EXHIBIT 10.18
COOPERATION AND COLLABORATION AGREEMENT
THIS COOPERATION AND COLLABORATION AGREEMENT is made and entered into by and
between Dade Behring Holdings, Inc., a Delaware corporation, and Hoechst AG, a
German corporation.
WHEREAS, pursuant to the Combination Agreement (as defined below), Hoechst
AG has transferred its diagnostics business to Diagnostic Holdings, Inc. in
exchange for an equity interest in Diagnostic Holdings, Inc.;
WHEREAS, following consummation of such combination, Diagnostic Holdings,
Inc. has changed its name to Dade Behring Holdings, Inc.;
WHEREAS, in connection with the combination of Hoechst AG's diagnostics
business with and into the business of Dade Behring Holdings, Inc., Hoechst AG
and Dade Behring Holdings, Inc. have agreed to set forth a set of basic
principles to govern their future discussions concerning strategies and
potential projects for cooperation and collaboration in the areas more fully
described below; and
WHEREAS, Dade Behring Holdings, Inc. and Hoechst AG acknowledge that any
such close cooperation and collaboration is intended to ensure a smooth
transition period for the combination of the two business units and to create
synergy effects for the mutual benefit of the parties, which constitutes an
essential element in particular for Hoechst AG to enter into said combination.
NOW, THEREFORE, the parties hereby agree as follows:
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1 DEFINITIONS
The following terms when used herein with initial capital letters shall have the
respective meanings set forth below.
1.1 Areas of Collaboration. The term "Areas of Collaboration" shall mean
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access to existing technology, research and development of new
technology, manufacturing and marketing of products, all with
applicability to both the Life Science Field and the Diagnostic Field
as further described in clause 2.1.
1.2 Combination Agreement. The term "Combination Agreement" shall refer to
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the Agreement and Plan of Combination dated June 24, 1997 between
Hoechst and DBI.
1.3 Confidential Information. The term "Confidential Information" shall
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mean any and all tangible and intangible information of either party,
whether oral or in writing or in any other medium, relating to the
management, operations, finances, products and technology of the
disclosing party, including, without limitation, any and all trade
secrets, inventions, know-how, designs, formulations, ingredients,
samples, processes, machines, processing and control information,
product performance dates, manuals, supplier lists, consumer lists,
purchase and sales records, marketing information and computer programs
in each case whether developed by the disclosing party or furnished to
the disclosing party by other parties.
1.4 Cooperation Agreement. The term "Cooperation Agreement" shall refer to
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this agreement.
1.5 Diagnostics Field. The term "Diagnostics Field" shall mean the
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research, development, manufacture, marketing, sale, distribution and
service of human in vitro diagnostic equipment, reagents, consumable
supplies and services.
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1.6 DBI. The term "DBI" shall mean Dade Behring Holdings, Inc. (formerly
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known as Diagnostic Holdings, Inc.) and any subsidiaries of DBI in
which it holds direct or indirect beneficial ownership of more than 50%
of the voting stock.
1.7 Effective Date. The term "Effective Date" shall mean the date of the
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closing of the transactions contemplated by the Combination Agreement.
1.8 Hoechst. The term "Hoechst" shall mean Hoechst AG and any subsidiaries
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of Hoechst in which it holds direct or indirect beneficial ownership of
more than 50% of the voting stock.
1.9 Life Sciences Field. The term "Life Sciences Field" shall mean the
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research, development, manufacture, marketing, sale, distribution and
service of pharmaceuticals, agricultural products and veterinary
medical products.
1.10 Specific Collaboration Agreement. The term "Specific Collaboration
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Agreement" shall mean an agreement setting forth terms and conditions
agreed to by the parties under which they shall pursue projects in the
Areas of Collaboration that have been approved by the Steering
Committee.
1.11 Steering Committee. The term "Steering Committee" shall mean a
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committee composed of an equal number of representatives appointed by
each of the parties that shall meet with a view to implement projects
in the Areas of Collaboration.
2 SCOPE OF COLLABORATION
2.1 In General. The parties regard each other as principal collaborators
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such as that DBI shall be Hoechst's principal collaborator in the
Diagnostic Field and Hoechst shall be DBI's principal collaborator in
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the Life Sciences Field. The parties shall cooperate in good faith to
identify and discuss potential projects within the Areas of
Collaboration whereby both parties may benefit from a collaborative
effort.
2.2 Areas of Consideration. The parties are in agreement that the areas to
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be considered for collaboration include:
2.2.1 the development of new technology including but not limited to
areas of: (i) specific diseases, such as cardiovascular
diseases, oncology, osteoporosis, infections, rheumatics,
allergies and Alzheimer's disease; (ii) bioinformatics (i.e.,
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information received through genome sequencing); and (iii)
clinical trials (e.g., the development of tests for drug
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monitoring and in the field of pharmacokinetics; acquisition
of clinical utility information on DBI products with DBI bearing
any associated incremental costs);
2.2.2 marketing collaboration including, but not limited to, the areas
of: (i) disease management, e.g., in the areas of cardiovascular
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diseases, rheumatoid arthritis and diseases of CNS; (ii) the
production of brochures, information and advertising materials;
(iii) the sponsoring of congresses and opinion leaders; (iv) the
coordination of visits of clinics and presentation to the
public; and
2.2.3 collaboration in the field of "managed care".
2.3 Existing Collaborations. To the extent there is not a formal
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collaboration agreement already in place, any collaboration efforts
begun prior to the Effective Date between Hoechst and the diagnostics
business of Hoechst (which has now been transferred to DBI pursuant to
the Combination Agreement) shall be governed by the terms of Specific
Collaboration Agreements which are to be negotiated in good
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faith between Hoechst and DBI as soon as practical after the Effective
Date.
Nothing in this Collaboration Agreement shall be construed such as
that it will interfere with existing agreements or negotiations with
any third party.
2.4 New Collaborations. This Cooperation Agreement shall not in any way
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prohibit either party from collaborating or cooperating with any third
party, or from undertaking projects on its own, in any area of
endeavor, including but not limited to the Areas of Collaboration;
provided, however, that each party shall treat the other as its
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principal collaborator as set forth in clause 2.1 and consistent
therewith shall first offer the other party the opportunity to enter
into any collaboration contemplated by such party in the Areas of
Collaboration prior to entering into a comparable arrangement with any
third party unless such party has a good faith business justification
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for choosing not to collaborate with the other party on a particular
project. In any event, the parties will use good faith efforts to
inform each other prior to entering into detailed discussions with
third parties about the intent to collaborate or cooperate within the
Areas of Collaboration it being the intention that both parties should
be free of outside constraints when evaluating the benefit of entering
into a joint collaboration or cooperation.
Notwithstanding anything in this Cooperation Agreement to the
contrary, it is understood and agreed between the parties that nothing
in this Cooperation Agreement shall prevent (i) DBI from entering into
collaborations or other arrangements with third party pharmaceutical
companies in connection with antimicrobial susceptibility testing
associated with antimicrobial therapy or (ii) Hoechst from entering
into collaborations or other arrangements with third party companies
in connection with decentralized near-patient point of care testing
and direct pharmaceutical therapy, provided that such third party
companies
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are not in competition with the business of DBI as it exists as of the
date hereof.
2.5 Steering Committee.
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2.5.1 The parties shall form a Steering Committee that will meet on a
regular basis during the term of this Cooperation Agreement to
present ideas, exchange information, identify potential
collaboration projects and ultimately decide about joint
projects subject to each party's formal approval. The Steering
Committee shall agree upon the timing and location of its
meetings. The Chairman of the Strategy Committee of DBI shall
serve as the Chairman of the Steering Committee. On the
Effective Date, the Chairman of the Steering Committee shall be
Uwe Bicker. The Steering Committee members shall be executives
of the respective parties that possess the technical knowledge
and skill applicable to the Areas of Collaboration.
2.5.2 Should the Steering Committee unanimously agree to pursue a
project within the Areas of Collaboration, it shall appoint the
appropriate personnel to determine the specific structure,
terms, conditions and other relevant details for a Specific
Collaboration Agreement that shall govern such project. The
Steering Committee shall oversee and coordinate the
implementation of the projects. Any differences at the working
level shall be discussed by the Steering Committee with the
endeavor to amicably settle such difference.
2.6 Procedures. If at any time either DBI or Hoechst desires to pursue a
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collaboration project within the Area of Collaboration, then the
relevant company shall deliver a written notice to the Chairman of the
Steering Committee describing such proposed project or activity in
reasonable detail. The Chairman of the Steering Committee will
distribute such proposal to the other members of the Steering
Committee and to the
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addressed company. The parties will discuss any such proposals within
the next Steering Committee meeting or thereafter, if reasonable, and
decide whether to pursue such proposal.
2.7 Specific Collaboration Agreements. To the extent appropriate Specific
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Collaboration Agreements shall include terms that address the
following:
(a) project objectives and overview;
(b) project approach and organization;
(c) responsibilities and contributions of each of the parties;
(d) scheduling, milestones and work plans;
(e) protection and maintenance of jointly-developed intellectual and
industrial property rights;
(f) estimated fees and expenses;
(g) responsibility for and documentation of costs, fees and expenses;
(h) cross-licensing and sub-licensing arrangements;
(i) confidentiality provisions;
(j) termination rules (including survival after termination of this
Cooperation Agreement);
(k) any terms different from those set forth in this Collaboration
Agreement that shall govern that project; and
(l) any other relevant terms.
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2.8 Jointly-Developed Inventions. Hoechst shall grant to DBI in the
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Diagnostics Field, and DBI shall grant to Hoechst in the Life Sciences
Field, a license to practice inventions developed jointly by the
parties pursuant to a collaboration. The terms and conditions of such
licenses, as well as licenses of such jointly developed technology in
areas outside the Diagnostics and Life Sciences Fields, including but
not limited to royalty rates, territory and exclusivity, shall be
negotiated in good faith between the parties and, if agreed to prior
to the commencement of a collaboration, shall be set forth in the
applicable Specific Collaboration Agreement. In recognition of the
parties choosing each other as their principal collaborator, the terms
of such licenses shall contain "most favored licensee" provisions such
that in the event the licensing party subsequently grants a third
party a license to the same technology on terms and conditions that,
taken in their entirety, are more favorable than those granted to the
other party hereto, the other party hereto shall receive the benefit
of such more favorable terms, provided that such party also accepts
all other terms and conditions included in the third party license
agreement.
2.9 Ownership of Inventions. Nothing herein shall be construed to restrict
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either party's ownership of or ability to use and otherwise exploit
inventions and intellectual property developed solely by that party.
If such invention or intellectual property is developed pursuant to a
Specific Collaboration Agreement, the exploitation of such invention
or intellectual property is subject to the terms of such agreement.
2.10 Intellectual Property. Nothing in this Cooperation Agreement shall be
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construed to grant or convey to either party any title or right to any
intellectual or industrial property rights, including but not limited
to any patents, copyrights, trade secrets or trademarks, of the other
party.
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3 CONFIDENTIALITY
3.1 In General. Each of the parties acknowledges that it will likely be in
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both parties' interest to disclose or provide access to certain
Confidential Information to the other party in order to realize any
benefit from the collaborations contemplated by this Cooperation
Agreement. The parties agree that any such disclosure or access shall
be permitted only to the extent necessary to fulfill its obligation of
cooperation pursuant to a Specific Collaboration Agreement or
hereunder, and that such access shall be permitted only on the terms
set forth in this Cooperation Agreement or, as applicable, the
Specific Collaboration Agreement.
3.2 Limited Transfer of Confidential Information. To the extent that
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either party elects to disclose certain Confidential Information to
the other party, the receiving party agrees that:
3.2.1 it will not use any Confidential Information for any purpose
other than in connection with a collaborative project
undertaken pursuant to the terms herein and in the Specific
Collaboration Agreement, as applicable;
3.2.2 it will not disclose, utilize, exploit or distribute the
Confidential Information or the terms of this Cooperation
Agreement or any Specific Collaboration Agreement, or cause the
Confidential Information to be exploited or distributed to any
third party, except with the prior written consent of the
disclosing party;
3.2.3 it shall take all reasonable steps to protect the Confidential
Information from disclosure and, in any event, employ means to
protect the Confidential Information that are at least as
stringent as those employed to protect its own Confidential
Information; and
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3.2.4 it will not make or permit to be made, without the prior
written consent of the disclosing party, any copies or other
reproductions of the Confidential Information that the
disclosing party may supply to the receiving party hereunder.
3.3 Exceptions. The limitations imposed by this Section shall not apply
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to:
3.3.1 information which at the time of disclosure is already
possessed by the receiving party as demonstrated by written or
other tangible evidence;
3.3.2 information that is or becomes part of the public domain
through no fault of the receiving party;
3.3.3 information disclosed to the receiving party in good faith by a
third party who has an independent right to such information;
3.3.4 information that is independently developed by an employee of
the receiving party who has not received or otherwise been
exposed to the information of the other party.
3.4 Injunctive Relief. Each party acknowledges and agrees that the
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Confidential Information of the other party is valuable and
confidential proprietary information of the other party, that the
unauthorized disclosure of any part of the Confidential Information
would cause the other party substantial and irreparable injury, and
the other party will not have an adequate remedy at law in the event
of such unauthorized disclosure. Therefore, each party acknowledges
and agrees that the other party shall be entitled to obtain
preliminary and permanent injunctive relief in any court of competent
jurisdiction against acts of unauthorized disclosure of the
Confidential Information, without the posting of bond or other
security, in addition to whatever other remedies it may have at law or
otherwise.
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3.5 Return of Materials. To the extent that either party no longer
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requires Confidential Information it has received from the other
party, or upon termination of this Cooperation Agreement for any
reason, or upon the request of the disclosing party, each party shall
promptly return to the disclosing party all documents and materials
containing Confidential Information and shall either return or destroy
all copies, extracts, summaries, analyses or reproductions containing
any Confidential Information, as well as all documents, memoranda,
notes and other writings prepared by the receiving party or its agents
that are based in whole or in part on any Confidential Information.
The receiving party shall provide the disclosing party with a written
certification by an authorized officer that such destruction has taken
place.
3.6 No Warranties. Each of the parties acknowledges that neither party
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makes any express or implied representation or warranty as to the
accuracy, completeness, usefulness or reliability of the Confidential
Information. Neither party nor any of its representatives shall have
any liability to the other party, express or implied, relating to the
use of its Confidential Information or for any errors therein or
omissions therefrom.
4 TERM AND IMMEDIATE TERMINATION
4.1 Term. This Cooperation Agreement shall be in effect from the Effective
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Date and shall continue for three (3) years. It shall automatically
renew for another one-(1)-year period unless terminated by either
party with a notice period of ninety (90) days before the start of any
such one-(1)-year period.
4.2 Immediate Termination. This Cooperation Agreement shall, however,
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terminate immediately on the date on which Hoechst (and its
Affiliates) own less than 75% of the Initial Hoechst Shares. The terms
"Affiliate" and "Initial Hoechst Shares" shall have the meanings set
forth in that
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certain Stockholders Agreement dated the date hereof by and between
Hoechst and certain stockholders of Diagnostic Holdings, Inc. (now
Dade Behring Holdings, Inc.).
4.3 Termination for Breach. Either party may terminate this Cooperation
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Agreement upon ninety (90) days' prior written notice, in the event of
the other party's breach which is not cured within such ninety (90)
day period.
5 MISCELLANEOUS
5.1 Amendment and Waiver. This Cooperation Agreement may be amended, or
any provision of this Cooperation Agreement may be waived, so long as
any such amendment or waiver is set forth in a writing executed by
each party hereto. No course of dealing between or among the parties
shall be deemed effective to modify, amend or discharge any part of
this Cooperation Agreement or any rights or obligations of any party
under or by reason of this Cooperation Agreement.
5.2 Notices. All notices, demands and other communications to be given or
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delivered under or by reason of the provisions of this Cooperation
Agreement shall be in writing and shall be deemed to have been given
when personally delivered, sent by telecopy (with receipt confirmed)
or two days after sent by reputable overnight express courier (charges
prepaid). Unless another address is specified in writing, notices,
demands and communications to Hoechst and DBI shall be sent to the
addresses indicated below:
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Notices to Hoechst:
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Hoechst AG
Bruningstrae 50
D-65929 Frankfurt a.M.
Germany
Attn: Horst Waesche, Member of the Management Board
Notices to DBI:
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Dade Behring Holdings, Inc.
1717 Deerfield Road
P.O. Box 778
Deerfield, Illinois 60015
U.S.A.
Attn: President
with copy (which shall not constitute notice hereunder) to:
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Bain Capital, Inc.
Two Copley Place
Boston, Massachusetts 02116
U.S.A.
Attn: Stephen G. Pagliuca
John Connaughton
5.3 Assignment. This Cooperation Agreement and all of the provisions
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hereof are personal to Hoechst and DBI and shall be binding upon and
inure to the benefit of the parties hereto and their respective
successors and permitted assigns, except that neither this Cooperation
Agreement nor any of the rights, interests or obligations hereunder
may be assigned, delegated or transferred, by operation or law, sale
of stock, change of control or otherwise, voluntarily or
involuntarily, without the prior written consent of the other party.
Any such purported assignment, transfer or delegation shall be deemed
ineffective.
5.4 Complete Agreement. The Combination Agreement and this Cooperation
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Agreement contain the complete agreement between the parties with
respect to the subject matter herein and supersede any prior
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understandings, agreements or representations by or between the
parties, written or oral.
5.5 Governing Law. The validity, construction, and enforceability of this
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Cooperation Agreement shall be governed in all respects by the laws of
the state of New York, without regard to its conflict of laws rules.
5.6 Venue. Courts in the federal districts of New York, shall have
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exclusive venue.
5.7 No Third-Party Beneficiaries. This Cooperation Agreement is for the
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sole benefit of the DBI and Hoechst and their permitted assigns and
nothing herein expressed or implied shall give or be construed to give
any person or entity, other than the parties hereto and their
permitted assigns, any legal or equitable rights hereunder.
5.8 Order of Precedence. This Cooperation Agreement shall take precedence
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over any Specific Collaboration Agreement, except that the parties may
agree to waive or modify a term or terms herein by express reference
in a Specific Collaboration Agreement. Any such reference in a
Specific Collaboration Agreement shall waive or modify a term or terms
of this Cooperation Agreement only with respect to the undertakings
contemplated by that Specific Collaboration Agreement.
5.9 Survival. Sections 2.8, 2.9, 2.10 and 5.5, and Article 3 of this
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Cooperation Agreement shall survive expiration or termination of this
Cooperation Agreement.
5.10 Severability. If any of the provisions contained in this Cooperation
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Agreement are or become invalid or impracticable for any reason,
including by virtue of the omission of any other provision, the
validity of the remaining provisions shall remain unaffected. The
invalid or impracticable provision shall be substituted or
supplemented by
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provisions that ensure the economic purpose of the invalid or
impracticable provision as far as possible.
5.11 Costs. Each of the parties shall bear its own costs and expenses in
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connection with the negotiation and preparation of this Cooperation
Agreement and any Specific Collaboration Agreement except as otherwise
set forth herein or in any Specific Collaboration Agreement.
5.12 Relationship of the Parties. Neither party shall be considered the
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agent or representative of the other party.
5.13 Counterparts. This Cooperation Agreement may be executed in multiple
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counterparts all of which taken together shall constitute one and the
same agreement.
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IN WITNESS WHEREOF, the parties have executed this Cooperation Agreement as
of the Effective Date.
DIAGNOSTICS HOLDINGS, INC.
By: /s/ John Connaughton
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Its: VICE PRESIDENT-JOHN CONNAUGHTON
HOECHST AG
By: /s/ Andreas Pollman
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Its:
By:
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Its:
COOPERATION AGREEMENT