EXHIBIT 10.1
LICENSE AGREEMENT
BETWEEN
AVID CORPORATION (LICENSEE)
AND
THE DUPONT MERCK
PHARMACEUTICAL COMPANY (LICENSOR)
*** Certain confidential portions of this Exhibit were omitted by means
of blackout of the text (the "Mark"). This Exhibit has been filed separately
with the Secretary of the Commission without the Mark pursuant to the
Company's Application Requesting Confidential Treatment under Rule 24b-2
under the 1934 Act.
TABLE OF CONTENTS
Page
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I. DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.01 "Affiliate" . . . . . . . . . . . . . . . . . . . . . . . 2
1.02 "Agency". . . . . . . . . . . . . . . . . . . . . . . . . 2
1.03 "Calendar Quarter". . . . . . . . . . . . . . . . . . . . 2
1.04 "Calendar Year" . . . . . . . . . . . . . . . . . . . . . 2
1.06 "Field" . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.07 "First Commercial Sale" . . . . . . . . . . . . . . . . . 2
1.08 "IND" . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.09 "Know-How". . . . . . . . . . . . . . . . . . . . . . . . 3
1.10 "Licensed Compound" . . . . . . . . . . . . . . . . . . . 3
1.11 "Licensed Product". . . . . . . . . . . . . . . . . . . . 3
1.12 "NDA" . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.13 "Net Sales" . . . . . . . . . . . . . . . . . . . . . . . 3
1.14 "Patent Rights" . . . . . . . . . . . . . . . . . . . . . 4
1.15 "Confidential Information". . . . . . . . . . . . . . . . 4
1.16 "Sublicensee" . . . . . . . . . . . . . . . . . . . . . . 4
1.17 "Territory" . . . . . . . . . . . . . . . . . . . . . . . 4
1.18 "Valid Patent Claim". . . . . . . . . . . . . . . . . . . 4
II. GRANT OF LICENSE . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.01 Grant By DuPont Merck . . . . . . . . . . . . . . . . . . 5
2.02 Reservation . . . . . . . . . . . . . . . . . . . . . . . 5
III. PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.01 Licensee's Up Front Payment . . . . . . . . . . . . . . . 5
3.02 Licensee's Milestones . . . . . . . . . . . . . . . . . . 5
3.03 Licensee's Royalties. . . . . . . . . . . . . . . . . . . 6
3.04 Licensee's Annual License Preservation Fee to Licensor. . 6
3.05 In The Event of Sublicense by Licensee. . . . . . . . . . 7
3.06 Payment and Exchange Rate . . . . . . . . . . . . . . . . 8
IV. RECORDS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
4.01 Reports . . . . . . . . . . . . . . . . . . . . . . . . . 9
4.02 Books and Records . . . . . . . . . . . . . . . . . . . . 9
4.03 Sublicensees. . . . . . . . . . . . . . . . . . . . . . . 9
V. DEVELOPMENT OF LICENSED PRODUCT. . . . . . . . . . . . . . . . . . . 10
5.01 Product Development . . . . . . . . . . . . . . . . . . . 10
5.02 Development Schedule. . . . . . . . . . . . . . . . . . . 10
5.03 Data Transfer . . . . . . . . . . . . . . . . . . . . . . 10
5.04 Periodic Updates. . . . . . . . . . . . . . . . . . . . . 11
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VI. PATENT MAINTENANCE/PATENT INFRINGEMENT . . . . . . . . . . . . . . . 11
6.01 Patent Maintenance. . . . . . . . . . . . . . . . . . . . 11
6.02 Reimbursement By Licensee . . . . . . . . . . . . . . . . 11
6.03 Notice of Infringement. . . . . . . . . . . . . . . . . . 11
6.04 Licensor's Right to Bring Suit. . . . . . . . . . . . . . 12
6.05 Licensee's Right to Bring Suit. . . . . . . . . . . . . . 12
6.06 Litigation Expenses . . . . . . . . . . . . . . . . . . . 12
VII. NOTICES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
7.01 Notices . . . . . . . . . . . . . . . . . . . . . . . . . 13
7.02 Payments. . . . . . . . . . . . . . . . . . . . . . . . . 13
VIII. INDEMNIFICATION. . . . . . . . . . . . . . . . . . . . . . . . . . . 14
8.01 Indemnification by Licensee . . . . . . . . . . . . . . . 14
8.02 Procedure . . . . . . . . . . . . . . . . . . . . . . . . 15
8.03 Insurance . . . . . . . . . . . . . . . . . . . . . . . . 15
8.04 Warranty. . . . . . . . . . . . . . . . . . . . . . . . . 15
IX. TERM; TERMINATION. . . . . . . . . . . . . . . . . . . . . . . . . . 16
9.01 Term and Expiration . . . . . . . . . . . . . . . . . . . 16
9.02 Termination for Breach. . . . . . . . . . . . . . . . . . 16
9.03 Termination by Licensee . . . . . . . . . . . . . . . . . 16
9.04 Termination by Licensor . . . . . . . . . . . . . . . . . 17
9.05 On Termination or Expiration. . . . . . . . . . . . . . . 17
9.06 Survival of Certain Obligations . . . . . . . . . . . . . 17
9.07 Paid-up License . . . . . . . . . . . . . . . . . . . . . 18
X. CONFIDENTIALITY. . . . . . . . . . . . . . . . . . . . . . . . . . . 18
10.01 Nondisclosure Obligation. . . . . . . . . . . . . . . . . 18
10.02 Use of Confidential Information . . . . . . . . . . . . . 19
10.03 Publication . . . . . . . . . . . . . . . . . . . . . . . 19
XI. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
11.01 Modifications . . . . . . . . . . . . . . . . . . . . . . 20
11.02 Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . 20
11.03 Assignment. . . . . . . . . . . . . . . . . . . . . . . . 20
11.04 Severability. . . . . . . . . . . . . . . . . . . . . . . 20
11.05 Headings. . . . . . . . . . . . . . . . . . . . . . . . . 20
11.06 Applicable Law/Jurisdiction . . . . . . . . . . . . . . . 20
11.07 Force Majeure . . . . . . . . . . . . . . . . . . . . . . 21
11.08 Entire Agreement. . . . . . . . . . . . . . . . . . . . . 21
11.09 Counterparts. . . . . . . . . . . . . . . . . . . . . . . 21
11.10 Use of Names. . . . . . . . . . . . . . . . . . . . . . . 21
11.11 Independent Contractors . . . . . . . . . . . . . . . . . 21
11.12 Representations and Warranties. . . . . . . . . . . . . . 22
11.13 Publicity . . . . . . . . . . . . . . . . . . . . . . . . 22
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LICENSE AGREEMENT
This License Agreement, effective as of the date of last signature, by a
party hereto (the "Effective Date"), is entered into by and between Avid
Corporation, a corporation organized and existing under the laws of the
Commonwealth of Pennsylvania, and its Affiliates (collectively, "Licensee")
and The DuPont Merck Pharmaceutical Company ("Licensor"), a general
partnership organized and existing under the laws of the State, of Delaware.
WHEREAS, Licensor and Licensee entered into that certain Exclusive Option
Agreement ("Option Agreement") dated March 7, 1996, whereby Licensor granted
Licensee an exclusive, worldwide option to enter into an exclusive, worldwide
license Agreement covering the development and commercialization of Licensed
Compound.
WHEREAS, Licensee has now exercised the option granted in the Option
Agreement and duly so notified DuPont Merck in a letter dated November 11,
1996; and
WHEREAS, Licensor desires to grant, and Licensee desires to receive, an
exclusive, worldwide license to make, have made, import, use and sell
Licensed Product, under the circumstances, set forth below;
NOW THEREFORE, intending to be legally bound, Licensor and Licensee
hereby covenant and agree as follows:
I. DEFINITIONS
The terms in this Agreement with initial letters capitalized, whether used
in the singular or plural, shall have the meaning designated below or, if
not designated below, the meaning as designated in places throughout this
Agreement.
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1.01 "Affiliate" means any corporation or other entity which controls, is
controlled by, or is under common control with a party to this
Agreement. A corporation or other entity shall be regarded as in
control of another corporation or entity if it owns or directly or
indirectly controls fifty percent (50%) or more of the voting stock or
other ownership interest of the other corporation or entity, or if it
possesses, directly or indirectly, the power to direct or cause the
direction of the management and policies of the corporation or other
entity or the power to elect or appoint fifty percent (50%) or more of
the members of the governing body of the corporation or other entity.
1.02 "Agency" means any governmental regulatory authority responsible for
granting health or pricing approvals, registrations, import permits,
and other approvals required before Licensed Product may be tested or
marketed in any country.
1.03 "Calendar Quarter" means the respective periods of three (3)
consecutive calendar months ending on March 31, June 30, September 30
and December 31.
1.04 "Calendar Year" means each successive period of twelve (12) months
commencing on January 1 and ending on December 31.
1.06 "Field" means prophylactic and/or therapeutic treatment of patients
suffering from human immunodeficiency virus ("HIV"), acquired
immunodeficiency disease ("AIDS") and/or AIDS-related diseases.
1.07 "First Commercial Sale" means, with respect to a Licensed Product, the
first sale for use or consumption by the public of such Licensed
Product in a country after all required approvals, including marketing
and pricing approvals, have been granted by the governing health
authority of such country.
1.08 "IND" means Investigational New Drug application, or the like, as
defined in the applicable laws and regulations of the governmental
drug regulatory agencies in each country in the Territory.
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1.09 "Know-How" means all information and materials, including but not
limited to, technology, experience, discoveries, improvements,
processes, formulae, data (including but not limited to all
preclinical, clinical, toxicological, and pharmacological data) and
inventions, know-how and trade secrets, patentable or otherwise, which
on the Effective Date of this Agreement are in Licensor's possession
or control, are not generally known and are necessary or useful for
Licensee in the research, development, manufacture, marketing, use or
sale of Licensed Product for the Field in the Territory. Know-How
shall not include any such data or information which is available to
Licensor under a license pursuant to which Licensor does not have the
light to grant sublicenses.
1.10 "Licensed Compound" means Licensor's protease inhibitor for treatment
of human immunodeficiency virus ("HIV"), which is known as DMP450, and
which has the chemical name, [4R-(4a,5a,6b,7b)]-hexahydro-5,6-
bis(hydroxy)-1,3-bis[(3-aminophenyl)methyl]-4,7 -bis(phenylmethyl)-
2H-1,3-diazepin-2-one, bis-methanesulfonic acid salt.
1.11 "Licensed Product" means a formulation for human pharmaceutical use in
unit dosage form comprising Licensed Compound the manufacture, import,
use or sale of which would infringe a Valid Patent Claim but for the
license provided under Article 11 hereinbelow.
1.12 "NDA" means either the accelerated or regular new drug application
filed in the U.S. or the corresponding application for authorization
for marketing of Licensed Product in any other country, as defined in
the applicable laws and regulations and filed with the Agency of a
given country in the Territory.
1.13 "Net Sales" means the aggregate gross invoice price of Licensed
Product sold by LICENSEE, its Affiliates and Sublicensees to an
independent third party after deducting (to the extent not already
deducted in the amount invoiced):
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(i) trade and quantity discounts;
(ii) returns and allowances; and
(iii) rebates, chargebacks and other amounts paid, credited or accrued.
1.14 "Patent Rights" means the patents and patent applications listed on
Exhibit A and any and all patents and patent applications owned by or
licensed to Licensor as of the Effective Date, which contain one or
more claims directed to Licensed Product for the Field, and any and
all divisions, continuations, continuations-in-part, reissues,
renewals, extensions or the like of any such patents and patent
applications and all foreign equivalents thereof. Patent Rights shall
not include any patents or patent rights available to Licensor under a
license pursuant to which Licensor does not have the light to grant
sublicenses. It is understood that Licensor shall not assert against
Licensee any other patent rights it may now possess or it acquires in
the future as they relate to the manufacture, importation, use or and
sale of Licensed Compound and Licensed Product.
1.15 "Confidential Information" means and includes, without limitation,
information and data of one party supplied to the other, know-how, and
all other scientific, clinical, regulatory, marketing, financial and
commercial information or data, whether communicated in writing or
orally or by other means, which is provided by one party to the other
party in connection with this Agreement.
1.16 "Sublicensee" means a business entity which is sublicensed by Licensee
under this Agreement.
1.17 "Territory" means the entire world.
1.18 "Valid Patent Claim" means a claim of an issued and unexpired patent
included within Patent Rights which, but for the license provided
under Article II hereof, would be infringed by Licensee's manufacture,
use, sale or import of Licensed Product, and which has not been
revoked or held unenforceable or invalid by a decision of a court
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or other governmental agency of competent jurisdiction, unappealable
or unappealed within the time allowed for appeal, or which has not
been disclaimed, denied or admitted to be invalid or unenforceable
through reissue or disclaimer or otherwise.
II. GRANT OF LICENSE
2.01 GRANT BY DUPONT MERCK Subject to the reservation of Section 2.02,
Licensor hereby grants Licensee an exclusive license, with right to
sublicense, for the Field under the Patent Rights and Know-How to
make, have made, import, use and sell Licensed Compound and Licensed
Product in the Territory.
2.02 RESERVATION DuPont Merck expressly reserves the right to make and use
Licensed Compound in its internal research programs.
III. PAYMENTS
3.01 LICENSEE'S UP FRONT PAYMENT - In consideration of the rights granted
Licensee in 2.01 hereinabove, Licensee shall pay Licensor an initial
license fee equal to one million seven hundred fifty thousand dollars
($1,750,000.00)(the "Initial License Fee"). Said Initial License Fee
shall be due on the Effective Date, and shall not be returnable in any
event, nor shall it be creditable against earned royalties.
3.02 LICENSEE'S MILESTONES - Licensee shall make the following payments to
Licensor on achievement of the following milestones:
***
***
***
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the commission.
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***
***
***
***
***
***
***
***
***
*** of all milestone payments shall be ***
but no single royalty payment shall be reduced by more than ***
Licensee shall notify Licensor in writing within thirty (30) days upon
the achievement of each milestone event and such milestone payment
shall be paid no later than *** following achievement of the
milestone event.
3.03 LICENSEE'S ROYALTIES - As further consideration for the rights and
licenses granted herein, Licensee shall pay Licensor a royalty equal
to *** of Licensee's and/or Licensee's Affiliates annual Net
Sales following First Commercial Sale of License Product, the
manufacture, importation, use or sale of which would, but for the
licenses granted hereunder, infringe a Valid Patent Claim.
3.04 LICENSEE'S ANNUAL LICENSE PRESERVATION FEE TO LICENSOR - In the event
that Licensee's total payments to Licensor in any calendar year
commencing with 1998, whether in the form of royalties, milestones, or
Additional Payment (as this term defined below), do not at least equal
the Annual License Preservation Fees set forth below, Licensee, as a
condition of maintaining the exclusivity of the licenses granted
hereunder, shall by the end of the calendar year in question pay the
difference between the Annual License
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Confidential Treatment and filed separately with the commission.
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Preservation Fee specified below and the total of royalties,
milestones and Additional Payments made to Licensor that year
(hereafter, the "Unpaid Difference");
Annual License Preservation Fee Calendar Year
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*** ***
*** ***
*** ***
*** ***
The Unpaid Difference in any given calendar year shall be Paid by
Licensee to Licensor in cash, provided however, that up to ***
of the Unpaid Difference in each of ***
may, at Licensee's election, be paid to Licensor in the form of
Licensee's stock valued at the then prevailing fair market price for
such stock and having those rights and preferences as mutually agreed
upon by the parties. The fair market price will be determined as the
average price of Licensee's stock for the prior thirty (30) days if
Licensee stock is on a major exchange. If Licensee's stock is not
traded on a major exchange, the fair market price will be the price of
Licensee's stock as determined in its most recent private placement.
If royalties, milestones or Additional Payments in any given year
exceed the Annual License Preservation Fee, the excess shall be
carried over and applied against the ensuing year(s)' Annual License
Preservation Fee.
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the commission.
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3.05 IN THE EVENT OF SUBLICENSE BY LICENSEE - Licensee has the right to
sublicense the rights granted it hereunder to unrelated, unaffiliated
third parties, after obtaining the prior written consent of DuPont
Merck, such consent not to be unreasonably withheld. In the event
Licensee enters into such a sublicense agreement, then Licensee shall
pay Licensor *** of the cash equivalent of any license fee and
technology premium equity payment that Licensee receives from its
Sublicensee ("Additional Payment"). As used herein, technology premium
equity payment means A(B-C), where A is the number of shares of
Licensee's stock purchased by the Sublicensee, B is the share price
paid by the Sublicensee, and C is the share price paid by the most
recent non-pharmaceutical investor to purchase at least ***
*** of the same type of Licensee stock, or, if Licensee is
publicly traded, then C is the average trading price of Licensee's
stock for the ten business days immediately prior to the transaction.
Moreover, Licensee shall pay Licensor *** of all milestones
that licensee receives from its Sublicensee. This *** share
shall be applied against, but will not excuse Licensee from, the above
milestone obligations (i.e. Licensor shall receive the greater of its
*** share of Licensee's milestones or the milestones specified
above). Also, Licensee shall pay Licensor a royalty equal to the
greater of *** of the royalties that Licensee receives from
its Sublicensee(s) or *** of the Sublicensee(s)' Net Sales
following First Commercial Sale of Licensed Product, the manufacture,
importation, use or sale of which would, but for the licenses granted
hereunder, infringe a Valid Patent Claim.
3.06 PAYMENT AND EXCHANGE RATE - All payments to be made under this
Agreement shall be made in United States dollars and shall be paid by
bank wire transfer in immediately available funds as provided in
Section 7.02 hereinbelow or to such other bank account in the United
States designated in writing by DuPont Merck. In the case of sales
outside the United States, the rate of exchange to be used in
computing the amount of currency equivalent in United States dollars
due shall be the month-end exchange rate applicable for the month in
which the sales are recorded. Such month-end rate of
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the commission.
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exchange shall be the rate prevailing at the close of the last
business day of the month as identified by THE WALL STREET JOURNAL. If
royalties are paid outside the U.S., Licensee shall use all reasonable
efforts to help Licensor obtain the lowest tax rate possible under the
applicable international treaty with the U.S.
IV. RECORDS
4.01 REPORTS - During the term of the Agreement following the First
Commercial Sale of a Licensed Product, Licensee shall furnish to
Licensor a quarterly written report for the Calendar Quarter stating
the gross sales price and the Net Sales (including a listing of
deductions) of all Licensed Product(s) sold by Licensee, its
Affiliates and its Sublicensees in the Territory during the reporting
period and the royalties payable under this Agreement. Reports shall
be due on the *** following the close of each Calendar
Quarter. Royalties shown to have accrued by each royalty report shall
be due and payable on the date such royalty report is due.
4.02 BOOKS AND RECORDS - Licensee agrees to keep full and accurate books of
account, records, data and memoranda regarding the sales of the
Product in sufficient detail to enable the payments due to Licensor
hereunder to be determined. Licensee grants Licensor the right, at
its own expense, to examine said books and records insofar as they
concern the Product once in any calendar year for the purpose of
verifying the reports provided for in this Agreement. Licensee shall
retain such records for *** ***. If Licensor examines the records,
documents and materials in the possession or under the control of
Licensee, such examination shall be conducted during normal business
hours in such manner as to not unduly interfere with Licensee's
business. Licensor and its representatives shall not disclose to any
other person, firm, or corporation any information acquired as a
result of any such examination, provided, however. that nothing
contained herein shall be construed to prevent Licensor and/or its
duly authorized representatives from testifying in any court or
tribunal of competent
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Confidential Treatment and filed separately with the commission.
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jurisdiction with respect to the information obtained as a result of
such examination in any action instituted to enforce Licensor's rights
under the terms of this Agreement. If any audit by Licensor discloses
a discrepancy of more than *** in the amount paid to Licensor
and the amount actually owed to Licensor, Licensee shall reimburse
Licensor for the reasonable actual costs of such audit and shall
promptly pay the discrepancy to Licensor, plus interest thereon at
*** from the date such amount was originally due.
4.03 SUBLICENSEES. - Licensee shall include in each sublicense granted by
it pursuant to this Agreement a provision requiring the Sublicensee to
make reports to Licensee, to keep and maintain records of sales made
pursuant to such sublicense and to grant access to such records by
Licensor's independent accountant to the same extent required of
Licensee under this Agreement.
V. DEVELOPMENT OF LICENSED PRODUCT
5.01 PRODUCT DEVELOPMENT - Licensee shall be responsible, at its own cost
and expense, for the development and commercialization of Licensed
Product. Licensee shall use its *** to develop the Licensed
Product. As used herein the term ***
***
***
*** Licensee shall diligently perform or cause to be performed
all research and development necessary to obtain and maintain in full
force and effect Agency approval in ***
***
***
*** Licensee shall at the earliest possible time, consistent with
sound scientific and business principles, Cite applications for Agency
approval to sell Licensed Products in ***
***
***
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the commission.
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5.02 DEVELOPMENT SCHEDULE - Attached hereto as Exhibit B is an initial
Development Schedule outlining the Licensed Product development plan
for the United States market. The Development Schedule may be
modified periodically as mutually agreed to, in writing, by the
parties. Licensee's substantial compliance with the Development
Schedule, as it may be amended from time to time, shall be deemed to
satisfy the *** *** referred to in Section 5.01,
above.
5.03 DATA TRANSFER - To the extent not provided during the term of the
Option Agreement, Licensor shall provide Licensee with existing
pre-clinical and clinical data. Such data will include the
*** Licensor shall also provide reasonable
technical assistance to facilitate an orderly transfer of the project,
provided that such assistance shall not be at a level that is unduly
burdensome to Licensor. At the request of Licensee, Licensor may, in
its sole discretion, provide additional assistance at Licensee's
expense. Promptly after the Effective Date, Licensor shall notify the
FDA that Licensee has acquired exclusive rights to Licensed Product,
and so should have access to relevant data relating to Licensed
Product on file at the FDA.
5.04 PERIODIC UPDATES - Licensee will update Licensor in writing not less
frequently than *** on the development status of the Licensed
compound.
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the commission.
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VI. PATENT MAINTENANCE/PATENT INFRINGEMENT
6.01 PATENT MAINTENANCE, Licensor shall be responsible for prosecuting and
maintaining the Patent Rights. In meeting such responsibility,
Licensor will rely on its staff attorneys to the same extent it
usually does in prosecuting similar patents and patent applications
owned by Licensor.
6.02 REIMBURSEMENT BY LICENSEE, Licensee shall reimburse Licensor for all
costs incurred by Licensor in filing, prosecuting and maintaining the
Patent Rights during the term of this Agreement, except for those
costs relating to efforts of Licensor's staff attorneys. In the event
that Licensee determines that it does not make commercial sense to
pursue filing, prosecuting and maintaining the Patent Rights in a
particular country and no longer desires to reimburse Licensor for
associated costs in such country, then Licensee shall so notify
Licensor, and Licensor may, in Licensor's discretion, maintain or
abandon the Patent Rights in that particular country.
6.03 NOTICE OF INFRINGEMENT, Each party shall immediately give notice to
the other of any potential infringement or infringement by a third
party of any Patent Rights of which they become aware or of any
certification of which they become aware filed under the United States
"Drug Price Competition and Patent Term Restoration Act of 1984"
claiming that Patent Rights covering the Licensed Product are invalid
or unenforceable or that infringement will not arise from the
manufacture, use or sale of Licensed Product by a third party.
6.04 LICENSOR'S RIGHT TO BRING SUIT, Licensor will have the right to
settle with the infringer or to bring suit or other proceeding at its
expense against the infringer in its own name
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or in the name of Licensee where necessary, after consultation with
Licensee. Licensee shall be kept advised at all times of such suit or
proceedings brought by Licensor. Licensee may, in its discretion,
join Licensor as party to the suit or other proceeding, provided that
Licensor shall retain control of the prosecution of such suit or
proceedings in such event. Licensee agrees to cooperate with Licensor
in its efforts to protect Patent Rights, including joining as a party
where necessary. Licensor agrees to prosecute diligently any
litigation it initiates under this Section 6.04.
6.05 LICENSEE'S RIGHT TO BRING SUIT, If within ninety (90) days after
receiving notice under Section 6.03 hereinabove, Licensor does not
settle with the infringer or bring suit or other proceeding against
the infringer, Licensee may in its discretion, bring suit or other
proceeding at its expense against the infringer, provided however,
that Licensee shall first consult with Licensor as to whether such
act(s) by a third party reasonably constitute infringement and whether
it is commercially advisable to bring such suit or proceeding, as
reasonably determined by Licensor. Licensor shall be kept advised at
all times of such suit or proceedings brought by Licensee. Licensor
may, in its discretion, join Licensor as party to the suit or other
proceeding, provided that Licensee shall retain control of the
prosecution of such suit or proceedings in such event. Licensor
agrees to cooperate with Licensee in its efforts to protect Patent
Rights, including joining as a party where necessary. Licensee agrees
to prosecute diligently any litigation it initiates under this Section
6.05.
6.06 LITIGATION EXPENSES, Each party will bear its own expenses with
respect to any suit or other proceeding against an infringer. Any
recovery in connection with such suit or proceeding will first be
applied to reimburse Licensee and Licensor for their out-of-pocket
expenses, including attorney's fees. Any remaining recovery shall be
divided by the parties as follows: (i) if the damages awarded the
party controlling the suit include an amount based on ***
then Licensor shall retain *** *** and Licensee shall retain
*** of said amount after first subtracting
from the award those amounts not based on ***
(ii) if the damages awarded the party controlling the suit include an
amount based on *** *** then, Licensee shall retain
*** and Licensor *** of the award after first
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the commission.
-13-
subtracting from the award those amounts not based on ***
*** (iii) if the damages awarded the party controlling the suit
includes an amount based *** ***
then the parties will each retain *** of such amount
and (iv) if the damages awarded the party controlling the suit
includes an amount not contemplated by (i)-(iii) above, then the
parties will each retain *** of such amount.
VII. NOTICES; PAYMENTS
7.01 NOTICES, Any notice required or permitted to be given hereunder
shall, except where specifically provided otherwise, be given in
writing to the person listed below by personal delivery, registered or
certified mail, return receipt requested, NEXT DAY AIR, telegram,
telex, or telecopier, and the date upon which such notice is so
personally delivered (or if notice is given by registered or certified
mail, the date that is three (3) business days from sending, or if by
NEXT DAY AIR, telegram, or telex or telecopier, the date of receipt at
the designated address) shall be deemed to be the date of such notice,
irrespective of the date appearing thereon:
The DuPont Merck Pharmaceutical Company Avid Corporation
DuPont Merck Plaza, Walnut Run 1667 Davis Street
974 Centre Road Camden, NJ 08029
Wilmington, DE 19805 Attn: Executive VP
Attn: Vice President, Business Development
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the commission.
-14-
7.02 PAYMENTS, Payments made to Licensor under Article II shall be wire to
Licensor's account as follows:
Mellon Bank, N.A.
Independence Center
701 Market Street
Philadelphia, PA 19016
***
***
VIII. INDEMNIFICATION; INSURANCE; WARRANTIES
8.01 INDEMNIFICATION BY LICENSEE - Licensee shall at all times during the
term of this Agreement and thereafter, indemnify, defend and hold
Licensor, its officers, employees, parent companies and Affiliates,
from and against any and all claim, loss, damage, liability, injury,
cost or expense, including without limitation expenses of litigation
and reasonable attorneys' fees, in connection with any claims made or
suits brought by third parties against Licensor relating to this
Agreement including, without limitation, those arising out of the
death of or injury to any person or persons or out of any damage to
property and resulting from the production, manufacture, sale, use,
lease, consumption or advertisement of Licensed Product and those
arising from the negligence, willful misconduct, or material breach of
this Agreement by Licensee, its Affiliates, subcontractors or agents.
8.02 PROCEDURE. - Should Licensor or any of its officers, agents, parent
companies, affiliates, or employees (the "Indemnitee") intend to claim
indemnification under this Article VIII, such Indemnitee shall
promptly notify the Licensee (the "Indemnitor") in writing of any
loss, claim, damage, liability or action in respect of which the
Indemnitee intends to claim such indemnification, and the Indemnitor
shall be entitled to assume the defense thereof with counsel selected
by the Indemnitor and approved by the
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the commission.
-15-
Indemnitee, such approval not to be unreasonably withheld, PROVIDED,
HOWEVER, that if representation of Indemnitee by such counsel first
selected by the Indemnitor would be inappropriate due to a conflict of
interest between such Indemnitee and any other party represented by
such counsel, then Indemnitor shall select other counsel for the
defense of Indemnitee, with the fees and expenses to be paid by the
Indemnitor, such other counsel to be approved by Indemnitee and such
approval not to be unreasonably withheld. The indemnity agreement in
this Article VIII shall not apply to amounts paid in settlement of any
loss, claim damage, liability or action if such settlement is effected
without the consent of the Indemnitor, which consent shall not be
withheld unreasonably. The failure to deliver notice to the
Indemnitor within a reasonable time after the commencement of any such
action, if prejudicial to its ability to defend such action, shall
relieve such Indemnitor of any liability to the Indemnitee under this
Article VIII, but the omission so to deliver notice to the Indemnitor
will not relieve it of any liability that it may have to any
Indemnitee otherwise than under this Article VIII. The Indemnities
under this Article VIII, 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.
8.03 INSURANCE. - Licensee shall use best efforts to obtain liability
insurance promptly after the Effective Date and in no event later than
thirty (30) days after the Effective Date. Such liability insurance
shall protect Licensee and Licensor in regard to events covered by
Section 8.01, and the nature and extent of the insurance coverage
shall be commensurate with usual and customary industry practices.
Thereafter, for the term of this Agreement, upon the commencement of
production, sale, or transfer, whichever occurs first, of any Licensed
Product, Licensee shall obtain and carry in full force and effect
liability insurance which shall protect Licensee and Licensor in
regard to events covered by Section 8.01, the nature and extent of
which insurance coverage shall be commensurate with usual and
customary industry practices. Licensee shall name Licensor as an
additional insured and provide Licensor a certificate of insurance
evidencing coverage.
-16-
8.04 WARRANTY. - Except as otherwise expressly set forth in this Agreement,
LICENSOR MAKES NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY
KIND, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO
WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND
VALIDITY OF PATENT RIGHTS' CLAIMS, ISSUED OR PENDING.
IX. TERM; TERMINATION
9.01 TERM AND EXPIRATION. - This Agreement shall be effective as of the
Effective Date and unless terminated earlier pursuant to Section 9.02,
9.03 or 9.04 below, the terms of this Agreement shall continue in
effect on a ***
***
9.02 TERMINATION FOR BREACH - In the event of a material breach by either
Licensor or Licensee of any of the obligations contained in this
Agreement, the other party shall be entitled to terminate this
Agreement by notice in writing under Section 7.01 provided that such
notice shall specify the complained of breach or breaches. If the
said breach or breaches are capable of remedy, the party committing
such breach or breaches shall be entitled to a period of ***
from the delivery of such notice in which to remedy or to undertake to
remedy the same. In the case the defaulting party shall fail to
remedy the breach or to undertake to remedy the breach to the
satisfaction of the injured party, the injured party shall have the
right *** ***
Failure of a party to exercise its rights under this Section 9.02
shall not be construed as a waiver as to future breaches whether or
not they are similar.
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the commission.
-17-
9.03 TERMINATION BY LICENSEE - Licensee may terminate this Agreement, with
respect to:
***
***
Licensee will disclose to Licensor its reasons for any such
termination.
9.04 TERMINATION BY LICENSOR - Licensor shall have the further right to
terminate this Agreement *** on written notice to License if:
***
***
***
***
9.05 ON TERMINATION - Licensee shall, upon termination of this Agreement:
(a) Immediately cease manufacture, use, importation and sale of
License Product;
(b) return to Licensor all copies of documents containing
Confidential Data and any materials received from Licensor under
confidentiality concerning compound, except that Licensee may
retain one (1) copy in its legal files to meet its obligations
hereunder that continue after termination under this Agreement;
(c) make no further use of any kind of any and all technology or
Confidential Data disclosed hereunder by Licensor with respect to
Licensed Product, except to the
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the commission.
-18-
extent such information has become public knowledge other than
through fault of Licensee;
(d) transfer to Licensor all approved and pending NDAs for all
countries within the Territory.
9.06 SURVIVAL OF CERTAIN OBLIGATIONS - The obligations set forth in
Sections 8.01 and 8.02, and Article X, and any obligations otherwise
accrued hereunder as of the date of termination shall survive
termination of this Agreement.
9.07 PAID-UP LICENSE - For each country, upon expiration of Licensee's
obligation to pay royalties pursuant to Section 3.03, License shall
have a fully paid-up, nonexclusive license under any Know-How, to
make, have made, use and sell Licensed Product in that country.
X. CONFIDENTIALITY
10.01 NONDISCLOSURE OBLIGATION. - The parties hereto entered into a
Confidential Disclosure Agreement ("CDA") on December 18, 1995. The
parties hereby agree that this Article X shall supersede and take the
place of the CDA, and that all Confidential Information disclosed by
one party to another, whether in the past or in the future, shall be
governed by the terms and conditions of this Article X. Confidential
Information includes but is not limited to compounds, intermediates,
data, designs, methods and processes, know-how, marketing strategies,
product plans, plans for research, developmental or experimental work,
development tools, financial information, test and safety data, and
supplier lists and information relating to Licensed Product. The
parties hereto agree that all Confidential Information shall be
maintained in confidence by the recipient and shall not be disclosed
by the recipient to any other natural person, or any corporation,
firm, partnership or other business entity, or any government or any
agency or political subdivision thereof, without the prior written
consent of the other party, except to the extent that such
Confidential Information:
-19-
(a) is known by recipient at the time of its receipt, and not through
a prior disclosure by the disclosing party, as documented by
business records;
(b) is properly in the public domain;
(c) is subsequently disclosed to the receiving party by a third party
who may lawfully do so and is not under an obligation of
confidentiality to the disclosing party;
(d) is developed by the receiving party independently of Proprietary
Information or other information received from the other party;
(e) is disclosed to governmental or other regulatory agencies in
order to obtain patents or to gain approval to conduct clinical
trials or to market Licensed Product, but such disclosure may be
only to the extent reasonably necessary to obtain patents or
authorizations;
(f) is necessary or useful to be disclosed to prospective investors,
Sublicensees, agents, consultants, Affiliates and/or other third
parties for the research and development, manufacturing,
marketing and or sale of Licensed Product (or for such parties to
determine their interest in performing such activities) in
accordance with this Agreement on the condition that such third
parties agree to be bound by the confidentiality obligations
contained in this Agreement, provided that the term of
confidentiality for such third parties shall be no less than ten
(10) years; or
(g) is required to be disclosed by law or court order, provided that
notice is promptly delivered to the other party in order to
provide an opportunity to challenge or limit the disclosure,
obligations.
-20-
10.02 USE OF CONFIDENTIAL INFORMATION. Both parties agree that the
Confidential Information shall only be used in connection with the
parties' respective rights and obligations under this Agreement.
10.03 PUBLICATION. During the term of this Agreement, Licensee and Licensor
each acknowledge the other party's interest in publishing its results
to obtain recognition within the scientific community and to advance
the state of scientific knowledge. Each party also recognizes the
mutual interest in obtaining valid patent protection and in protecting
business interests and trade secret information, Consequently, each
party agrees not to disclose Confidential Information of the other
party in publications without the express written consent of the other
party. In addition, the contributions of the parties to the research
shall be expressly noted in such publications or other public
disclosures by acknowledgment or co-authorship, whichever is
appropriate.
XI. MISCELLANEOUS
11.01 MODIFICATIONS - The terms and conditions of this Agreement may not be
amended or modified, except in a writing signed by both parties.
11.02 WAIVER - No failure or delay of either party to exercise any rights or
remedies under this Agreement shall operate as a waiver thereof nor
shall any single, or partial exercise or any rights or remedies
preclude any further or other exercise of the same or any other rights
or remedies with respect to any circumstances to be construed as a
waiver thereof with respect to any other circumstances.
11.03 ASSIGNMENT - Licensee may not assign any of its rights or delegate any
of its duties pursuant to this Agreement without the prior written
consent of Licensor and any attempted assignment without such consent
shall be void.
-21-
11.04 SEVERABILITY - In the event that any provision of this Agreement is
held invalid or unenforceable in any circumstance by a court of
competent jurisdiction, the remainder of this Agreement, and
application of such provision in any other circumstances, shall not be
affected thereby.
11.05 HEADINGS - The headings of articles and sections of this Agreement are
for convenience of reference only and shall not affect the meaning or
interpretation of this Agreement in any way.
11.06 APPLICABLE LAW/JURISDICTION - This Agreement shall be governed by and
construed in accordance with the laws of the *** without
regard to its conflicts of laws principles. Any litigation regarding
this Agreement or performance of obligations in connection therewith
shall be in the courts of the ***
***
11.07 FORCE MAJEURE - Neither party shall be responsible for any loss or
damage resulting from any delay in performing or failure to perform
any provisions of this Agreement, so long as any such failure or delay
arises from fires, floods, storms, earthquakes, civil commotion's,
strikes or other differences with workers or unions, or from any delay
or failure in delivery when the supplies of either party or the
facilities of production, manufacture, transportation or distribution
which otherwise would be available to either party are impaired by
mechanical breakdown or by causes beyond its control or by the order,
requisition, request, or recommendation of any governmental agency or
acting governmental authority, or either party's compliance therewith,
or by governmental regulation.
11.08 ENTIRE AGREEMENT - This Agreement constitutes the entire agreement
between Licensor and Licensee with respect to the subject matter
hereof, and supersedes all proposals,
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the commission.
-22-
oral or written, purchase orders, confidentiality agreements, and all
other communications between the parties with respect to such subject
matter, subject to any moneys due under the purchase orders between
the parties as of the date hereof.
11.09 COUNTERPARTS - This Agreement may be executed in counterparts, and
when each party has signed and delivered at least one counterpart,
each counterpart shall be deemed an original, and, when taken together
with other signed counterparts, shall constitute one Agreement, which
shall be binding upon and effective as to both parties.
11.10 USE OF NAMES - This Agreement does not confer any right to use the
name, tradename, trademark or other designation of either party.
11.11 INDEPENDENT CONTRACTORS - At all times during the term of this
Agreement, each party shall act as an independent contractor and
neither the making of this Agreement nor the performance of any of the
provisions hereof shall be construed to make one party an agent,
employee or legal representative of another party for any purpose, nor
shall this Agreement be deemed to establish a joint venture or
partnership.
11.12 REPRESENTATIONS AND WARRANTIES - Each party represents and warrants to
the other that it has the full right and authority to enter into this
Agreement, and that it is not aware of any impediment which would
inhibit its ability to perform the terms and conditions imposed on it
by such Agreement.
11.13 PUBLICITY - Each party will provide the other with a copy of any draft
press release covering the subject matter of this Agreement at least
one business day before issuance and in the case of a press release
covering the initial announcement of this Agreement, at least three
(3) business days before issuance - unless in the opinion of counsel
such delay in the issuance of the press release would result in a
violation of the securities law or other applicable law. Each party
will give due regard to comments, if any, made by the other party in
response to a draft release. Neither party may use the
-23-
name of the other party or the other party's divisions affiliates,
subsidiaries, or products to imply an endorsement, without the written
consent of such other party.
IN WITNESS WHEREOF, the parties intending to be bound have duly executed this
Agreement in duplicate by their appropriate authorized representative.
THE DUPONT MERCK AVID CORPORATION
PHARMACEUTICAL COMPANY
/s/ illegible /s/ illegible
- ----------------------------- -----------------------------
By By
President and CEO Executive Vice Pres
- ----------------------------- -----------------------------
Title Title
December 18, 1996 December 18, 1996
- ----------------------------- -----------------------------
Date Date
-24-
SCHEDULE A
DOCKET NO.: DM-6566-E
TITLE: Substituted Cyclic Carbonyls and Derivatives Thereof Useful as
Retroviral Protease Inhibitors
- -------------------------------------------------------------------------------
COUNTRY APPLN NO. APPLN DATE STATUS PATENT NO. ISSUE DATE EXPIRY DATE
- -------------------------------------------------------------------------------
US 08/197,630 2/16/94 Allowed
- -------------------------------------------------------------------------------
1 of 6
SCHEDULE A
DOCKET NO.: DM-6566-B
TITLE: Substituted Cyclic Carbonyls and Derivatives Thereof Useful as
Retroviral Protease Inhibitors
FOREIGN FAMILY FOR DM-6566-E
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COUNTRY APPLN NO. APPLN DATE STATUS PATENT NO. ISSUE DATE EXPIRY DATE
- -------------------------------------------------------------------------------
ASTL 94/061808 10/13/92 Pending
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ATRA unknown 10/13/92 Pending
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BELG unknown 10/13/92 Pending
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BRAZ PI9206623-2 10/13/92 Pending
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CANA 2120925 10/13/92 Pending
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CZEC PV00814-94 10/13/92 Pending
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DENM unknown 10/13/92 Pending
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EPC 92922262.8 10/13/92 Pending
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FINL 94/001649 10/13/92 Pending
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FRAN unknown 10/13/92 Pending
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GBRI unknown 10/13/92 Pending
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GERM unknown 10/13/92 Pending
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GREC unknown 10/13/92 Pending
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HUNG P94/01020 10/13/92 Pending
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IREL unknown 10/13/92 Pending
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ITAL unknown 10/13/92 Pending
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JAPA 93/507244 04/11/94 Pending
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KORS 94/701169 10/13/92 Pending
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LUXE unknown 10/13/92 Pending
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NETH unknown 10/13/92 Pending
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NORW 94/001278 10/13/92 Pending
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PCT US92/08749 10/13/92 (Pending)
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RUSS 94/031126 10/13/92 Pending
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SLVK PV00407-94 10/13/92 Pending
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SPAI unknown 10/13/92 Pending
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SWED unknown 10/13/92 Pending
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SWIT unknown 10/13/92 Pending
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2 of 6
SCHEDULE A
DOCKET NO.: DM-6681
TITLE: Method of Treating Human Immunodeficiency Virus Infection Using a
Cyclic Protease Inhibitor in Combination with a Reverse Transcriptase
Inhibitor
- -------------------------------------------------------------------------------
COUNTRY APPLN NO. APPLN DATE STATUS PATENT NO. ISSUE DATE EXPIRY DATE
- -------------------------------------------------------------------------------
US 08/110,603 8/26/93 Allowed
- -------------------------------------------------------------------------------
3 of 6
SCHEDULE A
DOCKET NO.: DM-6663
TITLE: Improved Pharmaceutical Formulations of Cyclic Urea Type Compounds
- -------------------------------------------------------------------------------
COUNTRY APPLN NO. APPLN DATE STATUS PATENT NO. ISSUE DATE EXPIRY DATE
- -------------------------------------------------------------------------------
US 08/208,243 3/9/94 Granted 5,559,110 9/24/96 3/9/2014
- -------------------------------------------------------------------------------
4 of 6
SCHEDULE A
DOCKET NO.: DM-6751
TITLE: Method for Preparing N,N'-Disubstituted Cyclic Ureas
- -------------------------------------------------------------------------------
COUNTRY APPLN NO. APPLN DATE STATUS PATENT NO. ISSUE DATE EXPIRY DATE
- -------------------------------------------------------------------------------
US 08/469409 6/6/95 Granted 5,532,356 7/2/96 6/6/2015
- -------------------------------------------------------------------------------
5 of 6
SCHEDULE A
DOCKET NO.: ***
TITLE: ***
FOREIGN FAMILY FOR ***
- -------------------------------------------------------------------------------
COUNTRY APPLN NO. APPLN DATE STATUS PATENT NO. ISSUE DATE EXPIRY DATE
- -------------------------------------------------------------------------------
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6 of 6
SCHEDULE B
DMP 450 DEVELOPMENT TIME LINE (1)
***
***
***
***
***
*** Portions of this page have been omitted pursuant to a request for
Confidential Treatment and filed separately with the commission.