Document:

Exhibit
10.38

 

Execution
Copy

 

 

EMPLOYMENT
AGREEMENT

 

AGREEMENT, dated as of April 30, 2003, between
Transkaryotic Therapies, Inc., a Delaware corporation (the “Company”), and
Michael J. Astrue (the “Executive”).

 

1.               EMPLOYMENT.  The Company hereby employs the Executive and
the Executive hereby accepts employment with the Company upon the terms and
conditions herein set forth.

 

2.               DUTIES.  The Executive shall be engaged as a
full-time employee to act as the Company’s President and Chief Executive
Officer, and shall report to the Company’s Board of Directors (the
“Board”).  The Executive shall perform
the duties consistent with such positions as the Board shall from time to time
reasonably provide.  The Executive shall
devote his entire time, attention and energies to the business of the Company
and shall not engage in any other business activity or activities, whether or
not such business activity is pursued for gain, profit or other pecuniary
advantage that, in the judgment of the Board, may conflict with the proper
performance of the Executive’s duties under this Agreement.  Notwithstanding the foregoing, (a) with
respect to businesses which do not compete with the Company, the Executive may
invest his personal or family assets in such form or manner as will not require
any services on the part of the Executive in the operation of the affairs of
the companies in which such investments are made and in which his participation
is solely that of an investor, and (b) the Executive may purchase securities in
any corporation whose securities are regularly traded in recognized securities
markets, provided that such investments shall not result in his collectively
owning beneficially at any time one percent (1%) or more of the equity
securities of any corporation engaged in a business competitive to that of the
Company.

 

3.               COMPENSATION.

 

(a)  BASE SALARY.  For services rendered under this Agreement, the Company shall pay
the Executive an annual salary of $400,000 (the “Base Salary”), payable (after
deduction of applicable withholding for Federal and state income and payroll
taxes) in equal semi-monthly installments. 
As requested by the Executive, the Company shall not pay the Executive,
and the Executive shall forego, any compensation under this Section 3(a) until
the ninetieth (90th) day following the Commencement Date (as defined
below), except to the extent that such compensation or a portion of such
compensation is required to be paid by law. 
Notwithstanding the previous sentence, for all other purposes of this
Agreement, the Executive shall be treated, and the benefits provided to the
Executive shall be determined, as if the Executive was not foregoing any
compensation under this Section 3(a). 
The Compensation Committee of the Board (the “Committee”) may review the
Executive’s compensation annually and make such increases to the Base Salary as
the Committee determines are merited, based upon the Executive’s performance
and consistent with the Company’s compensation policies as established by the
Committee.  Any such increase in annual
Base Salary shall be communicated to the Executive shortly after the January
meeting of the Board of Directors and shall be made effective on the first day
of January each year.  The Executive’s
Base Salary may not be reduced to an amount that is less than $400,000 without
the written consent of the Executive.

 

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(b)  BONUS. 
The Committee and the Executive shall establish objective performance
goals for the Executive for each calendar year. Upon the attainment of such
performance goals, but subject to the overall performance of the Company during
such year, the Executive may be entitled to a bonus targeted at fifty percent
(50%) of the Base Salary, as determined by the Committee.  Within thirty (30) days after the close of
each such calendar year, the Committee shall evaluate the attainment of the
performance goals for such calendar year and determine the amount of any
performance bonus payable hereunder. Any such performance bonus shall be
payable within ninety (90) days after the calendar year to which it relates.

 

(c)  FRINGE BENEFITS.  In addition to Base Salary and Bonus payments under Sections 3(a)
and (b) above, the Executive shall be eligible for and participate in such
fringe benefits, in accordance with the terms of each such benefit, as shall be
generally provided to executives of the Company, including incentive
compensation, the Company’s 401(k) Plan, health and dental insurance, and any
retirement programs, stock options plans or employee stock purchase plans which
may be adopted from time to time during the term hereof by the Company.  Nothing herein contained shall be deemed to
preclude the Company from granting such additional compensation or benefits to
the Executive as it shall in its sole discretion determine.

 

(d)  STOCK OPTIONS.  Upon authorization by the Board and the Committee, on February
11, 2003,  the Company granted the
Executive under the Company’s 1993 Long Term Incentive Plan, as amended (the
“Plan”), stock options to purchase an aggregate of three hundred fifty thousand
(350,000) shares of Common Stock of the Company, par value $.01 per share, at a
purchase price of Three Dollars and Eighty Cents ($3.80) per share (the “Stock
Options”).  The Stock Options will vest
and become exercisable in four equal annual installments commencing on the
first anniversary of the Commencement Date (as defined below); provided,
however, that upon the termination of the Executive’s employment pursuant to
Section 7(a)(iii) or 7(c), 50% of the Stock Options that have not vested as of
the date of such termination shall automatically vest.  The Stock Options shall be subject to all
the terms and conditions of the Plan and the Company’s standard form of Stock
Option Agreement, copies of which have been delivered to the Executive
separately.

 

4.               VACATION.  During the term of this Agreement, the
Executive shall be entitled to annual vacation consistent with the Company’s
vacation policy; provided, however, that notwithstanding the foregoing, the
Executive shall be entitled to at least fifteen (15) annual vacation days
accrued at the rate of 1.25 days per month.

 

5.               SICK LEAVE AND
DISABILITY.  During the term of this
Agreement, the Executive shall be entitled to sick leave consistent with the
Company’s customary sick leave and disability policies.

 

6.               EXPENSES.  During the term of this Agreement, the
Company shall reimburse the Executive in accordance with the Company’s
customary policies for all reasonable out-of-pocket expenses incurred by the
Executive in connection with the business of the Company and in performance of
his duties under this Agreement upon the Executive’s presentation to the
Company of an itemized accounting of such expenses with reasonable supporting
data.

 

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7.               TERM.

 

(a)          The Executive’s
employment under this Agreement commenced on February 11, 2003 (the
“Commencement Date”) and shall continue until terminated by the Company as
provided in this Section 7(a) or by the Executive as provided in Sections 7(c)
or (d) below.  For all purposes of this
Agreement, this Agreement shall be deemed to have become effective on the
Commencement Date and all references to the term of this Agreement shall mean
the term beginning on the Commencement Date. 
The Company may, at its election, terminate the obligations of the
Company under this Agreement as follows:

 

(i)    upon at least sixty (60) days prior written
notice if the Executive becomes physically or mentally incapacitated or is injured
so that he is unable to perform the services required of him hereunder and such
inability to perform continues for a period in excess of six (6) months and is
continuing at the time of such notice;

 

(ii)   for “Cause” immediately upon prior written
notice of such termination to the Executive. For purposes of this Agreement,
the Company shall have “Cause” to terminate the Executive’s employment
hereunder upon

 

(A)      the Board’s determination
that the Executive has ceased or failed to substantially perform his assigned
duties (other than as a result of his incapacity due to physical or mental
illness or injury), and has failed to remedy such failure within at least
thirty (30) days of written notice from the Company to the Executive notifying
him of such failure, it being agreed by the parties that the failure to achieve
performance objectives is not sufficient by itself to constitute “Cause”
hereunder,

 

(B)        the Executive’s death,

 

(C)        the Board’s determination
that the Executive has engaged or is about to engage in conduct materially
injurious to the Company, provided that any actions or any failures to act by
the Executive which are taken or fail to be taken in good faith and in a manner
which the Executive reasonably believed to be in, or not opposed to, the best
interests of the Company shall not be Cause for termination under this Section
7(a)(ii)(C),

 

(D)       the Executive’s having been
convicted of a felony, or

 

(E)         a material breach by the
Executive of any covenants set forth in this Agreement, including without
limitation, the covenants set forth in Sections 2, 9, or 11 hereof; or

 

(iii)       without Cause upon at least
sixty (60) days prior written notice of such termination to the Executive.

 

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(b)         If, subsequent to the
date six (6) months after the Commencement Date, this Agreement is terminated
pursuant to Section 7(a)(i) above, the Executive shall receive severance pay
until the fourth anniversary of the Commencement Date at a rate equal to the
Executive’s  Base Salary in effect
immediately prior to such termination, reduced by the amount received by the
Executive during such period under any Company maintained disability insurance
policy or plan or under Social Security or similar laws.  If this Agreement is terminated at any time
pursuant to Section 7(a)(ii) above, the Executive shall receive no severance
pay.  If this Agreement is terminated
pursuant to Section 7(a)(iii) above, the Executive shall receive severance pay,
for a period of eighteen (18) months from and after such termination, at a rate
equal to the Executive’s Base Salary in effect immediately prior to such
termination.  Such severance payments
(less applicable withholding and payroll taxes) shall be paid periodically to
the Executive as provided in Section 3(a) for the payment of Base Salary.

 

(c)          If (i) the Executive
provides written notice to the Company of the occurrence of Good Reason (as
defined below) within a reasonable time (not to exceed 30 days) after the
Executive has knowledge of the circumstances constituting Good Reason, which
notice specifically identifies the circumstances which the Executive believes
constitute Good Reason and (ii) the Company fails to notify the Executive of
the Company’s intended method of correction of these circumstances within a
reasonable period of time (not to exceed 30 days) after the Company receives
the notice from the Executive, or the Company fails to correct the
circumstances within a reasonable period of time (not to exceed 60 days) after
the Company receives the notice from the Executive (except that no such
opportunity to correct shall be applicable if the circumstances constituting
Good Reason are those described in paragraph (C) below, relating to
relocation), then within a reasonable period of time thereafter (not to exceed
30 days) the Executive may terminate his employment under this Agreement for
Good Reason upon at least sixty (60) days written notice to the Company.  If this Agreement is terminated pursuant to
this Section 7(c), the Executive shall receive severance pay, for a period of
eighteen (18) months from and after such termination, at a rate equal to the
Executive’s Base Salary in effect immediately prior to such termination.  Such severance payments (less applicable
withholding and payroll taxes) shall be paid periodically to the Executive as
provided in Section 3(a) for the payment of Base Salary.

 

For
purposes of this Agreement, “Good Reason” shall mean, without the Executive’s
express written consent, the occurrence of any of the following circumstances:

 

(A)                    a material
diminution in the responsibilities, duties, and powers of the Executive
including, without limitation, (I) the Executive ceasing to be the
President or Chief Executive Officer (provided that the Executive is willing to
serve as such), (II) the failure to be accorded the responsibilities,
duties and powers of such positions, (III) the assignment to the Executive
of any duties inconsistent with such positions, (IV) a change in
Executive’s reporting relationship such that he no longer reports directly to
the Board, or (V) the failure of the Executive to remain a member of the
Board (provided that the Executive is willing to serve as such).

 

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(B)                    a reduction by
the Company in the Executive’s Base Salary to an amount that is less than
$400,000, unless agreed to by the Executive;

 

(C)                    the relocation
of the Executive’s base office to an office that is more than 100 miles from
the metropolitan Boston area;

 

(D)                   upon the sale
of substantially all of the stock, assets or business of the Company, by
merger, sale of assets or otherwise if the acquiror, purchaser or other
successor to the Company in such transaction does not agree to assume and
perform the Company’s obligations under this Agreement;

 

(E)                     any purported
termination of the Executive’s employment by the Company which is not effected
in accordance with the requirements of 7(a), and for purposes of this
Agreement, no such purported termination shall be effective; or

 

(F)                     any material
breach of this Agreement by the Company not described in paragraphs (A) through
(E) above.

 

(d)         The Executive may
terminate his employment under this Agreement for any reason upon at least
sixty (60) days prior written notice. 
In the event of any such termination of employment pursuant to this
paragraph (d), the Executive shall not be entitled to any severance payments.

 

(e)          The provisions of
Sections 7, 9, 10 and 11 shall survive the termination of this Agreement.

 

8.               REPRESENTATIONS.
The Executive hereby represents to the Company that (a) he is legally entitled
to enter into this Agreement and to perform the services and other obligations
contemplated herein; (b) he has, and throughout the term of this Agreement will
continue to have, the full right, power and authority, subject to no rights of
third parties, to grant to the Company the rights contemplated by Section 10
hereof; and (c) he is not subject to any agreement, rule, regulation or policy
of any university, research institution or other third party inconsistent with
the foregoing representations.

 

9.               DISCLOSURE OF
INFORMATION.

 

(a)          The Executive recognizes
and acknowledges that the Company’s trade secrets, know-how and proprietary
processes as they may exist from time to time (including, without limitation,
information regarding methods, cultures, vectors, plasmids, synthesis
techniques, nucleic acid sequences, purification techniques and assay
procedures) as well as the Company’s confidential business plans and financial
data are valuable, special and unique assets of the Company’s business, access
to and knowledge of which are essential to the performance of the Executive’s
duties hereunder.  The Executive shall
not, during or after the term of his employment by the Company, in whole or in
part, disclose such secrets, know-how, processes, business plans or financial
data to any person, firm, corporation, association

 

5

 

or other entity for any
reason or purpose whatsoever, nor shall the Executive make use of any such
property for his own purposes or for the benefit of any person, firm,
corporation or other entity (except the Company) under any circumstances during
or after the term of his employment, provided that after the term of his
employment, these restrictions shall not apply to such secrets, know-how, and
processes which the Executive can establish by competent proof:

 

(i)                  were known,
other than under binder of secrecy, to the Executive prior to his initial
employment by the Company which commenced on May 18, 2000;

 

(ii)               were passed into
the public domain prior to or after their development by or for the Company,
other than through acts or omissions attributable to the Executive; or

 

(iii)            were subsequently
obtained, other than under binder of secrecy, from a third party not acquiring
the information under an obligation of confidentiality from the disclosing
party.

 

(b)         Upon termination of his
employment hereunder, the Executive shall promptly turn over to the Company all
originals and copies which he may have of any of the Company’s confidential
information described in this Section 9.

 

(c)          Nothing in the foregoing
provisions of this Section 9 shall be construed so as to prevent the Executive
from using, in connection with his employment for himself or an employer  other than the Company, non-confidential
information which was acquired by him during the course of his employment with
the Company, and which is generally known to persons of his experience in other
companies in the same industry.

 

10.         INTELLECTUAL
PROPERTY.  The Executive hereby sells,
transfers, and assigns to the Company, or to any person or entity designated by
the Company, the entire right, title, and interest of the Executive in and to
all inventions, ideas, discoveries, and improvements (including, without
limitation, all microorganisms, strains or cultures) whether patented or
unpatented, and copyrightable material made, conceived or reduced to practice
by the Executive, solely or jointly, during the term hereof, which arise out of
research or other activities conducted by, for or under the direction of the
Company, whether or not conducted at the Company’s facilities, or which relate
to methods, apparatus, designs, products, processes or devices, sold, leased,
used or under consideration or development by the Company.  The Executive acknowledges that all
copyrightable materials developed or produced by the Executive within the scope
of his employment constitute works made for hire.  The Executive shall communicate promptly and disclose to the
Company, in such form as the Company may reasonably request, all information,
details, and data pertaining to any such inventions, ideas, discoveries, and
improvements; and the Executive shall execute and deliver to the Company such
formal transfers and assignments and such other papers and documents and shall
give such testimony as may be necessary or required of the Executive to permit
the Company or any person or entity designated by the Company to file and
prosecute patent applications and, as to copyrightable material, to obtain
copyrights thereof.  Any such invention,
idea, discovery or improvement disclosed by the

 

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Executive within one (1) year following the termination of this Agreement
shall be deemed to fall within the provisions of this Section 10 unless proved
to have been first conceived and made following such termination.

 

11.         COVENANTS NOT TO COMPETE
OR INTERFERE.

 

(a)          Subject to Section 11(b)
below, during the term of this Agreement and the period ending twenty-four (24)
months from and after the termination of the Executive’s employment hereunder,
the Executive shall not engage in any business (whether as an officer,
director, owner, employee, partner, consultant, advisor or other direct or
indirect participant) engaged in the development or sale of products for the
treatment of lysosomal storage disorders. The Company and the Executive hereby
agree as of the date hereof that this Section 11(a) shall only apply to
BioMarin Pharmaceutical Inc., Amgen Inc. and Genzyme Corporation and any
subsidiary or affiliate of such companies. This Agreement shall not be
construed to restrict the Executive’s right to be employed as a faculty member
of any university or employee of any nonprofit agency or foundation after any
termination of this Agreement where this covenant not to compete shall continue
to be in effect.  During the period in
which this covenant not to compete is in effect the Executive also shall not
interfere with, disrupt or attempt to disrupt the relationship, contractual or
otherwise, between the Company and any customer, supplier, lessor, lessee,
employee, consultant, research partner or investor of the Company.

 

(b)         If this Agreement is
terminated by the Company pursuant to Section 7(a)(iii) above or Section 7(c)
above, the provisions of the first sentence of Section 11(a) shall apply until
twelve (12) months from and after such termination.

 

(c)          It is the desire and
intent of the parties that the provisions of this Section 11 shall be enforced
to the fullest extent permissible under the laws and public policies applied in
each jurisdiction in which enforcement is sought.  Accordingly, if any particular Subsection or portion of this
Section 11 shall be adjudicated to be invalid or unenforceable, this Section 11
shall be deemed amended to delete therefrom the portion thus adjudicated to be
invalid or unenforceable, such deletion to apply only with respect to the
operation of this Section in the particular jurisdiction in which such
adjudication is made.

 

(d)         In the event of any
breach of the provisions of this Section 11 by the Executive, any and all
rights of the Executive to receive severance payments under Section 7(b) and
(c) above shall automatically terminate.

 

12.              INJUNCTIVE
RELIEF.  If there is a breach or
threatened breach of the provisions of Section 9, 10, or 11 of this Agreement,
the Company shall be entitled to an injunction, without bond, restraining the
Executive from such breach.  Nothing
herein shall be construed as prohibiting the Company from pursuing any other
remedies for such breach or threatened breach.

 

13.              INSURANCE.  The Company may, at its election and for its
benefit, insure the Executive against accidental loss or death, and the
Executive shall submit to such physical examinations and supply such
information as may be required in connection therewith.

 

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14.         INDEMNIFICATION.  The Company and the Executive have entered
into that certain Indemnification Agreement, dated as of the date hereof,
providing for indemnification of the Executive by the Company on the terms and
conditions set forth therein.

 

15.         EXPENSES.  The Company shall reimburse the Executive
for the reasonable fees and expenses of his counsel, not to exceed $10,000 in
the aggregate, in connection with the negotiation of this Agreement and all
related agreements.

 

16.         NOTICES.  Any notice required or permitted to be given
under this Agreement to the Executive shall be sufficient if in writing and if
sent by certified or registered mail to his residence, or in the case of the
Company, to Transkaryotic Therapies, Inc., 700 Main Street, Cambridge, MA
02139, Attention: Board of Directors, or to such other offices or addresses as
the company shall designate from time to time in writing to the Executive.  Any such notice shall be effective on the
earlier of (a) the date on which it is personally delivered or (b) three (3)
days after it is deposited in the United States mails, postage prepaid.

 

17.         WAIVER OF BREACH.  A waiver by the Company or the Executive of
a breach of any provision of this Agreement by the other party shall not
operate or be construed as a waiver of any subsequent breach by the other
party.

 

18.         GOVERNING LAW.  This Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the Commonwealth
of Massachusetts.

 

19.         ASSIGNMENT.  This Agreement may be assigned, without the
consent of the Executive, by the Company to any person, partnership, corporation
or other entity which succeeds to the business of the Company or which has
purchased substantially all the assets of the Company, provided such assignee
assumes all the liabilities of the Company hereunder.

 

20.         ENTIRE AGREEMENT.  This Agreement, together with the
Indemnification Agreement and the Stock Options, contains the entire agreement
of the parties and supersedes any prior understandings or agreements between
the Executive and the Company.  This
Agreement may be changed only by an agreement in writing signed by the party
against whom enforcement of any waiver, change, modification, extension or
discharge is sought.

 

[Remainder of the Page Intentionally Left Blank]

 

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

 

 

TRANSKARYOTIC
THERAPIES, INC.

 

 

	
  By:

  	
  /s/
  Rodman W. Moorhead III

  	
   

  
	
   

  	
  Rodman W. Moorhead III

  
	
   

  	
  Chairman of the Board
  of Directors

  

 

 

EXECUTIVE

 

 

	
  /s/
  Michael J. Astrue

  	
   

  
	
  Michael
  J. Astrue

  	
   

  

 

9Exhibit 10.39

Confidential
Materials omitted and filed separately with the 

Securities and Exchange Commission. 
Asterisks denote omissions.

LICENSE
AGREEMENT made the 28 day of February, 2003

BETWEEN:

WOMEN’S
AND CHILDREN’S HOSPITAL, a non-profit institution incorporated in South
Australia and of 72 King William Road, North Adelaide, South Australia (“Licensor”);

AND:

TRANSKARYOTIC
THERAPIES, INC. 700 Main Street, Cambridge, Massachusetts (“Licensee”).

WHEREAS:

A.                                  Licensor has power to
grant rights in respect of certain technology.

B.                                   The parties desire that
Licensor shall grant to Licensee a License to make, use, distribute and sell
the technology upon the terms hereinafter appearing.

WHEREBY IT IS AGREED as follows:

1.         RECITALS

The matters referred to in the recitals are true and correct in every
material particular and shall form part of this Agreement.

2.         INTERPRETATION

In this Agreement:

2.1.       “Affiliate” means:

            2.1.1     A company that is the
parent company of Licensee;

            2.1.2     A company that is a
subsidiary of the parent company of Licensee;

            2.1.3     A company that is a
subsidiary of Licensee;

            2.1.4     A director of Licensee;

2.2.                           “Commencement Date” means February 28, 2003.

2.3.                           “Field” is the treatment of certain
mucopolysaccharidosis (“MPS”) namely MPS I, II, IIIA and IIIB by
means of gene therapy and/or protein replacement therapy, [**].

2.4.                           “Know How” means all
specifications, and quality control procedures and other technical or commercial
knowledge or information whether patentable or not of the Unit in relation to
the Field in existence on the date of this Agreement or which come into
existence as a result of the funded research under the Research Agreement
during the continuance of this Agreement.

2.5.                           “License” means the
authorities in this Agreement granted to Licensee under Clauses 3 through 5
inclusive of this Agreement.

2.6.                           “Licensor” means Women’s and
Children’s Hospital and includes its successors and permitted assigns.

2.7.                           “Licensee” means Transkaryotic
Therapies, Inc. and includes its successors and permitted assigns.

2.8.                           “Net Sales Value” shall mean
the invoiced amount billed on sales of Products in final packaging form made by
Licensee, its Affiliates, or its sublicensees to an unrelated third party, less
the following:

a)                                      amounts
refunded or credited for Products which were rejected, damaged, or returned;

b)                                     import, export, excise,
and sales taxes; and

c)                                     credits, rebates and quantity
or cash discounts.

The transfer of Products by Licensee or any
of its Affiliates to another Affiliate of Licensee or a sublicensee should not
be considered a sale; in such cases Net Sales shall be determined based on the
invoiced sales price by the Affiliate or sublicensee to the customer less the
above deductions.

If any Product is sold as a combination of
functional elements, the Net Sales Value shall be calculated by multiplying the
net sales price of the combination product by the fraction A over A+B, in which
“A” is the standard fully absorbed cost of the product portion of the
combination, and “B” is the standard fully-absorbed cost of the other
functional elements of the combination, with such costs being determined in
accordance with generally accepted accounting practices. An example of a
combination product is a medical device consisting of genetically modified
cells held immobile by a permeable matrix composed of polymeric molecules,
where the matrix is the product portion and the cells are the other functional
element of the combination product.

2.9.                           “Past Funded IP” means all
intellectual property rights developed as a result of the conduct of all
research by the Unit prior to the Commencement Date pursuant to the 1996
Research Agreement [**].

2.10.                    “Past Non-Funded IP” means all
intellectual property rights developed as a result of any research conducted by
the Unit prior to the Commencement Date, other than pursuant to the 1996
Research Agreement, [**].

2.11.                    “Patents” means any and all
patents and patent applications in the Field in Australia and throughout the
world which Licensor presently owns or controls or under which Licensor has the
right to grant sub-licenses or that hereafter result from the funded research
under the Research Agreement (or in respect of which the Research Agreement
otherwise obliges Licensor to grant a license to Licensee), including patents
comprised in the Past Funded IP and the Past Non-Funded IP.  Patents as of the date of this Agreement are
listed in Exhibit A attached hereto. The expression “patents and patent
applications” shall, without limitation, extend to and include petty patents,
inventors’ certificates, utility patents, patents of importation, patents of
confirmation, patents of improvements, patents of addition, utility models and
substitutions, extensions, re-issues, renewals, divisions, continuations or
continuations-in-part thereof or therefor. 
References to “patents” and to “patent applications” shall extend to
include, mutatis mutandis, any other intellectual property rights which may be
of relevance including any registered designs, copyrights or trademarks.

2.12.                    “Processes” means the processes, methods of
manufacture and procedures covered by Valid Claims of Patents or which utilize
Technical Information.

2.13.                    “Products” means products whose manufacture,
use or sale is covered by Valid Claims of Patents or which utilize Technical
Information, Past Funded IP or Past Non-Funded IP.

2.14.                    “Research” has the same
meaning specified for such term in the Research Agreement.

2.15.                    “Research Agreement” means the
written Research Agreement between the parties entered into on or about the
date of this agreement relating to mucopolysaccharidosis research.

2.16.                    “Settlement Agreement” means
the written Settlement Agreement between the parties entered into on or about
the date of this agreement relating to the 1996 Research Agreement and the 1996
License Agreement.

2.17.                    “Technical Information” means
processes, methods of manufacture and procedures of Licensor relating to the
Field and in respect of which Licensor is obliged, pursuant to the Research
Agreement, to grant Licensee a license.

2.18.                    “Term” means the period from
the date of this Agreement to the day of expiry of the last surviving Patent,
subject to early termination as provided in this Agreement.

2.19.                    “Territory” means [**].

2.20.                    “Therapy” excludes testing,
screening and diagnosis.

2.21.     [**].

2.22.                    “Valid Claim” means a claim of
an issued Patent which has not been declared invalid or unenforceable by a
court of competent jurisdiction or an administrative agency from which no
appeal can be or is taken.

2.23.                    “1996 Research Agreement”
means the written Research Agreement between the parties dated 1 July 1996
relating to mucopolysaccharidosis research.

2.24.                    “1996 Licence Agreement” means
the written Licence Agreement between the parties dated 1 July 1996, as amended
on 1 July 1998.

3.         LICENSE
GRANT

3.1.                           In relation to Patents,
Technical Information, Processes and Products arising from the Research, in
consideration of the timely performance of all warranties and agreements in
this Agreement given or made by Licensee, Licensor hereby grants to Licensee
and Licensee hereby accepts an exclusive, worldwide license to such Patents and
Technical Information, with the right to grant sublicenses, to make and have
made, to use and have used, to sell and have sold such Products, and to
practise and otherwise use such Processes for the duration of the Term subject
to and upon the terms in this Agreement.

 

3.2                              In relation to patents, technical
information, processes and products [**] within the Field during the term of
the Research Agreement, which would be Patents, Technical Information,
Processes and Products if they arose from the Research, in consideration of the
timely performance of all warranties and agreements in this Agreement given or
made by Licensee, Licensor hereby grants to Licensee and Licensee hereby
accepts an exclusive, worldwide license within the Field to such patents and
technical information, with the right to grant sublicenses, to make and have
made, to use and have used, to sell and have sold such products, and to
practise and otherwise use such processes for the duration of the Term subject
to and upon the terms in this Agreement.

 

In the event that any third party shall
propose to:

 

(i)                 
sponsor research at Licensor in the Field; or

 

(ii)               
enter into an academic research collaboration with Licensor

 

during the term of the Research Agreement,
then Licensor shall promptly give notice of such proposal to Licensee.  Licensee shall review the proposed research,
cognizant of the mutual goal of Licensor and Licensee to advance research in
the Field and commercialize Products. 
Licensee shall notify Licensor within thirty (30) days whether it is
willing to enter into negotiations with such third party regarding the
disposition of any patents, technical information, processes and products
arising from such third party-funded research or academic research
collaboration.  In the event that
Licensee agrees to enter into negotiations with such third party, Licensee
shall negotiate in good faith, but nothing contained herein shall require
Licensee to come to agreement with such third party.

 

Alternatively,
Licensor may enter into an academic research collaboration during the term of
the Research Agreement with any third party (such as a university or other
non-profit research institution) provided that it:

 

(a)               
notifies Licensee of the identity of the third party and obtains
Licensee’s consent to enter into the collaboration with that third party (such
consent not to be unreasonably withheld, and provided that a failure by
Licensee to respond to the request for consent within 30 days of the date of
the request shall constitute consent); 

 

and

                                                 (b)        obtains a written undertaking from the third party that
Licensee will obtain an exclusive, worldwide license within the Field to any
patents, technical information, processes and products arising from such
collaboration during the term of the Research Agreement.

3.3                               In relation to Patents,
Technical Information, Processes and Products comprising or arising from the
Past Funded IP, Licensor hereby grants to Licensee and Licensee hereby accepts
an exclusive, worldwide license to such Patents and Technical Information, with
the right to grant sublicenses, to make and have made, to use and have used, to
sell and have sold such Products, and to practise and otherwise use such
Processes for the duration of the Term subject to and upon the terms in this
Agreement.

3.4                               In relation to Patents,
Technical Information, Processes and Products comprising or arising from the
Past Non-Funded IP, Licensor hereby grants to Licensee and Licensee hereby
accepts an exclusive, worldwide license within the Field to such Patents and
Technical Information, with the right to grant sublicenses, to make and have
made, to use and have used, to sell and have sold such Products, and to
practise and otherwise use such Processes for the duration of the Term subject
to and upon the terms in this Agreement.

4.         NATURE OF
LICENSE

4.1.                           The rights granted to
Licensee are an exclusive right within the Territory (and, in the case of the
rights granted to Licensee pursuant to clauses 3.2 and 3.4, within the Field
only) to manufacture, use, sell and supply or procure the manufacture, use,
sale and supply under sub-License of Products.

4.2.                           The rights hereby granted
shall commence on the date of this Agreement and shall terminate on the
expiration of the Term, subject to early termination as herein provided.

4.3.                           Subject to the Licensor’s
rights to use the Patents and Technical Information for research purposes,
Licensor shall not itself exercise or grant the same or equivalent rights to
any other third party, except in the case of the License being converted to
non-exclusive status pursuant to Clause 6.4, without the consent in writing of
Licensee first had and obtained, which consent Licensee may in its absolute
discretion refuse.

5.         PATENTS,
TRADEMARKS AND KNOW HOW

For the purposes of the License, Licensor
hereby grants to Licensee:

5.1.                           An exclusive right (in
the case of the rights granted to Licensee pursuant to clauses 3.2 and 3.4,
within the Field only) to use the intellectual or industrial property the
subject of the Patents and Technical Information.

5.2.                           Exclusive access (in the
case of the rights granted to Licensee pursuant to clauses 3.2 and 3.4, within
the Field only) to instruction manuals and drawings and specifications or other
written or machine-readable technical material clearly explaining the subject
of the Patents and Technical Information.

5.3.                           Non-exclusive access (in
the case of the rights granted to Licensee pursuant to clauses 3.2 and 3.4,
within the Field only) to all other Know How of Licensor in relation to the
subject of the Patents and Technical Information.

6.         DUE
DILIGENCE OBLIGATIONS

 

6.1                              Licensee and Licensor acknowledge and
agree that they both intend to bring high quality, safe and effective products
to patients suffering from MPS disorders. 
The Parties acknowledge and agree that the Parties shall communicate
regularly in order to identify ways of achieving the mutual goal of bringing
these products to market as promptly as possible.  Licensee agrees that when high quality, safe and effective
products are ready for commercialization in Licensee’s reasonable discretion,
Licensee shall use its reasonable commercial efforts, consistent with sound
business practices, to commercialize, market and promote (by itself or by
sub-licensees) Products covered by this Agreement within major markets within
the Territory [**].  In the event that
Licensee determines that it cannot or will not commercialize a Product within
all or part of the Territory, it shall promptly notify Licensor at which point
Licensee shall [**].  Licensee shall
keep Licensor properly informed as to its development and commercialisation
activities and give to Licensor such information as Licensor may reasonably
request in relation to such activities. 
If Licensee is found (pursuant to clause 22 or by a Court) to have
breached its obligations under this clause 6, Licensor's sole remedy shall be
to notify Licensee of its intention to convert the license under clause 3 to a
non-exclusive license, to the extent it relates to the MPS disorder in respect
of which the breach was committed, unless within ninety (90) days of
notification by Licensor, Licensee remedies its failure.  If Licensor elects to convert the license
into non-exclusive status, then the royalty rate set forth in clause 14 on
Products for the applicable MPS disorder shall be reduced by [**] percent.  The Parties agree that nothing in this
clause 6 obliges Licensee to do anything that, at that time, it reasonably
believes to be unethical.

 

6.2                              As a sign of its good faith
intentions in relation to the development of Products capable of
commercialisation (“Development Process”),
Licensee agrees that if research proposals submitted to the Licensee by the
Licensor from time to time or the results of the Research indicate that further
research would be beneficial to the Development Process, then Licensee will
give due consideration to providing Licensor with additional funding for the
purpose of undertaking that research.

7.         RECORDS

7.1.                           Licensee shall keep
complete records of all production and sales of Products and all orders and
inquiries for orders received.

7.2.                           After Licensee makes its
first commercial sale of a Product, Licensee shall within one month of the
expiration of each March, June, September and December prepare and supply to
Licensor a report of the conduct of the License during the preceding quarter.
Such report shall include:

7.2.1                  quantities of Products
manufactured distinguishing between different types of Products;

7.2.2                  quantities and sales
values of Products sold distinguishing between different types of Products;

7.2.3                  sub-licenses granted;

7.2.4                  gross proceeds of the
License (broken down into Net Sales Values of Products sold and royalties and
license fees paid by sub-licensees); and

7.2.5                  royalties payable by
Licensee in respect of such period.

8.         PRODUCT
WARRANTIES

Licensee shall ensure that all Products
supplied in carrying on the License by Licensee are constructed of suitable
materials and are suitable for the purposes for which the Products are
intended.

9.         COMPLIANCE
WITH LAWS AND TECHNICAL STANDARDS

At its own expense Licensee shall promptly
identify and ensure compliance with all applicable laws and industry standards
and shall forthwith obtain all necessary governmental or industry standards and
approvals relevant to the production and supply of Products in the Territory.

10.       INSPECTION
AND ACCESS

The Licensee shall permit the Licensor to
examine the Licensee’s books and records periodically during regular business
hours upon reasonable notice for the purpose only and to the extent necessary
to verify any sales provided pursuant to this Agreement. Any such examination
will be made at the expense of the Licensor by an independent registered or
company auditor who is reasonably acceptable to the Licensee and who shall
report to the Licensor only the amount of royalties due and payable hereunder.
The Licensor agrees that any report (and any payment made pursuant thereto)
submitted more than one year preceding the date of any such examination shall
be conclusively presumed to be correct. In the event that the auditor
determines that an inaccuracy in the sales report resulted in more than a five
percent (5 %) deficiency in royalty payments to Licensor, Licensee shall pay
(i) the costs of the audit and (ii) such deficiency in royalties within thirty
(30) days from the date Licensee receives the audit report.

11.       REPORTS

The parties shall promptly exchange all
technical reports respectively produced or procured by either of them in
respect of the development of therapeutic products for MPS I, II, IIIA and
IIIB. Licensee shall present a detailed, written progress report covering the
development of therapeutic products for MPS I, II, IIIA and IIIB to Professor John
Hopwood on the occasion of his annual visit to Licensee. Should any
inaccuracies, inconsistencies, omissions, errors or faults be found in the
specifications or use of the Processes, the party aware of same shall as soon
as practicable notify the other party of same.

12.       COOPERATION

Each party shall give such reasonable
assistance, cooperation and information to the other as shall be required to
assist that party to carry out its obligations under this Agreement.

13.       INTELLECTUAL
AND INDUSTRIAL PROPERTY

13.1.                    Licensor to the best of its
knowledge warrants that it has the right to enter into this Agreement and no
provision of this Agreement will violate, conflict or infringe upon any rights
whatsoever of any person, firm or corporation.

13.2.                    Neither party shall during the
continuance of this Agreement or thereafter use, divulge or communicate to any
person whomsoever any confidential information concerning the other party or
the practices, dealings, transactions or affairs of the other party which may
have been acquired by the party pursuant to the performance of this Agreement,
save as required by law.

13.3.                    Licensee shall imprint or cause to
be imprinted on all relevant written materials supplied hereunder and all
copies thereof a copyright notice to the effect that the said materials are
subject to copyright and are confidential and are not to be disclosed to others
or publicly disseminated.

13.4.                    Licensee shall imprint or cause to
be imprinted on all Products the subject of a patent manufactured or supplied
under this Agreement a patent notice to the effect that the same are subject to
patent rights.

13.5.                    Licensee shall not do or commit any
act or omission whereby patent or other rights of Licensor in respect of the
subject matter of the Patents and Technical Information may become prejudiced,
void or voidable.

13.6.                    Under the Research Agreement,
Licensor has agreed to license any patents or patent applications invented, discovered
or created in the course of the Research to Licensee, subject to the terms and
conditions of this License Agreement. 
In such event, the parties will amend Exhibit A and any such
additional patents or patent applications will be treated as Patents hereunder.

13.7.                    Each party may defend any action
brought against it alleging that the Patents, the Technical Information or the
License infringes patent or other rights belonging to a third party.

13.8.                    Licensee shall, at its reasonable
discretion, notify Licensor of any infringement of the Patents and Technical
Information in the Territory by third parties (“Infringement”).  Licensor has the obligation to diligently
prosecute any Infringement.  If Licensor
fails to meet such obligation, Licensee shall have the right, but not the
obligation, upon five (5) days written notice, to take control of the
prosecution of an Infringement and bear the costs of such proceedings.  The Party that meets the obligation of
prosecuting any Infringement (i) shall be entitled to all damages and costs (if
any) awarded against third parties in favor of Licensee or Licensor, and (ii)
shall have the control and conduct of all negotiations for settlement or
compromise of such proceedings.

13.9.                    In relation to the filing,
prosecution and maintenance of Patents:

                                                 (a)        Licensee shall be responsible for the
preparation, filing, prosecution and maintenance of all patent applications and
Patents in Australia, the United States, and in those other countries selected
by Licensee.  Prosecution shall be
conducted by attorneys selected and supervised by Licensee, to which Licensor
has no reasonable objection.  Licensee
will keep Licensor apprised as to the status of each of the patent applications
and Patents.

(b)                                Licensee shall be
responsible for all costs associated with the prosecution and maintenance of
the licensed Patents.  These costs shall
be billed directly to Licensee by associated attorneys.

(c)                                each party shall give
such reasonable assistance, cooperation and information to the other as shall
be required to assist that party to carry out its obligations under this
Agreement.

14.       PAYMENTS

14.1.                    Licensee in consideration
of the use of the Patents and Technical Information shall pay to Licensor:

14.1.1              royalties in an amount
equal to [**] percent ([**]%) of the Net Sales Value of Products sold or
consumed by Licensee and its sub-licensees in countries within the Territory
where such sale or consumption is covered by a Valid Claim of any Patent;

14.1.2              for a period commencing
on the date of the first commercial sale of a Product, and ending upon
expiration or termination of this Agreement, royalties in an amount equal to
[**] percent ([**]%) of the Net Sales Value of Products sold or consumed by
Licensee and its sub-licensees in countries within the Territory where such
sale or consumption is not covered by a Valid Claim but utilizes Technical
Information. In the event that a third party sells such a Product in a country
within the Territory where such sale or consumption is not covered by a Valid
Claim, then the royalty paid to Licensor will be an amount equal to [**]
percent ([**] %) of the Net Sales Value of Products sold or consumed by
Licensee and its sublicensees.

14.2.                    It is acknowledged that
Products may be sold by the Licensee in combination with or incorporated into
some other product incorporated into some other functional element. (Product
when in combination with another functional element is herein called
“combination products”). If a combination product is sold for a single price,
any amount received by the Licensee from the sale thereof will be apportioned
to the constituent part or parts thereof which constitute Product and to the
constituent part or parts which constitute functional element. Only that part
of any amount received by the Licensee which is apportioned to Product will
represent Net Sales Value and attract royalty. The basis of any apportionment
will be as described in Clause 2.8.

14.3.                    Royalties shall be
calculated quarterly for each of the three (3) month periods ended March, June,
September and December and shall be payable within one (1) month of the end of
each three (3) month period and payment shall be accompanied by the Report
referred to in Clause 7.3

14.4.                    If at any time during the
Term the Licensee discovers that any product or process manufactured, sold,
exercised or used by the Licensee or any of its sub-licensees or any method of
manufacture of same or use thereof being the same subject of the License
infringes claims of any unexpired patent, patent application or other
intellectual property right owned by a third party, then the Licensee may
negotiate with such third party for a License on such terms as the Licensee
considers appropriate. If the terms of settlement with any such third party
include a royalty bearing license, then the royalties otherwise payable under
this Agreement shall be reduced by the royalty or other payment paid to such
third party. The offset in royalty should not be more than fifty percent (50%)
of the total royalty payable by Licensee to Licensor.

14.5.                    All royalties and signing
fees shall when payable be converted into the currency of Australia on the
basis of the weighted average exchange rate applicable on the first and last
days of each quarter. All payments shall, subject to deduction of withholding
or other taxes Licensee is required by law to withhold, be paid in Australian
Dollars by telegraphic transfer in clear funds to Licensor’s account at
Adelaide or to such other bank or place as Licensor may from time to time
nominate in writing.

14.6.                    If Licensee shall default
in the due and punctual payment of any amount payable herein to Licensor and
that default is continuing for a period of thirty (30) days then and without
limiting any other right or remedy, Licensee shall be liable to pay default
interest at the current London Inter Bank Offer Rate plus three per centum (3
%), adjusted monthly, on the outstanding amount until paid.

15.       INDEMNITY

Licensee shall defend, indemnify and hold
harmless Licensor from and against any and all damages and liability, including
reasonable legal fees, costs and disbursements it may incur as a result of
product liability, trademark infringement, product recall or any other claims
not specifically excluded elsewhere in this Agreement or events arising from
manufacture, sale or distribution of the Products by Licensee or its
sub-licensees. Commencing on the date of first use of a Product in humans,
Licensee shall at all times maintain in full force and effect a general
liability policy of insurance with product hazard coverage regarding the sale
of the Products and the supply of Services by Licensee in a commercially
standard amount and Licensee shall, on an annual basis, and at the written
request of the Licensor furnish Licensor a certificate confirming such
coverage.

16.       LEGAL
RELATIONSHIP

Nothing herein expressed or implied shall be
deemed to create any partnership or agency between the parties for the
production, marketing or exploitation of the Patents or Technical Information
or otherwise. Neither party shall hold any of its agents, contractors,
employees or servants to be the agent, contractor, employee or servant of the
other party. Neither party shall pledge the credit of the other party nor enter
into contracts on its behalf. Each party shall indemnify and hold harmless the
other party and any company related to the other party from any claims, demands
or liabilities with respect to damage to property or personal injury or death
of employees, contractors or agents of the indemnity or its own related
companies while in or about the premises, plant or site of operations of the
other party or any company related to the other party.

17.       THIRD
PARTIES

17.1.                    This Agreement extends to
and binds the parties and their respective successors and permitted assigns.

17.2.                    A party shall not assign
or charge the benefits and obligations on that party’s part to be enjoyed or
observed herein to any person, firm or corporation without the prior consent in
writing of the other party (which consent shall not be unreasonably withheld)
and the undertaking in writing by the assignee to be bound by this Agreement so
far as applicable.

17.3.                    Licensee may appoint
sub-licensees subject to Licensor ensuring that such sublicensee is not trading
in a country for which Australia has trade or diplomatic sanctions in place. If
no such sanctions exist, Licensee is not required to obtain approval for
appointment of sublicensees. Licensee agrees to ensure that no potential
sub-licensee is in litigation with Licensor at the time of the granting of a
sublicense.  Licensee agrees to provide
Licensor with contact details for each sublicensee within 2 weeks of
entering into a sublicense agreement with that sublicensee, and will promptly
notify Licensor of any change in such contact details.

18.       NO WAIVER

No failure or delay on the part of a party to
exercise any right or remedy hereunder shall operate as a waiver thereof nor
shall any single or partial exercise of any such right or remedy preclude any
other further exercise thereof or the exercise of any other right or remedy
hereunder.

19.       FORCE MAJEURE

The parties shall not be liable for any
failure to perform or observe any term of this Agreement if performance or
observance has been delayed, hindered, restricted or prevented by any
circumstance not within the direct control of the parties including, without
limiting the generality of the foregoing, Acts of God, strikes, lock-outs or
other industrial disturbances, war hostilities or the threat or apprehension
thereof or any interruption to the supply of materials or information or any
accident or breakdown of machinery or the making of emergency or essential
repairs thereto or compliance with any valid order of any governmental or
public authority and the time or times for performances of the obligations on
the respective parties’ parts to be performed herein shall be extended by a
period equal to each such period of delay provided that such party shall
forthwith give notice to the other party in accordance with the provisions of
this Agreement and shall endeavor to remove or remedy the cause thereof with
all due diligence and expedition.

20.       TERMINATION

The License shall immediately terminate upon
the occurrence of any of the following events:

20.1.                    Upon the expiration of
the Term; or

20.2.                    If a party fails to
perform or observe any of the obligations and undertakings on its part to be
performed herein and that party fails to remedy such breach within sixty (60)
days of notice from the other party requiring the alleged breach to be
remedied, such notice giving adequate particulars of the alleged breach and of
the intention of the party giving notice to terminate the License forthwith
upon expiration of the required remedy period; or

20.3.                    If a party enters into
liquidation (other than for the purposes of reconstruction) or if an order is
made or a resolution is passed for the winding up of a party or placing a party
under official management or if a receiver or receiver and manager of the
undertaking or property of a party or any part thereof shall be appointed; or

20.4.                    If the Licensee shall
have provided to the Licensor six months prior written notice of its intention
to terminate the License with respect to any one or more (including all)
countries or Products, such termination to be effective on and from the date of
termination specified in that notice. 
Such termination shall relieve the Licensee from any obligations to pay
royalties accruing from sales of Products the subject of such termination after
such termination or accruing from sales of Products in the country or countries
the subject of the termination after such termination (as the case may be) but
shall not relieve the Licensee of any obligations to pay royalties due or
accrued with respect to sales prior to the date of termination.  Termination of this Agreement with respect
to any one or more (including all) countries or Products shall not affect any
other rights or obligations of a party which may have accrued prior to
termination with respect to such country or countries or Product or Products.

20.5.                    Governmental diplomatic
developments or actions by any country or state adversely influencing the
substantial performance or observance of any of the material terms of this
Agreement, without compensation to either party provided that any termination
of the License pursuant to this Clause shall be without prejudice to the rights
of either party against the other party which may have accrued up to and
including the date of such termination.

20.6.                    Upon the happening of any
other event specified in this Agreement as terminating the Agreement.
Termination of this Agreement shall not affect any rights or obligations of a
Party which may have accrued prior to termination, including the payment of
royalties due or accrued with respect to sales made prior to or after the date
of termination.

20.7.                    Any sublicenses granted
by Licensee during the term of this Agreement shall survive termination, and
Licensor will be entitled to receive any consideration, including royalties, due
to Licensee thereunder, and shall have the right to terminate any such
sublicenses upon sixty (60) days notice of a material breach of the sublicense
which is not cured prior to expiration of such period, and further provided
that Licensor will not assume, and will not be liable for, any representations,
warranties or obligations of Licensee to any sublicensees.

21.       SALE AND
RETURN ON TERMINATION

Licensee shall immediately upon termination
of the License:

21.1.                    Complete any orders for
the sale of products that the Licensee has contracted to supply;

21.2.                    Offer for sale to
Licensor at its value all and several of the Products that Licensee is not
otherwise contracted to supply; and

21.3.                    Return to Licensor the
specifications of the subject matter of the Patents or Technical Information in
eye or machine-readable form and all copies thereof;

 in the
possession or control of Licensee.

22.       ARBITRATION

If during the term of this Agreement or at
any time thereafter any claim or dispute shall arise between the parties as to
their respective rights or obligations under this Agreement, such matter shall
be referred for final determination to an arbitrator in London, United Kingdom,
to be appointed pursuant to the Rules of the London Court of International
Arbitration. The arbitrator shall receive written and verbal submissions from
the parties within the time appointed by the arbitrator and the arbitrator
shall give reasonable consideration to such submissions before making a
determination. The arbitrator shall determine the matter in dispute for reasons
given in writing and shall dispatch a copy thereof to each party. Any
determination made by the arbitrator pursuant to this Clause shall be final and
binding on the parties and may be entered in and enforced by any court of
competent jurisdiction. The costs and expenses of the arbitrator shall be borne
equally between the parties. If this Clause shall be adjudicated as invalid,
void or unenforceable by any Court of competent authority, then this Clause
shall be severed and deleted from this Agreement without prejudicing or
affecting the validity and enforceability of the remainder of this Agreement.

23.       CONFIDENTIAL
INFORMATION

In order to facilitate commercialization of
the Products, the Parties shall disclose confidential information relevant to
the Research and either Party may disclose other confidential information such
as scientific engineering, economic, commercial or other technical data or information,
biological materials, all methods, processes and procedures or know-how
(hereinafter together “Confidential Information”) owned or controlled by it to
the other (the disclosing party being referred to as the “Disclosing Party”,
and the receiving party as the “Receiving Party”).

23.1.                    In consideration of such
disclosure, the Receiving Party agrees to maintain as confidential any and all
Information received from the Disclosing Party and to hold such Information in
trust for the exclusive benefit of the Disclosing Party. Information disclosed
by the Disclosing Party shall remain the exclusive property of the Disclosing
Party and will be used by the Receiving Party solely for the purpose for which
it was disclosed. The Receiving Party will protect Information received from
the Disclosing Party with at least the same degree of care as it uses to
protect the Receiving Party’s own Information. The Receiving Party will not use
Information disclosed by the Disclosing Party for itself or others or copy or
disclose such Information to anyone (except the Receiving Party’s employees, on
a need-to-know basis).

The foregoing
restrictions on use and disclosure shall not apply to any Information of the
Disclosing Party that:

23.1.1               was known to the
Receiving Party prior to its disclosure to the Receiving Party by the
Disclosing Party as evidenced by written documents predating the Receiving
Party’s receipt of such Information; or

23.1.2               is public knowledge at
the time of its disclosure to the Receiving Party or became public knowledge
after its disclosure to the Receiving Party through no act or omission or on
its behalf; or

23.1.3               is lawfully disclosed or
made available to the Receiving Party by a third party having no direct or
indirect obligation to the Disclosing Party to maintain the confidentiality of
such Information;

23.1.4               is independently
developed by the Receiving Party without the aid or benefit of Information
disclosed to the Receiving Party by the Disclosing Party; or

23.1.5               is disclosed by the Receiving
Party pursuant to a subpoena lawfully issued by a court or governmental agency provided
that the Receiving Party notifies the Disclosing Party immediately upon receipt
of any such subpoena.

The Receiving Party will promptly return to
the Disclosing Party upon request all Information of the Disclosing Party (and
any copies, reproductions, digests, abstracts or the like of such Information)
in its possession or under its control at the time of such request and destroy
any computer entries relating thereto.

24.       LIABILITY
FOR AFFILIATES

Licensee shall be vicariously responsible for
the obligations and undertakings herein to be observed or performed by
Affiliates. Any act or omission by an Affiliate that would, if it had been an
act or omission by Licensee, constitute a breach of this Agreement shall be
deemed a breach of this Agreement by Licensee.

25.       OTHER
DOCUMENTS

The parties shall do all such acts, matters
and things and shall sign or execute and deliver all such documents as may in
the reasonable opinion of Licensor be necessary or expedient to further and
more effectually carry into effect the provisions of this Agreement.

26.       OTHER
AGREEMENTS

This Agreement, the Research Agreement and
the Settlement Agreement contain the entire agreement between the parties with
respect to the subject matter hereof and the parties agree that this Agreement,
the Research Agreement and the Settlement Agreement supersede and prevail over
any prior agreement or understanding between the parties.  The parties agree that, to the extent of any
inconsistency between this Agreement and the Research Agreement, the Research
Agreement will prevail.

27.       AMENDMENT

No amendment of this Agreement shall bind the
parties unless made in writing expressed to be supplemental to or in
substitution for the whole or a part of this Agreement.

28.       NOTICES

A notice to be given or made pursuant to this
Agreement shall be in writing in English and may be signed by the authorized
agent of the party giving same and may be served either:

28.1.     Personally.

28.2.                    By posting the same by
registered or certified mail to a party at its address hereinbefore appearing
or at any other address of which prior notification shall have been given by
the addressee prior to the dispatch of the said notice and any notice given by
post shall be deemed to have been received by the addressee at the expiration
of fourteen (14) days after the same has been properly posted.

28.3.     By facsimile
transmission:

To Licensor:                                                                      Ms Sophie Lazenkas

Lysosomal
Diseases Research Unit

Women’s and
Children’s Hospital

72 King William
Road

North Adelaide

South Australia

Tel:  61 8 8161 7101

Fax:  61 8 8161 7100

to Licensee:                                                                         Dr Doug Treco

Senior Vice
President, Research and Development

Transkaryotic
Therapies Inc.

700 Main Street

Cambridge, MA
02139

Tel:                           1-617-349-0218

Fax:                        1-617-491-7903

or any other facsimile number of which prior
notification shall have been given to the sender prior to the transmission of
the facsimile and any facsimile transmission shall be deemed to have been
served on the date of transmission by the sender provided that the sender shall
receive confirmation of receipt from the recipient.

29.       GOVERNING
LAW

This Agreement shall be governed by the laws
of the United Kingdom and in default of arbitration as hereinbefore referred to
the parties agree by their execution hereof to submit to the non-exclusive
jurisdiction of the courts of that nation in respect of all matters arising
under this Agreement.

30.       SEVERANCE

If any provision or part thereof of this
Agreement is or shall be for any reason void, invalid or unenforceable then the
remainder thereof shall in no way be affected thereby but shall continue in
full force and effect.

31.       COSTS

Each party shall bear its own costs of and
incidental to the negotiation, preparation and execution of this Agreement.

32.       COUNTERPARTS

This Agreement may be executed in two
counterparts each of which shall together constitute but one original document.

 

IN
WITNESS whereof the duly authorised representatives of the
parties have signed this Agreement on the day and year first mentioned above.

 

	
  SIGNED by  

  	
  )

  
	
  for and on behalf of WOMEN’S AND

  	
  )

  
	
  CHILDREN’S HOSPITAL

  	
  )   ............................................................ 

  
	
  as its duly
  authorised representative

  	
  )

  
	
  in the presence
  of:

  	
  )

  
	
   

  	
   

  
	
   

  	
   

  
	
  ................................................................. 

  	
   

  
	
  Witness

  	
   

  

 

 

	
  SIGNED by  

  	
  )

  
	
  for and on behalf of TRANSKARYOTIC

  	
  )

  
	
  THERAPIES INC

  	
  )   ............................................................ 

  
	
  as its duly
  authorised representative

  	
  )

  
	
  in the presence
  of:

  	
  )

  
	
   

  	
   

  
	
   

  	
   

  
	
  ................................................................. 

  	
   

  
	
  Witness

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00052-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00052-of-00352.parquet"}]]