1
EXHIBIT 10.74
CONFIDENTIAL TREATMENT REQUESTED
LICENSE AND RESEARCH AND DEVELOPMENT AGREEMENT
BETWEEN
REVOTAR BIOPHARMACEUTICALS AG, registered in the commercial register of
the local court of Charlottenburg under HRB 72702 represented by its
Managing Director, Mr David B. McWilliams
- referred to as "Revotar" -
and
TEXAS BIOTECHNOLOGY CORPORATION,
represented by its President and C.E.O. David B. McWilliams,
7000 Fannin, USA TX 77030 Houston,
- referred to as "TBC" -
2
-1-
Table of Contents
Page
----
1. DEFINITIONS.......................................................5
1.1..................................................................5
1.2..................................................................5
1.3..................................................................5
1.4..................................................................5
1.5..................................................................5
1.6..................................................................6
1.7..................................................................6
1.8..................................................................6
1.9..................................................................6
1.10.................................................................6
1.11.................................................................6
1.12.................................................................7
1.13.................................................................7
1.14.................................................................7
1.15.................................................................7
1.16.................................................................7
1.17.................................................................7
1.18.................................................................7
1.19.................................................................8
1.20.................................................................8
1.21.................................................................8
1.22.................................................................8
1.23.................................................................8
1.24.................................................................8
1.25.................................................................9
1.26.................................................................9
1.27.................................................................9
1.28.................................................................9
3
-2-
Page
----
1.29.................................................................9
1.30.................................................................9
1.31.................................................................9
1.32.................................................................9
1.33.................................................................9
2. LICENSE TO REVOTAR...............................................10
2.1 EXCLUSIVE LICENSE...............................................10
3. DEVELOPMENT PROGRAM.............................................12
3.1 GOALS........................................................12
3.2 PROGRAM ADMINISTRATION.......................................13
3.3 PERFORMANCE OF SERVICES......................................15
3.4 RECORDS AND DATA.............................................16
3.5 VISIT OF FACILITIES..........................................16
4. PAYMENTS AND REPORTS............................................17
4.1 DEVELOPMENT FUNDING..........................................17
4.2 ROYALTIES AND PROFIT SHARING.................................17
4.3 AUDIT RIGHTS.................................................19
4.4 PAYMENT CURRENCY.............................................20
4.5 PAYMENT MECHANICS............................................20
50 COMMERCIALIZATION..............................................20
5.1 TBC TO MANUFACTURE...........................................20
5.2 REVOTAR TO SELL IN TERRITORY.................................21
60 TBC REPRESENTATIONS AND WARRANTIES.............................22
6.1 NO THIRD PARTY AGREEMENTS....................................22
6.2 NO THIRD PARTY RIGHTS........................................22
70 PROPRIETARY RIGHTS.............................................22
7.1 IMPROVEMENTS.................................................22
7.2 PATENT PROSECUTION AND MAINTENANCE...........................23
7.3 THIRD PARTY CLAIM OF INFRINGEMENT............................24
7.4 INFRINGEMENT BY THIRD PARTIES................................25
4
-3-
Page
----
80 CONFIDENTIALITY................................................26
8.1 GENERAL......................................................26
8.2 DISCLOSURE OF AGREEMENT......................................27
90 INDEMNIFICATION................................................27
9.1 MUTUAL RIGHT TO INDEMNIFICATION..............................27
9.2 PROCEDURE....................................................28
9.3 PRODUCT LIABILITY INSURANCE..................................28
100 TERM AND TERMINATION...........................................29
10.1 LICENSE TERM.................................................29
10.2 TERMINATION FOR BREACH.......................................29
10.3 TERMINATION FOR FAILURE TO PROCEED...........................30
10.4 SURVIVAL OF OBLIGATIONS......................................30
110 MISCELLANEOUS..................................................31
11.1 FORCE MAJEURE................................................31
11.2 RELATIONSHIP OF THE PARTIES..................................31
11.3 NOTICES......................................................31
11.4 SUCCESSORS AND ASSIGNS.......................................32
11.5 AMENDMENTS AND WAIVERS.......................................32
11.6 GOVERNING LAW................................................33
11.7 DISPUTE RESOLUTION...........................................33
11.8 SEVERABILITY.................................................34
11.9 HEADINGS.....................................................34
11.10 EXECUTION IN COUNTERPARTS.................................34
11.11 ENTIRE
Agreement..............................................................34
5
-4-
LICENSE AND RESEARCH AND DEVELOPMENT AGREEMENT
This Agreement is entered into between TBC, a Delaware corporation (,,TBC"), and
Revotar, a German stock company .
R E C I T A L S
A. TBC owns an equity interest in Revotar and desires to license
certain technology to Revotar in order to permit Revotar to
conduct research and development on certain of TBC's compounds
which are pharmaceutical product candidates.
B. TBC and Revotar desire to enter into this Agreement to set
forth the terms and conditions pursuant to which these
compounds will be licensed to Revotar and the manner in which
the research and development work will be conducted.
C. TBC is the only shareholder of Revotar. David B. McWilliams is
representing TBC in his capacity as its Chief Executive
Officer as well as Revotar his capacity as its sole Managing
Director at the same time. The current articles of association
of the Company do not provide for an express authorization of
the Managing Director to represent both sides at a time. Since
it is not absolutely clear under German law whether such
express authorization is necessary or not, as a precaution the
Shareholder has recently amended its current articles of
association and provided for such express authorization. As
soon as this amendment has been registered in the commercial
register and become effective David B. McWilliams will - again
just as a precaution - again confirm and approve all his
declarations and signatures made in connection with this and
the other concerned agreements.
In consideration of the foregoing and the mutual promises and covenants
contained in this Agreement, the parties hereto agree as follows:
6
-5-
1. DEFINITIONS.
The following capitalized terms used herein shall have the respective meanings
set forth below. The accounting terms used but not defined herein shall have the
meanings ascribed to them under U.S. Generally Accepted Accounting Principles.
Certain other capitalized terms are defined elsewhere in this Agreement.
1.1 "AFFILIATE" means a person or entity that directly or
indirectly controls, is controlled by or is under common
control with, a party to this Agreement. ,,Control" (and, with
correlative meanings, the terms ,,controlled by" and ,,under
common control with") means, in the case of a corporation, the
ownership of more than 50% of the outstanding voting
securities thereof or the right to acquire such securities
within 60 days and, in the case of any other type of entity
(including without limitation joint ventures), an interest
that results in the ability to direct or have a significant
impact on the direction of the management and policies of such
entity or a significant ownership position of no less than
25%.
1.2 "COMPOUNDS" means the compound owned by TBC and known as TBC
1269.
1.3 "CONFIDENTIAL INFORMATION" means all proprietary information
communicated to, learned of, developed or otherwise acquired
by either party separately or jointly under this Agreement.
1.4 "COST OF GOODS SOLD" OR ,,COGS" means TBC's total
Manufacturing Costs plus [*] of the Manufacturing Costs.
1.5 "DEVELOPMENT COSTS" means (a) the direct costs, fees and
out-of-pocket or other expenses incurred in the course of
performing the work under the Development Program (b) overhead
allocable to development and (c) the amount paid to Third
Parties to acquire goods and services for the development
work, whether or not completed. Overhead allocated to
development shall be limited to (i) a reasonable allocation of
the cost of employees who have a direct relationship with the
- ------------
[*] This information has been omitted in reliance on Rule 24B-2 under the
Securities Exchange Act of 1934, and has been filed separately with the
Securities and Exchange Commission.
7
-6-
Development Program, but who are not classified as direct
labor, which allocation shall be based on each such employee's
time spent in the Development Program as compared to time
spent on all such employee's work, and (ii) a reasonable
allocation of facilities' costs allocable to development
works. Development Costs shall be determined on a reasonable
and typical basis consistent with the developing party's
internal cost accounting system or on actual charges from
Third Parties.
1.6 "DEVELOPMENT PROGRAM" means research and development and other
work conducted by the parties hereunder on a Product or
Compound for use in the Field of Use, including clinical
testing, regulatory submissions and ongoing Product and
Compound research and development performed in accordance with
the Work Plans.
1.7 "DISTRIBUTION COSTS" means all freight and other
transportation costs actually incurred by a party hereto in
delivering a Product to its final distribution point before
delivery to an invoiced customer, including transportation
costs to a storage facility, storage charges, Third Party
handling fees, insurance during transport and taxes payable
for such transportation or storage services. Distribution
Costs shall exclude any transportation or other charges
deducted in calculating Net Sales. Distribution Costs incurred
by a party hereto shall be determined on a reasonable basis
consistent with such party's internal cost accounting system.
1.7a "EFFECTIVE DATE" Day of the signing of this agreement.
1.7b "EUROPEAN MARKET": Countries which are party of the European
Patent Treaty ("Europaisches Patentrechtsubereinkommen").
1.8 "FDA" means the United States Food and Drug Administration.
1.9 "FIELD OF USE" means the treatment of asthma using an inhaled
delivery system and the treatment of psoriasis using a topical
delivery system.
1.10 "FIRST COMMERCIAL SALE" means the first arms-length sale in
the Territory pursuant to this Agreement to one or more Third
Parties of any Product following receipt of approval to
commence manufacturing and selling such Product from any one
PRA.
1.11 "IND" means an investigational new drug application filed with
the FDA, or the similar filing made with any PRA, prior to
beginning clinical trials in humans.
8
-7-
1.12 "IMPROVEMENTS" means any Technology that is discovered,
developed or otherwise acquired in the course of the
Development Program hereunder that may be useful in the
discovery, development, manufacture, sale or use of the
Compounds or Products.
1.13 "LG CHEM" means LG Chemical Ltd.
1.14 "LG CHEM LICENSE" means that certain Strategic Alliance
Agreement dated October 10, 1996 by and between TBC and LG
Chemical Ltd. as amended from time to time.
1.15 "LICENSING TRANSACTION" means any agreement or arrangement of
any type pursuant to which Revotar licenses or transfers to a
Third Party any interest or rights of any kind to any Subject
Technology which is the subject of this Agreement including
without limitation the rights to use and sell any Compound or
Product in the Field of Use.
1.16 "MANUFACTURING COSTS" means (a) the direct material and labor
costs associated with manufacturing the Products, (b) overhead
allocable to manufacture of the Products and (c) the amount
paid to Third Parties to acquire manufactured Products,
whether or not completed, and (d) Distribution Costs. Direct
material costs include the costs of purchasing raw materials
and packaging components. Direct labor includes the costs of
employees directly employed in Product manufacturing, quality
control or packaging. Overhead allocated to manufacture of the
Products shall be limited to (i) a reasonable allocation of
the cost of employees who have a direct relationship with
Product manufacturing, quality control or packaging, but who
are not classified as direct labor, which allocation shall be
based on each such employee's time spent in Product
manufacturing, quality control or packaging as compared to
time spent on all such employee's work, and (ii) a reasonable
allocation of facilities' costs allocable to Product
manufacturing, quality control and packaging. Manufacturing
Costs shall be determined on a reasonable and typical basis
consistent with the manufacturing party's internal cost
accounting system or on actual charges from Third Parties.
1.17 "NDA" means a new drug application filed with the FDA, or a
similar application filed with any PRA to obtain marketing
approval for a Product.
1.18 "NET SALES" means the gross amount billed for Products sold
pursuant to this Agreement to a Third Party, less discounts,
rebates, returns, credits, allowances,
9
-8-
uncollectible sales, shipping and insurance charges, sales
taxes, and other governmental charges measured by the amount
billed.
1.18a "NORTH AMERICA": countries and regions which are subject to
the patent legislation of the USA and Canada.
1.19 "PRA" means any applicable regulatory authority in any
jurisdiction included within the Territory which regulates the
development, approval and marketing of pharmaceuticals.
1.20 "PARTICIPATION AGREEMENT" means that certain agreement
entered into on _______, 2000 by and between TBC and Revotar
and certain German venture capital investors known as bmp Life
Science AG Venture Capital, bmp Venture Tech and Mediport
Venture Fonds GmbH.
1.21 "PATENTS" means (a) the patent applications listed on
SCHEDULE 1 hereto and all patent applications hereafter filed
in the Territory that are owned by or licensed to or otherwise
acquired by TBC in the Territory and which have one or more
claims covering Compounds, Subject Technology or Improvements,
(b) any patent application in the Territory constituting an
equivalent, reissue, extension, continuation-in-part or a
division of any of the foregoing, and (c) any patents issued
upon any of the foregoing applications or any other patents
acquired by TBC relating to the Compounds, Subject Technology
or Improvements.
1.22 "PHASE I CLINICAL TRIALS" means the first phase of human
clinical trials of a Compound required by the FDA or a PRA in
which the Compound is tested to determine early safety
profile, drug distribution patterns, and metabolism.
1.23 "PHASE II CLINICAL TRIALS" means the second phase of human
clinical trials of a Compound required by the FDA or a PRA in
which the Compound is tested in patients afflicted with a
particular disease in order to gain preliminary evidence of
efficacy, optimal dosage and expanded evidence of safety.
1.24 "PHASE III CLINICAL TRIALS" means the third phase of human
clinical trials of a Compound required by the FDA or a PRA in
which the Compound is tested in patients afflicted with a
particular disease in order to gain statistical proof of
efficacy and safety.
10
-9-
1.25 "PIVOTAL CLINICAL TRIAL" means the final or pivotal phase of
human clinic trials of a Compound required by the FDA or a PRA
and intended to serve as the basis for an NDA filing.
1.26 "PRODUCT" means any pharmaceutical composition incorporating
any Compound or combination of Compounds which is to be used
in the Field of Use.
1.27 "PROJECT REPRESENTATIVE" means an individual designated by a
party pursuant to Section 3.2(a). All Project Representatives
of a party may be changed at any time by written notice to the
other party.
1.28 "SUBJECT TECHNOLOGY" means (i) all Technology owned or
controlled by TBC as of the date hereof or owned or controlled
by TBC hereafter during the term of this Agreement, but only
to the extent that such Technology relates to the use,
manufacture or sale of the Compounds or Products. Technology
,,owned or controlled" includes Technology as to which TBC has
the right to grant or cause to be granted sublicenses and/or
immunity from suit.
1.29 "TBC 1269 PROGRAM" means the research and development of TBC
1269 pursuant to this Agreement for the development of
Products for use in the Field of Use.
1.30 "TECHNOLOGY" means all (a) ideas, methods, inventions,
techniques, processes, know-how, trade secrets and other
information and all (b) compounds, formulations, and other
natural and man-made materials.
1.31 "TERRITORY" shall mean all countries of the European Market as
defined in sec. 1.7b above.
1.32 "THIRD PARTY" means any entity other than TBC, Revotar or
their Affiliates.
1.33 "WORK PLAN" means a written summary of the tasks to be
undertaken by each party during a particular calendar year in
connection with the research and development, if applicable,
of the Compounds or Products, together with a budget of the
anticipated Development Costs associated therewith, adopted by
the parties in accordance with Section 3.2(d). Each Work Plan
will include reasonably detailed descriptions of the tasks and
work to be performed, the resources required to accomplish the
work, the costs associated with the planned work and the party
that will be responsible for accomplishing each task. Work
Plans shall generally be in the
11
-10-
format and shall contain the information set forth in the
initial Work Plan attached hereto pursuant to Section 3.2(c).
1.34 "WORLDWIDE LICENSE" means one licensing transaction involving
at least - but not necessarily only - all countries within
North America and the European Market (exclusive of the
countries included within the territory described in the LG
Chem License, as far and as long the LG Chem License
prevails).
2. LICENSE TO REVOTAR.
2.1 EXCLUSIVE LICENSE FOR THE TERRITORY. Subject to the terms and
conditions of this Agreement, TBC hereby grants to Revotar an
exclusive right and license in the Territory, including the
exclusive right to grant sublicenses in the Territory.
The aforementioned license entitles Revotar to develop, use
and sell, any Compound or Product and to do research works
relating to the Compound and Product (a) which is covered by
one or more claims of the Patents or (b) which incorporates or
uses Subject Technology (herinafter "scope of the license")
and (c) without restriction to specific indications. Revotar
shall be obligated to perform in full all of the obligations
and agreements of any sublicenses, including payment of
royalties. The right of manufacturing remains with TBC
pursuant to section 5.1 hereof unless (a) Revotar grants a
sublicense to a Third Party which comprises also the
manufacturing rights within the scope of the sublicense
agreement or, (b) Revotar is able to produce the goods at
lesser Manufacturing Costs than TBC.
2.2 TIME-LIMITED RIGHT TO REVOTAR TO GRANT SUBLICENSES OUTSIDE THE
TERRITORY TBC hereby grants to Revotar for a limited period of
[*] from the effective date on an exclusive right and license
to enter into a sublicense agreement of the same scope as
defined in sec. 2.1 above in all other countries outside the
Territory except for North America and the territory described
in the LG Chem License. The term of the
- -------------------------
[*] This information has been omitted in reliance on Rule 24B-2 under the
Securities Exchange Act of 1934, and has been filed separately with the
Securities and Exchange Commission.
12
-11-
sublicense granted by Revotar within this period of [*]
does not have to be limited to a certain period of time.
After the expiration of the [*] period the right to enter into
sublicense agreements in countries outside the Territory
reverts to TBC. Sublicense Agreements concluded by Revotar
within the [*] period remain unaffected.
2.3 WORLDWIDE LICENSE
For a period of [*] from the effective date on, Revotar is
entitled to grant a Worldwide License as a Licensing
Transaction subject to the approval of TBC according to
section 4.2 (f).
2.4 RIGHTS AND DUTIES IN CONNECTION WITH A LICENSING TRANSACTION
TO A THIRD PARTY 2.4.1. In order to enable Revotar to
successfully negotiate and conclude Licensing Transactions
pursuant to sec. 2.2 and especially sec. 2.3, TBC will refrain
from entering into any Licensing Transaction outside of the
Territory for a period of [*] from the effective date on until
and as long as the conditions of the following subsections of
this section 2.4. are met.
2.4.2 [*]
2.4.3. [*]
2.4.3.1. [*]
2.4.3.2. [*]
- -------------------------
[*] This information has been omitted in reliance on Rule 24B-2 under the
Securities Exchange Act of 1934, and has been filed separately with the
Securities and Exchange Commission.
13
-12-
3. DEVELOPMENT PROGRAM.
3.1 GOALS.
Commencing upon completion of the initial Work Plan as set
forth in Section 3.2(c), TBC and Revotar agree that they will
conduct the research and development on the Compounds and the
Products according to the Work Plans, with the goal of
developing commercially marketable Products in the shortest
feasible period of time. The parties agree that the Work Plans
will focus on the development of pharmaceuticals in the Field
of Use. The parties also agree that Revotar shall be
responsible for the conduct of the pre-clinical research
regarding the identification and formulation of the Compounds,
the clinical trials regarding the Products and the Compounds
in the Territory, and Patent filing, maintenance and
prosecution regarding the Products in the Territory; provided
that TBC will make such filings and undertake prosecution and
maintenance if requested by and paid for by Revotar.
The parties acknowledge that scientific research is conducted
in patterns and sequences, but it is the intention that
Revotar will at all times have a team or teams devoting direct
and full time attention to the TBC 1269 Program. Revotar shall
devote sufficient research scientists and personnel either now
on its staff or subsequently hired to the Development Program
to perform the goals set forth herein. Revotar will perform
and pay for the development of any Compound and Product for
use in the Field of Use up to and including all regulatory
approvals and clinical trials in the Territory regarding such
Compound. Any information generated by Revotar in connection
with the Development Program will be shared without costs to
TBC and LG Chem as far as TBC is obliged to disclose such
information to LG Chem under the LG Chem License in the
version prevailing at the effective date. Any information
generated by TBC concerning the Patents, Compounds or Products
will be shared without costs to Revotar; the same applies to
information generated by LG Chem, if the LG Chem License in
the version prevailing at the effective date does not prohibit
the passing on of such information to Revotar.
14
-13-
Revotar is entitled to pass on information generated by TBC or
LG Chem to a sublicensee, but with reference to information
generated by LG Chem only according to the provisions of the
preceding section. Revotar will endeavor to oblige sublicensee
to pass on information concerning any Compound and Product and
to assent to passing on such information to TBC and LG Chem
and other sublicensees. TBC is obliged in the same mnner if it
grants a license to a sublicensee.
While the parties agree to use best efforts to achieve the
goals of the Development Program, neither TBC nor Revotar
warrants or guarantees that their efforts will result in a
marketable or approvable Product or that the goals specified
in the Work Plan will be achieved within the periods set forth
therein.
3.2 PROGRAM ADMINISTRATION.
3.2.1 PROJECT REPRESENTATIVES. The parties have each
designated two Project Representatives to facilitate liaison
between it and the other party, oversee and review the
progress of the Development Program, select indications to
pursue, determine the Development Program, develop clinical
trial protocols, manage the clinical/regulatory process and
discuss potential competition and other relevant matters to
assure rapid development and commercialization of the
Compounds and the Products. The Project Representatives will
also discuss and agree on the addition of indications outside
the Field of Use pursuant to the provisions of Section 2.1
above.
3.2.2 DISAGREEMENTS. All decisions made hereunder relating to
the Development Program shall require the approval of the
Project Representatives. The Project Representatives shall
attempt in good faith to reach consensus on all matters
regarding the Development Program. The Project Representatives
shall promptly present any disagreements to the chief
executive officers of the parties or their designees, who
shall attempt resolution of the matter. If such executives or
designees cannot promptly resolve such disagreement, then the
dispute shall be resolved under the arbitration provisions of
Section 11.7.
15
-14-
3.2.3 WORK PLANS. On or before the date hereof, the parties
hereto have agreed on the initial Work Plan for 2000, which is
attached hereto as SCHEDULE 2. If the Project Representatives
agree to pursue indications outside the Field of Use , then a
new Work Plan for those indications will be developed. The
Work Plan shall be the plan and budget as approved by both
parties in writing. Prior to November 1 of each year, the
Project Representatives shall prepare and recommend to each
party a proposed Work Plan for the next calendar year. Each
Work Plan adopted shall be agreed upon and signed by an
officer of both parties no later than January 1 of the year
covered by the Work Plan. The Project Representatives shall
actively consult with one another throughout the term of the
Development Program so as to adjust the specific work
performed under each Work Plan to conform to evolving
developments in technology and the results of the development
work performed. While minor adjustments to a Work Plan may be
made from time to time upon approval by the Project
Representatives, significant changes to the scope or direction
of the work in a Work Plan must be agreed to in writing by
each party, in the absence of which the most recently approved
Work Plan shall remain in effect.
3.2.4 PROGRESS REPORTS. Within 14 days following the end of
each calendar quarter, a Project Representative for each party
shall deliver to the other a reasonably detailed written
report which shall (a) describe the work performed by the
respective party during the quarter on the Development Program
and (b) if appropriate, recommend any revisions to the Work
Plan that would improve the progress of the Development
Program.
3.2.5 MEETINGS. The Project Representatives and other
employees or consultants of the parties responsible for
management of the Work Plan and the Development Program shall
meet at least once during each calendar quarter during the
term of the Development Program to review (i) relevant data,
(ii) technical issues that have arisen, (iii) issues of
priority and proposed Products or Compounds for clinical
candidates, (iv) the design and conduct of clinical trials and
anticipated regulatory
16
-15-
filings, (v) budgets and expenditures, (vi) competition,
(vii) patent prosecution, and (viii) any other matters
relevant to the development of the Products. Such meetings
shall be at such times as may be agreed to by the parties, and
the location of such meetings shall be at Revotar's
facilities, unless otherwise agreed by the parties. Revotar
shall be responsible for all costs incurred in connection with
such meetings. The Project Representatives shall jointly
prepare minutes summarizing the matters reviewed and any
actions taken at such meetings and shall distribute such
minutes to the parties within 14 days following each meeting.
Each party may invite additional colleagues to participate at
meetings as appropriate and acceptable to the other party.
Revotar shall be responsible for the preparation and
communication to TBC of the specific agenda of each meeting in
advance of each meeting and either party may place items for
consideration on the agenda.
3.3 PERFORMANCE OF SERVICES.
Each party shall perform the work assigned to it in a prudent
and skillful manner in accordance, in all material respects,
with the Work Plan then in effect and applicable laws.
[*]Revotar shall make available to TBC any materials it
proposes to file with the FDA or a PRA for TBC's review and
approval, which approval may not be unreasonably withheld or
delayed. Such materials shall be made available to TBC
sufficiently in advance of the anticipated filing date so as
to give TBC a reasonable opportunity to review and comment.
All responses by regulatory bodies shall also be promptly
disclosed to TBC. Revotar also agrees that it will (i) consult
with and seek in good faith to agree with TBC regarding major
decisions pertaining to the clinical trials in the Territory,
including protocol design and selection, (ii) take steps to
insure that the data filed with any PRA and/or produced in
clinical trials in the Territory will comply with all
applicable standards and (iii) promptly supply such data to
TBC. In any case where responsibility for a regulatory filing
is assigned to a sublicensee, the applicable sublicense shall
require the sublicensee to afford the parties hereto the
17
-16-
same review, approval and comment rights with respect to such
regulatory filings as are set forth in this Section 3.3.
3.4 RECORDS AND DATA.
Each party shall maintain records in sufficient detail and in
good scientific manner appropriate for patent and regulatory
purposes and so as to properly reflect all work done and
results achieved in the performance of the Work Plan and
Development Program. Such records shall include books,
records, reports, research notes, charts, graphs, comments,
computations, analyses, recordings, photographs, computer
programs and documentation thereof, computer information
storage means, samples of materials and other graphic or
written data generated in connection with the Work Plan and
Development Program, including any data required to be
maintained pursuant to applicable governmental regulations.
Each party shall provide the other the right to inspect all
such records, and shall provide copies of all such requested
records.
3.5 VISIT OF FACILITIES.
Representatives of each party may, upon reasonable notice and
at times reasonably acceptable to the other party, (a) visit
the facilities where the Work Plan and Development Program are
being conducted and/or the facilities where the other party
manufactures any Product or Compound contained therein (or has
a Product or such a Compound manufactured by a Third Party),
(b) consult informally, during such visits and by telephone,
with personnel of the other party performing work on the Work
Plan and Development Program and (c) with the other party's
prior approval, which approval shall not be unreasonably
withheld, visit the sites of any clinical trials or other
experiments being conducted by such other party in connection
with the Work Plan and Development Program, but only to the
extent in each case as such trials or other experiments relate
to the Work Plan and Development Program. If requested by the
other party, TBC and Revotar shall cause appropriate
individuals working on the Development Program to be available
for meetings at the location of
18
-17-
the facilities where such individuals are employed at times
reasonably convenient to the party responding to such request.
4. PAYMENTS AND REPORTS.
4.1 DEVELOPMENT FUNDING.
All Development Costs, including all preclinical toxicology
expenses incurred by TBC in the year 2000, whether incurred
before or after marketing approval of any Product, shall be
borne by Revotar up to a maximum amount of [*].
4.2 ROYALTIES.
4.2.1 ROYALTY RATES WHEN NO LICENSING TRANSACTION. Pursuant to
the rights in Patents and Subject Technology granted hereby,
in the event that Revotar commences sales of Products without
having entered into any Licensing Transaction, Revotar or its
Affiliates shall pay TBC [*] of Net Sales relating to any
Product sold by Revotar and its Affiliates in the Territory.
4.2.2 ROYALTY RATES AFTER LICENSING TRANSACTION (a) If Revotar
enters into a Worldwide License pursuant to sec. 2.4 with a
Third Party, then all royalties, license fees, milestone
payments and other payments or revenues of any kind received
by Revotar pursuant to such Worldwide License shall be [*]
with TBC. In addition, in the event Revotar enters into any
Worldwide License, TBC expressly reserves the right to
co-promote the sale of Products and Compounds in the North
American market on terms mutually agreeable to Revotar, TBC
and the third party to any such Worldwide License, which
agreements shall be negotiated in good faith and included in
the agreements relating to the Worldwide License.
(b) In the event Revotar enters into any Licensing Transaction
which is not a Worldwide License but includes only countries
within the European Market, and
- -------------------------
[*] This information has been omitted in reliance on Rule 24B-2 under the
Securities Exchange Act of 1934, and has been filed separately with the
Securities and Exchange Commission.
19
-18-
TBC is not required to fund a Phase III Clinical Trial to
obtain FDA approval regarding the Product, then Revotar and
TBC shall each pay to the other [*] of their respective
royalty revenues out of the Licensing Transaction to the third
party. This applies to Revotar only to the revenues generated
out of the European Market as defined above and applies only
to TBC regarding revenues generated in the North American
market.
(c) In the event Revotar enters into any Licensing Transaction
which is not a Worldwide License but includes only countries
within the European Market in the time of concluding the
License contract, and TBC is required to fund a Phase III
Clinical Trial to obtain FDA approval regarding the Product,
then Revotar shall pay to TBC [*] of its respective royalty
revenues out of any Licensing Transaction with third parties.
TBC will pay Revotar [*] of its respective royalty revenues
out of any Licensing Transaction with third parties. This
applies to Revotar only to the revenues generated out of the
European Market as defined above and applies to TBC only
regarding revenues generated in the North American market.
(d) In the event Revotar enters into any Licensing Transaction
which is not a Worldwide License and is not restricted to the
European Market, all royalties and other revenues received by
Revotar for sales generated outside the European Market which
are in excess of Development Costs incurred by Revotar in the
development of the Product in question shall be [*] by Revotar
and TBC.
(e) TBC and Revotar shall impose to their third party
licensees the duty to report on their Net Sales classified to
the regions defined in sec. (a) to (d).
(f) TBC and Revotar acknowledge and agree that any Licensing
Transaction involving countries outside the Territory shall
require the appropriate prior approval of TBC. The approval of
TBC will be only denied in case the Licensing transaction
infringes legitimate business interests of TBC. TBC is not
entitled to deny its approval without "good cause". There is
no "good cause" if the forecasted profits of the license which
requires the approval of TBC surpasses the profits of other
kinds of commercialization of the Compound which can be
realized at the time of the
- -------------------------
[*] This information has been omitted in reliance on Rule 24B-2 under the
Securities Exchange Act of 1934, and has been filed separately with the
Securities and Exchange Commission.
20
-19-
prospected commencement of the pending license agreement
unless there are substantial reasons which surpass the
commercial interest of both parties. In addition, any license
or other agreement entered into by Revotar in connection with
a Licensing Transaction shall comply in all respects with the
terms and conditions of Section 2 of this Agreement and the
Participation Agreement, including Article 3 thereof.
4.2.3 ROYALTIES AFTER TERMINATION. After the expiration of the
term of this Agreement pursuant to the first sentence of
Section 10.1 ( below, and in perpetuity thereafter, Revotar
shall pay to TBC [*] of the amounts due pursuant to this
Section 4.2. The same applies mutatis mutandis to the amounts
owed by TBC to Revotar.
4.2.4 REPORTS AND PAYMENT. Each party shall keep, and shall
require all Affiliates and sublicensees to keep, accurate
records in sufficient detail to enable the amounts due to the
other party to be determined. Each party shall deliver to the
other party within 60 days after the end of each calendar
quarter a written accounting, including quantities and
monetary amounts of sales of each Product by such party and
its Affiliates and sublicensees, on a country-by-country
basis, and the amount of the royalty payments, if any, due to
the other party for such quarter. Each party or its
Affiliates, simultaneously with the delivery of each such
accounting, shall tender payment of all royalties shown to be
due thereon.
4.3 AUDIT RIGHTS.
Each party shall permit the other party or its representatives
to have access, at its own expense, no more than once in each
calendar year during the term of this Agreement and twice
during the three (3) calendar years following the termination
hereof, during regular business hours and upon reasonable
notice, to its records and books for the sole purpose of
determining the appropriateness of all amounts payable
hereunder or
- -------------------------
[*] This information has been omitted in reliance on Rule 24B-2 under the
Securities Exchange Act of 1934, and has been filed separately with the
Securities and Exchange Commission.
21
-20-
verifying the royalties and profit sharing amounts payable
hereunder. If such examination reveals that such amounts have
been overstated or such royalties have been understated for
any calendar year, such overpayment shall be promptly refunded
or in the case of any underpayment, such party shall promptly
pay the amount of any underpayment; provided that if such
examination was not conducted by an independent accountant,
the party whose records were examined shall have the right to
engage an independent accountant reasonably acceptable to
examining party to verify the results of such examination. Any
sublicense granted by Revotar hereunder shall contain audit
provisions as set forth in this Section 4.4, mutatis mutandis.
4.4 PAYMENT CURRENCY.
All payments to be made under this Agreement shall be made in
United States dollars. In the case of sales in foreign
currencies, the rate of exchange to be used in computing the
amount of currency equivalent in United States dollars due to
TBC for the calendar quarter just ended shall be made at the
rate of exchange prevailing on the last day of such calendar
quarter published by a New York money center bank designated
by Revotar which Revotar uses for currency conversion in the
preparation of Revotar financial reports.
4.5 PAYMENT MECHANICS.
All payments under this Agreement shall be made by wire
transfer of immediately available funds to such account as the
receiving party shall specify or by other payment method
acceptable to the parties.
5. COMMERCIALIZATION.
5.1 TBC TO MANUFACTURE.
TBC will manufacture or subcontract, after the agreement of
Revotar and as a contractor of Revotar within the limits of
2.1, the manufacture of all Revotar's requirements for
Compounds and/or Products, subject to customary forecast and
order procedures. If TBC or its subcontractor is manufacturing
Compounds and/or Products, TBC's (or its subcontractor's)
responsibilities shall include all aspects of the
manufacturing process, including maintenance of manufacturing
inventory, quality control and shipment of Compounds and/or
22
-21-
Products in accordance with orders placed by Revotar. TBC and
Revotar will also agree to negotiate in good faith a
manufacturing agreement which will include provisions on
forecasts, delivery time, quality control, quality assurance,
delivery location, insurance, packaging, inventories, term and
time of payment and such other provisions as are customarily
included in agreements of this type. As compensation for such
manufacturing services, TBC shall be entitled to receive
payment of its COGS. Revotar shall have the right to audit at
its expense the manufacturer or submanufacturer of the
Compounds or Products.
5.2 REVOTAR TO SELL IN TERRITORY.
Following regulatory approval in any country in the Territory,
and subject to Section 5.3 below, Revotar shall use
commercially reasonable efforts to market and sell the
Products in such country. Revotar will use all resources in
such marketing and sales efforts that it would use regarding
any of its other products with similar commercial potential.
All terms of sale, including pricing policies, credit terms,
cash discounts and returns and allowances, shall be set by
Revotar. Revotar shall be responsible for invoicing the
customers for Products and collecting payment therefore.
Revotar, in consultation with TBC, will select the trademarks
to be used for the sale of Products in the Territory, which
selection will take into account the need for worldwide
trademarks. Such trademarks regarding sales of Products in the
Territory or any other territory that Revotar chooses will be
owned by Revotar. In the event TBC is marketing and selling
Products, TBC will have the right to use such trademarks
outside the Territory at no cost to TBC.
5.3. SUBLICENSEE TO REVOTAR
If Revotar will grant a sublicense to a Third Parties then
Revotar will impose to the sublicensee to assume the
obligations entered into by Revotar in section 5.2, sentences
1 and 2.
23
-22-
6. TBC REPRESENTATIONS AND WARRANTIES.
TBC represents and warrants to Revotar as follows:
6.1 NO THIRD PARTY AGREEMENTS.
Except for the patent applications filed by TBC and the LG
Chem License, there are no agreements with third parties
relating to the Products.
6.2 NO THIRD PARTY RIGHTS.
TBC owns or possesses adequate licenses or other rights to use
all patents, patent rights, inventions and know-how necessary
for the manufacture, use and sale of the Compounds and
Products and to grant the licenses granted herein. To the best
knowledge of TBC, the manufacture, use or sale of the Products
and Compounds pursuant to this Agreement will not infringe or
conflict with any Third Party right or patent and TBC is not
aware of any pending patent application that if issued would
be infringed by the manufacture, use or sale of the Products
pursuant to this Agreement. TBC has not received any notice
from a third party that any manufacture, use or sale of the
Products and Compounds pursuant to this Agreement infringes or
conflicts with any Third party right or patent.
7. PROPRIETARY RIGHTS.
7.1 IMPROVEMENTS.
Improvements conceived or made solely by the employees of
either party during the term of this Agreement shall be the
sole property of such party. Improvements made jointly by
employees of both parties during the term of this Agreement
shall be owned by Revotar. All Improvements no matter if
conceived solely by one party to this Agreement or jointly
shall be automatically included in the license granted to
Revotar under Section 2; provided, that the parties agree to
negotiate in good faith appropriate modifications to the terms
of this Agreement which reflect the fact that
24
-23-
an Improvement has been jointly developed or developed
only by TBC. TBC shall have a perpetual, royalty-free and
non-exclusive license, to make, use and sell and sublicense
outside the Territory any Improvements owned by Revotar,
provided such right does not conflict with the provisions of
this Agreement, especially sec. 2.4. Each party shall promptly
disclose to the other any Improvements developed by its
employees or agents acting on its behalf. Each party agrees
that all employees and other persons acting on its behalf
under this Agreement shall be obligated under a binding
written agreement to assign (or exclusively license in the
case of academics) to such party or as such party shall direct
all Improvements made or conceived by such employee or other
person.
7.2 PATENT PROSECUTION AND MAINTENANCE.
The parties agree that they will coordinate with each other in
all reasonable respects the worldwide prosecution of the
Patents, subject to the provisions of this Section 7. TBC
shall be responsible, at its expense, for prosecuting and
maintaining any patents and patent applications relating to
the Patents in existence on the date of this Agreement.
Revotar shall be responsible, at its expense, for filing,
prosecuting and maintaining the Patents (to the extent they
are not in existence on the date of this Agreement) (including
Improvements owned by Revotar or jointly developed by Revotar
and TBC, but excluding Improvements owned exclusively by TBC);
provided that TBC will make such filings and undertake
prosecution and maintenance if requested by and paid for by
Revotar. Each party shall furnish the other party with copies
of any patent application concerning Subject Technology or
Improvements sufficiently in advance of the anticipated filing
date (but in no event less than 5 working days before filing)
so as to give the other party a reasonable opportunity to
review and comment. Each party shall also furnish copies to
the other party of all communications to and from United
States and foreign patent offices regarding patents or patent
applications relating to this Agreement within a reasonable
time prior to filing such communication or promptly following
the receipt thereof. Each party shall reasonably consider any
comments the other party may have related to such patent
applications or communications. Each party shall have the
right
25
-24-
at its expense to file, prosecute and maintain patents in the
United States and all foreign countries on Improvements owned
solely by it. Notwithstanding the foregoing, beyond best
efforts, neither party assumes liability to the other for the
successful prosecution of any patent application. However, if
either party shall fail to pay an annuity, tax or other
maintenance fee with respect to a Patent or Patent application
or otherwise decide not to pursue a Patent relating to
Improvements owned solely by it, it shall give the other party
timely notice and the opportunity to take such action and
assume all ownership rights to such Patent or Patent
application.
7.3 THIRD PARTY CLAIM OF INFRINGEMENT.
Each party shall give the other prompt notice of each claim or
allegation that the exercise of rights hereunder constitutes
an infringement of one or more patents or other rights of a
Third Party. Revotar shall use all commercially reasonable
efforts to defend the parties against any such claim or
allegation with counsel of its own choice reasonably
acceptable to Revotar. The costs of such defense and any costs
of settling or otherwise satisfying such claim (including
damage awards, if any) shall be borne as follows:
7.3.1 TBC COSTS. TBC shall bear all costs associated with
claims based on any patent issued or patent application
published as of the date of this Agreement. If Revotar
continues to sell the Products following notice of such claim
against explicit requests to the contrary by TBC, then Revotar
shall have the obligation to satisfy all claims in connection
with such continued sales activity. At all times, Revotar
shall have the right to defend itself at its cost against this
with counsel of its own choice reasonably acceptable to TBC.
7.3.2 REVOTAR COSTS. Revotar shall bear all costs associated
with claims based on any patent or patent application that was
not issued or published as of the date of this Agreement.
26
-25-
7.3.3 COOPERATION. Each party agrees to cooperate with the
other in the defense of any such claim or allegation,
including, to the extent able, furnishing testimony by its
employees and providing technical support and information as
requested. Neither party shall settle or discontinue defense
of any such case without the other's prior written consent,
which shall not be unreasonably withheld. In the case of any
proposed settlement involving a cross-license with a Third
Party, neither party may unreasonably refuse to enter into
such a cross-license. The provisions of this Section 7.3 shall
also apply to actions for declaratory relief which raise or
are in response to an issue of infringement of a Third Party
patent.
7.4 INFRINGEMENT BY THIRD PARTIES.
Each party shall give the other party prompt written notice of
any incident of infringement of Patents that comes to its
attention. The parties shall thereupon confer as to what steps
are to be taken to stop or prevent such infringement. Revotar
agrees to use reasonable efforts to stop any such
infringement, but shall not be obligated to commence
proceedings against the infringer. If Revotar decides to
commence proceedings, however, Revotar shall be responsible
for any legal costs incurred and will be entitled to retain
any settlement or damage award received, and TBC agrees to
cooperate with Revotar in such proceeding. TBC shall have the
right at its expense to engage its own counsel in connection
with such proceedings. Should Revotar decide not to commence
proceedings, and should the infringement represent a
substantial threat to the commercial value of any Products,
TBC shall be entitled (but not obligated) to do so in its own
name and/or in Revotar's name against the infringer, in which
event TBC shall be responsible for all legal costs incurred,
and will be entitled to retain any settlement or damage award
received, and Revotar agrees to cooperate with TBC in such
proceedings and Revotar shall have the right at its expense to
engage its own counsel in connection with such proceedings.
27
-26-
8. CONFIDENTIALITY.
8.1 GENERAL.
Any party receiving Confidential Information pursuant to this
Agreement shall maintain the confidential and proprietary
status of such Confidential Information, keep such
Confidential Information and each part thereof within its
possession or under its control sufficient to prevent any
activity with respect to the Confidential Information that is
not specifically authorized by this Agreement and prevent the
disclosure of any Confidential Information to any Third Party
using the same degree of care it would use with respect to its
own information of like importance; PROVIDED, HOWEVER, that
such restrictions shall not apply to any Confidential
Information that is (a) independently developed outside the
scope of this Agreement by employees of the receiving party
having no access to or knowledge of the Confidential
Information disclosed hereunder, (b) in the public domain at
the time of its receipt or thereafter becomes part of the
public domain through no fault of the receiving party, (c)
lawfully received without an obligation of confidentiality
from a Third Party having the right to disclose such
information, (d) released from the restrictions of this
Section 8 by the express written consent of the disclosing
party, (e) disclosed to any permitted assignee, sublicensee or
subcontractor or customer of Revotar or TBC, provided that
such assignee, sublicensee, subcontractor or customer is
subject to the provisions of this Section 8 or substantially
similar provisions or (f) required by law, statute, rule or
court order to be disclosed, including requirements of the
Securities and Exchange Commission, the FDA, any PRA, and
other regulatory authorities, provided that the disclosing
party uses commercially reasonable efforts to obtain
confidential treatment of any such disclosure. Without
limiting the generality of the foregoing, Revotar and TBC each
shall use all commercially reasonable efforts to obtain, if
not already in place, confidentiality agreements from its
respective relevant employees and agents, to protect the
Confidential Information as herein provided.
28
-27-
8.2 DISCLOSURE OF AGREEMENT.
Neither party shall make a public announcement or otherwise
disclose the terms of this Agreement to any Third Party
without the prior written consent of the other except that the
parties may without such consent disclose (a) the existence of
this Agreement, (b) the identity of the other party and (c)
the general subject matter of this Agreement. Each party shall
also be permitted to make such disclosure of the terms of this
Agreement as its counsel reasonably determines is necessary to
comply with law, provided that such party shall use
commercially reasonable efforts to obtain confidential
treatment of any such disclosure.
9. INDEMNIFICATION.
9.1 MUTUAL RIGHT TO INDEMNIFICATION.
Each party shall defend, indemnify and hold harmless the other
and its directors, officers, employees and agents from and
against any and all claims, liabilities, losses and expenses,
including attorneys' fees, incurred by or asserted against it
or any of the foregoing arising out of the development,
testing, manufacture, handling or storage of any Product by
such party, including without limitation (i) any actual or
alleged bodily injury, death or property damage resulting from
the use of any Product manufactured by such party, (ii) any
actual or alleged violation of law applicable to the
development, testing, manufacture, handling or storage of the
Products by such party and (iii) any Product recall of Product
manufactured by such party that is ordered by a governmental
agency or required by a confirmed Product failure as
reasonably determined by the parties, except as otherwise
provided herein and except to the extent that such
liabilities, losses and expenses result from the negligence or
willful misconduct of a party, in which case the party who
engaged in such negligence or willful misconduct shall
indemnify and hold harmless the other party and its directors,
officers, employees and agents. Each party shall defend,
indemnify and hold harmless the other party and its directors,
officers, employees and agents from and against any and all
claims, liabilities, losses and expenses, including attorneys'
fees, incurred by or asserted against the other party or any
of the foregoing
29
-28-
arising out of a misrepresentation regarding any sales of
Products by such party, it Affiliates or sublicensees which is
not in accordance with approved Product claims.
9.2 PROCEDURE.
Any person that intends to claim indemnification under this
Section 9 (an ,,Indemnitee") shall promptly notify the other
party (the ,,Indemnitor") of any claim, in respect of which
the Indemnitee intends to claim such indemnification, and the
Indemnitor shall assume the defense thereof with counsel
mutually satisfactory to the parties; provided, however, that
an Indemnitee shall have the right to retain its own counsel,
with the fees and expenses to be paid by the Indemnitor, if
representation of such Indemnitee by the counsel retained by
the Indemnitor would be inappropriate due to actual or
potential differing interests between such Indemnitee and any
other party represented by such counsel in such proceedings.
The indemnity agreement in this Section 9 shall not apply to
amounts paid in settlement of any loss, claim, liability or
action if such settlement is effected without the consent of
the Indemnitor, which consent shall not be withheld
unreasonably. The failure to deliver notice to the Indemnitor
within a reasonable time after the commencement of any such
action, if prejudicial to its ability to defend such action,
shall relieve such Indemnitor of any liability to the
Indemnitee under this Section 9, but not any liability that it
may have to any Indemnitee otherwise than under this Section
9. The Indemnitee and its employees and agents shall cooperate
fully with the Indemnitor and its legal representatives in the
investigation of any action, claim or liability covered by
this indemnification. In the event that each party claims
indemnity from the other and one party is finally held liable
to indemnify the other, the Indemnitor shall additionally be
liable to pay the reasonable legal costs and attorneys' fees
incurred by the Indemnitee in establishing its claim for
indemnity.
9.3 PRODUCT LIABILITY INSURANCE.
Each party shall use all commercially reasonable efforts to
maintain product liability insurance with respect to its
manufacture and sale of the Products hereunder. Such insurance
shall be in such amounts and subject to such deductibles as
the parties may
30
-29-
agree based upon standards prevailing in the industry at the
time such manufacturing commences. At such time as a Product
is being launched by a party for commercial sale, the parties
shall attempt to maximize the product liability insurance
coverage for both parties. TBC shall maintain such insurance
for so long as Revotar continues to sell any Product
manufactured by TBC, and thereafter for so long as TBC
maintains insurance for itself covering such manufacture or
sales. Revotar shall maintain such insurance for as long as
Revotar continues to sell any Product pursuant to this
agreement manufactured by it, and thereafter for so long as
Revotar maintains insurance for itself covering such
manufacture or sales.
10. TERM AND TERMINATION.
10.1 LICENSE TERM.
The obligations of Revotar under the license granted in
section 2 shall terminate as to each Compound or Product on a
country-by-country basis on expiration of the last patent
included in the Patents in such country relating to each
Compound or Product in such country. Thereafter, Revotar shall
have a license to and perpetual rights in such Patents and
Subject Technology in such country as to the Product in
question, subject only to the obligations to make royalty
payments pursuant to Section 4.2.3 above..
10.2 TERMINATION FOR BREACH.
Either party may terminate this Agreement by written notice to
the other in the event that (i) the other party fails to
perform any material obligation hereunder and such failure is
not cured within 60 days following prompt notice thereof from
the non-defaulting party, or (ii) any bankruptcy,
receivership, insolvency or reorganization proceedings are
instituted by the other party or any such proceedings are
instituted against the other party and not dismissed within
120 days. The bankruptcy of a party shall not give rise to the
right of the bankrupt party to terminate any license granted
herein.
31
-30-
10.3 TERMINATION FOR FAILURE TO PROCEED.
In the event that (a) the Project Representatives have not
determined to proceed with the filing of a protocol for a
Pivotal Clinical Trial of a Product within six months after
completion of the last Phase II Clinical Trial and (b) the
parties have not agreed on plans for additional Phase II
trials of any Product, then TBC may terminate the license
granted hereunder solely with respect to such indications. All
other rights and licenses of Revotar hereunder shall continue
unimpaired. Notwithstanding the foregoing, if the Revotar
Project Representative has voted in favor of such filing and
the TBC Representative has voted against, then TBC may not
terminate the license for such indication. In addition, if
Revotar determines not to pursue commercialization of the
Product in any geographic market in the Territory and/or for
any clinical indication, it will cooperate with TBC to jointly
seek alliances with third parties to develop such use of a
Product, or at the option of TBC, will negotiate in good faith
with TBC for the license of such rights to TBC. This Agreement
shall terminate upon the failure of the Venture Capital
Investors (used herein as defined in the Participation
Agreement) to comply with the provisions of Article 3(8) of
the Participation Agreement.
10.4 SURVIVAL OF OBLIGATIONS.
No termination of this Agreement shall eliminate any rights
and obligations accrued prior to such termination. Promptly
following any termination of this Agreement, each party shall
return all written materials containing Confidential
Information, except one copy that may be retained by counsel
for each of the parties for record keeping purposes only. The
provisions of Sections 4.2.3, 7.3, 9, 10.4, 11.6 and 11.7
shall survive any termination of this Agreement. The
provisions of Section 8 shall survive until five years after
the expiration of the license as to all of the Products.
32
-31-
11 MISCELLANEOUS.
11.1 FORCE MAJEURE.
Each party shall be excused for any failure or delay in
performing any of its obligations under this Agreement, if
such failure or delay is caused by Force Majeure. For purposes
of this Agreement, ,,Force Majeure" shall mean any act of God,
accident, explosion, fire, storm, earthquake, flood, drought,
riot, embargo, civil commotion, war, act of war or any other
circumstances or event beyond the reasonable control of the
party relying upon such circumstance or event.
11.2 RELATIONSHIP OF THE PARTIES.
The parties agree that each is acting as an independent
contractor with respect to the other and nothing contained in
this Agreement is intended, or is to be construed, to
constitute Revotar and TBC as partners or joint venturers or
TBC an agent of Revotar. Neither party hereto shall have any
express or implied right or authority to assume or create any
obligations on behalf of or in the name of the other party or
to bind the other party to any contract, agreement or
undertaking.
11.3 NOTICES.
Any notice or other communication hereunder shall be in
writing and shall be deemed given when so delivered in person,
by overnight courier (with receipt confirmed) or by facsimile
transmission (with receipt confirmed by telephone or by
automatic transmission report) or on the tenth business day
after being sent by registered or certified mail (postage
prepaid, return receipt requested), as follows (or to such
other person's address as may be specified in writing to the
other party hereto):
33
-32-
Texas Biotechnology Corporation
7000 Fannin, 20th Floor
Houston, Texas 77030
Attention: David B. McWilliams
Telephone: (713) 796-8822
Facsimile: (713) 796-8232
Revotar Biopharmaceuticals AG
until further notice: c/o Dr. Horst Witzel
Schutzallee 48
14169 Berlin
11.4 SUCCESSORS AND ASSIGNS.
The terms and provisions of this Agreement shall inure to the
benefit of, and be binding upon, Revotar, TBC, and their
respective successors (including a successor pursuant to a
merger of a party hereto) and assigns. This Agreement, or any
of the rights granted hereunder, may be assigned by Revotar or
TBC to any of their respective Affiliates; provided, that such
assignment expressly provides that the assignor remains liable
for its obligations hereunder and the performance of its
Affiliate under this Agreement.
11.5 AMENDMENTS AND WAIVERS.
No amendment, modification, waiver, termination or discharge
of any provision of this Agreement, nor consent to any
departure by Revotar or TBC therefrom, shall in any event be
effective unless the same shall be in writing specifically
identifying this Agreement and the provision intended to be
amended, modified, waived, terminated or discharged and signed
by the party against whom enforcement of such amendment is
sought, and each amendment, modification, waiver, termination
or discharge shall be effective only in the specific instance
and for the specific purpose for which given. No provision of
this Agreement shall be varied, contradicted or explained by
any oral agreement, course of dealing or performance or any
other matter not set forth in an agreement in writing and
signed by the party against whom enforcement of such variance,
contradiction or explanation is sought.
34
-33-
11.6 GOVERNING LAW.
This Agreement shall be governed by and construed in
accordance with the laws of the Federal Republic of Germany.
11.7 DISPUTE RESOLUTION.
11.7.1 The parties agree to effect all reasonable efforts to
resolve any and all disputes between them in connection with
this Agreement in an amicable manner. The parties agree that
any dispute that arises in connection with this Agreement and
which cannot be amicably resolved by the parties shall be
resolved by binding Alternative Dispute Resolution (ADR) in
the manner set forth in the following Section 11.7.2
11.7.2. All diputes arising in connection with this Agreement
or its validity which cannot be amicably resolved by the
parties shall be finally settled in accordance with the
Arbitration Rules of the German Institution of Arbitration
e.V. (DIS) without recourse to the ordinary courts of law if
not agreed otherwise in this section 11.7.2..
The place of arbitration shall be Berlin. The language of the
arbitral proceedings shall be English.
The arbitral tribunal shall consist of a single neutral
individual selected according to the following subsection.
If a party intends to begin ADR to resolve a dispute, such
party shall provide written notice to the other party
informing the other party of such intention and the issues to
be resolved. Within ten (10) business days after its receipt
of such notice, the other party may, by written notice to the
party initiating ADR, add additional issues to be resolved. If
the parties cannot agree upon the selection of a neutral
within twenty (20) business days following receipt of the
original ADR notice, a neutral shall be selected by the then
President ("Vorstandsvorsitzender") of the German Institution
of Arbitration (D.I.S.), Bonn. The neutral shall be a single
individual having experience in the pharmaceutical industry.
The neutral selected shall not be an employee, director or
shareholder of either party or of an Affiliate. Each party
shall have ten
35
-34-
(10) business days from the date the neutral is selected to
object in good faith to the selection of that person. If
either party makes such an objection, the then President of
the DIS shall, as soon as possible thereafter, select another
neutral under the same conditions as set forth above.
11.8 SEVERABILITY.
If any provision hereof should be held invalid, illegal or
unenforceable in any respect in any jurisdiction, then, to the
fullest extent permitted by law, (a) all other provisions
hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in order to
carry out the intentions of the parties hereto as nearly as
may be possible and (b) such invalidity, illegality or
unenforceability shall not affect the validity, legality or
enforceability of such provision in any other jurisdiction.
11.9 HEADINGS.
Headings used herein are for convenience only and shall not in
any way affect the construction of, or be taken into
consideration in interpreting, this Agreement.
11.10 EXECUTION IN COUNTERPARTS.
This Agreement may be executed in any number of counterparts,
each of which counterparts, when so executed and delivered,
shall be deemed to be an original, and all of which
counterparts, taken together, shall constitute one and the
same instrument.
11.11 ENTIRE AGREEMENT.
This Agreement and the Research Agreement attached hereto as
SCHEDULE 3, contains the entire agreement and understanding of
the parties hereto, and supersedes any prior agreements or
understandings between the parties with respect to the subject
matter hereof.
36
-35-
IN WITNESS HEREOF, the parties hereto have caused this Agreement to be
duly executed as of the 21st day of July, 2000 .
TEXAS BIOTECHNOLOGY CORPORATION
By: /s/ David B. McWilliams
--------------------------------------------
Title: President
-----------------------------------------
REVOTAR BIOPHARMACEUTICALS AG
By: /s/ David B. McWilliams
---------------------------------------------
Title: Managing Director
-----------------------------------------