Exhibit 10.49


 


[...] =      Certain
confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.


 


CONFIDENTIAL PROVISIONS MARKED


 


EXHIBIT 10.49 (CONFIDENTIAL)


 


PDL LICENSE AGREEMENT


 


between


 


PROTEIN DESIGN LABS, INC.


 


and


 


GENENTECH, INC.


 


This PDL License Agreement (“Agreement”), effective
as of December 18, 2003 (“Effective
Date”), is made by and between PROTEIN DESIGN LABS, INC., a Delaware
corporation, having offices at 34801 Campus Drive, Fremont, CA 94555
(hereinafter “PDL”)
and GENENTECH, INC., a Delaware corporation, having offices at 1 DNA Way, South
San Francisco, CA 94080 (hereinafter “GNE”).


 


RECITALS


 


A. GNE and PDL have entered into a Patent
Licensing Master Agreement effective September 25, 1998, as amended by
Amendment No. 1 To The Patent Licensing Master Agreement dated September 18,
2003, and Amendment No. 2 To The Patent Licensing Master Agreement dated
December 18, 2003 (the “Master Agreement”), pursuant to which GNE may enter
into this Agreement with respect to a license under the “Queen Patents” for
GNE’s antibody products.


 


B. The Master Agreement provides GNE with
the right to obtain a nonexclusive, worldwide, royalty-bearing license under
the PDL Licensed Patents under the terms and conditions of this Agreement.


 


AGREEMENT


 


NOW THEREFORE, in consideration of the
mutual covenants herein contained and intending to be legally bound, the
parties agree as follows:


 


1.              DEFINITIONS


 


All references to Exhibits, Articles and
Sections shall be references to Exhibits, Articles and Sections of this
Agreement. In addition, except as otherwise expressly provided herein, the
following terms in this Agreement shall have the following meanings:


 


1

















 


1.01 “Affiliate”  means any corporation or other
business entity controlled by, controlling, or under common control with
another entity, with “control” meaning direct or indirect beneficial ownership
of more than fifty percent (50%) of the voting stock of such corporation, or
more than a fifty percent (50%) interest in the decision-making authority of
such other unincorporated business entity; and a corporation in which the
maximum amount of stock permitted by law to be held by another entity is
beneficially owned by such other entity. Notwithstanding the foregoing, the
term “Affiliate” under this Agreement with respect to GNE shall not include
Roche Holdings, Inc., including its affiliated companies (“Roche”), until
assignment of this Agreement to a member of such enterprise in accordance with
Section 8.01.


 


1.02 “Antibody”  means any
antibody directed against an Antigen and shall include, without limitation, monospecific and bispecific
antibodies (but only with respect to the Antigen for a 

bispecific antibody); less than full-length antibody forms such as Fv, Fab, and
F(ab’), single-chain antibodies and antibody conjugates bound to a toxin, label
or other moiety, as well as any and all such constructs directed against the
Antigen.


 


1.03 “Antigen” means
the target molecule: CD11a as further identified on Exhibit B.


 


1.04 “Bulk Product” means
Licensed Product supplied in a form other than Finished Product which can be
converted into Finished Product.


 


1.05 “Combination Product(s)” means
any product containing both a pharmaceutically active agent or ingredient which
constitutes a Licensed Product and one or more other pharmaceutically active
agents or ingredients which do not constitute Licensed Products.


 


1.06 “Europe” means
the European Patent Convention Member Countries, including any successor
organization and any additional countries that may join such organization from
time to time during the term of this Agreement.


 


1.07 “Finished Product(s)”  means any and all Licensed Products in
form for use by an end user and not intended for further chemical or genetic
manipulation or transformation.


 


1.08 “Licensed Product(s)” means an
Antibody with respect to which GNE has either significant marketing rights or
has done significant development (e.g., created, humanized or conducted
preclinical or clinical development), the manufacture, import, use, offer to
sell or sale of which would infringe, if not licensed under this Agreement, a
Valid Claim.


 


1.09 “Net Sales” means
the aggregate gross revenues, whether in cash or in kind, derived by or payable
from or on account of the sale or other transfer of Finished Products by GNE,
Affiliates of GNE, GNE’s sublicensees, Roche or Affiliates of GNE’s
sublicensees to an independent third party not an Affiliate of GNE, a
sublicensee of GNE, Roche, or an Affiliate of a sublicensee of GNE, less [...] to
cover the following: (a) credits or allowances, if any, actually granted on account
of price adjustments, recalls, rejection or return of items previously sold,
(b) excise and sales taxes, duties or other taxes imposed on and paid with
respect to such sales (excluding income or franchise taxes of any kind) and (c)
outer packing, freight and freight insurance costs. For all Finished Product(s)
used or consumed by others than GNE, GNE shall be entitled to deduct [...]) from
Net Sales in lieu of all other deductions such as taxes, shipping charges,
packing, allowances and the like prior to calculating royalties due. If GNE or
any of its Affiliates or sublicensees receive non-cash consideration for any
Finished Product sold or


 


2

















 


otherwise transferred to an independent
third party not Roche or an Affiliate of the seller or transferor, the fair
market value of such non-cash consideration on the date of such transfer as
known to GNE, or as reasonably estimated by GNE if unknown, shall be included
in the definition of Net Sales. Net Sales shall not include Finished Products
provided for bona fide clinical trial, evaluation, research or development
purposes.


 


Net Sales for Bulk Products shall be
calculated by multiplying the units of Finished Product to which such Bulk
Product is reasonably anticipated to be converted by the established market
price of the Finished Product on the date of sale of the Bulk Product. By way
of example and without limitation, units of Finished Product may be measured in
grams or doses, as appropriate.


 


The method of calculating Net Sales of
materials in form other than Finished Product or Bulk Product that can be
converted into Finished Product shall be established by good faith discussion
between PDL and GNE prior to the first sale or transfer of any such material by
GNE to a non-Affiliate.


 


1.10 “Opposition Proceedings” means
the legal proceedings at the European Patent Office (“EPO”) initiated against
EP patent 451,216B1 and terminating at the decision (oral and/or written)
rendered by the Opposition Division (“OD”) of the EPO, but excluding any
proceedings resulting from the filing of an appeal to the OD’s decision.


 


1.11 “PDL Licensed Patents”  means the patents and patent applications
identified on Exhibit A,
and including any applications filed as of the Effective Date in the United
States or any foreign jurisdiction. PDL Licensed Patents shall include U.S. or
foreign patents or patent applications which claim priority to any application
to which a listed U.S. Patent also claims priority. PDL Licensed Patents shall
also include any foreign equivalents, addition, continuation,
continuation-in-part or division of such patents or patent applications or any
substitute applications therefor, any patent issued with respect to any such
patent application, any reissue, extension or patent term extension of any such
patent, and any confirmation patent or registration patent or patent of
addition based on any such patent.


 


1.12 “Territory” means
either (a) worldwide, or (b) [...].


 


1.13 “Valid Claim” means
any claim in any PDL Licensed Patents which claim has neither expired or been
disclaimed nor been held invalid or unenforceable by a court or other body of
competent jurisdiction from which no appeal has been or may be taken.


 


2.              LICENSE


 


2.01 License
Grant. Subject to the fulfillment by GNE of all of the terms and
conditions of this Agreement, PDL hereby grants to GNE and GNE hereby accepts a
nonexclusive license in the Territory under the PDL Licensed Patents, including
the right to grant sublicenses in accordance with Section 2.02, to make, have
made, import, use, offer to sell and sell Licensed Products in the Territory.
PDL shall be free at its discretion to enter into additional agreements with
additional licensees at any time and on terms solely of its choosing.


 


2.02 Limitation on
Sublicenses; Notification. GNE shall have the right to grant
sublicenses of its rights under Section 2.01 with respect to Licensed Products,
provided that GNE shall grant such sublicenses only in connection with the
assignment or license by GNE to such sublicensee


 


3

















 


of the right to use, make, have made, sell
or otherwise transfer the Licensed Products. GNE shall notify PDL of the
identity of the sublicensee and scope of such sublicense promptly following the
grant of a sublicense hereunder. Notwithstanding the assignment or grant of a
sublicense by GNE hereunder, GNE shall remain obligated to pay all royalties
due to PDL with respect to the sale of Licensed Products by its assignee or
sublicensee. In addition, the grant of any sublicenses under Section 2.01 shall
be on terms and conditions which are subject to and subordinate to the terms of
this Agreement and GNE shall remain fully responsible to PDL for the
performance of any and all such terms by its sublicensees.


 


2.03 Updates to
List of PDL Licensed Patents. Upon written request of GNE (which
request shall not be made more than once per calendar year), PDL agrees to
provide a written update listing the PDL Licensed Patents, and such update
shall constitute an amendment to Exhibit A.
PDL may, at its option, furnish such update to GNE from time to time during the
term of this Agreement as part of an update to the Master Agreement.


 


2.04 No Other
Rights. GNE acknowledges and agrees that, except for the license
expressly granted under Section 2.01, no rights to any other PDL patents or
patent applications, or to any know-how, trade secrets or licenses are included
in this Agreement or granted by implication, estoppel or otherwise.


 


2.05 [...]


 


3.              PAYMENTS, ROYALTIES, REPORTS


 


3.01 Signing Fee. In
consideration for the license granted by PDL under Article 2 of this Agreement,
GNE shall pay to PDL, within fifteen (15) business days of the Effective Date
of this Agreement, a nonrefundable signing and licensing fee in the sum of [...],
increased annually beginning on January 1, 1999 and on each January 1
thereafter by an amount equal to the Consumer Price Index-U (or its successor)
published by the U.S. Bureau of Labor Statistics (“CPI-U”) for the prior year.
GNE shall be entitled to deduct from the signing and licensing fee under this
Agreement any amounts not previously credited and subject to credit under
Section 3.03(a). All such deductions shall be documented with any payments
hereunder.


 


3.02 Annual
Maintenance Fee. In further consideration of the license
granted under Article 2, within fifteen (15) business days of the [...]
anniversary of the Effective Date and each anniversary thereafter, GNE shall
pay PDL a nonrefundable annual maintenance fee in the amount of [...]. Such
annual maintenance shall be [...] against royalties payable by GNE for the year
with respect to which such annual maintenance fee is paid.


 


3.03 Credits;
Reductions. [...]


 


(a)  [...]


 


(b)  [...]


 


3.04 Royalties to PDL. The
royalties payable to PDL under this PDL License Agreement shall be as set forth
in Section 4.1 of the Master Agreement, except that in the event that GNE: (i)
breaches its obligations under Sections 2.3 or 2.4 of the Settlement Agreement
by and between PDL and GNE dated December 18, 2003 (“Settlement Agreement”);
and (ii) fails to cure such


 


4

















 


breaches as provided under Section 4.2 of
the Settlement Agreement, then PDL, at its sole discretion, may invoke its
rights under Article 4 of the Settlement Agreement.


 


3.05 Royalties Payable
Only Once; Sales Among Affiliates. Sales or other transfers of
Licensed Products between and among GNE and any of its Affiliates, its
sublicensees or Roche which are subsequently resold or to be resold by such
Affiliates, sublicensees or Roche shall not be subject to royalty, but in such
cases royalties shall accrue and be calculated on any subsequent sale or other
transfer of such Licensed Products to a non-Affiliate. Genentech is obligated
to pay royalties to PDL is imposed only once with respect to each unit of a
Licensed Product.


 


3.06 Combination
Products. Net Sales in a particular country in the Territory, in the case
of Combination Products for which the pharmaceutically active agent or
ingredient constituting a Licensed Product and each of the other
pharmaceutically active agents or ingredients not constituting Licensed
Products have established market prices in that country in the Territory when
sold separately, shall be determined by multiplying the Net Sales for each such
Combination Product by a fraction, the numerator of which shall be the
established market price for the Finished Product(s) contained in the
Combination Product and the denominator of which shall be the sum of the
established market prices for the Finished Product(s) plus the established
market prices for the other pharmaceutically active agents or ingredients
contained in the Combination Product. When such separate market prices are not
established in that country in the Territory, then the parties shall negotiate
in good faith to determine a fair and equitable method of calculating Net Sales
in that country for the Combination Product in question.


 


3.07 Currency Conversion. All
amounts payable to PDL under this Agreement shall be payable in U.S. Dollars by
wire transfer to a bank account designated by PDL. In the case of royalties on
Net Sales, all amounts payable shall first be calculated in the currency of
sale and then converted into U.S. Dollars using the average of the daily exchange
rates for such currency quoted by Citibank, N.A. for each of the last five (5)
banking days of each calendar quarter.


 


3.08 Reports.


 


(a)
Current Reports.  GNE agrees
to make written reports and royalty payments to PDL within sixty (60) days
after the close of each calendar quarter during the term of this Agreement,
beginning with the calendar quarter in which the date of first commercial sale
or other transfer of a Licensed Product by GNE, its Affiliates, Sublicensees or
Roche, provided that reports with respect to sales by sublicensees or Roche
shall include only those sales as to which royalty reports were received by GNE
during such calendar quarter.  Sales of
a Licensed Product occurring prior to the Effective Date shall be reported, and
royalties on such sales shall be paid, in the first written report and royalty
payment under this Agreement.  These
reports shall be certified by an officer of GNE and shall state for the
calendar quarter in question:  (1)
identification of Net Sales of the Licensed Product on a country-by-country
basis, (2) Net Sales in the Territory, (3) the quantities of Licensed Products
sold or manufactured in such quarter in the Territory, (4) applicable offsets
and (5) the net royalty due to PDL thereon pursuant to this Article 3.  No later than at the time of the making of
each such report, GNE shall make any payment due to PDL of royalties for the
period covered by such report.


 


(b)
Termination Report. For each Licensed Product, GNE also agrees to
make a written report to PDL within ninety (90) days after the date on which
GNE, its Affiliates or sublicensees last sell or otherwise transfer that
Licensed Product in the Territory stating in such report the same


 


5

















 


information required by quarterly reports
for all such Licensed Products made, sold or otherwise disposed of which were
not previously reported to PDL.


 


(c)
Notification of Marketing Approval. GNE agrees to notify PDL in
writing within sixty (60) days after the date on which GNE, its Affiliates or
sublicensees or Roche obtain marketing approval of a Licensed Product in any
country in the Territory. Such notice shall specify the country in which
marketing approval was obtained and the date of such approval.


 


3.09 Inspection. GNE
agrees to keep, and to require any of its Affiliates or sublicensees to keep,
clear, accurate and complete records for a period of at least three (3) years
for each reporting period in which Net Sales occur showing the sales of
Licensed Products in the Territory in sufficient detail to enable the royalties
payable hereunder to be determined, and further agrees to permit its books and
records, and to require any of its Affiliates or sublicensees to permit their
books and records, to be examined by an independent accounting firm selected by
PDL and reasonably satisfactory to GNE from time-to-time, but not more than
once a year. Such examination is to be made at the expense of PDL, except in
the event that the results of the audit reveal that GNE underpaid PDL by [...] or
more, then GNE shall pay any deficiency plus interest for such overdue
royalties in accordance with Section 3.11 hereof, and the audit fees shall be
paid by GNE. Any such discrepancies will be promptly corrected by a payment or
refund, as appropriate.


 


3.10 Withholding.


 


(a)
Fees. The amounts payable under Sections 3.01 and 3.02 shall
represent the actual proceeds to be received by PDL, net of any withholding or
other taxes or levies that may be applicable to such payments. PDL agrees to
reasonably cooperate with GNE in obtaining a refund of any withholding taxes or
levies paid by GNE, if any, with respect to any payments to PDL hereunder. In
the event that PDL is successful in obtaining any refund of tax withholding
amounts paid by GNE under this Agreement, PDL agrees to promptly remit such
refund amount to GNE.


 


(b)
Royalty Payments. GNE may withhold from royalties due to PDL amounts
for payment of any income or withholding tax that GNE has actually paid to any
taxing authority with respect to royalty amounts due to PDL hereunder in the
Territory. GNE shall promptly provide PDL with official tax receipts or other
documentation sufficient to enable PDL to satisfy U.S. tax authorities with
respect to PDL’s application for a for-tax credit. GNE agrees to reasonably
cooperate with PDL in obtaining a foreign tax credit in the U.S. with respect
to royalties due to PDL on the sale or manufacture of Licensed Products.


 


3.11 Interest on Overdue
Royalties. GNE shall be liable for interest on any overdue royalties, at the
rate of ten percent (10%) per annum, or the highest rate allowed by law,
whichever is less, commencing on the date such royalties are due until paid.


 


3.12 Royalties to Third
Parties. GNE acknowledges and agrees that other licenses may be required
from third parties with respect to the development, manufacture, importation,
use, and sale of any Licensed Product under this Agreement, and that GNE shall
be responsible for any royalties and other payments with respect to those
license rights.              In no
event shall GNE have a right to credit against, reduce or otherwise offset any
royalty or payment obligations to such third parties against royalty amounts
payable to PDL under the this Agreement.


 


6

















 


4.              INFRINGEMENT OF PDL LICENSED PATENTS


 


4.01 Suits. PDL
shall have no obligation hereunder to institute any action, suit or other
proceeding against third parties for infringement of any PDL Licensed Patents
or to defend any action, suit or proceeding brought by a third party which
challenges or concerns the validity or enforceability of any PDL Licensed
Patents in the Territory. Any monies recovered from alleged infringers shall be
retained by PDL.


 


4.02 Notification
of Third Party Infringements. GNE shall promptly notify PDL in
writing of any actual or suspected infringement by third parties of any PDL
Licensed Patent, which notification shall specify in reasonable detail the
nature of such actual or suspected infringement of which GNE is aware and shall
provide PDL with the available evidence, if any of such infringement.


 


5.              REPRESENTATIONS AND WARRANTIES; DISCLAIMERS; INDEMNIFICATION


 


5.01
Representations of GNE. GNE represents and warrants to PDL that:


 


(a)          The execution, delivery and
performance of this Agreement by GNE will not, with or without notice, the
passage of time or both, result in any violation of, be in conflict with, or

constitute a default under any material contract, obligation or commitment to
which GNE is a party or by which it is bound, or to GNE’s knowledge, violate
any statute, rule or governmental regulation applicable to GNE.


 


(b)         GNE has all requisite legal and
corporate power and authority to enter into this Agreement on behalf of itself
and its Affiliates and to carry out and perform its obligations under the terms
of this Agreement.


 


5.02
Representations of PDL. PDL represents and warrants to GNE that:


 


(a)          The execution, delivery and
performance of this Agreement by PDL will not, with or without notice, the
passage of time or both, result in any violation of, be in conflict with, or
constitute a default under any material contract, obligation or commitment to
which PDL is a party or by which it is bound, or to PDL’s knowledge, violate
any statute, rule or governmental regulation applicable to PDL.


 


(b)         PDL has all requisite legal and
corporate power and authority to enter into this Agreement and to carry out and
perform its obligations under the terms of this Agreement.


 


5.03 Disclaimers. Nothing
in this Agreement shall be construed as (a) a warranty or representation by PDL
as to the validity, enforceability or scope of any PDL Licensed Patents; (b) a
requirement that PDL file any patent application, or to secure any patent or
patent rights, or maintain any patent in force, or to provide copies of patent
applications to GNE or its Affiliates or sublicensees, or to disclose any
inventions described or claimed in such patent applications; or (c) a warranty
or representation by PDL that any Licensed Product made, used, imported, sold
or otherwise disposed of under the license granted in this Agreement is or will
be free from infringement of patents, copyrights, trademarks, trade secrets or
other rights of third parties. GNE acknowledges and agrees that any royalties
or payments that may be due to third parties in order


 


7

















 


for GNE to make, have made, import, use,
sell or otherwise dispose of Licensed Products shall be the sole responsibility
of GNE.


 


5.04 No Other
Warranties. EXCEPT AS SPECIFICALLY SET FORTH
IN ARTICLE 5, PDL MAKES NO REPRESENTATIONS OR WARRANTIES OF ANY KIND, EITHER
EXPRESS OR IMPLIED, WITH RESPECT TO PDL LICENSED PATENTS OR ANY CELL LINES,
ANTIBODIES OR LICENSED PRODUCTS DEVELOPED BY GNE UNDER THE LICENSE SET FORTH IN
THIS AGREEMENT AND PDL FURTHER MAKES NO EXPRESS OR IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE USE OF OR
PRACTICE UNDER PDL LICENSED PATENTS OR ANY CELL LINES, ANTIBODIES, LICENSED
PRODUCTS OR OTHER MATERIALS DEVELOPED BY GNE UNDER THE LICENSE SET FORTH IN
THIS AGREEMENT WILL NOT INFRINGE ANY THIRD PARTY RIGHTS.


 


5.05
Indemnification. GNE shall at all times, during the term
of this Agreement and thereafter, indemnify and hold harmless PDL and its
Affiliates, sublicensees, directors, officers, agents and employees from any
claim, proceeding, loss, expense, and liability of any kind whatsoever
(including but not limited to those resulting from death, personal injury,
illness or property damage and including legal expenses and reasonable
attorneys’ fees) arising out of or resulting from (a) any claim of patent
infringement (direct or contributory) or inducing patent infringement with
respect to the activities of GNE or its Affiliates or sublicensees, and (b) the
development, manufacture, holding, use, testing, advertisement, sale or other
disposition by GNE, its Affiliates or sublicensees, or any distributor,
customer or representative thereof or any one in privity therewith, of any
Licensed Product; provided, however, that PDL shall promptly notify GNE of such
claim, proceeding, loss, expense or liability and GNE, at GNE’s cost, shall
have sole control over the defense, including settlement of any claim or
action, with full cooperation from PDL.


 


6.              CONFIDENTIALITY


 


The provisions of Article 9 of the Master
Agreement are incorporated by reference as if set forth in their entirety
herein.


 


7.              TERM AND TERMINATION


 


7.01 Term. Unless
earlier terminated as provided in this Article 7, this Agreement shall come
into force on the Effective Date and shall continue until the last to expire of
the PDL Licensed Patents. Thereafter, this Agreement shall terminate and all
licenses or sublicenses granted hereunder shall become fully-paid licenses.


 


7.02 Termination.


 


(a)          This Agreement may be terminated on
sixty (60) days prior written notice by GNE.


 


(b)         If GNE shall
at any time default in the payment of any royalty, or the making of any report
hereunder, or shall commit any material breach of any covenant or agreement
herein contained or shall make any false report, and shall fail to have
initiated and actively pursued remedy of any such default or breach within
thirty (30) days after receipt of written notice thereof by the other party,
PDL may, at its option, cancel this Agreement and revoke any rights and
licenses herein granted


 


8

















 


and directly affected
by the default or breach by notice in writing to such effect, but such act
shall not prejudice PDL’s rights to recover any royalty or other sums due at
the time of such cancellation, it being understood, however, that if within
thirty (30) days after receipt of any such notice GNE shall have initiated and
actively pursued remedy of its default, then the rights and licenses herein
granted shall remain in force as if no breach or default had occurred on the
part of GNE, unless such breach or default is not in fact remedied within a
reasonable period of time. If GNE disputes the existence of a default or
material breach or making a false report or the failure to pursue a remedy or
to remedy the default or breach, the provisions for resolution of a default
shall be limited to those set forth in Section 11.6 of the Master Agreement.


 


(c)          This Agreement may be terminated by
either party upon the occurrence of any of the following which is not stayed or
vacated within sixty (60) days of such occurrence: (i) petition in bankruptcy
filed by or against the other party; (ii) adjudication of the other party as
bankrupt or insolvent; (iii) appointment of a liquidator, receiver or trustee
for all or a substantial part of the other party’s property; or (iv) an
assignment for the benefit of creditors of the other party.


 


(d)         In the event that GNE: (i) breaches
its obligations under Sections 2.3 or 2.4 of the Settlement Agreement and (ii)
fails to cure such breach(es) as provided under Section 4.2 of the Settlement
Agreement, then PDL, at its sole discretion, may invoke its rights under
Article 4 of the Settlement Agreement.


 


7.03 No Waiver. The
right of either party to terminate this Agreement as provided herein shall not
be affected in any way by its waiver of any previous failure to perform
hereunder or by its failure to take action with respect thereto.


 


7.04 Survival.
Termination for any reason hereunder shall not affect any accrued rights or
obligations of the parties arising in any manner under this Agreement as of the
date of termination. In any event, the rights and obligations, including
without limitation any accrued payment obligations, under Articles 3, 5 and 6
shall survive any termination of this Agreement.


 


8.              MISCELLANEOUS


 


8.01 Assignment. This
Agreement may not be assigned by either party without the prior written consent
of the other, except that either may assign this Agreement without consent to a
party which acquires all or substantially all of that portion of the business
to which this Agreement pertains, whether by merger, sale of assets or
otherwise. A merger or consolidation shall be deemed to constitute an
assignment.


 


8.02 Disputes. The
provisions of Section 11.6 of the Master Agreement are incorporated by
reference as if set forth in their entirety herein.


 


8.03 Severability. If any
provision of this Agreement is declared invalid by a court of law resort or by
any court, the decision of which an appeal is not taken within the time
provided by law, then and in such event, this Agreement will be deemed to have
been terminated only as to the portion thereof which relates to the provision
invalidated by that decision and only in the relevant jurisdiction, but this
Agreement, in all other respects and all other jurisdictions, will remain in
force; provided, however, that if the provision so invalidated is essential to
the Agreement as a whole, then the parties shall negotiate in good faith to
amend the terms hereof as


 


9

















 


nearly as practical to carry out the
original interest of the parties, and, failing such amendment, either party may
submit the matter to a court of competent jurisdiction for resolution.


 


8.04 Notices. Any
notice or report required or permitted to be given under this Agreement shall
be in writing and shall be sent by expedited delivery or telecopied and
confirmed by mailing as follows (or to such other address as may be specified
in writing) and shall be effective three (3) days after such delivery:


 


If to PDL:                     Protein
Design Labs, Inc. 

34801 Campus Drive 

Fremont, CA. 94555 

Attention: General Counsel


 


Facsimile number: (510) 574-1500


 


If to GNE:                  Genentech,
Inc. 

1 DNA Way 

South San Francisco, California USA 94080 

Attn: Corporate Secretary


 


Facsimile number: (650) 225-8654


 


8.05 Choice of
Law. The validity, performance, construction, and effect of this
Agreement shall be governed by the laws of the State of California which are
applicable to contracts between California residents to be performed wholly
within California.


 


8.06 Waiver. None of
the terms, covenants and conditions of this Agreement can be waived except by
the written consent of the party waiving compliance.


 


8.07 Force
Majeure. Neither party shall be responsible to the other for failure or
delay in performing any of its obligations under this Agreement or for other
non-performance hereof provided that such delay or non-performance is
occasioned by a cause beyond the reasonable - control and without fault or
negligence of such party, including, but not limited to earthquake, fire,
flood, explosion, discontinuity in the supply of power, court order or
governmental interference, act of God, strike or other labor trouble and
provided that such party will inform the other party as soon as is reasonably
practicable and that it will entirely perform its obligations immediately after
the relevant cause has ceased its effect.


 


8.08 Headings. The
captions used herein are inserted for convenience of reference only and shall
not be construed to create obligations, benefits, or limitations.


 


8.09 Entire
Agreement. This Agreement and the Master Agreement constitute the entire
Agreement between the parties hereto with respect to the Antigen and supersede
all previous Agreements, whether written or oral. In the event of any conflict
between the terms of this Agreement and the Master Agreement with respect to
the subject matter herein, the terms of this Agreement shall govern. This Agreement
shall not be changed or modified orally, but only by an instrument in writing
signed by both parties.


 


10

















 


8.10 Counterparts. This
Agreement may be executed in counterparts, all of which taken together shall be
regarded as one and the same instrument.


 


IN WITNESS WHEREOF, the parties hereto
have duly executed this Agreement as of the date first above written.


 


 


	
  By: 

  	
  /s/ Douglas O. Ebersole

  	
   

  	
  By: 

  	
  /s/

  	
  Stephen Juelsgaard

  	
   

  
	
   

  	
  Douglas O. Ebersole

  	
   

  	
   

  	
  Stephen Juelsgaard

  
	
   

  	
  SVP, Legal & Corporate Development

  	
   

  	
   

  	
  EVP & General Counsel

  



 


11

















 


Exhibit A


 


PDL Licensed Patents


 


The following are patents and patent
applications (also known as the “Queen et al. patents”) issued and filed in
certain countries in the world and licensed as part of the PDL Patent Rights
under the Agreement. (As of: September 23, 2003)


 


1. 
The following issued U.S. patents and pending U.S. patent applications:


 


Patent No. 5,585,089, “Humanized Immunoglobulins,”
issued December 17, 1996.


 


Patent No. 5,693,761, “Polynucleotides
Encoding Improved Humanized Immunoglobulins,” issued December 2, 1997.


 


Patent No. 5,693,762, “Humanized
Immunoglobulins,” issued December 2, 1997.


 


Patent No. 6,180,370  “Humanized Immunoglobulins and Method of
Making the Same”, issued January 30, 2001.


 


[...]


 


2. 
The following patents and patent applications outside the U.S.:


 


	
   

  	
   

  	
   

  	
   

  	
  Patent No.

  	
   

  	
  Country

  	
   

  	
  Title*

  	
   

  
	
  Issue Date

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Issued

  	
   

  	
  9/29/00

  	
   

  	
  AR 254487 V1

  	
   

  	
  Argentina

  	
   

  	
  “Novel Immunoglobulins, Their
  Production and Use”

  	
   

  
	
  Issued

  	
   

  	
  7/12/94

  	
   

  	
  647383

  	
   

  	
  Australia

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/7/97

  	
   

  	
  671949

  	
   

  	
  Australia

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  AT 0451216

  	
   

  	
  Austria

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  0451216

  	
   

  	
  Belgium

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  8/25/99

  	
   

  	
  0682040

  	
   

  	
  Belgium

  	
   

  	
   

  	
   

  
	
  Issued

  	
   

  	
  1/14/03

  	
   

  	
  1101125-4

  	
   

  	
  Brazil

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  10/27/97

  	
   

  	
  61095

  	
   

  	
  Bulgaria

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  8/13/02

  	
   

  	
  2328851

  	
   

  	
  Canada

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  8/20/02

  	
   

  	
  2006865

  	
   

  	
  Canada

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  4/11/00

  	
   

  	
  40279

  	
   

  	
  Chile

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  7/21/00

  	
   

  	
  58770

  	
   

  	
  China

  	
   

  	
   

  	
   

  
	
  Issued

  	
   

  	
  11/4/99

  	
   

  	
  P920500A

  	
   

  	
  Croatia

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  12/02/02

  	
   

  	
  174317

  	
   

  	
  Denmark

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  0451216B1

  	
   

  	
  Europe(1)

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  8/25/99

  	
   

  	
  0682040 B1

  	
   

  	
  Europe(1)

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  3/28/02

  	
   

  	
  108797

  	
   

  	
  Finland

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  FR0451216

  	
   

  	
  France

  	
   

  	
  “

  	
   

  



 


12

















 


	
  Issued

  	
   

  	
  8/25/99

  	
   

  	
  FR0682040

  	
   

  	
  France

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  DE 68925536.5

  	
   

  	
  Germany

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  8/25/99

  	
   

  	
  DE 68929061.6

  	
   

  	
  Germany

  	
   

  	
   

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  DD 296 964

  	
   

  	
  East Germany

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  GB 0451216

  	
   

  	
  Great Britain

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  8/25/99

  	
   

  	
  GB 0682040

  	
   

  	
  Great Britain

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/5/93

  	
   

  	
  1001050

  	
   

  	
  Greece

  	
   

  	
  “

  	
   

  
	
  Regist.

  	
   

  	
  7/14/00

  	
   

  	
  0682040

  	
   

  	
  Hong Kong

  	
   

  	
   

  	
   

  
	
  Issued

  	
   

  	
  3/22/96

  	
   

  	
  211174

  	
   

  	
  Hungary

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  2/3/03

  	
   

  	
  82755

  	
   

  	
  Ireland

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  IT 0451216

  	
   

  	
  Italy

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  8/25/99

  	
   

  	
  IT 0682040

  	
   

  	
  Italy

  	
   

  	
   

  	
   

  
	
  Issued

  	
   

  	
  9/18/98

  	
   

  	
  2828340

  	
   

  	
  Japan(2)

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  LU 0451216

  	
   

  	
  Luxembourg

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  8/25/99

  	
   

  	
  LU 0682040

  	
   

  	
  Luxembourg

  	
   

  	
   

  	
   

  
	
  Issued

  	
   

  	
  2/18/92

  	
   

  	
  92.2146

  	
   

  	
  Monaco

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  NL 0451216

  	
   

  	
  Netherlands

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  8/25/99

  	
   

  	
  NL 0682040

  	
   

  	
  Netherlands

  	
   

  	
   

  	
   

  
	
  Issued

  	
   

  	
  10/20/97

  	
   

  	
  231984

  	
   

  	
  New Zealand

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  6/8/00

  	
   

  	
  314793

  	
   

  	
  New Zealand

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  7/9/01

  	
   

  	
  19912385

  	
   

  	
  Norway(3)

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  12/26/91

  	
   

  	
  132068

  	
   

  	
  Pakistan

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  5/17/96

  	
   

  	
  29729

  	
   

  	
  Philippines

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  10/20/95

  	
   

  	
  92758

  	
   

  	
  Portugal

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  2/10/99

  	
   

  	
  2126046

  	
   

  	
  Russia

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  SG 0451216

  	
   

  	
  Singapore

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  5/22/01

  	
   

  	
  78258

  	
   

  	
  Singapore

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  2/28/99

  	
   

  	
  8912489

  	
   

  	
  Slovenia

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  10/31/90

  	
   

  	
  89/9956

  	
   

  	
  South Africa

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  11/23/98

  	
   

  	
  178385

  	
   

  	
  South Korea

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  2081974 T3

  	
   

  	
  Spain

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  8/25/99

  	
   

  	
  0682040

  	
   

  	
  Spain

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  SE 0451216

  	
   

  	
  Sweden

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  8/25/99

  	
   

  	
  SE 0682040

  	
   

  	
  Sweden

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  1/24/96

  	
   

  	
  CH 0451216

  	
   

  	
  Switzerland

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  8/25/99

  	
   

  	
  CH 0682040

  	
   

  	
  Switzerland

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  12/2/91

  	
   

  	
  50034

  	
   

  	
  Taiwan

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  5/19/93

  	
   

  	
  13349

  	
   

  	
  Uruguay

  	
   

  	
  “

  	
   

  
	
  Issued

  	
   

  	
  2/9/96

  	
   

  	
  56455

  	
   

  	
  Venezuela

  	
   

  	
  “

  	
   

  



 


	
  Country

  	
   

  	
  Application No.

  	
   

  	
  Title*

  	
   

  
	
  [...]

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


13

















 












* Exact titles may differ in different countries.


(1) and corresponding European national patents issued therefrom.


(2) registration date


(3) this is the application number; have not received patent yet.


 


14


 


[...] =      Certain
confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.