OF SUCH
OTHER PARTY WHO REQUIRES SUCH CONFIDENTIAL INFORMATION OR PROPRIETARY MATERIALS
FOR A PARTY TO EXERCISE ITS RIGHTS OR CARRY OUT ITS RESPONSIBILITIES UNDER THIS
AGREEMENT OR (B) THIRD PARTY SUBCONTRACTOR ENGAGED BY A PARTY UNDER AN AGREEMENT
APPROVED BY THE JDC PURSUANT TO SECTION 6.2.1 TO ENABLE SUCH OTHER PARTY TO
EXERCISE ITS RIGHTS OR TO CARRY OUT ITS RESPONSIBILITIES UNDER THIS AGREEMENT;
PROVIDED, THAT, ANY SUCH DISCLOSURE OR TRANSFER SHALL ONLY BE MADE TO PERSONS
WHO ARE BOUND BY WRITTEN OBLIGATIONS AS DESCRIBED IN SECTION 5.1.3.
IN
ADDITION, ARQULE AND DS EACH AGREES THAT THE OTHER PARTY MAY DISCLOSE ITS
CONFIDENTIAL INFORMATION (A) ON A NEED-TO-KNOW BASIS TO SUCH OTHER PARTY'S LEGAL
AND FINANCIAL ADVISORS, (B) AS REASONABLY NECESSARY IN CONNECTION WITH AN ACTUAL
OR POTENTIAL (I) PERMITTED SUBLICENSE OF SUCH OTHER PARTY'S RIGHTS HEREUNDER,
(II) DEBT OR EQUITY FINANCING OF SUCH OTHER PARTY OR (III) MERGER, ACQUISITION,
CONSOLIDATION, SHARE EXCHANGE OR OTHER SIMILAR TRANSACTION INVOLVING SUCH PARTY
AND ANY THIRD PARTY, AND (C) FOR ANY OTHER PURPOSE WITH THE OTHER PARTY'S
CONSENT, NOT TO BE UNREASONABLY WITHHELD.
IN ADDITION, EACH PARTY AGREES THAT
THE OTHER PARTY MAY DISCLOSE SUCH PARTY'S CONFIDENTIAL INFORMATION OR PROVIDE
SUCH PARTY'S PROPRIETARY MATERIALS (A)
69
AS REASONABLY NECESSARY TO FILE, PROSECUTE OR MAINTAIN PATENT RIGHTS, OR TO
FILE, PROSECUTE OR DEFEND LITIGATION RELATED TO PATENT RIGHTS, IN ACCORDANCE
WITH THIS AGREEMENT; OR (B) AS REQUIRED BY APPLICABLE LAWS AS DETERMINED BY THE
DISCLOSING PARTY IN ITS REASONABLE DISCRETION; PROVIDED, THAT, IN THE CASE OF
ANY DISCLOSURE UNDER THIS CLAUSE (B), THE DISCLOSING PARTY SHALL (1) IF
PRACTICABLE, PROVIDE THE OTHER PARTY WITH REASONABLE ADVANCE NOTICE OF AND AN
OPPORTUNITY TO COMMENT ON ANY SUCH REQUIRED DISCLOSURE AND (2) IF REQUESTED BY
THE OTHER PARTY, COOPERATE IN ALL REASONABLE RESPECTS WITH THE OTHER PARTY'S
EFFORTS TO OBTAIN CONFIDENTIAL TREATMENT OR A PROTECTIVE ORDER WITH RESPECT TO
ANY SUCH DISCLOSURE, AT THE OTHER PARTY'S EXPENSE.
NOTWITHSTANDING THE
FOREGOING, (X) DS MAY DISCLOSE MECHANISM OF INHIBITION INFORMATION ONLY TO
INDIVIDUALS WHO ARE EMPLOYEES OF DS AND ITS AFFILIATES, WHO ARE DIRECTLY ENGAGED
IN THE DEVELOPMENT OF A COLLABORATION COMPOUND AND WHO REQUIRE SUCH MECHANISM OF
INHIBITION INFORMATION IN ORDER TO PERFORM THE DEVELOPMENT ACTIVITIES ASSIGNED
TO THEM (EACH, A "PERMITTED EMPLOYEE"), AND NOT TO CONSULTANTS, THIRD PARTY
SUBCONTRACTORS AND (Y) DS MAY NOT INCLUDE ANY MECHANISM OF INHIBITION
INFORMATION IN ANY HARDCOPY OR ELECTRONIC DATABASE OR OTHER ARCHIVE TO WHICH ANY
PERSON WHO IS NOT A PERMITTED EMPLOYEE HAS ACCESS.
5.1.3
EMPLOYEES, CONSULTANTS AND THIRD PARTY SUBCONTRACTORS.
ARQULE AND
DS EACH HEREBY REPRESENTS THAT ALL OF ITS EMPLOYEES AND CONSULTANTS, ALL OF THE
EMPLOYEES AND CONSULTANTS OF ITS AFFILIATES, AND ALL OF ITS THIRD PARTY
SUBCONTRACTORS WHO PARTICIPATE IN THE ACTIVITIES OF THE COLLABORATION OR HAVE
ACCESS TO CONFIDENTIAL INFORMATION OR PROPRIETARY MATERIALS OF THE OTHER PARTY
ARE OR WILL, PRIOR TO THEIR PARTICIPATION OR ACCESS, BE BOUND BY WRITTEN
OBLIGATIONS TO MAINTAIN SUCH CONFIDENTIAL INFORMATION OR PROPRIETARY MATERIALS
IN CONFIDENCE.
EACH PARTY