**EXHIBIT 10.87**

 

CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BYBRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES ANDEXCHANGE COMMISSION PURSUANT TO RULE 24b-2 OF THE SECURITIES EXCHANGE ACT OF1934, AS AMENDED.

 

AMENDMENT NO. 1 TOCOLLABORATIONAND LICENSE AGREEMENT

 

This AMENDMENT NO. 1 toCOLLABORATION AND LICENSE AGREEMENT (this “Amendment”) dated as of March19, 2004 (the “Amendment Effective Date”), is entered into by andbetween, on the one hand, ABGENIX, INC., a Delaware corporation (“ABX”),having a place of business at 6701 Kaiser Drive, Fremont, California 94555,U.S.A., and, on the other hand, ASTRAZENECA UK LTD., a company incorporated inEngland under no. 3674842 whose registered office is at 15 Stanhope Gate,London, WIK 1LN, England (“AZ”).

 

RECITALS

 

A.            Theparties have entered into the Collaboration and License Agreement dated as ofOctober 15, 2003 (the “Agreement”).

 

B.            Theparties now desire to amend the Agreement to include the right to use XenoMouse®Lambda Animals (as defined in the Agreement) [Confidential Treatment Requested]with the Amendment No. 1 Antigen (as defined below) on the terms and conditionsset forth below.

 

NOW THEREFORE, in consideration of the foregoingpremises and the mutual covenants set forth below, and other good and valuableconsideration, the receipt and sufficiency of which are hereby acknowledged,the Parties, intending to be legally bound, agree as follows:

 

# 1.             Definitions.  All capitalized terms not defined in this Amendmentshall have the meaning set forth in the Agreement.

#  

# 2.             Acknowledgements.  The parties acknowledge that pursuant toSection 4.18.2 of the Agreement:

#  

2.1           AZhas requested to include under the scope of the Agreement the use of XenoMouseLambda Animals with respect to the antigen described on Exhibit A to thisAmendment (the “Amendment No. 1 Antigen”).

 

2.2           Subject to the terms and conditions ofthis Amendment and the Agreement, ABX hereby grants to AZ non-exclusivesublicences under the following ABX In-Licenses pursuant to which ABX ControlsXenoMouse Lambda Animals as applicable to Antibodies that bind to and aredirected against the Amendment No. 1 Antigen [Confidential TreatmentRequested] : (a) that certain license agreement between ABX and the MedicalResearch Council, dated December 14, 1998 (as amended or restated fromtime to time) (“MRC II”), and (b) that certain license agreement betweenABX and Babraham Bioscience Technologies Limited (“Babraham”) dated May14, 2002 (as amended or restated from time to time, the “Babraham Agreement”).  AZ acknowledges that ABX has provided to AZredacted copies of such ABX In-Licenses.

 

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2.3           AZ acknowledges and agrees that itshall be subject to the terms and conditions applicable to AZ as a sublicenseeunder the Babraham Agreement. Exhibit B to this Amendment describes such terms and conditions andcontains a calculation of the Lambda Payments (as defined in Section 3.1of this Amendment) payable by AZ to ABX by reason of the Babraham Agreement [ConfidentialTreatment Requested].

 

2.4           AZ acknowledges and agrees that itshall be subject to the terms and conditions applicable to AZ as a sublicenseeunder MRC II.  Exhibit C to thisAmendment describes such terms and conditions and contains a calculation of theLambda Payments payable by AZ to ABX by reason of MRC II.

 

# 3.             Lambda Payments.

#  

3.1           Pursuant to Section 4.18.2 of theAgreement, and notwithstanding anything to the contrary in this Amendment orthe Agreement (including the representations and warranties, indemnificationobligations and financial obligations), AZ shall pay to ABX [ConfidentialTreatment Requested], which shallbe in addition to any other payments owing by AZ to ABX pursuant toSection 9 of the Agreement.

 

3.2           Withinfive (5) business days following the Amendment Effective Date, AZ shall pay toABX the first Lambda Payment [Confidential Treatment Requested]. AZ shall make each Lambda Payment toABX at least five (5) business days before such Lambda Payment is due to ABX’slicensors under the ABX In-Licenses referenced in Section 2.2 of thisAmendment.

 

3.3           Examples of calculations of LambdaPayments, including milestone amounts and royalty percentage rates, are setforth on Exhibit D to this Amendment.

 

# 4.             Amendments to theAgreement.

#  

4.1           Section 1.203of the Agreement is amended and restated in its entirety as follows:

 

1.203       XenoMouseAnimals” shall mean(a) except as expressly set forth in clause (b) below, those mice that aretransgenic for the human heavy chain variable Ig loci that is described inMendez, et al., Nature Genetics 15: 146-156 (1997), and any and allimproved strains of such mice, and (b) for the limited purpose of theAmendment No. 1 Antigen (as defined in Amendment No. 1 to this Agreement)(i) those mice that are transgenic for the human heavy chain variable Igloci that is described in Mendez, et al., Nature Genetics 15: 146-156(1997), [Confidential Treatment Requested], and (iii) any and all improved strains of any of the foregoingmice; in each case that are used by ABX or its Affiliates in their business togenerate antibodies for use in the Commercial Field.

 

# 5.             Miscellaneous.

#  

5.1           ContinuingEffect.  This Amendment shall beeffective for all purposes as of the Amendment Effective Date.  Except as otherwise expressly modified bythis Amendment, the Agreement shall remain in full force and effect inaccordance with its terms.

 

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5.2           GoverningLaws.  This Amendment shall begoverned by, interpreted and construed in accordance with the laws of the Stateof New York, without regard to conflicts of law principles.

 

5.3           Counterparts.  This Amendment may be executed incounterparts, each of which shall be deemed to be an original and togethershall be deemed to be one and the same document.

 

IN WITNESSWHEREOF, the parties have caused this Amendment to be executed by theirrespective duly authorized officers as of the Amendment Effective Date.

 
|   | ABGENIX, INC.       |
|--------|---------------------|
|   |                |   |
|   | By:                 | /s/ Raymond M. Withy |
|   |                | (Signature) |
|   |                |   |
|   |                | Raymond M. Withy |
|   |                | (Printed Name) |
|   |                |   |
|   |                | President and CEO |
|   |                | (Title) |
|   |                |   |
|   | ASTRAZENECA UK LTD. |
|   |                |   |
|   | By:                 | /s/ C.R.W. Petty |
|   |                | (Signature) |
|   |                |   |
|   |                | C.R.W. Petty |
|   |                | (Printed Name) |
|   |                |   |
|   |                | Authorised Signatory |
|   |                | (Title) |

 

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EXHIBIT A

 

Amendment No. 1 Antigen

 

[Confidential Treatment Requested]

 

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EXHIBIT B

 

BABRAHAM AGREEMENT

 

# 1.             Terms and Conditions of the BabrahamAgreement Applicable to AZ.

#  

1.1           All sums due to Babraham pursuant tothis Amendment [Confidential Treatment Requested].

 

1.2           AZ shall indemnify and hold harmlessBabraham and Babraham’s officers, directors, employees and agents from andagainst any and all losses, liabilities, damages and expenses (includingreasonable attorneys’ fees and costs) incurred as a result of any third partyclaims, demands, actions or other proceedings to the extent arising from:

 

(a)           any breach by AZ of the terms of thisAmendment; or

 

(b)           any use, application or exploitation ofany rights licensed under this Amendment, whether by AZ or its Affiliates (asdefined below), except in each case due to the negligence or willful misconductof Babraham.  As used in thisExhibit B, “Affiliates” shall mean any business entity controlling,controlled by or under common control with AZ. “Control” shall mean as to any entity effective ownership of at leastfifty percent (50%) of the voting capital, stock, voting partnership shares orcomparable owner equity in such entity.

 

1.3           AZ’s rights and obligations under thisAmendment with respect to the Babraham Agreement shall commence on theAmendment Effective Date and shall continue thereafter [ConfidentialTreatment Requested].  Upon expiration of such period, thelicenses granted under this Amendment shall continue [ConfidentialTreatment Requested].

 

1.4           Termination of AZ’s rights andobligations under this Amendment with respect to the Babraham Agreement shallnot affect the accrued rights of AZ, ABX or Babraham arising in any way out ofthis Amendment as of the date of such termination and in particular but withoutlimitation the right of either party to recover damages against the others, andall provisions of the Babraham Agreement which are expressed to survive theBabraham Agreement shall remain in full force and effect.

 

1.5           Upon termination of the BabrahamAgreement, AZ’s rights and obligations under this Amendment with respect to theBabraham agreement shall be assigned to Babraham or terminated, at Babraham’soption.

 

# 2.             Calculation of Lambda Payments underBabraham Agreement.

#  

The Lambda Payments payable byAZ to ABX pursuant to Section 7.2.2 of the Babraham Agreement [ConfidentialTreatment Requested] that are based on [Confidential Treatment Requested] thatconstitute “Licensing Income” (as defined in Section 7.2.2 of the BabrahamAgreement), shall be calculated as follows:

 

[Confidential Treatment Requested]

 

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EXHIBIT C

 

MRC II

 

# 1.             Terms and Conditions of MRC IIApplicable to AZ.

#  

1.1           In the event of termination of MRC II,the sublicense granted by ABX to AZ under this Amendment with respect to MRC IIshall continue in effect if AZ provides the Medical Research Council withwritten notice of its agreement to be bound by all the terms of MRC II.  In such event, such sublicense shallcontinue as if it was a license agreement directly between the Medical ResearchCouncil and AZ.

 

1.2           AZ shall indemnify, defend and holdharmless the Medical Research Council and its trustees, officers and employeesagainst all claims and expenses including reasonable legal expenses andreasonable attorneys’ fees arising out of the death of or injury to any personor persons or out of any damage to property and against any other claim,proceeding, demand, expense and liability of any kind whatsoever resulting fromthe production, manufacture, sale, use, lease, consumption or advertisement ofthe Biological Materials and Information (as defined in MRC II) of LicensedProducts (as defined in MRC II) by AZ.

 

1.3           Except to the extent that AZ isrequired under any laws or government regulations or by the rules of any stockexchange of any country, AZ shall not use the name of the Medical ResearchCouncil nor of any of its employees or officers or inventors or originators ofthe Property Rights (as defined in MRC II) nor any adaptation thereof in anyadvertising, promotional or sales literature without first obtaining the priorwritten consent of the Medical Research Council, which consent shall not beunreasonably withheld.

 

# 2.             Calculation of Lambda Payments underMRC II.

 

The Lambda Payments payable byAZ to ABX pursuant to MRC II shall equal [Confidential Treatment Requested] ofLicensed Products (as defined in MRC II) by AZ; provided, however, (a) that AZshall not be obligated to pay such royalty on any Licensed Product (as definedin MRC II) for which ABX is [Confidential Treatment Requested] pursuant to MRCI (as defined on Exhibit D to this Amendment), (b) that if AZ sells LicensedProduct (as defined in MRC II) to [Confidential Treatment Requested], ABX oranother sublicensee of ABX of the Property Rights (as defined in MRC II) forthe production of such Licensed Product, such a royalty will be due and payable[Confidential Treatment Requested] to a party other than [ConfidentialTreatment Requested], ABX or such sublicensee, and (c) [Confidential TreatmentRequested] shall be due and payable with respect to Licensed Products (asdefined in MRC II) that are [Confidential Treatment Requested].

 

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EXHIBIT D

 

LAMBDA PAYMENT EXAMPLES(1)

 
| Milestone                          |   | Amount AZ pays to ABX applicable to Non-Lambda Antibodies |   | Amount AZ pays to ABX applicable to Lambda Antibodies while MRC I(2)  is still in effect |   | Amount AZ pays to ABX applicable to Lambda Antibodies after MRC I has  expired |
|------------------------------------|--------|-----------------------------------------------------------|--------|------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------|
|                               |   |                                                      |   |                                                                                     |   |                                                                           |
| [Confidential Treatment Requested] |   | [Confidential Treatment Requested]                        |   | [Confidential Treatment Requested]                                                       |   | [Confidential Treatment Requested]                                             |

 

 
| Royalty Rate payable by AZ to ABX applicable to Non-Lambda Antibodies |   | Royalty Rate payable by AZ to ABX applicable to Lambda Antibodies  while MRC I is still in effect |   | Royalty Rate payable by AZ to ABX applicable to Lambda Antibodies  after MRC I has expired |
|-----------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------|
|                                                                  |   |                                                                                                   |   |                                                                                            |
| [Confidential Treatment Requested]                                    |   | [Confidential Treatment Requested]                                                                     |   | [Confidential Treatment Requested]                                                              |

 

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(1)      This table is purely for illustration purposes asthe amounts and royalty rates on which the calculations set forth in the tableare based may change due to amendments to the Agreement.

 

(2)      License Agreement dated March 29, 1994 byand among Medical Research Council, Agricultural and Food Research CouncilInstitute of Animal Physiology and Genetics Research of Babraham Hall, MarianneBruggermann c/o Institute of Animal Physiology and Genetics Research, BabrahamHall, and Cell Genesys, Inc (“MRC I”).

 

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