Exhibit 10.3

20 December 2012

ELAN CORPORATION PLC

AND

PROTHENA CORPORATION PLC

RESEARCH AND DEVELOPMENT SERVICES

AGREEMENT

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Contents

 

   Clause      Page    1.    Interpretation      1    2.    Projects      4   
3.    Services      4    4.    Governance      5    5.    Payments      5    6.
   Intellectual Property Rights and Publication:      6    7.    Confidentiality
     7    8.    Warranties      7    9.    Insurance      8    10.    Dispute
Resolution      8    11.    Data Protection      8    12.    Term and
Termination      8    13.    Liability      9    14.    Personnel      9    15.
   Force Majeure      10    16.    Assignment      10    17.    Relationship
between the parties      10    18.    Notices      11    19.    Variation     
12    20.    Waiver      12    21.    Rights Cumulative      12    22.   
Severability      12    23.    Entire Agreement      12    24.    Survival     
12    25.    Further Assurances      12    26.    Governing Law and Jurisdiction
     12   

Schedule 1—Prothena Services

Schedule 2—Charges

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This Agreement is made on 20 December 2012

Between

 

(1) Elan Corporation Plc a public limited company incorporated in Ireland, with
registered number 30356 having its registered office at Treasury Building, Lower
Grand Canal Street, Dublin 2, Ireland (Elan); and

 

(2) Prothena Corporation Plc a public limited company incorporated in Ireland
with registered number 518146 having its registered office is at 25-28 North
Wall Quay, Dublin 2, Ireland (Prothena).

(each a Party, together the Parties)

Whereas

 

A. Elan has entered into an agreement with Prothena dated 8 November 2012 (the
“Demerger Agreement”) whereby Elan has transferred to Prothena the Prothena
Business (as defined in the Demerger Agreement) which comprises the biotechnogy
business focused on the discovery and development of novel antibodies for the
potential treatment of a broad range of diseases.

 

B. Elan and Prothena have agreed to enter into this agreement in accordance with
the terms of the Demerger Agreement in order to make available to Elan certain
of Prothena’s resources and services on the terms and conditions and subject to
the limitations herein with a view to conducting research and development to
identify potential therapeutics or potential targets for intervention for the
Projects.

It is agreed

 

1. Interpretation

 

1.1. In this Agreement:

Affiliate means, in relation to either party, any company which is for the time
being a holding company of that party or a subsidiary of that party or of any
such holding company (as defined in section 155 of the Companies Act 1963 (as
amended)).

Applicable Law means:

 

  (a) any statute, regulation, by law, ordinance or subordinate legislation
which is in force for the time being to which a party is subject;

  (b) the common law as applicable to the parties (or any one of them);

  (c) any binding court order, judgment or decree applicable to the parties (or
any one of them); and

  (d) any applicable industry code, policy, guidance, standard or accreditation
terms (i) enforceable by law which is in force for the time being, and/or
(ii) stipulated by any regulatory authority to which any party is subject.

Background Intellectual Property means, in respect of any party, any
Intellectual Property (other than Foreground Intellectual Property) which is
owned by or licensed to such party before the Effective Date or is later
developed or otherwise acquired by such party independently of performing its
obligations under this Agreement and which is used or is required for use in
connection with any Project or services contemplated under this Agreement.

Business Day means a day other than a Saturday, Sunday or public holiday in
Ireland

Charges has the meaning given to it in clause 5.1 .

Completion has the meaning given to it in the Demerger Agreement

Confidential Information means the confidential information more particularly
described in clause 7.

Data means, in respect of either party, all data or records of whatever nature
and whatever form (including Personal Data) relating to the business, clients,
potential clients or employees of that party, whether subsisting before the date
of this Agreement or as created or processed as part of, or in connection with,
any Project or Services.

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Dispute means any dispute or difference arising out of or in connection with
this Agreement.

Data Protection Law means the Data Protection Acts 1988 and 2003 or any other
similar Applicable Law and where Data Controller Data Processor and Personal
Data or Processing are referred to in this Agreement they shall have the
respective meanings set out in Data Protection Law.

Effective Date means the date of Completion.

Fixed Charge has the meaning given to it in Schedule 2.

Final Report means a written report prepared and agreed by Elan and Prothena at
the completion of a Project, as more fully described in clause 4.4.

Foreground Intellectual Property means any Intellectual Property that is
specifically related to any Project that arises or is created in the course of
or in connection with any Project and (i) has no applicability to the Prothena
Business (“Elan Foreground IP”); or (ii) has applicability to the Prothena
Business (“Prothena Foreground IP”) which Intellectual Property arises or is
created in the course of or in connection with the provision of the Prothena
Services, including adaptations, amendments, variations and derivatives to the
other party’s Background Intellectual Property.

Full Time Equivalent or FTE has the meaning given to it in Schedule 2

Good Industry Practice means the exercise of that degree of reasonable skill,
diligence, prudence and foresight which would be expected from a skilled and
experienced provider of services similar to the Prothena Services, seeking in
good faith to comply with its contractual obligations including, without
limitation compliance with all Applicable Laws.

Insolvency Event means in respect of a party (the Affected Party):

 

  (a) if the Affected Party enters into liquidation whether compulsory or
voluntary (other than for the purposes of amalgamation or reconstruction
approved in writing by the former party on the basis that the resulting company
undertakes that other party’s obligations under this Agreement and is
commercially acceptable to the former party which approval shall not be
unreasonably withheld or delayed); or

 

  (b) if the Affected Party has a receiver or administrative receiver or
administrator or similar official appointed over all or any of its assets and
not discharged within a period of thirty (30) days; or

 

  (c) if the Affected Party is declared insolvent or makes any general
composition with its creditors; or

 

  (d) if the Affected Party ceases or threatens to cease to carry on the whole
or any material part of its business and any such cessation, in the reasonable
opinion of the party terminating this Agreement, would be likely to affect
adversely the other party’s ability to observe and perform properly and
punctually all or any of its obligations under or pursuant to this Agreement.

Intellectual Property means all (a) inventions (whether or not patentable and
whether or not reduced to practice), records of inventions, test information,
developments, applications, improvements, formulae, concepts, ideas, methods or
processes, research property rights, all improvements to any of the foregoing,
and all Patents, (b) Trademark Rights and all copyrightable works,
(c) copyrights, and all applications, registrations, and renewals in connection
therewith, (d) trade secrets, know-how rights and confidential information
(including all ideas, concepts, research and development, know-how, composition
information and embodiments, manufacturing and production processes, techniques
and information, specifications, technical and business data, designs, drawings,
supplier lists, pricing and cost information, and data and know-how embodied in
business and marketing plans and proposals), (e) computer software, firmware and
applications (including source code, executable code, data, databases,
programming and notes and documents and other related documentation) , (f) works
and designs embodied in advertising and promotional materials, (g) other
proprietary rights and (h) copies and tangible embodiments of the foregoing in
whatever form or medium.

 

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Mark-Up has the meaning given to it in Schedule 2.

Monthly Report has the meaning given to it in Schedule 2.

Owning Party means: (a) in the case of any Elan Background Intellectual
Property, Elan; (b) in the case of any Prothena Background Intellectual
Property, Prothena; and (c) in the case of Elan Foreground IP, Elan and (d) in
the case of Prothena Foreground IP, Prothena

Person means any individual, firm, partnership, company, corporation, government
authority or other entity.

Personnel means any individuals engaged in the provision of the Prothena
Services on behalf of a party, including any employees, agents and
sub-contractors of that party.

Processing means obtaining, recording or holding Personal Data or carrying out
any operation or set of operations on Personal Data.

Project(s) means research and development activity in support of the programs
referred to in Schedule 1.

Project Manager means the person to be appointed in accordance with clause 4.1.

Project Plan means the project plan agreed to by the parties in respect of each
Project.

Prothena Services means those services more particularly described in Schedule1
provided that any “Prothena Services” shall be substantially similar to services
provided, prior to Completion, by Prothena to Elan in conducting the Prothena
Business.

Research Costs has the meaning given to it in Schedule 2

Term means the term of this Agreement as set out in clause 12.

Third Party Contract has the meaning as set out in clause 3.6.

Trademark Rights All trademarks, trademark rights, service marks, service mark
rights, trade dress, logos, slogans, trade names, trade name rights, Internet
domain names and subdomains (including all website content associated
therewith), together with all translations, adaptations, derivations, and
combinations thereof and including all goodwill associated therewith, and all
applications, registrations, and renewals in connection therewith.

Variable Charge has the meaning given to it in Schedule 2.

 

1.2. In this Agreement, unless the context otherwise requires:

 

  (a) any recitals and schedules form part of this Agreement and references to
this Agreement include them;

 

  (b) references to recitals, clauses and schedules are to recitals and clauses
of, and schedules to, this Agreement and references in a schedule or part of a
schedule to paragraphs are to paragraphs of that schedule or that part of that
schedule;

 

  (c) references to this Agreement or any other document are to this Agreement
or that document as in force for the time being and as amended from time to time
in accordance with this Agreement or that document (as the case may be);

 

  (d) words importing a gender include every gender, references to the singular
include the plural and vice versa and words denoting persons include individuals
and bodies corporate, partnerships, unincorporated associations and other bodies
(in each case, wherever resident and for whatever purpose) and vice versa; and

 

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  (e) a reference to a statute, statutory provision or subordinate legislation
(as so defined) shall be construed as including a reference to that statute,
provision or subordinate legislation as in force at the date of this Agreement
and as from time to time modified or consolidated, superseded, re-enacted or
replaced (whether with or without modification) after the date of this
Agreement).

 

1.3. The headings and contents table in this Agreement are for convenience only
and do not affect its interpretation. The schedules to this Agreement shall form
part of this Agreement.

 

1.4. If there is a conflict or inconsistency between any clause of, and any
schedule to, this Agreement the clause prevails. For this purpose an omission
(whether deliberate or inadvertent) is not, by itself, to be construed as giving
rise to a conflict or inconsistency.

 

1.5. In this Agreement the words “other”, “includes”, “including” and “in
particular” do not limit the generality of any preceding words and any words
which follow them shall not be construed as being limited in scope to the same
class as the preceding words where a wider construction is possible.

 

2. Projects

 

2.1. Elan and Prothena agree to undertake the Projects

 

3. Services

 

3.1. Prothena shall provide two FTE’s worth of effort per year in performance of
the Prothena Services for the benefit of Elan and its Affiliates.

 

3.2. In respect of the Prothena Services, Prothena is appointed by Elan under
this Agreement as the non-exclusive provider of the Prothena Services and
nothing in this Agreement prevents Elan or any of its Affiliates from acquiring
the Prothena Services or services similar to the Prothena Services in any
territory from any third party or from performing any such services for itself
internally. Each Person who performs the Prothena Services shall be an employee
of Prothena (or an Affiliate thereof) under Applicable Law, and, at all times,
shall perform the Prothena Services solely at the direction of such Person’s
employer.

 

3.3. Prothena shall develop the Project Plan for the applicable Project, which
Project Plan shall include a reasonable timetable and shall be agreed in writing
by the parties. Prothena will deliver an appropriate draft Project Plan to Elan
within one month of Elan’s request.

 

3.4. Prothena shall perform all of its obligations under this Agreement,
including the provision of the Prothena Services:

(a) in accordance with any applicable Project Plan;

(b) in accordance with Good Industry Practice; and

(c) in compliance with all Applicable Laws.

 

3.5. Prothena shall provide the Prothena Services in a timely manner and in
accordance with any timetable identified in the applicable Project Plan. If at
any time, Prothena believes that any of its obligations will not, or are
unlikely to, be met in accordance with the timetable in the Project Plan, it
shall as soon as reasonably practical:

(a) inform Elan in writing of the reasons for not meeting, or being unable to
meet, the timetable in the Project Plan;

(b) inform Elan in writing of the consequences of not meeting the timetable in
the Project Plan; and

(c) take all steps reasonably necessary, including all additional resources, to
mitigate such failure and to ensure the timetable in the Project Plan is met as
soon as reasonably practical.

 

3.6.

Where the Prothena Services require contracting with a third party (“Third Party
Contract”), such Third Party Contract shall be entered into between Elan and
such third party and Prothena shall not be

 

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a party thereto. Invoices for a Third Party Contract shall be sent to and paid
by Elan and Prothena shall have no responsibility with regard the charges
incurred thereunder. Elan shall be responsible for maintaining all data
generated under such Third Party Contract. For the avoidance of doubt Prothena
shall not be responsible for meeting its timetable in the Project Plan or the
reporting obligations at clause 3.5 where the Prothena Services require a Third
Party Contract and Elan, without bona fide reason, unduly delays entering into a
Third Party Contract

 

4. Governance

 

4.1. The parties shall each appoint a Project Manager to assume overall
responsibility for their respective roles and obligations under this Agreement.
The parties’ respective Project Managers will be responsible for:

 

  (a) co-ordinating all development work in respect of each Project, including
overseeing the performance and quality of the Project and completion of any
milestones;

 

  (b) arranging and attending (personally or by representative), at each party’s
own cost, management meetings as described in clause 4.5 and other meetings, at
intervals and locations as agreed between the parties from time to time, to
discuss developments and seek to resolve any issues arising. The parties’
respective Project Managers shall use reasonable endeavours to resolve issues
arising under this Agreement, but shall refer all problems which are outside
their ordinary authority to resolve to appropriate members of the parties’
respective senior management;

 

  (c) co-ordinating day to day liaison between the parties;

 

  (d) co-ordinating the preparation of the Final Reports; and

 

  (e) co-ordinating the identification of any Foreground Intellectual Property
created or developed, or to be created or developed, in the course of any
Project, prior to or as soon as reasonably practicable following creation or
development of the same in the course of any Project.

 

4.2. Either party may replace its appointed Project Manager at any time on prior
written notice to the other party.

 

4.3. Each party shall permit the other’s Project Manager (and other duly
authorised representatives) such access to its premises at which any Project is
being conducted as may be reasonably appropriate having regard to the nature and
progress of such Project at any time.

 

4.4. On completion of each Project, the parties shall jointly inspect and
evaluate the work performed and shall jointly produce and sign a Final Report in
respect of the Project, incorporating such matters and details as may be agreed
between the parties from time to time.

 

4.5. The parties agree, at least once every 12 months during the term hereof, or
at such other intervals, and at such locations, including by teleconference, as
may be agreed between them from time to time, to procure that their respective
Project Managers meet (each such meeting a Management Meeting) to discuss and
review the progress and status of any Project performed hereunder, and consider
proposals and agree actions in relation to the same with a view to ensuring the
due and proper completion of all Projects in accordance with such dates and
quality standards as may be agreed between the parties. Minutes of each
management meeting are to be prepared by Elan and agreed by both Project
Managers.

 

5. Payments

 

5.1. As compensation for the Prothena Services to be provided hereunder, Elan
(or an Affiliate nominated by them) shall pay Prothena the charges in the amount
and in accordance with Schedule 2 (the “Charges”).

 

5.2. Unless otherwise stated (including in the relevant Schedules), Prothena
shall invoice Elan (or an Affiliate nominated by them) monthly in arrears in
respect of the Charges and the Charges shall be due and payable in US Dollars
within thirty (30) days after the receipt of such invoice.

 

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5.3. Reasonable travel and expense costs shall be reimbursed by Elan (or an
Affiliate nominated by them) to any Prothena employee on the assigned Prothena
Services (only if such persons home is based outside a 75 mile radius from the
relevant Elan premises or designated work location, unless otherwise negotiated
and agreed in writing).

 

5.4. Unless otherwise expressly stated between the parties, the Charges and
other such amounts expressed to be payable by Elan under this Agreement shall
constitute Elan’s entire payment liability under this Agreement.

 

5.5. All amounts stated to be payable under this Agreement are stated as
exclusive of any VAT chargeable on them, which shall be paid by the paying party
at the rate and in the manner prescribed in law from time to time.

 

5.6. If Elan (or an Affiliate nominated by them) receives an invoice from
Prothena which it disputes in good faith, Elan shall notify Prothena in writing
of such dispute as soon as reasonably practicable and Elan may withhold payment
of such sums as are in dispute pending resolution of such dispute.

 

5.7. Each party shall be entitled to receive interest on any payment not made to
it when properly due to it pursuant to the terms of this Agreement, calculated
from day to day at a rate per annum equal to 2% above the providing base rate of
the European Central Bank and payable from the day after date on which payment
was due up to and including the date of payment.

 

6. Intellectual Property Rights and Publication:

 

6.1. All Background Intellectual Property is and shall remain the exclusive
property of the party owning it (or, where applicable, the third party from whom
its right to use the Background Intellectual Property has derived).

 

6.2. Each party shall grant to the other party for the duration of this
Agreement a non-exclusive, non transferable (without the right to sub-licence)
licence to use its Background Intellectual Property solely to the extent
necessary for the other party to carry out its obligations under this Agreement.

 

6.3. Unless otherwise provided all right, title and interest (including
copyright and database right) in and to each party’s Data shall remain the
absolute property of that party at all times.

 

6.4. With the exception of Foreground Intellectual Property (below), each party
hereby assigns to the other party, all present and future right, title and
interest being capable of assignment it may acquire in and to any adaptations,
amendments, variations and derivatives that it makes to the other party’s
Background Intellectual Property or that have been created or developed by the
other party or on its behalf.

 

6.5. If during the term of this Agreement Prothena (or its authorised
sub-contractors) develop or create (whether with or without others and whether
jointly with the other party or not) any Foreground Intellectual Property, they
shall promptly disclose any such Foreground Intellectual Property to Elan.

 

6.6. Unless the parties otherwise agree in writing:

 

  (a) Elan Foreground Intellectual Property shall be owned by Elan, provided,
however that Elan hereby grants Prothena a non-exclusive royalty free license to
such Foreground Intellectual Property Rights solely for research purposes.

  (b) Prothena Foreground IP shall be owned by Prothena, provided, however, that
Prothena hereby grants Elan an exclusive royalty free licence solely for the
research, development and commercialization of ELND-005 and ELND-002, including
the right to make, have made, use, offer for sale, sell, have sold, import and
have imported ELND-005 and ELND-002.

 

6.7. The Owning Party shall have sole responsibility for the filing,
prosecution, maintenance and enforcement of its Foreground Intellectual
Property. Upon Elan’s request and at Elan’s expense, Prothena will undertake
such actions as requested by Elan to secure for the benefit of Elan such
Prothena Foreground IP as provided for by clause 6.6.

 

6.8

Subject to the remainder of this clause 6.8, Elan shall, at its own expense,
defend or at its option settle any action brought against Prothena which
consists of a claim that the use of Elan’s Background Intellectual Property or
Foreground Intellectual Property within the scope of any activity contemplated

 

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  under this Agreement infringes any Intellectual Property right belonging to a
third party, and Elan agrees to be responsible for all and indemnify Prothena
against all losses, costs (including reasonable legal costs), damages,
liabilities, claims and expenses suffered or incurred by Prothena in connection
with any such claim. Elan’s obligations under this clause 6.8 shall be
conditional on Prothena:

 

  (a) promptly notifying Elan of such claim;

 

  (b) giving Elan express authority to proceed as contemplated by this clause
6.8; and

 

  (c) providing Elan with all such available information and assistance as it
may reasonably require in responding to such claim.

 

6.9 Elan agrees to reasonably consider Prothena’s request to publish results of
the Prothena Services subject to the remaining obligations of this clause 6 and
the obligations of clause 7, and to provide the relevant Personnel with
appropriate byline credit in any publication proposed by Elan according to
generally accepted standards for authorship.

 

7. Confidentiality

 

7.1. The parties each undertake to keep confidential and not to disclose to any
third party nor to use themselves other than for the purposes of the Projects or
as permitted under or in accordance with this Agreement (including for the
purpose of enjoying the benefit of the rights and licences granted under clause
6) any confidential or secret information in any form directly or indirectly
belonging or relating to the other, its Affiliates, its or their business or
affairs, disclosed by the one and received by the other pursuant to or in the
course of this Agreement or any Project, including without limitation any
Background Intellectual Property of the other or Foreground Intellectual
Property of the other, and the existence and terms of this Agreement
(Confidential Information).

 

7.2. Each of the parties undertakes to disclose Confidential Information of the
other only to those of its officers, employees, agents and contractors, to whom
and to the extent to which, such disclosure is necessary for the purposes
contemplated under this Agreement.

 

7.3. The obligations contained in this clause 7 shall survive the expiry or
termination of this Agreement for any a period of seven (7) years but shall not
apply to any Confidential Information which:

 

  (a) is publicly known at the time of disclosure to the receiving party;

 

  (b) after disclosure becomes publicly known otherwise than through a breach of
this Agreement by the receiving party, its officers, employees, agents or
contractors;

 

  (c) can be proved by the receiving party to have reached its hands otherwise
than by being communicated by the other party including being known to it prior
to disclosure, or having been developed by or for it wholly independently of the
other party or having been obtained from a third party without any restriction
on disclosure on such third party of which the recipient is aware, having made
due enquiry; or

 

  (d) is required by law, regulation or order of a competent authority
(including any regulatory or governmental body or securities exchange) to be
disclosed by the receiving party, provided that, where practicable, the
disclosing party is given reasonable advance notice of the intended disclosure.

 

8. Warranties

 

  (a) Each party warrants that it has full power and authority to carry out the
actions contemplated under this Agreement, and that its entry into and
performance under the terms of this Agreement will not infringe the rights of
any third party or cause it to be in breach of any obligations to a third party.

 

  (b) Prothena warrants that it shall perform the Projects in a professional
manner with reasonable skill and care, using suitably qualified personnel, and
shall use commercially reasonable endeavours to achieve the objectives of each
Project;

 

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  (c) Each party warrants that all information, data and materials provided by
it to the other hereunder will be, to the best of its knowledge, accurate and
complete in all material respects, and it is entitled to provide the same to the
other without recourse to any third party;

 

9. Insurance

 

9.1. Prothena will at all times during the term of this Agreement, maintain in
force and effect at its own expense with a reputable insurance company, public
and employers’ liability insurance and professional indemnity insurance, each
for a minimum level of cover of $2 million which shall remain in effect
throughout this Agreement and for 6 years after termination subject to cover
availability.

 

10. Dispute Resolution

 

10.1. Where at any point during the Term of this Agreement any matter relating
to this Agreement cannot be agreed by the Parties, it shall be escalated as
follows:

 

  (a) the matter shall be referred as soon as practicable to the Project Manager
for resolution; and

 

  (b) if the matter has not been resolved within ten (10) Business Days (or such
longer period as may be agreed in writing by the Parties) of being referred to
the Project Manager or if the Project Manager determines it is incapable of
being resolved at that level, then the matter shall be immediately referred to
the Chief Executive Officer of Prothena and the Chief Executive Officer of Elan;
and

 

  (c) if after the expiry of 30 Business Days from the time the matter in
dispute was referred to the CEO of each of Elan and Prothena the matter remains
unresolved, the Parties shall refer the matter to non-binding mediation in
accordance with the procedure set out in clause 21.3.1 of the Demerger
Agreement.

 

  (d) in the event that:-

 

  (1) having been so requested, the mediation does not commence within 20
Business Days of the request for mediation; or

 

  (2) a binding settlement in writing is not reached within a period of 60
Business Days after the delivery of a written request for mediation;

 

  (e) and, in any such case, the dispute or difference referred to in this
clause 10 remains unresolved, the Parties (or the relevant one of them) shall
then be entitled to instigate legal proceedings

 

10.2. Any joint decision as to a resolution at any stage in the above process
shall be recorded in writing and signed on behalf of each Party and shall be
final and binding on the Parties.

 

11. Data Protection

 

11.1. The parties shall at all times comply with the provisions of the Data
Protection Law in their Processing of Personal Data including, without
limitation, ensuring that appropriate technical and organisational measures are
taken against unauthorised or unlawful processing of the Personal Data and
against accidental loss or destruction of, or damage to the Personal Data.

 

12. Term and Termination

 

12.1. This Agreement shall come into effect on the Effective Date and, subject
to the remaining terms of this Agreement, shall continue in full force and
effect for a period of two (2) years unless the parties agree in writing to
extend this Agreement.

 

12.2. Either party (the first party) shall be entitled to terminate this
Agreement at any time by notice in writing to the other (the other party) if:

 

  (a) the other party is in material breach of this Agreement which breach is
irremediable or, if remediable, is not remedied by the defaulting party within
thirty (30) days of being requested to do so by the other;

 

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  (b) the other party is subject to an Insolvency Event; or

 

  (c) the other party is in breach of any of its confidentiality obligations
under clause 7

 

12.3. Termination in accordance with this clause 12 shall be without prejudice
to the rights of the parties accrued at the date of termination.

 

12.4. Upon termination of any licences hereunder in accordance with this
Agreement each party shall forthwith destroy or, at the request of the other
party, return all information and materials belonging to the other party then in
its or its contractors’ possession, custody or control, including all
Confidential Information of the other party relating to such licences with the
exception, in the case of the Terminating Party, of such information and
materials belonging to the Defaulting Party as shall be reasonably required by
the Terminating Party to enjoy the benefit of any continuing licences to it
hereunder, and shall not retain any copies of the same except that either party
may retain copies of information in its back up electronic systems.

 

13. Liability

 

13.1. Nothing in this Agreement shall limit the liability of either party for:

 

  (a) fraud or fraudulent misrepresentation;

 

  (b) for death or personal injury caused by its negligence or the negligence of
its employees, contractors or agents;

 

  (c) any liability which cannot be excluded or limited by law.

 

13.2 Subject to Clause 13.1, no party shall be liable to another party for any
indirect or consequential loss or damage even if foreseeable or if such party
has been advised of the possibility of such losses.

 

13.3 Subject to Clause 13.1, the total liability of either party arising under
or in connection with this Agreement, whether in tort (including negligence),
contract, representation (other than fraudulent misrepresentations) or otherwise
or for loss (whether direct, indirect or consequential) of business, profits,
use, revenue, data, anticipated savings or goodwill shall be limited to
USD$500,000.

 

13.4 Prothena shall not be liable for any failure to provide, or for any delay
in the provision of, any of the Prothena Services to the extent that such
failure or delay is directly caused or is contributed to directly by any failure
of a third party service provider to provide an element of the Prothena
Services.

 

14. Personnel

 

14.1 Prothena shall appoint Personnel to perform the Prothena Services who shall
have the experience and knowledge to provide the applicable Prothena Services in
accordance with Good Industry Practice.

 

14.2 If Elan reasonably determines at any time that a member of the Personnel is
not suitable for involvement in the provision of the Prothena Services, it shall
notify the other party in writing detailing the reasons for its determination.
Where, following any reasonable consultation between Elan and Prothena regarding
the said notification, Elan and Prothena agree that the relevant member of the
Personnel is not or is no longer suitable for involvement in the provision of
the Prothena Services, Prothena shall take or procure that reasonable steps are
taken in accordance with its established human resources procedure and
Applicable Law to remove the relevant person from his or her position as a
member of the Personnel as soon as reasonably practicable. In the event that
Elan and Prothena do not agree that a relevant member of the Personnel is no
longer suitable, then such matter shall be managed in accordance with clause 10.

 

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  15. Force Majeure

 

15.1. Neither party shall be liable for any delay in performing or for failure
to perform its obligations hereunder if the delay or failure results from any
cause or circumstance whatsoever beyond its reasonable control, including any
breach or non-performance of this Agreement by the other party (hereinafter
event of force majeure), provided the same arises without the fault or
negligence of such party. If an event of force majeure occurs, the date(s) for
performance of the obligation affected shall be postponed for as long as is made
necessary by the event of force majeure, provided that if any event of force
majeure continues for a period of or exceeding three (3) months, either party
shall have the right to terminate this Agreement forthwith by written notice to
the other party. Each party shall use its reasonable endeavours to minimise the
effects of any event of force majeure.

 

16. Assignment

This Agreement shall be binding upon and inure to the benefit of Prothena and
Elan and their respective successors and permitted assigns. Neither party may
assign all or any part of any benefit of or interest, right or licence in or
arising under this Agreement without the prior written consent of the other
party, provided, however, that either party may, without prior notice or
consent, assign this Agreement and/or the rights and obligations thereunder to
an Affiliate or, in connection with the transfer or sale of all or substantially
all of its business related to the subject matter of this Agreement, or in the
event of a change in control, merger, acquisition, consolidation or similar
transaction, to a third party. Any purported assignment or transfer in violation
of this Clause 16 shall be void.

 

17. Relationship between the parties

 

17.1. Nothing in this Agreement is to be construed as establishing or implying
any partnership or joint venture between the parties, or as appointing any party
as the agent or employee of any other party. No party shall hold out any other
party as its partner or joint venturer. Except, and to the extent, that this
Agreement expressly states otherwise, no party may incur any expenses or
negotiate on behalf of any other party or commit any other party in any way to
any person without that other party’s prior written consent.

 

18. Notices

All notices to be given to a party under this Agreement shall be in writing in
English detailed for the party below, and sent by overnight courier, first class
prepaid post, or by other means of delivery requiring an acknowledged receipt.
All notices shall be effective upon receipt.

 

  (a) in the case of Elan:

Address:         Treasury Building, Lower Grand Canal Street, Dublin 2, Ireland

Attention:       Company Secretary

 

  (b) in the case of Prothena:

Address:         [Note: Prothena to insert]

Attention:        ¿

A party may change the details recorded for it in this clause by notice to the
other in accordance with this clause 18.

 

18.2. A notice shall be treated as having been received:

 

  (a) if delivered by hand between 9.00 am and 5.00 pm on a Business Day (which
time period is referred to in this clause as Business Hours), when so delivered;
and if delivered by hand outside Business Hours, at the next start of Business
Hours; and

 

  (b) if sent by first class post, at 9.00 am on the second Business Day after
posting if posted on a Business Day and at 9.00 am on the third Business Day
after posting if not posted on a Business Day.

 

18.3. In proving that a notice has been given it shall be conclusive evidence to
prove that delivery was made, or that the envelope containing the notice was
properly addressed and posted (as the case may be).

 

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19. Variation

No variation of this Agreement shall be effective unless it is in writing and is
signed by or on behalf of each of the parties.

 

20. Waiver

Delay in exercising, or failure to exercise, any right or remedy in connection
with this Agreement shall not operate as a waiver of that right or remedy. The
waiver of a right to require compliance with any provision of this Agreement in
any instance shall not operate as a waiver of any further exercise or
enforcement of that right and the waiver of any breach shall not operate as a
waiver of any subsequent breach. No waiver in connection with this Agreement
shall, in any event, be effective unless it is in writing, refers expressly to
this clause, is duly signed by or on behalf of the party granting it and is
communicated to the other party in accordance with clause 18 (Notices).

 

21. Rights Cumulative

The rights and remedies of the parties in connection with this Agreement are
cumulative and, except as expressly stated in this Agreement, are not exclusive
of any other rights or remedies provided by law or equity or otherwise. Except
as expressly stated in this Agreement (or at law or in equity in the case or
rights and remedies provided by law or equity) any right or remedy may be
exercised (wholly or partially) from time to time.

 

22. Severability

The parties intend each provision of this Agreement to be severable and distinct
from the others. If a provision of this Agreement is held to be illegal, invalid
or unenforceable, in whole or in part, the parties intend that the legality,
validity and enforceability of the remainder of this Agreement shall not be
affected.

 

23. Entire Agreement

 

23.1 This Agreement (together with all other documents to be entered into
pursuant to it) sets out the entire agreement and understanding between the
parties, and supersedes all proposals and prior agreements, arrangements and
understandings between the parties, relating to its subject matter.

 

23.2 Each party acknowledges that in entering into this Agreement (and any other
document to be entered into pursuant to it) it does not rely on any
representation, warranty, collateral contract or other assurance of any person
(whether party to this Agreement or not) that is not set out in this Agreement
or the documents referred to in it. Each party waives all rights and remedies
which, but for this clause, might otherwise be available to it in respect of any
such representation, warranty, collateral contract or other assurance. The only
remedy available to any party in respect of any representation, warranty,
collateral contract or other assurance that is set out in this Agreement (or any
document referred to in it) is for breach of contract under the terms of this
Agreement (or the relevant document). Nothing in this Agreement shall, however,
limit or exclude any liability for fraud.

 

24. Survival

Termination of this Agreement for any reason shall not affect any rights or
liabilities that have accrued prior to termination or the coming into force or
continuance in force of any term that is expressly or by implication intended to
come into or continue in force on or after termination.

 

25. Further Assurances

Each party shall do and execute, or arrange for the doing and executing of, any
other act and document reasonably requested of it by any other party to
implement and give full effect to the terms of this Agreement.

 

26. Governing Law and Jurisdiction

This Agreement and any non-contractual obligations arising out of or in relation
to this Agreement shall be governed by and construed in accordance with Irish
law. The parties to this Agreement irrevocably agree that the courts of Ireland
are to have non-exclusive jurisdiction to settle any questions or disputes which
may arise out of or in connection with this Agreement.

 

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This Agreement has been entered into on the date stated at the beginning of this
Agreement.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
first set forth above.

 

  ELAN CORPORATION PLC       PROTHENA CORPORATION PLC By:    /s/ William F.
Daniel     By:    /s/ Neil McLoughlin

Name: William F. Daniel

Title: Company Secretary

   

Name: Neil McLoughlin

Title: Company Secretary

 

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SCHEDULE 1

Prothena Services

A. Support for ELND-005 and ELND-002 programs

 

  (1) Expert advice and opinion in the areas of nonclinical safety/toxicology
and pharmacology

 

  a. Attendance in project team meetings

 

  b. Leadership of a nonclinical subteam

 

  i. Development and proposal of nonclinical plans

 

  (2) Representation/presentations of nonclinical areas at external meetings
(regulatory/investigator/KOL/investor/scientific)

 

  (3) Regulatory support for nonclinical sections of pertinent documents

 

  a. IND filings and updates

 

  b. IB preparation and updates

 

  c. Regulatory briefing packages

 

  d. NDA filings

 

  e. Ex-US filings

 

  (4) Conducting and interpreting externally conducted nonclinical studies (GLP
and non-GLP)

 

  a. Assistance in patent filing based on nonclinical results

 

  (5) Inspection or audit readiness activities

 

  (6) Timely response to regulatory and/or investigator questions

 

  (7) Identification and maintenance of nonclinical expert advisors as needed

 

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SCHEDULE 2

Charges

1.1 The Charges will comprise:

1.1.1. a fixed charge at a rate of USD$250,000 per annum (“Fixed Charge”) per
the equivalent of one employee working full time (“Full Time Equivalent” or
“FTE”) allocated by Prothena to the provision of the Prothena Services. In
accordance with clause 3.1 of this Agreement, Prothena will allocate two FTE’s
during the Term to support the provision of the Prothena Services. Elan will pay
Prothena the Fixed Charge per FTE for each full year of the Term so that the
total Fixed Charge for each year of the Term will be USD$500,000.

1.1.2 a variable charge at a rate of USD $250,000 per annum (“Variable Charge”)
per one FTE allocated by Prothena to the provision of the Prothena Services,
payable where the Fixed Charge has been exceeded for that year. The actual
amount of the Variable Charge payable will be calculated pro rata based on the
number of days spent providing the Prothena Services. For the avoidance of
doubt, Elan shall only be liable to pay a Variable Charge if the Fixed Charge of
$500,000 per annum payable in accordance with clause 1.1.1 of this Schedule, has
been exhausted in full in respect of that year.

1.1.3 Research costs (“Research Costs”) which shall comprise the other
reasonable direct overhead costs to Prothena of performing the Prothena Services
including direct materials and other relevant overheads.

1.1.4 a mark-up of 10% (“Mark-Up”) as applied to the Fixed Charge, the Variable
Charge (if any) and Research Costs, such that the Fixed Charge, the Variable
Charge (if any), Research Costs and Mark-Up, collectively, shall reflect an
arm’s length cost-plus standard.

2. 1 Prothena will maintain a range of cost codes (or cost centres) in its books
for the purpose of recording the Research Costs.

2.2. At the end of each calendar month, Prothena shall provide Elan with a
report detailing the services provided, and the categories and line items under
which the Charges have been accrued, in respect of that monthly period (the
“Monthly Report”).

3. Prothena shall issue an invoice for the agreed Charges, detailing the amount
due in respect of the Prothena Services respectively for the relevant period.

4. All Charges shall be subject to increase or decrease (by way of
reconciliation in subsequent invoices) to the extent such increases or decreases
are provided for by this Schedule 2.

5. Any disputes in relation to the Charges shall be dealt with in accordance
with Clause 10 of this Agreement.

The following is an illustration of how the Charges will be calculated:

 

Charge

   cost per month USD$  

Fixed Charge for 2 FTE

     41,667   

Research Costs

     2,000   

Mark up of 10%

     4,368      

 

 

 

Total Cost

     48,038      

 

 

 

 

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