement, or from the CaMV
Promoter License Agreement or the Glyphosate-Protected Corn License Agreement,
all three of even date herewith, "Net Units" must be calculated separately for
each Agreement. The use by DEKALB or the Affiliates, International Associates
or sublicensees of DEKALB or MONSANTO of commercially reasonable amounts of
Licensed DEKALB Corn Products or Licensed MONSANTO Corn Products for
promotional sampling or replant shall not be included in Net Units.
2.27 The term "DEKALB Plasmid(s)," as used herein, means a
transformation vector(s) which is supplied to MONSANTO by DEKALB prior to or
during the term of this Agreement.
2.28 The term "MONSANTO Plasmid(s)," as used herein, means
a transformation vector(s) which is supplied to DEKALB by MONSANTO prior to or
during the term of this Agreement.
2.29 The term "Territory," as used herein, means the
world.
2.30 The term "Unit(s)," as used herein, means a quantity
of approximately Eighty Thousand (80,000) kernels.
2.31 The term "Valid DEKALB Claim," as used herein, means
an issued claim of the Licensed DEKALB Patent Rights which has not been finally
held invalid or unenforceable by a decision of a court or other authority of
competent jurisdiction which is not appealable.
2.32 The term "Valid MONSANTO Claim," as used herein,
means an issued claim of the Licensed MONSANTO Patent Rights which has not been
finally held invalid or unenforceable by a decision of a court or other
authority of competent jurisdiction which is not appealable.
2.33 The term "-branded," when used in conjunction with an
entity's name, means a trademark or logo of that entity, whether registered or
not, affixed to a product or product container, or used in advertising,
promotion or other marketing of such a product.
2.34 The term "person," as used herein, shall mean an
individual, corporation, partnership, limited liability company, joint venture,
association, trust, unincorporated organization or other entity.
SECTION 3-CONVEYANCE OF RIGHTS
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3.01 LICENSE GRANT BY MONSANTO: Subject to the terms and
conditions of this Agreement, MONSANTO hereby grants to DEKALB a
royalty-bearing, non-exclusive, license under the Licensed MONSANTO Patent
Rights, Licensed MONSANTO Non-patent Proprietary Materials, Licensed MONSANTO
Methods and MONSANTO Know-How, (1) to make, have made, use and sell Licensed
DEKALB Corn Products in the Territory; (2) to sublicense DEKALB's Affiliates
and International Associates to make, have made, use and sell DEKALB-branded
Licensed DEKALB Corn Products in the Territory; and [***] No sublicensee
hereunder shall have the right to further sublicense any rights hereunder.
3.02 DISTRIBUTION OF LICENSED DEKALB CORN PRODUCTS:
Except as otherwise provided under Subsection 3.01(3), with respect to the
sales of Licensed DEKALB Corn Products hereunder in the Territory, DEKALB and
its Affiliates and International Associates shall only be permitted to sell and
distribute DEKALB-branded Licensed DEKALB Corn Products.
3.03 MARKING OF LICENSED DEKALB CORN PRODUCTS:
(a) DEKALB and its Affiliates and International
Associates and sublicensees shall conspicuously display on all packages
containing Licensed DEKALB Corn Products to be sold or transferred to permitted
third-party growers or customers, the following notice (tailored to reflect the
nature of the conveyance), or a notice having the same meaning and effect, with
the blanks appropriately filled in to the extent such notice is applicable in
the respective area:
THE (PURCHASE/BAILMENT/TRANSFER) OF THESE SEEDS INCLUDES A
LIMITED LICENSE UNDER PATENT(S)____ TO PRODUCE A SINGLE CORN
CROP IN THE UNITED STATES (or other applicable country). THIS
LICENSE DOES NOT EXTEND TO ANY USE OTHER THAN PRODUCTION OF A
SINGLE CROP.
(b) Where transactions occur in countries whose primary
language is not English, a translation of the notice in the appropriate
language shall be used if appropriate or required by law.
3.04 TRADEMARK USAGE:
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(a) It is agreed that a trademark owned by MONSANTO
relating to a Licensed DEKALB Corn Product in the Licensed Field shall be
licensed to DEKALB and its sublicensees, Affiliates and International
Associates on a non-exclusive basis pursuant to a trademark license agreement.
The form of the trademark license agreement is attached hereto as Appendix B-M.
The parties shall execute said license agreement when MONSANTO identifies the
trademark which will be utilized. DEKALB and its Affiliates and International
Associates and sublicensees shall conspicuously display said trademark on all
seed packages of Licensed DEKALB Corn Products as well as all promotional and
advertising material for such Licensed DEKALB Corn Products in the manner
specified in the trademark license agreement.
(b) In the event that MONSANTO should terminate such
trademark agreement without cause, the obligation of DEKALB and its Affiliates
and International Associates to display said trademark pursuant to Subsection
3.04(a) shall be waived.
3.05 NO OTHER LICENSES: No license is granted by this
Agreement, under the Licensed MONSANTO Patent Rights or any other patent right
by implication or otherwise to make, have made, use or sell, directly or by
sublicense, any Licensed DEKALB Corn Product for any use outside the Licensed
Field. DEKALB shall not have the right hereunder to grant sublicenses under
Licensed MONSANTO Patent Rights allowing the sale of a corn product for
commercial use as [***]
3.06 LICENSE GRANT BY DEKALB: Subject to the terms and
conditions of this Agreement, DEKALB hereby grants to MONSANTO a
royalty-bearing, non-exclusive, license under the Licensed DEKALB Patent
Rights, Licensed DEKALB Non-patent Proprietary Materials, Licensed DEKALB
Method and DEKALB Know-How, (1) to make, have made, and use Licensed MONSANTO
Corn Products in the Territory, and (2) to sublicense MONSANTO Affiliates and
International Associates and Hybrid Seed Companies [***] to make, have made,
use and sell Licensed MONSANTO Corn Products in the Territory. No sublicensee
hereunder shall have the right to further sublicense any rights hereunder.
3.07 MARKING OF LICENSED MONSANTO CORN PRODUCTS:
(a) MONSANTO and its Affiliates, International
Associates, and sublicensees shall conspicuously display on all packages
containing Licensed MONSANTO Corn Products to be sold or transferred to
permitted third-party growers or customers, the following notice (tailored to
reflect the nature of the conveyance), or a notice having the same meaning and
effect, with the blanks appropriately filled in to the extent such notice is
applicable in the respective area:
THE (PURCHASE/BAILMENT/TRANSFER) OF THESE SEEDS INCLUDES A
LIMITED LICENSE UNDER PATENT(S)____
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___________________ TO PRODUCE A SINGLE CORN CROP IN THE
UNITED STATES (or other applicable country). THIS LICENSE
DOES NOT EXTEND TO ANY USE OTHER THAN PRODUCTION OF A SINGLE
CROP.
(b) Where transactions occur in countries whose primary
language is not English, a translation of the notice in the appropriate
language shall be used if appropriate or required by law.
3.08 USE OF DEKALB'S NAME: The parties agree that where
a MONSANTO brand or trademark is employed in connection with the advertising,
sale, promotion or other marketing of a Licensed MONSANTO Corn Product, then
such brand or trademark shall only be so employed in conjunction with both
DEKALB's and MONSANTO's names being used in equal prominence.
3.09 NO OTHER LICENSES: No license is granted by this
Agreement, under the Licensed DEKALB Patent Rights or any other patent right by
implication or otherwise to make, have made, use or sell, directly or by
sublicense, any Licensed MONSANTO Corn Product for any use outside the
Licensed Field. MONSANTO shall not have the right hereunder to grant
sublicenses under Licensed DEKALB Patent Rights allowing the sale of a corn
product for commercial use as [***].
3.10 COMMERCIALIZATION WITH GROWER AGREEMENT: MONSANTO
and DEKALB shall meet and discuss whether it is in their mutual interest to
commercialize the Licensed MONSANTO Corn Products and Licensed DEKALB Corn
Products by directly licensing and or sublicensing the corn grower to use such
Products.
3.11 MONSANTO AND DEKALB [***]: If MONSANTO or
DEKALB grant to [***] a sublicense under the Licensed DEKALB Patent Rights
or Licensed MONSANTO Patent Rights, MONSANTO or DEKALB shall [***] and their
respective Affiliates, International Associates and sublicensees with regard to
the [***] that relate to the sale of existing Licensed MONSANTO Corn Products
or existing Licensed DEKALB Corn Products. The obtaining of such rights shall
not constitute consideration under for purposes of Subsection 4.01(a). This
obligation can be [***] of the parties.
3.12 NO RIGHTS REGARDING PROPRIETARY GERMPLASM: Notwithstanding
anything
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in this Agreement to the contrary, no rights in proprietary corn inbreds or
hybrids of either party are granted the other under this Agreement.
3.13 FUTURE ACCESS: During the term of this Agreement,
[***] shall have the right to [***] within the Licensed Field, either
internally or with any third party, such that results of that [***], and rights
flowing from that research, will not be subject to the grants under [***], of
this Agreement.
SECTION 4 - PAYMENTS, REPORTS AND RECORD RETENTION
4.01 ROYALTIES PAYABLE BY MONSANTO:
(a) In partial consideration for the license rights
granted by DEKALB hereunder, until the obligation of MONSANTO to pay royalties
to DEKALB expires, MONSANTO shall pay to DEKALB [***], of any cash or
cash-equivalent consideration or other consideration received by MONSANTO from
its Affiliates, International Associates and Hybrid Seed Companies [***], on
any sale of Licensed MONSANTO Corn Products or Licensed DEKALB Corn Products in
the Territory by such persons sublicensed by MONSANTO under Licensed DEKALB
Patent Rights or Licensed MONSANTO Patent Rights pursuant to the terms of this
Agreement [***]. To the extent MONSANTO intends to negotiate a sublicense that
contemplates such other consideration that is not cash or a cash equivalent,
MONSANTO shall [***]. DEKALB shall have fifteen (15) business days to consider
whether to accept enjoyment of the benefit of such other consideration, or to
reject such enjoyment and accept instead a cash value equivalent thereto. If
DEKALB does not provide notice of acceptance of enjoyment of the benefit of
such other consideration to MONSANTO within the fifteen (15) day period, DEKALB
shall be deemed to have accepted the cash value equivalent thereto. To the
extent there exists any such other consideration, including but not limited to
a cross-license, involved in the sublicense the monetary equivalent thereof
shall be agreed by the parties for the purpose of this Subsection 4.01(a). If
despite good faith negotiations, the parties cannot reach agreement on the
monetary equivalent, then determination of such equivalent shall be submitted
to arbitration pursuant to the provisions of Subsection 10.15 if requested by
either party. Examples of such other consideration include technical data or a
sublicense under any license obtained by
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MONSANTO. Notwithstanding the above provisions of this Subsection 4.01(a),
MONSANTO shall not be obligated to negotiate access to such other consideration
(i.e., other than cash or cash equivalent) for DEKALB, except as provided in
Subsection 3.11.
(b) In further consideration for the license rights
granted by DEKALB hereunder, MONSANTO shall pay as a royalty to DEKALB an
amount equal to the [***] or (ii) [***] of the payment established for
Subsection 4.02(a), times the Net Units of Licensed DEKALB Corn Products or
Licensed MONSANTO Corn Products sold by DEKALB and its Affiliates and
International Associates until the obligation under Subsection 4.02(a) of
DEKALB to pay royalties to MONSANTO expires.
(c) If DEKALB subsequently grants a license under the
Licensed DEKALB Patent Rights to a third party having terms which considered as
a whole are more favorable to the licensee than the terms considered as a whole
granted to MONSANTO as set forth in Subsection 4.01(a), then DEKALB shall
advise MONSANTO as to such more favorable terms. MONSANTO shall, at its
election, be entitled upon notice to DEKALB to have this Agreement amended to
substitute such third party terms for the terms of this Agreement as of the
date upon which such license containing the more favorable terms shall have
become effective; provided, however, that MONSANTO also agrees to have the
Agreement amended to contain any additional obligations that are recited in
such license containing the more favorable terms.
(d) In the event DEKALB shall at any time while this
Agreement is in effect be compelled by applicable law to issue licenses under
the Licensed DEKALB Patent Rights in the Licensed Field to any other person
with royalty terms more favorable than those granted to MONSANTO hereunder,
DEKALB shall inform MONSANTO of the order compelling any such licenses and
shall offer the royalties only with respect to the country or countries wherein
such compulsory licenses have been ordered so that the new royalty terms shall
be no less favorable to MONSANTO than those granted to any third party under
any such compulsory license.
(e) Nothing in this Subsection 4.01 shall entitle
MONSANTO to any retroactive adjustment, reduction in royalty, or other relief
from any of the provisions of this Agreement merely because DEKALB shall
commence proceedings against a third party who has infringed the Licensed
DEKALB Patent Rights, which proceedings shall be resolved by the third party
becoming licensed under the Licensed DEKALB Patent Rights, so long as such
subsequent license agreement shall, at least prospectively, impose upon such
third party terms as to royalty no more favorable than the royalty terms
imposed upon MONSANTO under this Agreement as set forth in Subsection 4.01(a).
4.02 ROYALTIES PAYABLE BY DEKALB:
(a) In partial consideration for the license rights
granted by MONSANTO hereunder, DEKALB shall pay as a royalty to
MONSANTO an amount equal to [***] the Net Units of Licensed DEKALB Corn
Products or Licensed MONSANTO Corn Products sold by DEKALB and its Affiliates
and International Associates, [***]
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(b) In partial consideration for the license rights
granted by MONSANTO hereunder, until the obligation of DEKALB to pay royalties
to MONSANTO expires, DEKALB shall pay to MONSANTO [***] of any cash or
cash-equivalent consideration or other consideration received by DEKALB, other
than consideration received for sales by DEKALB and its Affiliates and
International Associates covered under Subsection 4.02(a), on any sale of
Licensed MONSANTO Corn Products or Licensed DEKALB Corn Products in the
Licensed Field in the Territory by persons licensed by DEKALB under the
Licensed DEKALB Patent Rights pursuant to the terms of this Agreement [***].
To the extent DEKALB intends to negotiate a sublicense that contemplates such
other consideration that is not cash or a cash equivalent, DEKALB shall [***].
MONSANTO shall have fifteen (15) business days to consider whether to accept
enjoyment of the benefit of such other consideration, or to reject such
enjoyment and accept instead a cash value equivalent thereto. If MONSANTO does
not provide notice of acceptance of enjoyment of the benefit of such other
consideration to DEKALB within the fifteen (15) day period, MONSANTO shall be
deemed to have accepted the cash value equivalent thereto. To the extent there
exists any such other consideration, including but not limited to a
cross-license, involved in the sublicense, the monetary equivalent thereof
shall be agreed by the parties for the purpose of this Subsection 4.02(b). If
despite good faith negotiations, the parties cannot reach agreement on the
monetary equivalent, then determination of such equivalent shall be submitted
to arbitration pursuant to the provisions of Subsection 10.15, if requested by
either party. Examples of such other consideration include technical data or a
sublicense under any license obtained by DEKALB. Notwithstanding the above
provisions of this Subsection 4.02(b), DEKALB shall not be obligated to
negotiate access to such other consideration (i.e., other than cash or cash
equivalent) for MONSANTO, except as provided in Subsection 3.11.
(c) If MONSANTO subsequently grants a license
under the Licensed MONSANTO Patent Rights to a third party having terms which
considered as a whole are more favorable to the licensee than the terms
considered as a whole granted to DEKALB as set forth in Subsection 4.02(a),
then MONSANTO shall advise DEKALB as to such more favorable terms. DEKALB
shall, at its election, be entitled upon notice to MONSANTO to have this
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Agreement amended to substitute such third party terms for the terms of this
Agreement as of the date upon which such license containing the more favorable
terms shall have become effective; provided, however, that DEKALB also agrees
to have the Agreement amended to contain any additional obligations that are
recited in such license containing the more favorable terms.
(d) In the event MONSANTO shall at any time while this
Agreement is in effect be compelled by applicable law to issue licenses under
the Licensed MONSANTO Patent Rights in the Licensed Field to any other company
with royalty terms more favorable than those granted to DEKALB hereunder,
MONSANTO shall inform DEKALB of the order compelling any such licenses and
shall offer the royalties only with respect to the country or countries wherein
such compulsory licenses have been ordered so that the new royalty terms shall
be no less favorable to DEKALB than those granted to any third party under any
such compulsory license.
(e) Nothing in this Subsection 4.02 shall entitle DEKALB
to any retroactive adjustment, reduction in royalty, or other relief from any
of the provisions of this Agreement merely because MONSANTO shall commence
proceedings against a third party who has infringed the Licensed MONSANTO
Patent Rights, which proceedings shall be resolved by the third party becoming
licensed under the Licensed MONSANTO Patent Rights, so long as such subsequent
license agreement shall, at least prospectively, impose upon such third party
terms as to royalty no more favorable than the royalty terms imposed upon
DEKALB under this Agreement as set forth in Subsection 4.02(a).
4.03 FIRST COMMERCIAL SALE IN A COUNTRY:
(a) The parties shall promptly advise one another in
writing of the first commercial sales of Licensed DEKALB Corn Products or
Licensed MONSANTO Corn Products in each country of the Territory.
(b) At the time such first commercial sale is reported
pursuant to Subsection 4.03(a), the reporting party shall briefly describe the
relationship between the reporting party and the entity making the first
commercial sale.
4.04 SUBLICENSES: The parties shall promptly advise one
another in writing of each sublicense of Licensed MONSANTO Corn Products or
Licensed DEKALB Corn Product.
4.05 ROYALTY REPORTS:
(a) Within sixty (60) days after the end of each Fiscal
Year, DEKALB shall provide MONSANTO with a written report of the Net Units of
Licensed DEKALB Corn Products and Licensed MONSANTO Corn Products sold by
DEKALB and its Affiliates and International Associates and sublicensees during
such Fiscal Year and the consideration received
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on licenses of Licensed DEKALB Corn Products and Licensed MONSANTO Corn
Products granted by DEKALB in the Licensed Field in the Territory under the
Licensed DEKALB Patent Rights and Licensed MONSANTO Patent Rights. The report
shall contain the determination of royalties due MONSANTO based on such Net
Units and consideration. Any consideration other than cash or cash-equivalents
received by DEKALB for such licenses shall be provided to MONSANTO, in
accordance with Subsection 4.02(b), as soon after receipt by DEKALB as is
practicable.
(b) Within sixty (60) days after the end of each Fiscal
Year, MONSANTO shall provide DEKALB with a written report of the Net Units of
Licensed DEKALB Corn Products and Licensed MONSANTO Corn Products sold by
MONSANTO's Affiliates and International Associates and sublicensees during such
Fiscal Year and the consideration received on licenses of Licensed DEKALB Corn
Products and Licensed MONSANTO Corn Products granted by MONSANTO in the
Licensed Field in the Territory under the Licensed DEKALB Patent Rights and
Licensed MONSANTO Patent Rights. The report shall contain the determination of
royalties due DEKALB based on such Net Units and consideration. Any
consideration other than cash or cash-equivalents received by MONSANTO for such
licenses shall be provided to DEKALB, in accordance with Subsection 4.01(a), as
soon after receipt by MONSANTO as is practicable.
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4.06 ROYALTY PAYMENTS:
(a) After receipt of the reports pursuant to Subsection
4.05, each party shall offset payments due from the other party against
payments due to the other party. Within ten (10) days after submission of the
reports, the party having the duty to pay amounts remaining after the offset
shall promptly make the payments then due. Payments shall be in United States
dollars. Payments due on sales of Licensed MONSANTO Corn Products and Licensed
DEKALB Corn Products sold outside the United States or on sublicenses granted
outside the United States shall first be calculated in the foreign currency and
then converted to United States dollars on the basis of the rate of exchange in
effect for purchase of dollars at Chase Manhattan Bank, New York, New York, on
the last business day of the period for which royalties are due. Payments
shall be without set off and free and clear of any taxes, duties, fees or
charges other than withholding taxes, if any.
(b) Each payment to MONSANTO hereunder shall be sent to:
(i) MONSANTO's account by wire transfer:
[***]
with a written notice of such wire transfer, or
(ii) to another account in the United States which
MONSANTO may subsequently designate from time to time by notice to DEKALB.
(c) Each payment to DEKALB hereunder shall be sent to:
(i) DEKALB's account by wire transfer:
[***]
with a written notice of such wire transfer, or
(ii) to another account in the United States which
DEKALB may subsequently designate from time to time by notice to MONSANTO.
4.07 RECORDS RETENTION:
(a) DEKALB agrees to keep, and shall cause its Affiliates
and International Associates and sublicensees to keep, records of the sales of
all Licensed DEKALB Corn Products and Licensed MONSANTO Corn Products and of
all consideration received on licenses granted by DEKALB in the Licensed Field
under the Licensed DEKALB Patent Rights and Licensed MONSANTO Patent Rights to
any Hybrid Seed Company in sufficient detail to permit MONSANTO to confirm the
accuracy of DEKALB's royalty calculations. MONSANTO agrees to keep and shall
cause its Affiliates and International Associates and sublicensees to keep,
records of all payments and other consideration received on all licenses and
all sublicenses
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granted by MONSANTO in the Licensed Field under the Licensed MONSANTO Patent
Rights and Licensed DEKALB Patent Rights to any Hybrid Seed Company, in
sufficient detail to permit DEKALB to confirm the accuracy of MONSANTO's
royalty calculations. At either party's request, the other party shall permit
an independent accountant appointed by the requesting party and reasonably
acceptable to the other party to examine, not more often than once during any
Fiscal Year and under appropriate confidentiality provisions, upon reasonable
notice of at least ten (10) days and at reasonable times and in a manner that
does not interfere unreasonably with the other party's business, such records
solely to the extent necessary to verify the other party's calculations. Such
records shall be kept and examination thereof shall be limited to a period of
time no more than three (3) Fiscal Years immediately preceding the request for
examination.
(b) The audit of the other party's records shall be at
the requesting party's expense, provided that, if a net aggregate discrepancy
of more than ten percent (10%) is found in favor of the other party, then the
other party shall be obligated to reimburse the requesting party for the cost
of the audit.
4.08 LATE PAYMENT: Notwithstanding any other remedy
available under the provisions of this Agreement, if any sum of money owed
hereunder is not paid when due, the unpaid amount shall bear interest
compounded quarterly, at an annual rate of one (1) percentage point above the
prime rate quoted by Morgan Guaranty Trust Company of New York on the day
payment was due, until paid.
4.09 EFFECT OF TERMINATION OF THE INVESTMENT AGREEMENT:
(a) Upon termination of the Investment Agreement between
MONSANTO and DEKALB of even date hereof before the termination of the
Collaboration Agreement and License between MONSANTO and DEKALB of even date
hereof, because of (1) the issuance by any governmental authority of any order
or decree requiring MONSANTO to terminate the Investment Agreement, which order
or decree resulted from MONSANTO's voluntary action, or (2) the termination of
the Investment Agreement by MONSANTO other than for Cause, as defined in the
Investment Agreement in Subsection 9.1.6:
(i) Subsection 4.01(a) shall be modified so that
the term [***] shall replace the term [***]
(ii) Subsection 4.01(b) shall be modified so that
the terms [***] and [***] shall replace the terms [***] and [***] respectively;
and
(iii) Subsection 4.02(b) shall be modified so that
the term [***] shall replace the term [***]
(b) Upon termination of the Investment Agreement between
MONSANTO and DEKALB of even date hereof before the termination of the
Collaboration Agreement and License between MONSANTO and DEKALB of even date
hereof because of the issuance by any governmental authority of any order or
decree requiring DEKALB to terminate the Investment
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Agreement, which order or decree resulted from DEKALB's voluntary action:
(i) Subsection 4.01(a) shall be modified so that
the term [***] shall replace the term [***]
(ii) Subsection 4.01(b) shall be modified so that
the terms [***] and [***] shall replace the terms [***] and [***] respectively;
and
(iii) Subsection 4.02(b) shall be modified so that
the term [***] shall replace the term [***]
SECTION 5 - REGULATORY APPROVAL AND PRODUCT REGISTRATION
5.01 REGULATORY APPROVALS: This Agreement does not
obligate either party to undertake any regulatory approvals or product
registrations. Each party shall bear its own cost of undertaking such
approvals or registrations it seeks.
5.02 REQUEST FOR INFORMATION BY DEKALB: Subject to the
provisions of Subsection 5.01, MONSANTO shall, at the reasonable request of
DEKALB, provide assistance to DEKALB in seeking such regulatory approvals
and/or product registrations, including data, studies and any applicable
regulatory filings which MONSANTO may have in its possession; provided,
however, that MONSANTO shall not be obligated to conduct any new experiments or
other work with respect to any such request by DEKALB.
5.03 REQUEST FOR INFORMATION BY MONSANTO: Subject to the
provisions of Subsection 5.01, DEKALB shall, at the reasonable request of
MONSANTO, provide assistance to MONSANTO in seeking such regulatory approvals
and/or product registrations, including data, studies and any applicable
regulatory filings which DEKALB may have in its possession; provided, however,
that DEKALB shall not be obligated to conduct any new experiments or other work
with respect to any such request by MONSANTO.
SECTION 6 - PATENT PROCUREMENT, ENFORCEMENT
AND INFRINGEMENT
6.01 PATENT PROCUREMENT: MONSANTO shall have the
exclusive right to apply for, and seek issuance of, maintain or abandon any or
all of the Licensed MONSANTO Patent Rights. DEKALB shall have the exclusive
right to apply for, and seek issuance of, maintain or abandon any or all of the
Licensed DEKALB Patent Rights.
6.02 PATENT ENFORCEMENT:
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(a) DEKALB and MONSANTO shall each give prompt notice to
the other of any infringement of the Licensed MONSANTO Patent Rights or of the
Licensed DEKALB Patent Rights within the Licensed Field which may come to its
attention.
(b) MONSANTO shall have the exclusive right (but not the
obligation) to institute and conduct legal action against third-party
infringers of the Licensed MONSANTO Patent Rights, and to enter into settlement
agreements as a way of responding to any infringements as may be deemed
appropriate by MONSANTO. MONSANTO shall receive the full benefits of any
action it takes pursuant to this Subsection 6.02; provided however, that once
any attorney's fees and other reasonable costs incurred in conducting such
legal action have been deducted from any recovery obtained from enforcement of
Licensed MONSANTO Patent Rights which arise, MONSANTO shall pay to DEKALB its
pro rata portion of such recovery, calculated in accordance with the terms of
this Agreement as they apply to amounts received pursuant to the applicable
Licensed MONSANTO Patent Rights.
(c) If the activities of the third party infringing the
Licensed MONSANTO Patent Rights result in a material adverse effect on the
business of DEKALB or any of its Affiliates or International Associates or
sublicensees and at the end of One Hundred and Eighty (180) days from the
receipt of notice from DEKALB of such infringement, the third party is both
unlicensed under the Licensed MONSANTO Patent Rights and is engaging in
activities which are an infringement of the Licensed MONSANTO Patent Rights,
and MONSANTO has not brought a suit, action or other proceeding for
infringement against such third party, then DEKALB and all of its Affiliates
and International Associates and sublicensees shall be excused from making the
payments otherwise due hereunder with respect to revenues derived from sales of
Licensed DEKALB Corn Products or Licensed MONSANTO Corn Products in a country
in which the competitive infringing activity occurs. Such excuse from payment
shall arise only as to sales by DEKALB and its Affiliates, International
Associates and sub-licensees of the affected Licensed DEKALB Corn Products or
Licensed MONSANTO Corn Products in the country in which the infringing products
are sold and shall continue only for so long as the infringing products
continue to be infringing and to so compete with such Licensed DEKALB Corn
Products or Licensed MONSANTO Corn Products unchallenged by an infringement
suit, action or other proceeding brought by MONSANTO. If the infringing
activities of more than one third party result in such a material adverse
effect, then MONSANTO will fulfill its obligation under this Subsection through
litigation with only one such third party at a time.
(d) DEKALB shall have the exclusive right (but not the
obligation) to institute and conduct legal action against third-party
infringers of the Licensed DEKALB Patent Rights, and to enter into settlement
agreements as a way of responding to any infringements as may be deemed
appropriate by DEKALB. DEKALB shall receive the full benefits of any action it
takes pursuant to this Subsection 6.02; provided however, that once any
attorney's fees and other reasonable costs incurred in conducting such legal
action have been deducted from any recovery obtained from enforcement of
Licensed DEKALB Patent Rights which arise, DEKALB shall pay
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to MONSANTO its pro rata portion of such recovery, calculated in accordance
with the terms of this Agreement as they apply to amounts received pursuant to
the applicable Licensed DEKALB Patent Rights.
(e) If the activities of the third party infringing the
Licensed DEKALB Patent Rights result in a material adverse effect on the
business of MONSANTO's sublicensees and at the end of One Hundred and Eighty
(180) days from the receipt of notice from MONSANTO of such infringement, the
third party is both unlicensed under the Licensed DEKALB Patent Rights and is
engaging in activities which are an infringement of the Licensed DEKALB Patent
Rights, and DEKALB has not brought a suit, action or other proceeding for
infringement against such third party, then MONSANTO and all of its
sublicensees shall be excused from making the payments otherwise due hereunder
with respect to revenues derived from sublicenses of Licensed MONSANTO Corn
Products or Licensed DEKALB Corn Products in the country in which the
competitive infringing activity occurs. Such excuse from payment shall arise
only as to sales by MONSANTO's Affiliates, International Associates and
sublicensees of the affected Licensed MONSANTO Corn Products or Licensed DEKALB
Corn Products in the country in which the infringing products are sold and
shall continue only for so long as the infringing products continue to be
infringing and to so compete with such Licensed MONSANTO Corn Products or
Licensed DEKALB Corn Products unchallenged by an infringement suit, action or
other proceeding brought by DEKALB. If the infringing activities of more than
one third party result in such a material adverse effect, then DEKALB will
fulfill its obligation under this Subsection through litigation with only one
such third party at a time.
(f) DEKALB shall not have the right (by operation of law
or otherwise) to enforce any Licensed MONSANTO Patent Right licensed hereunder
against any alleged infringer. MONSANTO shall not have the right (by operation
of law or otherwise) to enforce any Licensed DEKALB Patent Right licensed
hereunder against any alleged infringer.
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SECTION 7 - WARRANTIES AND LIABILITIES
7.01 REPRESENTATIONS AND WARRANTIES:
(a) MONSANTO represents and warrants that:
(i) it is the owner or licensee of the Licensed
MONSANTO Patent Rights to the extent required for the
grant of rights contained herein;
(ii) Appendix A-M lists the MONSANTO-owned patent
applications and patents known or believed by
MONSANTO to be necessary to make, have made, use or
sell Licensed DEKALB Corn Products, and that, to the
extent any patent necessary to make, have made, use
or sell the Licensed DEKALB Corn Products issues to
or is controlled by MONSANTO during the term of this
Agreement that is not listed in Appendix A-M, DEKALB
shall be entitled to continue to make, have made,
use, or sell the Licensed DEKALB Corn Products
without paying royalty in addition to the royalty set
forth in Subsection 4.02 above;
(iii) it has not previously granted, and will not
grant to any third party during the term of this
Agreement, any rights and licenses under the Licensed
MONSANTO Patent Rights that are in conflict with
the rights granted to DEKALB herein; and
(iv) it has full power, right and authority to
enter into and carry out its obligations under this
Agreement.
(b) DEKALB represents and warrants that:
(i) it is the owner or licensee of the Licensed
DEKALB Patent Rights to the extent required for the
grant of rights contained herein;
(ii) Appendix A-D lists the DEKALB-owned patent
applications and patents known or believed by DEKALB
to be necessary to make, have made, use or sell
Licensed MONSANTO Corn Products, and that, to the
extent any patent necessary to make, have made, use
or sell the Licensed MONSANTO Corn Products issues to
or is controlled by DEKALB during the term of this
Agreement that is not listed in Appendix A-D,
MONSANTO shall be entitled to continue to make, have
made, use, or sell the Licensed MONSANTO Corn
Products without paying royalty in addition to the
royalty set forth in Subsection 4.01 above;
(iii) it has not previously granted, and will
not grant to any third party during the term of this
Agreement, any rights and licenses under the Licensed
DEKALB Patent Rights that are in conflict with the
rights granted to MONSANTO herein; and
(iv) it has full power, right and authority to
enter into and carry out its
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obligations under this Agreement.
7.02 NO OTHER WARRANTIES:
(a) EXCEPT FOR THE EXPRESS WARRANTIES IN SUBSECTION 7.01,
MONSANTO MAKES NO WARRANTIES REGARDING THE LICENSED MONSANTO PATENT RIGHTS
(INCLUDING, WITHOUT LIMITATION, THE VALIDITY OR SCOPE OF THE LICENSED MONSANTO
PATENT RIGHTS) OR THE LICENSED DEKALB CORN PRODUCTS (INCLUDING, WITHOUT
LIMITATION, THE NON-INFRINGEMENT OF THE LICENSED DEKALB CORN PRODUCTS ON THIRD
PARTY PATENT RIGHTS) OR OTHERWISE, EXPRESS OR IMPLIED, EITHER IN FACT OR BY
OPERATION OF LAW.
(b) EXCEPT FOR THE EXPRESS WARRANTIES IN SUBSECTION 7.01,
DEKALB MAKES NO WARRANTIES REGARDING THE LICENSED DEKALB PATENT RIGHTS
(INCLUDING, WITHOUT LIMITATION, THE VALIDITY OR SCOPE OF THE LICENSED DEKALB
PATENT RIGHTS) OR THE LICENSED MONSANTO CORN PRODUCTS (INCLUDING, WITHOUT
LIMITATION, THE NON-INFRINGEMENT OF THE LICENSED MONSANTO CORN PRODUCTS ON
THIRD PARTY PATENT RIGHTS) OR OTHERWISE, EXPRESS OR IMPLIED, EITHER IN FACT OR
BY OPERATION OF LAW.
7.03 INDEMNIFICATION:
(a) EXCEPT TO THE EXTENT CAUSED BY MONSANTO'S GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT, DEKALB SHALL DEFEND AND INDEMNIFY MONSANTO
AGAINST, AND HOLD MONSANTO AND ITS EMPLOYEES, DIRECTORS, OFFICERS AND AGENTS
HARMLESS FROM, ANY LOSS, COST, LIABILITY OR EXPENSE (INCLUDING COURT COSTS AND
REASONABLE FEES OF ATTORNEYS AND OTHER PROFESSIONALS) INCURRED FROM ANY CLAIM
ARISING OR ALLEGED TO ARISE OUT OF THE MANUFACTURE, USE, DISTRIBUTION OR SALE
OF ANY LICENSED DEKALB CORN PRODUCT BY DEKALB OR ANY DEKALB SUBLICENSEE,
AFFILIATE OR INTERNATIONAL ASSOCIATE; PROVIDED, HOWEVER, THAT (I) DEKALB SHALL
HAVE SOLE CONTROL OF SUCH DEFENSE, AND (II) MONSANTO SHALL PROVIDE NOTICE
PROMPTLY TO DEKALB OF ANY ACTUAL OR THREATENED CLAIM OF WHICH MONSANTO BECOMES
AWARE.
(b) EXCEPT TO THE EXTENT CAUSED BY DEKALB'S GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT, MONSANTO SHALL DEFEND AND INDEMNIFY DEKALB
AGAINST, AND HOLD DEKALB AND ITS EMPLOYEES, DIRECTORS, OFFICERS AND AGENTS
HARMLESS FROM, ANY LOSS, COST, LIABILITY OR EXPENSE (INCLUDING COURT COSTS AND
REASONABLE FEES OF ATTORNEYS AND OTHER PROFESSIONALS) INCURRED FROM ANY CLAIM
ARISING OR ALLEGED TO ARISE OUT OF THE MANUFACTURE, USE, DISTRIBUTION OR
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SALE OF ANY LICENSED MONSANTO CORN PRODUCT BY MONSANTO OR ANY MONSANTO
SUBLICENSEE, AFFILIATE OR INTERNATIONAL ASSOCIATE; PROVIDED, HOWEVER, THAT (I)
MONSANTO SHALL HAVE SOLE CONTROL OF SUCH DEFENSE, AND (II) DEKALB SHALL PROVIDE
NOTICE PROMPTLY TO MONSANTO OF ANY ACTUAL OR THREATENED CLAIM OF WHICH DEKALB
BECOMES AWARE.
7.04 LIMITED LIABILITY: EXCEPT TO THE EXTENT PROVIDED FOR
IN SUBSECTION 7.03 ABOVE, NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY
LOSS OF PROFITS, LOSS OF BUSINESS, INTERRUPTION OF BUSINESS, INDIRECT, SPECIAL
OR CONSEQUENTIAL DAMAGES OF ANY KIND SUFFERED BY SUCH OTHER PARTY FOR BREACH
HEREOF, WHETHER BASED ON CONTRACT OR TORT CLAIMS OR OTHERWISE, EVEN IF SUCH
PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSS.
SECTION 8 - TERM AND TERMINATION
8.01 TERM:
(a) The term of this Agreement shall begin on the closing
of the Investment Agreement between DEKALB and MONSANTO of even date
("Effective Date") and shall end upon expiration, revocation, abandonment or
invalidation of the last-to-expire patent within the Licensed MONSANTO Patent
Rights and the Licensed DEKALB Patent Rights, unless terminated sooner in
accordance with this Section 8. Upon expiration, revocation, abandonment or
invalidation of the last-to-expire U.S. patent within the Licensed MONSANTO
Patent Rights or Licensed DEKALB Patent Rights, DEKALB and MONSANTO, and any of
their Affiliates, International Associates and sublicensees, shall have a paid
up license in all countries of the Territory except those countries where
patents included within the Licensed MONSANTO Patent Rights or Licensed DEKALB
Patent Rights shall then still be in effect.
(b) In those countries of the Territory where Licensed
MONSANTO Patent Rights or Licensed DEKALB Patent Rights extend beyond the term
of the Licensed MONSANTO Patent Rights or Licensed DEKALB Patent Rights in the
United States, DEKALB and MONSANTO, and any of their Affiliates, International
Associates and sublicensees, shall have a paid-up license, on a country by
country basis, upon expiration, revocation, abandonment or invalidation of such
Licensed MONSANTO Patent Rights and Licensed DEKALB Patent Rights in the
respective ex.-U.S. country.
8.02 TERMINATION OF AGREEMENT FOR BREACH:
(a) Either party may terminate this Agreement upon at
least sixty (60) days written notice to the other party should the other party
commit a material breach of its
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obligations or be in material default under any of the provisions of this
Agreement, provided that the other party has failed to cure the breach or
default (or, if such breach or default cannot be cured within the sixty (60)
day period, the other party has not taken reasonable steps to cure the breach
or default) within the same sixty (60) day notice period.
(b) Notwithstanding a party's right to terminate this
Agreement as a result of a non-cured material breach by the other party, the
non-breaching party shall not be prevented from seeking any other remedy which
may be available to it in equity, including specific performance on the part of
the party in breach.
8.03 INSOLVENCY: Either party may terminate this
Agreement if, at any time:
(a) the other party makes an assignment for the benefit of
creditors or admits in writing its inability generally to pay or is generally
not paying its debts as such debts become due;
(b) any decree or order for relief is entered against the
other party under any bankruptcy, reorganization, compromise, arrangement,
insolvency, readjustment of debt, dissolution or liquidation or similar law;
(c) the other party petitions or applies to any tribunal
for, or consents to, the appointment of, or taking possession by, a trustee,
receiver, custodian, liquidator or similar official, of such other party or any
substantial part of its assets, or commences a voluntary case under the
bankruptcy law of any jurisdiction;
(d) any such petition or application is filed, or any
such proceedings are commenced, against the other party and such other party by
any act indicates its approval thereof, consent thereto or acquiescence
therein, or an order, judgment or decree is entered appointing any such
trustee, receiver, custodian, liquidator or similar official, or approving the
petition in any such proceedings, and such order for relief, order, judgment or
decree remains unstayed and in effect for more than sixty (60) days; or
(e) any order, judgment or decree is entered in any
proceedings against the other party decreeing the dissolution of such other
party and such order, judgment or decree remains unstayed and in effect for
more than sixty (60) days.
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8.04 EFFECTS OF TERMINATION/SURVIVAL:
(a) Expiration or termination of this Agreement shall not
relieve the parties of any obligation accruing prior to or upon such expiration
or termination. Accordingly, Subsections 7.03 and 7.04 and Section 9 shall
survive expiration or termination of this Agreement and neither party shall be
relieved of any payment obligation that may have accrued prior to or subsequent
to such expiration or termination.
(b) Upon an early termination of this Agreement, DEKALB
and its Affiliates and International Associates and sublicensees shall be
entitled to sell remaining inventories of any Licensed DEKALB Corn Products
which are already in its or their possession or then under production, and
MONSANTO and its Affiliates and International Associates and sublicensees shall
be entitled to sell remaining inventories of any Licensed MONSANTO Corn
Products which are already in its or their possession or then under production.
Such sales shall be in accordance with this Agreement, and the parties shall
continue to be obligated to make all applicable payments hereunder. Thereafter
(A) any remaining Licensed DEKALB Corn Products which are not intended to be
sold, and all materials and information relating to or provided by MONSANTO, if
any, shall be destroyed or shall be returned, respectively, and the destruction
shall be certified to MONSANTO by a representative of DEKALB and (B) any
remaining Licensed MONSANTO Corn Products which are not intended to be sold,
and all materials and information relating to or provided by DEKALB, if any,
shall be destroyed or shall be returned, respectively, and the destruction
shall be certified to DEKALB by a representative of MONSANTO.
SECTION 9 - CONFIDENTIALITY
9.01 CONFIDENTIAL INFORMATION: The parties have
previously disclosed and it is anticipated that it will be necessary, in
connection with their obligations under this Agreement, for DEKALB and MONSANTO
to disclose to each other Confidential Information. The Confidential
Information shall include, but shall not be limited to, information disclosed
in writing or other tangible form, including samples of materials.
9.02 CONFIDENTIALITY AND LIMITED USE:
(a) With respect to all Confidential Information, both
DEKALB and MONSANTO agree as follows, it being understood that "recipient"
indicates the party receiving the confidential, proprietary information from
the other "disclosing" party. Confidential Information disclosed to the
recipient shall remain the property of the disclosing party and shall be
maintained in confidence by the recipient with the same care and diligence as
the recipient maintains its own Confidential Information. Confidential
Information shall not be disclosed to third parties by the recipient and,
further, shall not be used except for purposes contemplated in this Agreement.
All confidentiality and limited use obligations with respect to the
Confidential
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Information shall terminate ten (10) years after the termination date of this
Agreement.
(b) Notwithstanding any provision to the contrary, a
party may disclose the Confidential Information of the other party: (i) in
connection with an order of a court or other government body or as otherwise
required by or in compliance with law or regulations; provided that the party
required to disclose provides the other party with notice and takes reasonable
measures to obtain confidential treatment thereof; (ii) in confidence to
recipient's attorneys, accountants, banks and financial sources and its
advisors; or (iii) in confidence, in connection with the sale of substantially
all the business assets to which this Agreement relates, so long as, in each
case, the entity to which disclosure is made is bound to confidentiality on
terms consistent with those set forth herein.
(c) Notwithstanding any provision to the contrary, a
party seeking to make a disclosure to an entity not bound to confidentiality on
terms consistent with those set forth herein shall first provide to the other
party a copy of the material proposed to be disclosed and shall obtain the
consent of the other party before making the disclosure, which consent shall
not be unreasonably withheld .
9.03 EXCEPTIONS: The obligations of confidentiality and
limited use shall not apply to any of the Confidential Information which:
(a) is publicly available by publication or other
documented means or later becomes likewise publicly available through no act or
fault of recipient; or
(b) is already known to recipient before receipt from the
disclosing party, as demonstrated by recipient's written records; or
(c) is made known to recipient by a third party who did
not obtain it directly or indirectly from the disclosing party and who does not
obligate recipient to hold it in confidence; or
(d) is independently developed by the recipient as
evidenced by credible written research records of recipient's employees or
agents who did not have access to the disclosing party's Confidential
Information. Specific information should not be deemed to be within any of
these exclusions merely because it is embraced by more general information
falling within these exclusions.
9.04 DISCLOSURES TO PERSONNEL: Recipient agrees to advise
those of its officers, directors, employees, associates, agents, consultants,
Affiliates, and International Associates who become aware of the Confidential
Information, of these confidentiality and limited use obligations and agrees,
prior to any disclosure of Confidential Information to such individuals or
entities, to make them bound by obligations of confidentiality and limited use
of the same stringency as those contained in this Agreement.
9.05 RETURN OF CONFIDENTIAL INFORMATION: Upon termination
of this
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Agreement, originals and copies of Confidential Information in written or other
tangible form will be returned to the disclosing party by recipient or
destroyed by recipient. One copy of each document may be retained in the
custody of the recipient's legal counsel solely to provide a record of what
disclosures were made.
9.06 CONFIDENTIAL STATUS OF AGREEMENT: The terms of this
Agreement shall be deemed to be Confidential Information and shall be dealt
with according to the confidentiality requirements of this Section 9. Neither
party will make public disclosures concerning specific terms of this Agreement
without obtaining the prior written consent of the other party, which consent
shall not be unreasonably withheld and except as may be necessary, in the
opinion of counsel of the party making such disclosure, to comply with the
requirements of any stock exchange or over-the-counter market on which the
shares of such party may be listed or of any law, governmental regulation or
order. If a party determines that such a disclosure is necessary, it shall
promptly notify the other party so that the other party can obtain confidential
treatment of its Confidential Information.
SECTION 10 - MISCELLANEOUS
10.01 NOTICES: Any notice or other communication required or
permitted to be given by either party under this Agreement shall be given in
writing and shall be effective when delivered, if delivered by hand or by
electronic facsimile or five days after mailing if mailed by registered or
certified mail, postage prepaid and return receipt requested, addressed to each
party at the following addresses or such other address as may be designated by
notice pursuant to this Subsection 10.01:
If to MONSANTO: Monsanto Company
800 North Lindbergh Boulevard
St. Louis, Missouri 63167
Attention: Robert T. Fraley, Ph.D.
President, Ceregen
Facsimile: (314) 694-7771
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with a copy to: Monsanto Company
700 Chesterfield Pkwy North
St. Louis, Missouri 63198
Attention: Patent Counsel, Ceregen
Monsanto Company
Mail Code BB4F
Facsimile: (314) 537-6047
and to: Monsanto Company
700 Chesterfield Pkwy North
St. Louis, Missouri 63198
Attention: William M. Ziegler
Business Director,
Corn and Soybeans
Mail Code BB4D
Facsimile: (314) 537-6047
If to DEKALB: DEKALB Genetics Corporation
3100 Sycamore Road
DeKalb, Illinois 60115
Attention: Richard O. Ryan
President and
Chief Operating Officer
Facsimile: (815) 758-3711
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with a copy to: DEKALB Genetics Corporation
3100 Sycamore Road
DeKalb, Illinois 60115
Attention: John H. Witmer, Jr.
Senior Vice President
and General Counsel
Facsimile: (815) 758-6953
and to: DEKALB Genetics Corporation
62 Maritime Dr.
Mystic, Conn. 06355
Attention: Catherine J. Mackey,
Ph.D.
Vice President,
Research
Facsimile: (860) 572-5241
10.02 PROVISIONS CONTRARY TO LAW: In performing this Agreement, the
parties shall comply with all applicable laws and regulations. Nothing in this
Agreement shall be construed so as to require the violation of any law, and
wherever there is any conflict between any provision of this Agreement and any
law the law shall prevail, but in such event the affected provision of this
Agreement shall be affected only to the extent necessary to bring it within the
applicable law.
10.03 FORCE MAJEURE:
(a) Neither of the parties shall be liable for any
default or delay in performance of any obligation under this Agreement caused
by any of the following: Act of God, war, riot, fire, explosion, accident,
flood, sabotage, compliance with governmental requests, laws, regulations,
orders or actions, national defense requirements or any other event beyond the
reasonable control of such party; or labor trouble, strike, lockout or
injunction (provided that neither of the parties shall be required to settle a
labor dispute against its own best judgment).
(b) The party invoking this Subsection 10.03 shall give
the other party written notice and full particulars of such force majeure
event.
(c) Both MONSANTO and DEKALB shall use reasonable efforts
to mitigate the effects of any force majeure on their respective parts.
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10.04 RELATIONSHIP OF THE PARTIES: Notwithstanding any provision
hereof, for all purposes of this Agreement each party shall be and act as an
independent contractor and not as partner, joint venturer or agent of the other
and shall not bind nor attempt to bind the other to any contract, without the
prior written consent of the party to be bound.
10.05 USE OF NAMES: Unless otherwise required by the terms of this
Agreement, neither party shall use the name of the other in any promotional
materials or advertising without the prior written consent of the other.
10.06 ASSIGNABILITY AND CHANGE IN CONTROL:
(a) The rights acquired herein by DEKALB are not
assignable or transferable in whole or part (by operation of law or otherwise)
to any third party without the prior written consent of MONSANTO, except as
provided in Subsection 10.06(d).
(b) The rights acquired herein by MONSANTO are not
assignable or transferable in whole or part (by operation of law or otherwise)
to any third party without the prior written consent of DEKALB, except as
provided in Subsection 10.06(e).
(c) Any transfer, assignment or delegation made or
attempted in violation of this Subsection 10.06 shall be void ab initio and of
no effect.
(d) Upon any change in control of DEKALB (by acquisition,
merger, consolidation or otherwise) resulting in, direct or indirect, ownership
of the voting stock of DEKALB at a level of greater than 50% by a single entity
or by two or more entities acting together or, control as a consequence of a
shareholder agreement, joint venture agreement or other agreement, DEKALB may
assign its rights hereunder to any such successor(s) in interest; Upon any such
change in control, MONSANTO's payment obligation to DEKALB (or its successor in
interest) shall be changed as follows:
(i) Subsection 4.01(a) shall be modified so that
the term [***] shall replace the term [***]
(ii) Subsection 4.01(b) shall be modified so that
the terms [***] and [***] shall replace the terms [***] and [***]
respectively; and
(iii) Subsection 4.02(b) shall be modified so that
the term [***] shall replace the term [***].
This Subsection 10.06(d) shall not apply to any such change in control in which
Monsanto becomes the controlling party.
(e) Upon any change in control of MONSANTO (by
acquisition, merger, consolidation or otherwise) resulting in, direct or
indirect, ownership of the voting stock of MONSANTO at a level of greater than
50% by a single entity or by two or more entities acting
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together or, control as a consequence of a shareholder agreement, joint venture
agreement or other agreement, MONSANTO may assign its rights hereunder to any
such successor(s) in interest. Upon any such change in control, MONSANTO's
payment obligation to DEKALB (or its successor in interest) shall be changed as
follows:
(i) Subsection 4.01(a) shall be modified so that
the term [***] shall replace the term [***]
(ii) Subsection 4.01(b) shall be modified so that
the terms [***] and [***] shall replace the terms [***] and [***],
respectively; and
(iii) Subsection 4.02(b) shall be modified so that
the term [***] shall replace the term [***].
10.07 ENTIRE AGREEMENT; AMENDMENTS; WAIVER: This Agreement
constitutes the full understanding of the parties, a complete allocation of
risks between them and a complete and exclusive statement of the terms and
conditions of their agreement relating to the subject matter hereof and
supersedes any and all prior agreements, whether written or oral, that may
exist between the parties with respect thereto. Except as otherwise
specifically provided in this Agreement, no conditions, usage of trade, course
of dealing or performance, understanding or agreement purporting to modify,
vary, explain or supplement the terms or conditions of this Agreement shall be
binding unless hereafter made in writing and signed by the party to be bound
and no modification shall be effected by the acknowledgment or acceptance of
documents containing terms or conditions at variance with or in addition to
those set forth in this Agreement. No waiver by any party with respect to any
breach or default or of any right or remedy and no course of dealing or
performance, shall be deemed to constitute a continuing waiver of any other
breach or default or of any right or remedy, unless such waiver be expressed in
writing signed by the party to be bound. Failure of a party to exercise any
right shall not be deemed a waiver of such right or rights in the future.
10.08 CHOICE OF LAW: IT IS THE INTENTION OF THE PARTIES HERETO THAT
ALL QUESTIONS WITH RESPECT TO THE CONSTRUCTION OF THIS AGREEMENT AND THE RIGHTS
AND LIABILITIES OF THE PARTIES HERETO SHALL BE DETERMINED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO BUSINESS ARRANGEMENTS ENTERED
INTO AND PERFORMED ENTIRELY WITHIN THE STATE OF DELAWARE.
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10.09 EXPORT CONTROL:
(a) Notwithstanding any other provisions of this
Agreement, DEKALB agrees to make no disclosure or use of any MONSANTO Know-How
or Confidential Information of MONSANTO furnished or made known to DEKALB
pursuant to this Agreement, except in compliance with the laws and regulations
of the United States of America, including the Export Administration
Regulations promulgated by the Office of Export Administration International
Trade Administration, United States Department of Commerce; and in particular,
DEKALB agrees not to export, directly or indirectly, either
(i) the technical data furnished or made known to
DEKALB pursuant to this Agreement; or
(ii) the "direct product" thereof; or
(iii) any commodity produced using such technical
data to any country or countries for which a validated license is required
unless a validated license is first obtained pursuant to the Export
Administration Regulations. The term "direct product" as used above, is
defined to mean the immediate product (including process and services) produced
directly by the use of the technical data.
(b) Notwithstanding any other provisions of this
Agreement, MONSANTO agrees to make no disclosure or use of any DEKALB Know-How
or Confidential Information of DEKALB furnished or made known to MONSANTO
pursuant to this Agreement, except in compliance with the laws and regulations
of the United States of America, including the Export Administration
Regulations promulgated by the Office of Export Administration International
Trade Administration, United States Department of Commerce; and in particular,
MONSANTO agrees not to export, directly or indirectly, either
(i) the technical data furnished or made known to
MONSANTO pursuant to this Agreement; or
(ii) the "direct product" thereof; or
(iii) any commodity produced using such technical
data to any country or countries for which a validated license is required
unless a validated license is first obtained pursuant to the Export
Administration Regulations. The term "direct product" as used above, is
defined to mean the immediate product (including process and services) produced
directly by the use of the technical data.
10.10 MEET AND CONFER: It is the intention of the parties that in
the event any dispute arises under this Agreement, the parties shall first meet
and confer with one another to attempt to negotiate a resolution of such
dispute without recourse to litigation.
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10.11 REMEDIES: Except as otherwise expressly stated in this
Agreement, the rights and remedies of a party set forth herein with respect to
failure of the other to comply with the terms of this Agreement (including,
without limitation, rights of full termination of this Agreement) are not
exclusive, the exercise thereof shall not constitute an election of remedies
and the aggrieved party shall in all events be entitled to seek whatever
additional remedies may be available in law or in equity.
10.12 FEES: Except as otherwise provided herein, each party shall
bear its own legal fees incurred in connection with the transactions
contemplated hereby, provided, however, that if any party to this Agreement
seeks to enforce its rights under this Agreement by legal proceedings or
otherwise, the non-prevailing party shall pay all costs and expenses incurred
by the prevailing party, including, without limitation, all reasonable
attorneys' fees.
10.13 HEADINGS: Headings herein are for convenience of reference
only and shall in no way affect interpretation of this Agreement.
10.14 COUNTERPARTS: This Agreement may be executed in any number of
counterparts with the same effect as if all parties had signed the same
document. All such counterparts shall be deemed an original, shall be construed
together and shall constitute one and the same instrument.
10.15 ARBITRATION: Disputes arising out of Subsections 4.01 and
4.02 of this Agreement will be finally settled by arbitration conducted in
accordance with the arbitration rules and guidelines outlined in attached
Appendix C. The arbitration will be held in Chicago, Illinois as promptly as
possible at such time as the arbitrator(s) may determine. The decision of the
arbitrator(s) will be final and binding upon the parties hereto.
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10.16 APPENDICES: The appended Appendices and Exhibits form an
integral part of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
MONSANTO COMPANY DEKALB GENETICS CORPORATION
By: Robert T. Fraley By: Bruce P. Bickner
-------------------------------------- ----------------------------
Robert T. Fraley Bruce P. Bickner
Title: President, Ceregen Title: Chairman and CEO
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