Document:

Seattle Genetics - Genencor CTR

 

EXHIBIT 10.1

Confidential treatment

requested

 

COLLABORATION AGREEMENT

 

This Agreement is entered

into as of January 4, 2002, by and between:

 

•                                          SEATTLE

GENETICS, INC., a Delaware corporation, having its principal place

of business at 21823 30th Drive S.E., Bothell, Washington 98021

 

(hereinafter

referred to as “SGI”)

 

and:

 

•                                          GENENCOR

INTERNATIONAL, INC., a Delaware corporation, having its principal

place of business at 925 Page Mill Road, Palo Alto, CA 94304-1013.

 

(hereinafter

referred to as “GCOR”).

 

WHEREAS,  SGI

and GCOR entered into a Mutual Non-Disclosure Agreement dated December 19, 2000

pursuant to which the parties have been discussing a potential relationship

relating to the use of enzymes for the activation of prodrugs;

 

WHEREAS, SGI has

developed and/or acquired technology and intellectual property relating to its

ADEPT platform, including a lead ADEPT molecule referred to as SGN-17/19, and

GCOR has developed technology and intellectual property relating to its TEPT

platform, and each intends to continue developing its platform through the

collaboration envisioned by this Agreement;

 

WHEREAS, SGI and GCOR desire to enter into

an agreement to exclusively collaborate in the field of targeted enzyme

technologies in combination with prodrugs for the treatment of cancer;

 

WHEREAS, SGI and GCOR each have ongoing

research and/or development activities relating to cancer therapies outside the

field of the collaboration envisioned by this Agreement and intend that nothing

contained in this Agreement will preclude such other activities;

 

NOW, THEREFORE, in

consideration of the foregoing premises and the mutual promises and covenants

contained herein and other good and valuable consideration, the receipt and

sufficiency of which are hereby acknowledged, the Parties, intending to be

legally bound, do hereby agree as follows:

 

ARTICLE I — DEFINITIONS AND

INTERPRETATION

 

1.1           Definitions:  For the purposes of this Agreement the

following words and phrases shall have the following meanings:

 

“ADEPT”

means SGI’s antibody-directed enzyme prodrug therapy platform covered by SGI

ADEPT Patents and the SGI [***] Patents.

 

 

“Affiliate”

means, with respect to a Party, any person, corporation or business entity that

directly, or indirectly through one or more intermediaries, controls, is

controlled by, or is under common control with, a Party.  For the purpose of this definition, control

shall mean the direct or indirect ownership of at least [***] of the voting interest

or equity in such corporation or other business entity.

 

“Agreement”

means this agreement, all amendments and supplements to this Agreement and all

exhibits to this Agreement, including the following:

 

	

  Exhibit A

  	

  -

  	

  SGI ADEPT  Patents

  
	

  Exhibit B

  	

  -

  	

  SGI [***]  Patents

  
	

  Exhibit C

  	

  -

  	

  GCOR TEPT Patents

  
	

  Exhibit D

  	

  -

  	

  GCOR TE Patents

  
	

  Exhibit E

  	

  -

  	

  GCOR Background Patents

  
	

  Exhibit F

  	

  -

  	

  Work Plan

  
	

  Exhibit G

  	

  -

  	

  The Stock Purchase Agreement

  

 

“Applicable Law” means the applicable laws,

rules, and regulations, including any rules, regulations, guidelines, or other

requirements of the Regulatory Authorities that may be in effect from time to

time.

 

“BLA” means a Biologics License

Application, as defined in the U.S. Federal Food, Drug, and Cosmetics Act, as

amended, and the regulations promulgated thereunder, and any corresponding

foreign or domestic marketing authorization application, registration or

certification, necessary or reasonably useful to market a Product, but not

including pricing and reimbursement approvals.

 

“[***]” means the [***].

 

“[***]” means the [***].

 

“[***]”

means any of the [***] periods beginning [***] in any year.

 

“Collaboration”

means all research, development, manufacture and

commercialization activities conducted by or on behalf of the Parties in the

Field according to the terms of this Agreement.

 

“Collaboration

Product” means any Product other than a [***] Product or a [***]

Product.

 

“Commercially

Reasonable Efforts” means, with respect to the research,

development, manufacture or commercialization of Products, efforts and

resources commonly used in the biotechnology industry for  a product of similar commercial potential at

a similar stage in its lifecycle, taking into consideration its safety and

efficacy, its cost to develop, the competitiveness of alternative products, its

proprietary position, the likelihood of regulatory

 

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approval, its profitability, and all other relevant

factors.  Commercially Reasonable

Efforts shall be determined on a market-by-market basis for each Product, as

applicable.

 

“Control”

means, with respect to any Information and Invention, Patent or other

intellectual property right, possession of the right, whether directly or

indirectly, and whether by ownership, license or otherwise, to assign, or grant

a license, sublicense or other right to or under, such Information and

Invention, Patent or right as provided for herein without violating the terms

of any agreement with any Third Party.

 

“Development

Decision” means a decision by the Steering Committee

regarding whether a Development Program should be commenced for a Collaboration

Product and/or whether a Collaboration Product should be advanced to the next

stage of a Development Program such as for example, advancing a Collaboration

Product from Phase I Clinical Trials to Phase II Clinical Trials or advancing a

Collaboration Product to IND filing stage.

 

“Development

Program” means any activities conducted by or on behalf of

the Parties with respect to a Collaboration Product pursuant to a Development

Decision, commencing upon identification of a [***] for such Collaboration

Product, as determined by the Steering Committee, and ending upon First

Commercial Sale of such Collaboration Product in a Major Country.  The Parties may also agree to initiate a

Development Program for a Collaboration Product prior to the above by unanimous

decision of the Steering Committee.

 

“Effective

Date” means the date of this Agreement.

 

“Exploit”

or “Exploitation” means to make, have made,

import, use, sell, offer for sale, or otherwise dispose of, including all

discovery, research, development, registration, modification, enhancement,

improvement, manufacture, storage, formulation, exportation, transportation,

distribution, promotion and marketing activities related thereto.

 

“FDA”

means the United States Food and Drug Administration and any successor agency

thereto or its equivalent in other countries or regulatory jurisdiction.

 

“Field”

means the use of [***] for the treatment and diagnosis  of cancer in humans.

 

“First

Commercial Sale” means, in each country, the first commercial

sale of a Product following, if required by law, Regulatory Approval and, when

Regulatory Approval is not required by law, the first commercial sale in that

country, in each case for use or consumption of such Product in such country by

the general public; for avoidance of doubt, First Commercial Sale of a given

Product cannot occur more than once in any particular country.

 

“GCOR

Background Know-How” means all Information and Inventions in

the Control of GCOR as of the Effective Date or at any time during the Term

that [***]

are deemed necessary or reasonably useful for the Collaboration or

for the exercise of the GCOR Background Patents, including without limitation

all Information and Inventions relating to [***], but excluding: (a) any [***];

and (b) any [***].

 

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“GCOR

Background Patents” means: (a) all Patents listed in Exhibit

E to this Agreement; and (b) any other Patents in the Control of GCOR

during the Term that are necessary or reasonably useful for the Collaboration

or for the practice of the GCOR Background Know-How, but excluding: (a) any [***];

(b) any [***];

and (c) any [***].

 

“GCOR

Background Technology” means GCOR Background Patents and GCOR

Background Know-How.

 

“GCOR

Expression Technology” means GCOR Background Technology

relating to microbial production systems for the expression of proteins,

peptides or antibodies.

 

“GCOR i-mune

Technology” means GCOR Background Technology relating to its in vitro

method used to determine allergenic epitope(s) in a protein.

 

“GCOR

Patents” means GCOR Background Patents and GCOR TEPT Patents.

 

“GCOR

Technology” means GCOR Background Technology and GCOR TEPT

Technology.

 

“GCOR TE

Patents” means (a) all Patents listed in Exhibit D to this

Agreement; and (b) any other Patents in the Control of GCOR at any time that

relate to TE.

 

“GCOR

TEPT Know-How” means all Information and Inventions in the

Control of GCOR or its Affiliates as of the Effective Date or at any time

during the Term that: (a) relate to [***]; and (b) are necessary or reasonably

useful for the Collaboration or for the exercise of the GCOR TEPT Patents.

 

“GCOR

TEPT Patents” means: (a) all Patents listed in Exhibit C

to this Agreement; and (b) any other Patents in the Control of GCOR during the

Term that: (i) relate to [***]; and (ii) are necessary or reasonably

useful for the Collaboration.

 

“GCOR

TEPT Technology” means GCOR TEPT Patents and GCOR TEPT

Know-How.

 

“Improvement”

means any modification to an antibody, compound, product or technology or any

discovery, device, process or formulation related to such antibody, compound,

product or technology, whether or not patented or patentable, including any

enhancement in the efficiency, operation, manufacture, ingredients,

preparation, presentation, formulation, means of delivery, packaging or dosage

of an antibody, compound, product or technology, any discovery or development

of any new or expanded indications or applications for an antibody, compound,

product or technology, or any discovery or development that improves the

stability, safety or efficacy of an antibody, compound, product or technology.

 

“IND”

means an investigational new drug application filed with the FDA for

authorization to commence human clinical trials, and its equivalent in other

countries or regulatory jurisdictions.

 

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“Information

and Inventions” means all technical, scientific and other

know-how and information, trade secrets, knowledge, technology, means, methods,

processes, practices, formulas, instructions, skills, techniques, procedures,

experiences, ideas, technical assistance, designs, drawings, assembly

procedures, computer programs, apparatuses, specifications, data, results and

other material, including high-throughput screening, gene expression, genomics,

proteomics and other drug discovery and development technology, pre-clinical

and clinical trial results, manufacturing procedures, test procedures and

purification and isolation techniques, (whether or not confidential,

proprietary, patented or patentable) in written, electronic or any other form

now known or hereafter developed, and all Improvements, whether to the

foregoing or otherwise, and other discoveries, developments, inventions and

other intellectual property (whether or not confidential, proprietary, patented

or patentable).

 

“Joint

Know-How” means all Information and Inventions made jointly

by employees of SGI and GCOR under this Agreement, but excluding any

Improvements to either Party’s Background Technology which shall remain the

sole property of the Party contributing said Background Technology.

 

“Joint

Patents” means any Patents jointly owned by the Parties that

relate to Joint Know-How and cover the manufacture, use or sale of Products.

 

“Joint

Technology” means Joint Patents and Joint Know-How, but

excluding SGI Technology and GCOR Technology.

 

“Major

Country” means any of [***].

 

“NDA”

means a New Drug Application filed with the FDA and its equivalent in other

countries or regulatory jurisdictions.

 

“Net Sales” shall

mean [***]

amounts [***]

from or in connection with the sale or other disposition of Product [***]:[***]

 

In the event a Party or its Affiliates or Sublicensees

sells or otherwise disposes of a Product in combination with other active

ingredients or components which are not Products, Net Sales for purposes of

royalty payments on the combination shall be calculated as follows:

 

In the event the

Product is sold [***], the applicable royalty for such Product shall be

determined by [***].

 

“Parties”

means GCOR and SGI, and “Party” means either of them.

 

“Patents”

means: (a) patents and patent applications; (b) any substitutions, divisions,

continuations, continuations-in-part, reissues, renewals, registrations, confirmations,

re-examinations, extensions, supplementary protection certificates and the

like, and any

 

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provisional applications, of any such patents or

patent applications; and (c) any foreign or international equivalent of any of

the foregoing.

 

“Phase I

Clinical Trial” means a clinical study in subjects to

evaluate the pharmacokinetic and pharmacodynamic properties, maximum tolerated

dose, dosing interval, and absorption, distribution, metabolism and excretion

of a candidate drug.

 

“Phase

II Clinical Trial” means a controlled dose clinical trial to

evaluate the efficacy and safety of a candidate drug in the targeted patient

population and to define the optimal dosing regimen.

 

“Phase

III Clinical Trial” means a controlled, pivotal, multi-center

clinical trial, involving patients with the disease or condition of interest to

obtain sufficient efficacy and safety data to support regulatory submission of

a BLA or NDA and labeling of a candidate drug.

 

“Product”

means any targeted enzyme plus prodrug combination product(s) developed

pursuant to the Collaboration.

 

“Product

Trademarks” means the Trademarks developed for the Products

by the Steering Committee and owned jointly be the Parties, all packaging

designs and other trade dress used in connection with the Products and such

other Trademarks relating thereto and any registrations thereof or any pending

applications relating thereto.

 

“Regulatory

Approval” means final regulatory approval (including, where

applicable, pricing approval in the event that actual sales do not take place

before such approval) required to market a Product for a disease or condition

in accordance with the applicable laws and regulations of a given country.  In the United States, its territories and

possessions, Regulatory Approval means approval of a BLA or its equivalent by

the FDA.

 

“Regulatory

Authority” means any applicable government entities

regulating or otherwise exercising authority with respect to the Exploitation

of the Products.

 

“Regulatory

Documentation” means all applications, registrations,

licenses, authorizations and approvals (including all Regulatory Approvals),

all correspondence submitted to or received from Regulatory Authorities

(including minutes and official contact reports relating to any communications

with any Regulatory Authority), all supporting documents and all clinical

studies and tests, relating to any Product, and all data contained in any of

the foregoing, including all regulatory drug lists, advertising and promotion

documents, adverse event files and complaint files.

 

“Research

Program” means the research program conducted pursuant to

Section 3.2.

 

“Royalty

Term” means, on a Product-by-Product and country-by-country

basis, the period of time equal to the longer of: (a) [***] from the date of First

Commercial Sale of the Product in such country; or (b) the expiration of

the last to expire of the Valid Patent Claims necessary for the manufacture,

use or sale of a Product in such country.

 

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“SGI

ADEPT Know-How” means all Information and Inventions in the

Control of SGI as of the Effective Date or at any time during the Term that:

(a) relate to SGN-17/19 or ADEPT;  and (b) are necessary or reasonably useful

for the Collaboration or for the exercise of the SGI ADEPT Patents or SGI [***]

Patents.

 

“SGI

ADEPT Patents” means: (a) all Patents listed in Exhibit A

to this Agreement; and (b) any other Patents in the Control of SGI during the

Term that: (i) relate to SGN-17/19 or ADEPT; and (ii) are necessary or

reasonably useful for the Collaboration.

 

“SGI

ADEPT Technology” means SGI ADEPT Patents, SGI [***]

Patents and SGI ADEPT Know-How.

 

“SGI

Background Know-How” means all Information and Inventions in

the Control of SGI as of the Effective Date or at any time during the Term that [***] are

deemed necessary or reasonably useful for the Collaboration or for the exercise

of the SGI Background Patents, but excluding: (a) any [***]; and (b) any [***].

 

“SGI

Background Patents” means any Patents in the Control of SGI

during the Term that are necessary or reasonably useful for the Collaboration

or for the practice of the SGI Background Know-How, but excluding: (a) any [***];

(b) [***];

and (c) any [***].

 

“SGI

Background Technology” means SGI Background Patents and SGI

Background Know-How.

 

“SGI

[***] Patents” means [***] and all Patents relating thereto [***]

to SGI pursuant to the [***] and all other Patents listed on Exhibit

B.

 

“SGI

Patents” means SGI Background Patents, SGI ADEPT Patents and

SGI [***]

Patents.

 

“SGI

Technology” means the SGI Background Technology and the SGI

ADEPT Technology.

 

“SGN-17”

means SGI’s proprietary protein containing monoclonal antibody and enzyme

components that incorporates the binding site of the monoclonal antibody L49

and the enzyme β-lactamase, as well as [***].

 

“SGN-19”

means SGI’s proprietary form of the chemotherapeutic prodrug

melphanan that has been inactivated through the addition of a chemical group

that can be removed by the enzyme β-lactamase.

 

“SGN-17/19”

means  a combination of SGN-17 and SGN-19.

 

“Stock

Purchase Agreement” means the Common Stock Purchase Agreement

of even date herewith by and between SGI and GCOR attached hereto as Exhibit

G.

 

7

 

“Sublicensee”

means any person acting pursuant to a permitted sublicense granted to it by the

Parties pursuant to Section 6.4 or Section 15.6.3(c) and the other terms and

conditions of this Agreement.

 

“Technology” means SGI Technology, the GCOR Technology and/or the Joint Technology,

as applicable.

 

“TE”

means GCOR’s [***]

and covered in GCOR TE Patent(s).

 

“TEPT”

means GCOR’s targeted enzyme prodrug therapy platform covered by GCOR TEPT

Patents expressly [***].

 

“Term”

means the Initial Term and any Renewal Term(s).

 

“Therapeutics

Field” shall mean the use of [***] for the treatment and

diagnosis of diseases in humans.

 

“Third-Party”

means any person or entity other than GCOR, SGI and their respective

Affiliates.

 

“Trademark”

means any word, name, symbol, color, designation or device or any combination

thereof, including any trademark, trade dress, service mark, service name,

brand mark, trade name, brand name, logo or business symbol.

 

“Valid

Patent Claim” means a claim of an issued and unexpired patent

included in SGI Patents, GCOR Patents or Joint Patents which has not been held

permanently revoked, unenforceable or invalid by a decision of a court or other

governmental agency of competent jurisdiction, unappealable or unappealed within

the time allowed for appeal, and which has not been admitted to be invalid or

unenforceable through reissue or disclaimer or otherwise.

 

“Work

Plan” means the plan developed by the Parties and attached

hereto in draft form setting forth the roles, responsibilities, timelines and

deliverables for each of the Parties during the Collaboration, which, when

finalized and approved by the Steering Committee no later than ninety (90) days

from the Effective Date, shall be attached to this Agreement as Exhibit F, including

any amendments or modifications made by agreement of the Steering Committee.

 

1.2           Terms

Defined Elsewhere in this Agreement.  In addition to the foregoing definitions, the following terms are

defined in the applicable Sections of this Agreement:

 

8

 

	

  Defined

  Term

  	

   

  	

  Section

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

  “[***]”

  	

   

  	

  15.6.3

  	

  (a)

  
	

  “[***]”

  	

   

  	

  15.6.3

  	

  (e)

  
	

  “Collective

  Opinion of Counsel”

  	

   

  	

  13.3

  	

   

  
	

  “[***]

  Party”

  	

   

  	

  7.2

  	

   

  
	

  “Confidential Information”

  	

   

  	

  9.1

  	

   

  
	

  “[***]

  Product”

  	

   

  	

  7.4

  	

   

  
	

  “Indemnified

  Party”

  	

   

  	

  16.3.1

  	

   

  
	

  “Indemnification

  Claim Notice”

  	

   

  	

  16.3.1

  	

   

  
	

  “Indemnitee”

  and “Indemnitiees”

  	

   

  	

  16.3.1

  	

   

  
	

  “Infringement

  Suit”

  	

   

  	

  13.4.2

  	

   

  
	

  “Initial

  Term”

  	

   

  	

  15.1

  	

   

  
	

  “Losses”

  	

   

  	

  16.1

  	

   

  
	

  “[***]”

  	

   

  	

  7.1

  	

   

  
	

  “[***]

  Notice”

  	

   

  	

  7.1

  	

   

  
	

  “[***]

  Party”

  	

   

  	

  7.1

  	

   

  
	

  “Project

  Plan”

  	

   

  	

  3.5

  	

  (a)

  
	

  “Project

  Budget”

  	

   

  	

  3.5

  	

  (b)

  
	

  “Publication”

  	

   

  	

  9.5

  	

   

  
	

  “Renewal

  Term”

  	

   

  	

  15.1

  	

   

  
	

  “Reporting

  Party”

  	

   

  	

  4.5.2

  	

   

  
	

  “Royalty

  Reports”

  	

   

  	

  4.5.1

  	

   

  
	

  “Steering

  Committee”

  	

   

  	

  2.1

  	

   

  
	

  “[***]”

  	

   

  	

  15.6.3

  	

  (b)

  
	

  “Third

  Party Claim”

  	

   

  	

  16.3.2

  	

   

  
	

  “[***]

  Product”

  	

   

  	

  7.2

  	

   

  
	

  “Withholding

  Taxes”

  	

   

  	

  5.3

  	

   

  
	

  “Working

  Teams”

  	

   

  	

  3.1

  	

  (c)

  

 

1.3           Certain Rules of Interpretation in this Agreement and

the Schedules.

 

(a)           Unless otherwise specified, all

references to monetary amounts are to United States of America currency (U.S.

Dollars);

 

(b)           The descriptive headings of Articles

and Sections are inserted solely for convenience of reference and are not

intended as complete or accurate descriptions of the content of such Articles

or Sections;

 

(c)           The use of words in the singular or

plural, or with a particular gender, shall not limit the scope or exclude the

application of any provision of this Agreement to such person or persons or

circumstances as the context otherwise permits;

 

(d)           The words “include” and “including”

have the inclusive meaning frequently identified with the phrases “without

limitation” and “but not limited to”;

 

(e)           Subject to Article 17, whenever a

provision of this Agreement requires an approval or consent by a Party to this

Agreement and notification of such approval or consent is not delivered within

the applicable time limit, then, unless otherwise specified, the Party whose

approval or consent is required shall be conclusively deemed to have withheld

its approval or consent;

 

9

 

(f)            Unless otherwise specified, time

periods within or following which any payment is to be made or act is to be

done shall be calculated by excluding the day on which the period commences and

including the day on which the period ends and by extending the period to the

next business day following if the last day of the period is not a business day

in the jurisdiction of the Party to make such payment or do such act; and

 

(g)           Whenever any payment is to be made or

action to be taken under this Agreement is required to be made or taken on a

day other than a business day, such payment shall be made or action taken on

the next business day following such day to make such payment or do such act.

 

ARTICLE

2 — STEERING COMMITTEE

 

2.1           Formation

of Steering Committee.  Within

[***]

of the Effective Date, the Parties shall establish a joint committee (the “Steering

Committee”) to make certain decisions regarding the

Collaboration.  The Steering Committee

will be composed of [***] representatives of each Party, who

shall be appointed (and may be replaced at any time) by such Party on written

notice to the other in accordance with this Agreement.  Such representatives shall possess the

requisite experience and seniority to enable them to make decisions on behalf

of the Parties with respect to the Collaboration.  Development Decisions, and such other decisions as expressly set

forth herein, shall be subject to approval of the Parties.

 

2.2           Responsibilities

of the Steering Committee.  The

Steering Committee will be responsible for, among other things:

 

(a)           determining the overall strategy for

the Collaboration in the manner contemplated by this Agreement;

 

(b)           within [***] of the Effective Date,

formulating a final Work Plan, which shall be attached to this Agreement as Exhibit

F and may be amended from time to time by the Steering Committee;

 

(c)           preparing a Project Plan and Project

Budget for each Collaboration Product;

 

(d)           coordinating, expediting, overseeing

and controlling all development of Collaboration Products in the Field,

including pre-clinical research, clinical research, manufacturing, regulatory

filings and post approval development studies;

 

(e)           monitoring, reviewing and directing

the commercialization of Collaboration Products within the Field, including

developing annual marketing and sales budgets, annual forecasts or sales and

production requirements, an annual marketing plan, product positioning,

creative campaign strategies, pricing and managed care contract strategies;

 

10

 

(f)            evaluating additional technologies

that may be necessary or beneficial to the Collaboration and recommending the

acquisition or in-licensing of these technologies;

 

(g)           addressing, financial issues which

arise in connection with the Collaboration in the areas of accounting, cost

allocation, budgeting and financial reporting

 

(h)           settling disputes or disagreements

between the Parties regarding the Collaboration ; and

 

(i)            performing such other functions as

appropriate to further the purposes of this Agreement.

 

2.3.          Steering

Committee Decision-Making.  The

Steering Committee will make decisions related to the matters set forth above

and such day-to-day matters as necessary to progress the Collaboration.  Development Decisions and other decisions

deemed extraordinary by a majority of the Steering Committee shall be made by

mutual agreement of the Parties within [***] of the Steering Committee presenting

such extraordinary matters to the Parties. 

All decisions of the Steering Committee will be based on a [***]

vote of the total number of members of the Steering Committee, regardless of

the number of members actually in attendance at a meeting; provided that

no decision may be made at any Steering Committee meeting unless there is at

least one (1) representative from each Party in attendance at such

meeting.  The Steering Committee will

have an appointed Chairperson who shall hold such position for [***].  The Chairperson shall preside over meetings

of the Steering Committee and shall perform such other duties as shall be

assigned to him or her from time to time by the Steering Committee.  The Chairperson will alternate between SGI

and GCOR with the first Chairperson being a GCOR representative.  Any member of the Steering Committee may

designate a substitute to attend and perform the functions of that member

(including voting) at any meeting of the Steering Committee.  The Steering Committee will meet, either in

person or by teleconference, at least [***], or more frequently upon [***]

agreement of the members of the Steering Committee.  Face-to-face meetings, unless otherwise agreed, will alternate

between Bothell and Palo Alto.  The

Steering Committee may also act by written consent of [***] of the members of the

Steering Committee.

 

2.4.          Progress Reports.  Within [***] after the end of each [***]

during which research, development or commercialization activities with respect

to Collaboration Products are performed by or on behalf of the Parties, each

Party shall provide to the other Party through the Steering Committee a written

progress report, which shall (a) describe such activities and any other work

relating to the Collaboration Products that it has performed, or caused to be

performed, during such [***], (b) evaluate the work performed in

relation to the goals of the Work Plan and any existing Project Plans and

Project Budgets, and (c) provide such other information as may be required by

the Work Plan, Project Plan or Project Budget or reasonably requested by the

other Party relating to such activities.

 

2.5.          Dispute Resolution.  Any dispute that may arise relating to the

terms of this Agreement or the activities of the Parties hereunder shall be

brought to the attention of the

 

11

 

Steering

Committee, which shall attempt in good faith to achieve a resolution.  Either Party may convene a special meeting

of the Steering Committee for the purpose of resolving disputes.  If the Steering Committee is unable to

resolve such a dispute within [***] of the first presentation of such

dispute to the Steering Committee, such dispute shall be resolved in accordance

with the dispute resolution procedures set forth in Section 22.3.

 

ARTICLE

3 —  CONDUCT OF THE COLLABORATION

 

3.1           General Responsibilities of the Parties.  Subject to each Party’s internal decisions

regarding allocation of its resources, the general responsibilities of the

Parties under the Collaboration are intended to be as follows:

 

(a)           SGI

Responsibilities.  SGI will use

Commercially Reasonable Efforts to: (i) perform [***] to determine [***];

(ii) perform [***] on all [***] provided by either Party; and (iii)

identify and research potential [***] and/or [***] other than [***],

including those that do not relate to [***], for development consideration.  Assays will include [***] experiments comparing [***]

with [***].

Once [***],

SGI will use Commercially Reasonable Efforts to perform [***], using [***]

of [***],

to assess [***]

for consideration to include in a [***]. Prior to [***], SGI will be

responsible for the [***] of [***] for use in combination

with [***].

 

(b)           GCOR Responsibilities.  GCOR will use Commercially Reasonable

Efforts to: (i) perform analysis of the [***] using [***]; (ii) determine [***]

with the objective of [***] of [***] in humans; (iii)

introduce [***]

into the [***];

(iv) test [***]

using [***]

to identify those with [***] to [***]; (v) produce [***]

of [***]

for each of the best [***] for delivery to SGI for testing in [***];

and (vi) identify and research potential [***] (excluding [***] components thereof) for

development consideration.  In the event

[***]

described above are not successful, GCOR will, at its discretion, attempt to

provide other [***], either new, or through [***] of [***] provided by SGI, for

SGI to test and for the Steering Committee to consider for further

development.  Additionally, GCOR will

attempt to develop a process for [***], or a [***], but [***]

form of [***],

or other [***]

mutually agreed upon, at a level of [***] determined by the Steering Committee.

 

(c)           Reallocation of Responsibilities.  Responsibilities set forth in Sections

3.1(a) and (b) reflect the Parties’ skills and interests as of the Effective

Date, which skills and interests may evolve during the Term, at which time

responsibilities may be reallocated [***].

 

(d)           Cooperation.  In order to advance the Collaboration SGI

and GCOR personnel working on the Collaboration including research,

development, pre-clinical and clinical personnel as appropriate (“Working

Teams”) will periodically and at least [***] exchange  information

and results relating to their efforts on behalf of the Collaboration.  This exchange will be done primarily through

telephonic conference calls, but may also include face-to-face meetings, site

visits or other methods as deemed appropriate by the Steering Committee.

 

12

 

(e)           Intent.  During the term of the Agreement, the

Parties intend that each will contribute sufficient resources to the

Collaboration to identify and present Collaboration Products to the Steering

Committee for consideration in a Development Program.

 

3.2.          Scope of the Research Program.   The initial scope of the Research

Program shall comprise research efforts relating to [***].  At the discretion of the Steering Committee,

the Research Program may be expanded to include research efforts relating to

other SGI Technology or GCOR Technology, such as other [***] within the Field.  Absent agreement to the contrary, nothing

contained in this Agreement shall obligate either SGI or GCOR to provide to the

other or to the Collaboration novel cancer targets regardless of whether they

might be useful within the Field.

 

3.3.          Conduct of Research Program.  Under the direction and supervision of

the Steering Committee, the Parties shall use Commercially Reasonable Efforts

to conduct their respective research and development activities in accordance

with this Agreement.  All research work

performed by GCOR and SGI pursuant hereto shall be performed in a good

scientific manner and in compliance with all applicable laws.

 

3.4           Research Program Expenses. [***] costs

incurred with respect to any Collaboration Product [***] (“Research Costs”).

 

3.5           Development Program.  The Steering Committee shall determine

whether to advance each Collaboration Product to a Development Program as set

forth in Article 2.  Upon such

advancement, the following terms shall apply:

 

(a)           Project Plans and Project Budgets.  The Steering Committee shall develop and

implement a project plan (each a “Project Plan”) and project budget (each a “Project

Budget”) for the research, development, manufacture and

commercialization of each Collaboration Product that has entered a Development

Program.  It is understood that the

components of each Project Plan and Project Budget will evolve as the

applicable Collaboration Product moves through the development, manufacture and

commercialization life cycle.

 

(b)           Development Costs.  The Parties shall [***] expenses incurred in

connection with any Collaboration Products that [***], including without

limitation costs associated with [***] and [***] (collectively, “Development

Costs”); provided, however, that such costs or

expenses may not exceed (or be projected to exceed) the amounts set forth in

the relevant Project Budget with respect to such Collaboration Product by more

than [***]

in any [***]

without the approval of the Steering Committee (“Authorized Development Costs”).  For the purposes of calculating development

costs, each employee of either Party working on a Development Program shall be

valued at [***]

per FTE per year increasing at a rate of [***] per [***] starting on the [***]

of the Effective Date.  Within [***]

after the end of each [***], each Party shall furnish the

Steering Committee with: (a) a statement detailing the Development Costs

actually incurred by or on behalf of such Party during such [***];

and (b) a comparison of the actual Development Costs with the projections

set forth in the Project Budget.  Within

[***]

after

 

13

 

the end

of each [***],

the Parties shall make any necessary re-balancing payments to each another so

that [***]

shall bear [***] of the total Authorized Development Costs for such [***].

 

(c)           SGN-17/19.  The Parties intend that promptly after the

Effective Date, SGN-17/19 will be [***]. 

Accordingly, [***] associated with the [***]

of [***],

as specified in the Project Budget will be [***].

 

3.6           Resourcing Development Activities.  With respect to any Development Program

activities that can be outsourced, including but not limited to activities such

as toxicology studies, clinical and commercial supplies of Collaboration

Products in a Development Program, and clinical development activities, the

Steering Committee may solicit bids from Third Parties.  Each Party shall have the right to submit a

bid on such terms, as it desires.   The

Steering Committee shall use its best efforts to enter into appropriate

agreement(s) with the Third Party that is best able to meet the Parties’

requirements, taking into consideration such factors as price, quality,

capacity, quantity, reliability and reputation.  In the event the Steering Committee selects a Party to provide

such development activities pursuant to this Section 3.6, the price and other

terms and conditions of such services shall be based on arm’s length

negotiations with the Steering Committee.

 

3.7           Marketing and Sales

Responsibilities.  The

Parties may out license Collaboration Products in a Development Program;

however, if the Parties decide to further develop and commercialize a

Collaboration Product already in a Development Program, the Parties shall

negotiate and conclude a marketing and sales agreement or such other agreement

as deemed appropriate and necessary to complement the terms set forth in this

Collaboration Agreement promptly after such decision, setting forth the Parties

rights and obligations, cost sharing, profit sharing and such other matters as

deemed necessary and appropriate.

 

ARTICLE

4 — FINANCIAL TERMS

 

4.1           Equity Purchase.  GCOR shall purchase Three Million U.S.

Dollars ($3,000,000) of common stock of SGI on the terms set forth in the Stock

Purchase Agreement.

 

4.2           Milestone Payments.  The Parties shall make the following

payments to each other within [***] of the first occurrence of each event

set forth below:

 

(a)           SGI

will make a payment of U.S. [***] to GCOR upon the [***] by GCOR to SGI of

either:

 

(i)            a [***] having all of the

following [***]

traits: (1) [***] or a mutually agreed upon [***]

with a [***];

(2) [***]

to other [***]

comparable to or less than [***]; (3) [***] of [***] to [***] of at least [***]

of [***];

and (4) [***]

comprising [***] in the [***] (the [***] to be agreed to by the

Steering Committee) that result in a decrease of the [***] of the [***]

to less than [***] relative to the [***] of [***]; or

 

14

 

(ii)           a [***]

that is not a [***] with an [***] or [***] having traits [***]

specified in Section 4.2(a)(i) above and [***] based on [***] over time) [***]

to [***]

when both are combined with [***].

 

(b)           GCOR shall make a payment of U.S. [***]

to SGI upon [***].

 

(c)           SGI shall make a payment of U.S. [***]

to GCOR upon the earlier of: (i) the [***] of the  first [***] that [***];

or (ii) completion of the [***] that [***] if [***] by the Steering

Committee for reasons other  than [***].

 

(d)           GCOR shall make a payment of U.S. [***]

to SGI on the [***] anniversary of the Effective Date.

 

(e)           If the Steering Committee is [***] on

the [***]

anniversary of the Effective Date, GCOR shall make a payment of U.S. [***]

to SGI.

 

4.3           Royalties.

 

4.3.1        Royalties Payable by SGI.  During the Royalty Term, SGI shall pay

royalties to GCOR on Net Sales of [***] Products for which [***]

has [***]

pursuant to Section 7.1,  determined on a [***] Product-by-[***] Product

basis, as follows:

 

	

  For [***]

  Products Incorporating:

  	

   

  	

  Rate1

  	

   

  	

  Rate 2

  	

   

  
	

  [***]

  	

   

  	

  [***]

  	

  %

  	

  [***]

  	

  %

  
	

  [***]

  	

   

  	

  [***]

  	

  %

  	

  [***]

  	

  %

  
	

  [***]

  	

   

  	

  [***]

  	

  %

  	

  [***]

  	

  %

  

 

Rate 1 shall apply if [***] with respect to such [***] Product

prior to completing the [***] of the first [***] in a [***]

for such [***]

Product.  Rate 2 shall apply

if [***]

with respect to such [***] Product after completing the [***]

of the first [***] in a [***] for such [***] Product.

 

If a [***] Product incorporates [***],

the royalties payable by SGI shall be [***]. 

For purposes of illustration, if a [***] Product incorporates [***],

SGI shall pay royalties to GCOR on Net Sales of such [***] Product at the rate of [***]

above.

 

4.3.2.       Royalties

Payable by GCOR.  During the Royalty

Term, GCOR shall pay royalties to SGI on Net Sales of [***] Products for which [***] pursuant

to Section 7.1, determined on a [***] Product-by-[***] Product basis, as

follows:

 

	

  For [***] Products Incorporating:

  	

   

  	

  Rate 1

  	

   

  	

  Rate 2

  	

   

  
	

  [***]

  	

   

  	

  [***]

  	

  %

  	

  [***]

  	

  %

  

 

Rate 1

shall apply if [***] with respect to such [***] Product prior to

completing the [***] of the first [***] in a [***] for such [***] Product.  Rate 2 shall apply if [***] with respect

 

15

 

to such

[***] Product

after completing the [***] of the first [***] in a [***]

for such [***]

Product.

 

4.4           Third-Party Obligations.

 

4.4.1        Collaboration Products.  The Parties shall [***] any

royalties, milestones or other payments owed to Third Parties based on a

decision made by the Steering Committee on account of Exploitation of

Collaboration Products.

 

4.4.2        [***] Products.  The [***] Party electing to [***]

a [***] Product

shall be responsible for [***] of such [***] Product arising under

the [***]

or arising after the Effective Date based on a decision made by the Steering

Committee.  The [***] Party shall remain

responsible for [***] of such [***] Product  based on agreements existing

prior to the Effective Date and to which the [***] Party was a party

excluding the [***].

 

4.5           Royalty

Reports.

 

4.5.1        Reports.  During the Royalty Term, any Party

commercializing a [***] Product subject to royalty payments

pursuant to Section 4.3 shall provide to the other Party, with respect to each [***],

a written report showing on a consolidated basis in reasonably specific detail

and [***],

(a) the gross sales of [***] Products sold by such Party and its

Affiliates during the corresponding [***] and the calculation of Net Sales from

such gross sales; (b) the royalties payable in U.S. dollars, if any, which

shall have accrued hereunder based upon Net Sales of [***] Products; (c) the

withholding taxes, if any, required by law to be deducted in respect of such

royalties; (d) the dates of the First Commercial Sale of each [***]

Product in each country if it has occurred during the corresponding [***];

and (e) the exchange rates (as determined pursuant to Section 5.2 herein)

used in determining the royalty amount expressed in U.S. dollars (collectively,

“Royalty

Reports”).

 

4.5.2        Submission of Reports and Payment.

The Party making such Royalty Reports (the “Reporting Party”) shall include in each

permitted sublicense granted by it pursuant to this Agreement a provision

requiring its Sublicensees to make Royalty Reports to the other Party consistent

with Section 4.5.1.    Royalty Reports

and payment shall be due on the [***] day following the close of each [***].  Subject to Section 5.4, the Reporting Party

shall keep complete and accurate records in sufficient detail to properly

reflect all gross sales and Net Sales and to enable the royalties payable

hereunder to be determined.

 

ARTICLE

5 — PAYMENTS TERMS; RECORDS; AUDITS

 

5.1           Payment Method.  All amounts due by one Party hereunder shall

be paid in U.S. dollars by wire transfer in immediately available funds to an

account designated by the receiving Party. 

Any payments or portions thereof due hereunder which are not paid within

[***]

of  the date such payments are due under

this Agreement shall bear interest at a rate equal to the lesser of the [***],

on the first day of each [***] in which such payments are overdue,

plus [***]

 

16

 

percent ([***]%),

or the maximum rate permitted by law, calculated on the number of days such

payment is delinquent, compounded monthly.

 

5.2           Currency; Foreign Payments.  If any currency conversion shall be required

in connection with any payment hereunder, such conversion shall be made by

using the exchange rate for the purchase of U.S. dollars as published in [***]

on the last business day of the [***] to which such payments relate.

 

5.3           Taxes.  A Party may deduct from any amounts it is required to pay pursuant

to this Agreement an amount equal to that withheld for or due on account of any

taxes (other than taxes imposed on or measured by net income) or similar

governmental charge imposed by a jurisdiction other than the United States (“Withholding

Taxes”).  At the receiving

Party’s request, the paying Party shall provide the receiving Party a

certificate evidencing payment of any Withholding Taxes hereunder and shall

reasonably assist the receiving Party, at the receiving Party’s expense, to

obtain the benefit of any applicable tax treaty.

 

5.4           Records Retention; Audit.

 

5.4.1        Record Retention.  Each Party shall maintain (and shall ensure

that its Affiliates and Sublicensees shall maintain) complete and accurate

books, records and accounts that fairly reflect their respective: (a)

Development Costs reimbursable or otherwise shared by the Parties hereunder and

(b) royalties payable hereunder by one Party to the other Party with respect to

[***]

Products in each case in sufficient detail to confirm the accuracy of any

payments required hereunder and in accordance with generally accepted

accounting principles, which books, records and accounts shall be retained by

such party [***] after the end of the period to which such books, records

and accounts pertain.

 

5.4.2        Audit.  Each Party shall have the right to have an

independent certified public accounting firm of nationally recognized standing,

reasonably acceptable to the audited Party, to have access during normal

business hours, and upon reasonable prior written notice, to such of the

records of the other Party (and its Affiliates and Sublicensees) as may be

reasonably necessary to verify the accuracy of such Development Costs and

royalties, as applicable, for any [***] ending not more than [***]

prior to the date of such request; provided, however, that

neither Party shall have the right to conduct more than one such audit in any [***]

period.  The accounting firm shall only

disclose to each Party whether such Development Costs or royalties, as

applicable, are correct or incorrect and the specific details concerning any

discrepancies.  No other information

shall be provided to the requesting Party. 

The requesting Party shall bear the cost of such audit unless the audit

reveals a variance of more than [***] percent ([***]%) from the reported

results, in which case the audited Party shall bear the cost of the audit.  The results of such accounting firm shall be

final, absent manifest error.

 

5.4.3        Payment of Additional Amounts.  If, based on the results of such audit,

additional payments are owed by a Party under this Agreement, such Party shall

make such additional payments, with interest from the date originally due at

the rate of [***] percent ([***]%) per month, within [***]

after the date on which such accounting firm’s written report is delivered to

such Party.

 

17

 

5.4.4        Confidentiality.  The auditing Party shall treat all

information subject to review under this Section 5.4 in accordance with the

confidentiality provisions of Article 9 and shall cause its accounting firm to

enter into a reasonably acceptable confidentiality agreement with the audited

Party obligating such firm to maintain all such financial information in

confidence pursuant to such confidentiality agreement.

 

5.5           Sales by

Affiliates and Sublicensees. 

Each Party shall include in each permitted sublicense granted by it

pursuant to the Agreement a provision requiring its Affiliates and Sublicensees

to make reports to the other Party, to keep and maintain records of sales made

pursuant to such sublicense and to grant access to such records by the other

Party’s independent accountant to the same extent required with respect to such

Party’s records under this Agreement.

 

ARTICLE 6 — LICENSES

 

6.1           [***] Licenses.

 

6.1.1

       By SGI.  Subject to the terms and conditions of this

Agreement, SGI hereby grants to GCOR and its Affiliates a [***], license or sub-license

under the SGI ADEPT Patents  and Joint

Technology, with the limited right to sublicense as permitted in Section 6.4,

solely to Exploit Products within the Field.

 

6.1.2        By GCOR.  Subject to the terms and conditions of this

Agreement, GCOR hereby grants to SGI and its Affiliates a [***], license under the GCOR

TEPT Patents and Joint Technology, with a limited right to sublicense as

permitted in Section 6.4, solely to Exploit Products within the Field.

 

6.2           [***] Licenses.

 

6.2.1        By SGI.  Subject to the terms and conditions of this Agreement, SGI hereby

grants to GCOR and its Affiliates a [***], license or sub-license under the (a)

SGI Background Technology; and (b) SGI ADEPT Know-How; with the limited right

to further sublicense as permitted in Section 6.4, solely to Exploit Products

within the Field.  SGI hereby grants to

GCOR and its Affiliates a [***] sublicense under the SGI [***]

Patents with the limited right to sublicense as permitted in Section 6.4,

solely to Exploit Products in the Field.

 

6.2.2        By

GCOR.  Subject to the terms and

conditions of this Agreement, GCOR hereby grants to SGI and its Affiliates a [***],

license under the (a) GCOR Background Technology; and (b) GCOR TEPT Know-How;

with a limited right to sublicense as permitted in Section 6.4, solely to

Exploit Products within the Field.

 

6.3           [***]

Product Licenses.  If one

Party [***]

with respect to a particular [***] Product pursuant to Article 7, the [***]

Party shall thereupon be automatically deemed to have granted to the [***]

Party a [***]

to the extent [***], license under such Party’s Technology, with the right

to sublicense, to Exploit the particular [***] Product within the Field.

 

18

 

6.4           Rights to Sublicense.  Neither Party may further sublicense the

rights granted to it pursuant to Section 6.1 and 6.2 except as follows:  (a) the [***] Party may sublicense the rights

granted to it pursuant to Section 6.1 or 6.2 to a Sublicensee solely to Exploit

a [***]

Product in the Field; and (b) either Party may sublicense to a Third Party

under its interest in Joint Technology solely for the Exploitation of products [***].  No approval shall be required for

sublicensing conducted by the Parties under this Section 6.4; provided that the

Party granting such sublicense shall forward to the other Party a fully

executed copy of such sublicense agreement or amendment thereof (either of

which may be redacted to remove confidential information) within [***]

of execution of such sublicense agreement or amendment.  Neither party may grant any rights under the

Joint Technology to any Third Party [***] that would restrict the other Party’s

use of the Joint Technology, except by mutual agreement of the Parties.

 

6.5           Third Party Licenses.  Each Party shall be free to license its

respective Background Technology to Third Parties within or outside the Field

without notice or approval.  Only by

decision of the Steering Committee, as approved by the Parties, may licenses or

sublicenses to SGI ADEPT Technology, GCOR TEPT Technology and Joint Technology

be granted to Third Parties for Exploitation of Products within the Field.

 

6.6           [***]. 

All licenses granted by SGI to GCOR herein are subject to the terms and

conditions of the [***], including the [***]. 

GCOR and its Sublicensees agree to comply with the following

sections of the [***], and any amendments thereto upon written disclosure

thereof to GCOR, as if GCOR were a party to the [***]: Sections [***].  The Parties agree that [***] is a [***]

to this Agreement with respect to SGI Technology that includes technology [***].  SGI hereby agrees that it will not amend or

otherwise modify the [***] in any manner that negatively impacts

GCOR’s rights or obligations hereunder without the prior written consent of

GCOR.  If [***] under the [***]

to [***],

SGI agrees to [***].  SGI will

provide GCOR notice of any other amendment or modification to the [***]

including a copy thereof within [***] of execution of such amendment;

provided that SGI may redact such amendment to remove confidential information

that is not related to GCOR’s rights or obligations.

 

6.7           Restriction on Use.  Notwithstanding anything to the contrary in

this Agreement, GCOR shall not have any right to [***].

 

ARTICLE

7 — [***] DEVELOPMENT

AND COMMERCIALIZATION

 

7.1           [***] by a Party.  Each Party (the “[***] Party”) shall have the

right, on [***]

written notice to the other (an “[***] Notice”), to [***] at any time; provided

that such Party shall be responsible for all [***] that the Steering

Committee has approved in the applicable [***] for the [***] following the date that

the other Party receives such Party’s [***] Notice to the extent such [***].

 

7.2           Rights and Obligations of Parties

with Respect To [***] Products.  Upon

receipt by a Party of an [***] Notice with respect to a [***],

the receiving Party shall have the right on written notice to the [***]

Party within [***] following receipt of the [***] Notice, to proceed [***]

(the “[***]

Party”) with the [***] of such Product  (each, a “[***] Product”)],

 

19

 

subject to [***].  The [***] Party shall have: (a) [***] to

[***]

any additional efforts in respect of such [***] Product except as set forth in

Section 7.1; (b) [***] regarding such [***] in respect of such [***]

Product; and (c) [***] to [***] of such [***] Product.  In the event that neither Party elects to [***],

or the [***]

Party subsequently [***] of a [***] Compound such [***] or

such [***]

Product shall become a [***] Product and the rights and

obligations of the Parties with respect thereto shall thereafter be governed by

Section 7.4.

 

7.3           Diligence of [***] Party.  A [***] Party shall use Commercially

Reasonable Efforts to develop and commercialize a [***] Product.  The [***] Party will provide to the [***]

Party a written report overviewing the continued development and

commercialization activities of the [***] Product upon request and no more than

[***].  Failure to [***] the [***]

Compound over a [***] period shall result in the [***] Compound becoming a [***]

Product.

 

7.4           Third-Party Research, Development and

Commercialization of [***] Products.  At the discretion of the Steering Committee, the Parties

shall have the right, at any time with respect to a [***] Product or [***]

Product, to license to Third Parties rights with respect to the research,

development, manufacture or commercialization of such [***] Product or [***]

Product on such terms and conditions as the Parties may mutually agree; provided

that any disputes between the Parties as to whether or not to grant such a

license shall not be subject to any Third Party dispute resolution mechanism.

 

7.5           [***] Products.  If the Parties [***] of a particular [***] Product [***],  and

the Parties have not [***] to such [***] Product to a Third

Party pursuant to Section 7.3 that would be inconsistent therewith, (each, a “[***]

Product”) either Party shall have the right at any time to [***]

such [***]

Product to the [***] to discuss whether to [***] of such [[***] Product.  The initiating Party shall specify the

reasons for proposing to [***].  If,

within [***]

after the receipt of such notice, the other Party fails to notify the

interested Party in writing that it wishes to [***] of such [***] Product,

then the interested Party shall have the right to [***] of such [***]

Product as a [***] Product pursuant to Sections 7.1 and 7.2.

 

ARTICLE

8 — DISCLOSURE OF INFORMATION

 

8.1           Exchange of Know-How.  During the Term,  each Party will, and will

cause its Affiliates and Sublicensees, as applicable, to, without additional

compensation and at such Party’s sole expense, disclose and make available to

the other Party, in whatever form each such other Party may reasonably request,

all Regulatory Documentation, all of its Background and Co-Exclusive Know-How,

all Joint Know-How and any other Information and Inventions reasonably

necessary for the Exploitation of any Collaboration Product in a Development

Program.

 

8.2           Cooperation.  With respect to the research, development, commercialization

or other Exploitation of the Collaboration Products, each Party, shall

cooperate with any and all reasonable requests for assistance from the other

Party, including by making its employees, consultants and other scientific

staff available upon reasonable notice during normal business hours at their

respective places of employment to consult with such other Party, as

applicable, on issues arising during such research, development,

commercialization or Exploitation.

 

20

 

8.3           Regulatory Records.  With respect to the subject matter of this

Agreement, each Party shall maintain, or cause to be maintained, records of its

respective research, development, manufacturing and commercialization activities,

including all Regulatory Documentation, in sufficient detail and in good

scientific manner appropriate for patent and regulatory purposes, which shall

be complete and accurate and shall fully and properly reflect all work done and

results achieved in the performance of such activities, and which shall be

retained during the term of this Agreement and for a period of [***]

thereafter, or for such longer period as may be required by Applicable Law.

 

ARTICLE

9 — CONFIDENTIALITY

 

9.1           Non-Disclosure Obligations.  Except as otherwise provided in this

Article 9, during the Term and for a period of [***] thereafter, each Party

shall maintain in confidence, and use only for purposes as expressly authorized

and contemplated by this Agreement, all confidential or proprietary

information, data, documents or other materials supplied by the other Party

under this Agreement and marked or otherwise identified as “Confidential”,

including all SGI Technology and GCOR Technology.  For purposes of this Agreement, information and data described

above shall be hereinafter referred to as “Confidential Information”.  Each Party shall use at least the same

standard of care as it uses to protect its own Confidential Information to

ensure that its and its Affiliates’ employees, agents, consultants and clinical

investigators only make use of Confidential Information for purposes as

expressly authorized and contemplated by this Agreement and do not disclose or

make any unauthorized use of such Confidential Information.

 

9.2           Permitted Disclosures.  Notwithstanding the foregoing, the

provisions of Section 9.1 hereof shall not apply to information, documents or

materials that can conclusively be established:

 

(a)           to have become published or otherwise

entered the public domain other than by acts of the recipient in contravention

of this Agreement;

 

(b)           are permitted to be disclosed by

prior consent of the discloser;

 

(c)           have become known to the recipient by

a Third Party, provided such Confidential Information was not obtained by such Third

Party directly or indirectly from the discloser on a confidential basis;

 

(d)           prior to disclosure under the

Agreement, was already in the possession of the recipient or its Affiliates or

Sublicensees;

 

(e)           is disclosed in a press release

agreed to by both Parties hereto, which agreement shall not be unreasonably

withheld; and

 

(f)            are required to be disclosed by the

recipient to comply with any applicable law, regulation or court order, or are

reasonably necessary to obtain Patents, copyrights or

 

21

 

authorizations to conduct clinical trials with, and to

commercially market Product(s), provided that the recipient shall provide prior

notice of such disclosure to the discloser and take reasonable and lawful

actions to avoid or minimize the degree of disclosure.

 

9.3           Terms of the Agreement.  GCOR and SGI shall not disclose any

terms or conditions of this Agreement to any Third-Party without the prior

consent of the other Party, except as required by applicable laws, the

Securities and Exchange Commission (“SEC”) or any listing agency on which a

Party’s stock is traded, regulations or a court order (and in any such case the

Recipient shall provide notice to the Discloser and take reasonable and lawful

actions to avoid or minimize the degree of such disclosures).

 

9.4           Press Releases and Other Disclosures to Third-Parties.  The Parties shall mutually agree upon

press releases to be released announcing the execution of this Agreement and

the existence of the Collaboration.  For

any subsequent press releases or disclosures relating to the Collaboration,

each Party shall promptly review and comment or approve any press release

proposed by the other Party.  Failure to

respond or approve within [***] of receipt of a proposed press

release shall be deemed acceptance. 

Neither SGI nor GCOR will, without the prior consent of the other, issue

any other press release or make any other public announcement or furnish any

statement to any Person concerning the terms of this Agreement and the

transactions contemplated thereby, except for: (i) disclosures made in

compliance with Sections 9.2 and 9.3 hereof; (ii) disclosures to

attorneys, consultants, and accountants retained to represent them in

connection with the transactions contemplated hereby; and

(iii) occasional, brief comments by the respective officers of GCOR and

SGI consistent with such guidelines for public statements as may be mutually

agreed by GCOR and SGI made in connection with routine interviews with analysts

or members of the financial press.

 

9.5           Publications Regarding Results of the Collaboration.  Neither Party may publish, present or

announce results of the Collaboration either orally or in writing (the “Publication”)

without obtaining the written consent of the other Party.  The other Party shall have [***]

from receipt of the proposed Publication to provide comments and/or proposed

changes to the disclosing Party.  The

disclosing Party shall take into account the comments and/or proposed changes

made by the other Party on any Publication and shall agree to have employees or

others acting on behalf of the other Party be mentioned as co-authors on any

Publication describing results to which such persons have contributed.  If the other Party reasonably determines the

Publication would amount to the public disclosure of such Party’s Confidential

Information and/or of a patentable invention upon which a patent application

should be filed prior to any such disclosure, submission of the concerned

Publication to Third-Parties shall be delayed for a [***] period from the date of

said notice, or for such longer period which may appear necessary for

appropriately deleting Confidential Information from the proposed Publication

and/or drafting and filing a patent application covering such invention.

 

ARTICLE 10 — COMMERCIALIZATION OF

COLLABORATION PRODUCTS 

 

10.1         Commercialization Efforts.  Subject to Section 3.3, the Parties each

agree to use Commercially Reasonable Efforts to collaborate diligently on the

commercialization of

 

22

 

Collaboration Products, including without limitation regulatory,

marketing, sales, distribution efforts. 

The Parties shall be guided by a standard of reasonable in economic

terms and of fairness to each of the Parties, striving to balance as best they

can the legitimate interests and concerns of the Parties to realize the

economic potential of Collaboration Products.

 

10.2         Product Trademarks.  All Collaboration Products shall be sold

under Product Trademarks selected by the Steering Committee and owned jointly

by the Parties. The Steering Committee shall use its best efforts to select

worldwide Product Trademarks. Such Product Trademarks shall not be confusingly

similar to, misleading or deceptive with respect to, or dilute any of the

Trademarks owned or Controlled by either of the Parties, or any part of such

Trademarks.  Absent agreement to the

contrary, no Party or any of its Affiliates or Sublicensees shall commercialize

a Collaboration Product under any Trademark other than the Product Trademarks.

 

ARTICLE

11 — INTELLECTUAL PROPERTY

 

11.1         Intellectual

Property Ownership.  SGI

shall retain all its right, title and interest in all SGI Technology and GCOR

shall retain all its right, title and interest in all GCOR Technology.  All Joint Know-How shall be [***]

owned by SGI and GCOR, and [***] Party shall retain [***] in

any Joint Patents resulting therefrom, with [***] rights in any field and

subject to the licenses granted in Article 6, the right to sublicense pursuant

to Sections 6.4 and 15.6.3(c).  The laws

of the United States with respect to joint ownership of inventions shall apply

in all jurisdictions giving force and effect to this Agreement.

 

11.2         Ownership

of Product Trademarks. 

The Parties shall each own [***] in each Product Trademark with

respect to a Collaboration Product.  In

the event that a Party [***] with respect to a Collaboration

Product, it shall, without any additional consideration, assign all of its

right, title and interest in and to any Product Trademark with respect to such [***]

Product to the [***] Party; provided, however, that each Party

shall retain all of its right, title and interest in and to any Product

Trademarks with respect to [***] Products.

 

11.3         Ownership

of Regulatory Documentation. 

The Parties shall [***] own all Regulatory Approvals with

respect to a Collaboration Product. 

Each Party shall, to the extent permitted by law, have [***]

in all other Regulatory Documentation; provided, however, that if

certain Regulatory Documentation must be held in the name of one Party only,

then SGI shall hold title for Regulatory Documentation for SGN-17/19 and

variants and GCOR shall hold title to Regulatory Documentation for any TEPT

Product.  Each [***] Party shall have the

right to own all right, title and interest in and to all Regulatory Approvals

with respect to its [***] Products.  In the event that a Party [***] with respect to a Collaboration

Product in a Development Program, it shall assign all of its right, title and

interest in and to all Regulatory Documentation with respect to such [***]

Product, including any Regulatory Approvals and applications therefore, to the [***]

Party (or its designee); provided, however, that each Party shall

retain any of its right, title and interest in and to any Regulatory

Documentation with respect to a [***] Product.  Notwithstanding the ownership of any Regulatory Approval or any

other Regulatory Documentation, each Party shall have the right to use and

reference any of the

 

23

 

Regulatory Documentation in connection with the Exploitation of

Collaboration Products as provided in this Agreement.

 

ARTICLE 12 — PROSECUTION OF PATENTS

AND TRADEMARKS 

 

12.1         SGI Patents.  As between the Parties, SGI shall have the

sole right, at its cost and expense, to obtain, prosecute and maintain

throughout the world the SGI Patents.

 

12.2         GCOR Patents.  As between the Parties, GCOR shall have the

sole right, at its cost and expense, to obtain, prosecute and maintain

throughout the world the GCOR Patents.

 

12.3         Joint Patents.  The Steering Committee shall make a

recommendation to the Parties regarding which Party is best situated to file,

prosecute and maintain Joint Patents. 

The Parties shall, and shall cause their respective Affiliates and

Sublicensees, as applicable, to, cooperate with one another with respect to the

filing, prosecution and maintenance of all Joint Patents, including selecting

outside counsel, reasonably acceptable to the Parties, to handle such filing,

prosecution and maintenance.  The

Steering Committee shall provide each Party with (i) drafts of any new

application for a Joint Patent prior to filing that application, allowing

adequate time for review and comment by the Parties if possible; provided,

however, the Steering Committee shall not be obligated to delay the

filing of any application; and (ii) copies of all correspondence from any and

all Patent offices concerning Joint Patent applications and an opportunity to

comment on any proposed responses, amendments and submissions of any kind to be

made to any and all such Patent offices. 

The Parties shall share equally in the expenses associated with the

filing, prosecution (including any interferences, reissue proceedings and

reexaminations) and maintenance of all Joint Patents.

 

12.4         Product Trademarks.  The Steering Committee, with respect to a

Product, shall supervise and direct the filing, prosecution and maintenance of

the registrations of the Product Trademarks for such Product.  The Steering Committee shall provide each

Party with (i) drafts of any new application to register a Product Trademark

prior to filing that application, allowing adequate time for review and comment

by the Parties if possible; provided, however, the Steering

Committee shall not be obligated to delay the filing of any application; and

(ii) copies of all correspondence from any and all Trademark offices concerning

Product Trademark registrations and an opportunity to comment on any proposed

responses, voluntary amendments and submissions of any kind to be made to any

and all such Trademark offices.  The

Parties shall share equally in the expenses associated with the filing,

prosecution and maintenance of such Product Trademark registrations.

 

12.5         Cooperation.  Each Party shall, and shall cause its Affiliates and

Sublicensees, as applicable, to, cooperate fully in the preparation, filing,

prosecution, and maintenance of Joint Patents, SGI Patents, GCOR Patents and

Product Trademarks.  Such cooperation

includes (a) promptly executing all papers and instruments and requiring

employees to execute such papers and instruments as reasonable and appropriate

so as to enable such other Party or the Steering Committee, as applicable, to

file, prosecute, and maintain Joint Patents, SGI Patents or GCOR Patents, as

the case may be, in any country; and (b) promptly informing such other Party of

matters that may affect the preparation, filing, prosecution, or maintenance of

any such Patents.

 

24

 

12.6         Patent Filings.  SGI covenants not to, and to cause its

Affiliates and Sublicensees, as applicable, not to, file any patent application

disclosing or claiming any GCOR Technology or the Exploitation thereof, without

GCOR’s prior written consent.  GCOR

covenants not to, and to cause its Affiliates and Sublicensees, as applicable,

not to, file any patent application disclosing or claiming any SGI Technology

or the Exploitation thereof, without SGI’s prior written consent.

 

12.7         Election not to Prosecute.  If a Party elects not (a) to pursue the

filing, prosecution or maintenance of a Joint Patent in a particular country,

(b) to pursue the registration, prosecution or maintenance of a Product

Trademark in a particular country, or (c) to take any other action with respect

to Joint Technology or a Product Trademark in a particular country that is

necessary or reasonably useful to establish or preserve rights thereto, then in

each such case such Party shall so notify the other Party promptly in writing

and in good time to enable such other Party to meet any deadlines by which an

action must be taken to establish or preserve any such rights in such Joint

Technology or Product Trademark, as applicable, in such country.  Upon receipt of each such notice by such

other Party or if, at any time, such Party fails to initiate any such action

within [***]

after a request by such other Party that it do so (and thereafter diligently

pursue such action), such other Party shall have the right, but not the

obligation, to pursue the filing or registration, or support the continued

prosecution or maintenance, of such Patent or Product Trademark, as applicable,

at its expense in such country.  If such

other Party elects to pursue such filing or registration, as the case may be,

or continue such support, then such other Party shall notify such Party of such

election and such Party shall, and shall cause its Affiliates and Sublicensees,

as applicable, to, (x) reasonably cooperate with such other Party in this regard,

and (y) promptly release or assign to such other Party, without compensation,

all right, title and interest in and to such Patent or Product Trademark, as

applicable, in such country. 

 

ARTICLE 13 — ENFORCEMENT OF PATENTS

AND TRADEMARKS

 

13.1         Rights and Procedures.  If SGI or GCOR determines that any

Technology or Product Trademark is being infringed by a Third Party’s

activities and that such infringement could affect the exercise by the Parties

of their respective rights and obligations under this Agreement, it shall

promptly notify the other Party in writing and provide such other Party with

any evidence of such infringement that is reasonably available.

 

13.1.1      Joint Technology and Product Trademarks.  With respect to Joint Technology and Product

Trademarks, the Steering Committee, upon approval of the Parties, shall have

the first right to remove such infringement using commercially appropriate

steps, including the filing of an infringement suit or taking other similar

action.  Each Party shall be responsible

for half of the reasonable and verifiable costs and expenses incurred in

connection with such action.  In the

event the Steering Committee fails to take commercially appropriate steps to

remove any infringement of any such Joint Technology or Product Trademark

within [***]

following notice of such infringement, or earlier notifies the

Parties in writing of its intent not to take such steps, either Party shall

have the right to do so at its expense; provided, however, that

if the Steering Committee has commenced negotiations with an alleged infringer

for discontinuance of such infringement within such [***] period, the Steering

Committee shall have an additional

 

25

 

[***] to conclude its negotiations before a

Party unilaterally may bring suit for such infringement.

 

13.1.2      SGI Technology and GCOR Technology.  With respect to SGI Technology or GCOR

Technology, the owner of such Technology shall have the sole right, but not the

obligation, to remove such infringement; provided, however, that

the other Party shall reimburse the owner of such Technology for [***]

of the reasonable out-of-pocket costs incurred by such owner with respect to

the removal of any such infringement with respect to any Collaboration Product.

 

13.2         Cooperation.  The Party not enforcing the applicable

Technology or Product Trademark shall provide reasonable assistance to the

other Party, including providing access to relevant documents and other

evidence, making its employees available at reasonable business hours, and

joining the action to the extent necessary to allow the enforcing Party to

maintain the action.

 

13.3         Recovery.  Any amounts recovered by a Party pursuant to Section 14.1,

whether by settlement or judgment, shall be used to reimburse the Parties for

their reasonable costs and expenses in making such recovery (which amounts

shall be allocated pro rata if insufficient to cover the totality of such

expenses), with any remainder being retained by the Party that has exercised

its right to bring the enforcement action; provided, however,

that to the extent that any award is attributable to loss of sales of a

Collaboration Product, the Parties shall negotiate in good faith an appropriate

allocation of such award to reflect the economic interests of the Parties under

this Agreement with respect to such Collaboration Product.

 

13.4         Potential Third Party Rights.

 

13.4.1      Third Party Licenses.  If (a) in the Collective Opinion

of Counsel, a Party, or any of its Affiliates or Sublicensees, cannot Exploit a

Collaboration Product in a country without infringing one or more Patents that

have issued to a Third Party in such country, or (b) one or both of the Parties

identify Third Party Patents or technology that may be beneficial to the Collaboration

and/or the Exploitation of Collaboration Products and the Steering Committee

agrees that one or both Parties should pursue a license to such Third Party

Patents or technology, or (c) as a result of any claim made against a Party, or

any of its Affiliates or Sublicensees, alleging that the Exploitation of a

Collaboration Product infringes or misappropriates any Patent or any other

intellectual property right of a Third Party in a country, a judgment is

entered by a court of competent jurisdiction from which no appeal is taken

within the time permitted for appeal, such that a Party cannot Exploit such

Collaboration Product in such country without infringing the Patent or other

proprietary rights of such Third Party, then, in any case, the Parties shall

use Commercially Reasonable Efforts to obtain a license in the names of the

Parties from such Third Party as necessary for the Exploitation of any

Collaboration Products hereunder in such country; provided, however,

that SGI shall have the sole right to seek any such license with respect to

Exploitation of SGI Technology, and shall use Commercially Reasonable Efforts

to obtain such a license in its own name from such Third Party in such country,

under which SGI shall, to the extent permissible under such license, grant a

sublicense to GCOR as necessary for GCOR, and any of its Affiliates and

Sublicensees, to Exploit the Collaboration Products as

 

26

 

provided hereunder in

such country; and provided  further that GCOR shall have the sole

right to seek any such license with respect to Exploitation of GCOR Technology,

and shall use Commercially Reasonable Efforts to obtain such a license in its

own name from such Third Party in such country, under which GCOR shall, to the

extent permissible under such license, grant a sublicense to SGI as necessary

for SGI, and any of its Affiliates and Sublicensees, to Exploit the

Collaboration Products as provided hereunder in such country.  The Parties shall [***] bear [***]

of any royalty or other obligations under such licenses to the extent related

to the Exploitation of Collaboration Products. 

Any royalty or other obligation relating to either SGI’s or GCOR’s use

of the licensed technology for purposes other than the Exploitation of

Collaboration Products shall be borne by the respective party using the

licensed technology.  “Collective

Opinion of Counsel” means the final joint opinion of patent counsel

designated by SGI and patent counsel designated by GCOR, after review of all

data and information reasonably available at the time such opinion is

rendered.  If patent counsel for the

Parties cannot agree on a final joint opinion within [***] after submission of the

matter to such counsel, the patent counsel of the Parties shall agree on a

third patent counsel who shall offer an independent opinion on the subject

matter, which independent opinion shall be deemed the Collective Opinion of

Counsel.

 

13.4.2      Third Party Litigation.  In the event that a Third Party institutes a

Patent, Trademark or other infringement suit against either Party during the

Term, alleging that the Exploitation of the Collaboration Products or any other

activities hereunder, infringes one or more Patent, Trademark or other

intellectual property rights held by such Third Party (an “Infringement Suit”), the

Parties shall cooperate with one another in defending such suit.   The Parties shall jointly direct and

control any Infringement Suit with respect to Collaboration Products.  The Parties shall [***] bear [***]

of any costs and expenses of such defense.

 

13.4.3      Retained Rights.  Nothing in this Section 13.4 shall prevent

either Party, at its own expense, from obtaining any license or other rights

from Third Parties it deems appropriate in order to permit the full and

unhindered exercise of its rights under this Agreement.

 

13.5         [***] Patent Rights.  Notwithstanding anything to the contrary in

this Agreement, with respect to any SGI Patents that are subject to the [***],

the rights and obligations of the Parties under this Article 13 shall be

subject to [***]’s rights to participate in and control prosecution,

maintenance and enforcement of such SGI Patents in accordance with the terms

and conditions of the [***].

 

ARTICLE

14 — REPRESENTATIONS AND WARRANTIES

 

14.1.        Representations, Warranties and Covenants.  Each of the Parties hereby represents,

warrants and covenants as follows:

 

(a)           This Agreement has been duly executed

and delivered by such Party and constitutes the valid and binding obligation of

such Party, enforceable against such Party in accordance with its terms, except

as enforceability may be limited by bankruptcy, fraudulent conveyance,

insolvency, reorganization, moratorium or other laws relating to or affecting

creditors’ rights generally and by general equitable principals.  The execution, delivery and

 

27

 

performance of

this Agreement has been duly authorized by all necessary action on the part of

such Party, its officers and directors.

 

(b)           The execution, delivery and

performance of this Agreement by such Party does not conflict with any

agreement, instrument or understanding, oral or written, to which it is a party

or by which it is bound, nor violate any law or regulation of any court, governmental

body or administrative or other agency having jurisdiction over it.

 

(c)           SGI represents and warrants that it

has not, and during the Term of the Agreement will not, grant any right to any

Third Party relating to the SGI Technology that would conflict with the rights

granted to GCOR hereunder.  SGI

represents and warrants that it has the right to grant the licenses (including

the sublicense under the SGI [***] Patents and SGI ADEPT Know-How)

granted herein and that, [***], SGI has no knowledge of any rights

of any Third Parties that would interfere with the rights granted to GCOR

hereunder or otherwise interfere with the Parties Exploitation of ADEPT-based

Collaboration Products and SGN-17/19. 

SGI represents and warrants that it has disclosed to GCOR all financial

obligations existing as of the Effective Date for the Exploitation of ADEPT and

SGN-17/19.

 

(d)           GCOR represents and warrants that it

has not, and during the Term of the Agreement will not, grant any right to any

Third Party relating to the GCOR Technology that would conflict with the rights

granted to SGI hereunder.  GCOR

represents and warrants that it has the right to grant the licenses granted

herein and that it has no knowledge of any rights of any Third Parties that

would interfere with the practice of the GCOR Patents or other GCOR Technology.

 

(e)           SGI will use diligent efforts to

obtain and disclose to GCOR information relating to the rights, if any, [***]

to the SGI Technology licensed under the [***] as soon as practicable after the Effective

Date.

 

14.2.        Performance by Affiliates.  The Parties recognize that each may perform

some or all of its obligations under this Agreement through Affiliates,

provided, however, that each Party shall remain responsible and be guarantor of

the performance by its Affiliates and shall cause its Affiliates to comply with

the provisions of this Agreement in connection with such performance.

 

ARTICLE

15 — TERM AND TERMINATION

 

15.1         Term.  The term of this Agreement shall commence

upon the Effective Date and shall continue in effect until the [***] anniversary

of the Effective Date (the “Initial Term”), unless terminated at an

earlier date in accordance with the terms and conditions set forth in this

Article 15.  The Initial Term shall

automatically be extended for additional consecutive [***] terms (each, a “Renewal

Term”) unless either Party delivers written notice of termination to

the other Party more than [***] prior to the expiration of the

Initial Term or any Renewal Term.

 

15.2         Termination of Agreement for Material Breach.  Failure by a Party to comply with any of

its material obligations contained herein shall entitle the Party not in

default to give

 

28

 

to the Party in

default notice specifying the nature of the default, requiring the defaulting

Party to make good or otherwise cure such default, and stating its intention to

terminate if such default is not cured. 

If such default is not cured within [***] after the receipt of such notice (or,

if such default cannot be cured within such [***] period, if the Party in

default does not commence actions to cure such default within such period and

thereafter diligently continue such actions or if such default is not otherwise

cured within [***] after the receipt of such notice), the Party not in

default shall be entitled, without prejudice to any of its other rights

conferred on it by this Agreement, and in addition to any other remedies

available to it by law or in equity, to terminate this Agreement in its entirety.

 

15.3         Termination of Rights with Respect to Products Upon

Material Breach.  Failure

by a Party to comply with any of its material obligations contained herein with

respect to a Collaboration Product shall entitle the Party not in default to

give to the Party in default notice specifying the nature of the default,

requiring the defaulting Party to make good or otherwise cure such default, and

stating its intention to [***] pursuant to Sections 7.1 and 7.2 if

such default is not cured.  If such default

is not cured within [***] after the receipt of such notice (or,

if such default cannot be cured within such [***] period, if the Party in

default does not commence actions to cure such default within such period and

thereafter diligently continue such actions or if such default is not otherwise

cured within [***] after the receipt of such notice), the Party not in

default shall be entitled, on written notice to the other Party, to [***] pursuant

to Sections 7.1 and 7.2, whereupon the defaulting Party shall be deemed the [***]

Party with respect to such [***] Product for all purposes hereunder

and the notice provided under this provision shall be deemed equivalent to an [***]

notice as provided in Sections 7.1 and 7.2.

 

15.4         Termination Upon Insolvency.  Either Party may terminate this Agreement

if, at any time, the other Party shall file in any court or agency pursuant to

any statute or regulation of any state, country or jurisdiction, a petition in

bankruptcy or insolvency or for reorganization or for an arrangement or for the

appointment of a receiver or trustee of that Party or of its assets, or if such

other Party proposes a written agreement of composition or extension of its

debts, or if such other Party shall be served with an involuntary petition against

it, filed in any insolvency proceeding, and such petition shall not be

dismissed within [***] after the filing thereof, or if such other Party shall

propose or be a party to any dissolution or liquidation, or if such other Party

shall make an assignment for the benefit of its creditors.

 

15.5         Rights in Bankruptcy.  All rights and licenses granted under or

pursuant to this Agreement by either Party are, and shall otherwise be deemed

to be, for purposes of Section 365(n) of the United States Bankruptcy Code,

licenses of rights to “intellectual property” as defined under Section 101 of

the United States Bankruptcy Code.  The

Parties agree that the Parties, as licensees of such rights under this

Agreement, shall retain and may fully exercise all of their rights and

elections under the United States Bankruptcy Code.  The Parties further agree that, in the event of the commencement

of a bankruptcy proceeding by or against a Party under the United States

Bankruptcy Code, the Party hereto that is not a Party to such proceeding shall

be entitled to a complete duplicate of (or complete access to, as appropriate)

any such intellectual property and all embodiments of such intellectual

property, which, if not already in the non-subject Party’s possession, shall be

promptly delivered to it (a) upon any such commencement of

 

29

 

a bankruptcy

proceeding upon the non-subject Party’s written request therefor, unless the

Party subject to such proceeding elects to continue to perform all of its

obligations under this Agreement or (b) if not delivered under clause (a)

above, following the rejection of this Agreement by or on behalf of the Party

subject to such proceeding upon written request therefor by the non-subject

Party.

 

15.6         Consequences of Expiration or

Termination.

 

15.6.1      Termination of the Research Program.  Upon expiration or termination of the

Agreement, the Parties shall discontinue the Research Program with respect to

all Products that [***]. 

The Steering Committee shall determine whether to jointly continue

development and commercialization activities with respect to each Collaboration

Product that [***].

 

15.6.2      Return of Information and Materials.  Upon expiration or termination of the

Agreement, each Party, at the request of the other Party, shall return or

destroy all data, files, records and other materials in its possession or

control relating to such other Party’s Technology, or containing or comprising

such other Party’s Information and Inventions or other Confidential Information

(excluding one copy of which may be retained solely for archival purposes),

except to the extent that the returning Party retains rights hereunder with

respect to further development of [***] Products or Products pursuant to this

Section 15.6.

 

15.6.3                  Further

Development and Commercialization.

 

(a)           [***] Products

by SGI.  Notwithstanding Section

15.6.1, SGI shall have the right but not the obligation to [***] of any [***] or

[***]

after the termination or expiration of the Agreement (collectively “[***]”)

subject to: (i) the obligation to [***] for the [***] set forth in Section

15.6.3(c)(i); (ii) the obligation to [***] using the [***] or [***] under Section

15.6.3(c)(i) [***] by SGI or its Affiliates or Sublicensees; (iii) the obligation

to [***]

upon the [***]

for each [***]

using the [***] or [***] under Section

15.6.3(c)(i), by SGI, or its Affiliates or Sublicensees; (iv) the obligation to

[***]

upon the [***]

each [***]

using the [***]

or [***]

under Section 15.6.3(c)(i), by SGI or its Affiliates or Sublicensees; (v) the

obligation to [***] upon the [***] each [***] using the [***]

or [***]

under Section 15.6.3(c)(i), by SGI or its Affiliates or Sublicensees; (vi) the

obligation to [***] upon the [***] for each [***] using the [***]

or [***]

under Section 15.6.3(c)(i), by SGI, its Affiliate or Sublicensee; and (vii) the

[***]

set forth in Section 15.6.3(d).

 

(b)           [***] Products by GCOR.  Notwithstanding Section 15.6.1, GCOR shall

have the right but not the obligation to [***] of any [***] or [***] after the termination

or expiration of the Agreement (collectively “[***]”) subject to: (i) the

obligation to [***] for the [***] set forth in Section 15.6.3(c)(ii);

(ii) the obligation to [***] using the [***] under Section

15.6.3(c)(ii) [***] by GCOR or its Affiliates or Sublicensees; provided that

in the event GCOR or its Affiliates or Sublicensees do not [***] pursuant to this

Section 15.6.3(b)(ii) but SGI [***] under the [***], then GCOR or its

Affiliates or Sublicensees shall [***];  (iii) the obligation to [***]

upon the [***]

for each [***]

using the [***]

or [***]

under Section 15.6.3(c)(ii), by GCOR or its Affiliates or Sublicensees; (iv)

the obligation to [***] upon the [***] each [***] using

the [***]

or [***]

under Section 15.6.3(d)(ii), by SGI or its Affiliates or Sublicensees; (v)

 

30

 

the obligation to [***] upon

the [***]

each [***] using the [***] or [***] under Section

15.6.3(c)(ii), by SGI or its Affiliates or Sublicensees; (vi) the obligation to

[***] upon

the [***]

for each [***] using the [***] or [***] under Section

15.6.3(c)(ii), by GCOR or its Affiliates or Sublicensees; and (vii) the [***]

set forth in Section 15.6.3(d).

 

(c)           Post-Termination [***].

 

(i)            To SGI.  If, within [***] after termination or

expiration of this Agreement, [***] specified in Section 15.6.3(a)(i),

GCOR shall [***].

 

(ii)           To GCOR.  If, within [***] after termination or

expiration of this Agreement, [***] specified in Section 15.6.3(b)(i),

SGI shall [***];

except to the extent such [***] incorporates or uses technology

covered by the [***] or any [***] necessary to [***], in which case this [***].

 

(iii)          Each Party agrees to provide the other

Party a fully executed copy of any sublicense agreement or amendment thereof

entered into pursuant to this Section 15.6.3(c) (either of which may be

redacted to remove confidential information) within [***] of execution of such

agreement or amendment.

 

(d)           [***] Products and [***].  If the Parties [***] after expiration or

termination of the Agreement, either Party or the Parties jointly upon decision

of the Steering Committee may [***];  provided, however, that if

one Party [***]

of research on a [***], the [***] Party shall [***] the [***]

Party a [***]

to [***].  Prior to the equivalent of a [***]

by the [***]

Party, the [***] Party shall give the [***] Party written notice of

the [***]

Party’s intention to [***] the equivalent of a [***] for

each [***].  Notice shall include [***] and such other

information as is reasonably necessary for the [***] Party to make an

informed decision on whether to [***]. The [***] Party shall have [***]

from receipt of such notice to inform the [***] Party that it wishes to [***]

to [***]

for such [***],

subject to the terms of this Agreement relating to [***] in a [***],

including [***].  “[***]”  shall mean all [***]

of a [***]

that [***]

to the same [***] as a [***] already in a [***].

 

15.6.4      Accrued Rights; Surviving Obligations.  Termination or expiration of this Agreement

for any reason shall be without prejudice to any rights that shall have accrued

to the benefit of a Party prior to such termination or expiration.  Such termination or expiration shall not

relieve a Party from obligations that are expressly indicated to survive the

termination or expiration of this Agreement.

 

15.6.5      Survival.  Articles 5, 7, 9, 11, 12, 13, 16, 17, 18,

19, 20, 21 and 22, and Sections 4.3, 4.4.2, 4.5, 6.3, 6.4, 6.6, 6.7, 8.3 and

15.7, of this Agreement and this Section 15.6 shall survive expiration or

termination of this Agreement for any reason.

 

15.7         Termination

of [***].  All rights and obligations under the [***] or [***],

as the case may be, sublicensed under this Agreement shall terminate upon [***] prior written notice by [***] if [***]

breaches any material provision of the [***]

or the [***], as the case may be,

and fails to cure such breach within [***]

after notice thereof; provided, however such cure period

 

31

 

may be extended by consent of the Parties.  All rights and obligations under the [***] shall automatically terminate if [***] fails to maintain the insurance

required under the [***].  All rights and obligations under the [***] or [***],

as the case may be, sublicensed under this Agreement shall terminate upon

termination of the [***] or [***], as the case may be.

 

ARTICLE

16 — INDEMNIFICATION AND INSURANCE

 

16.1         Indemnification by SGI.  SGI shall indemnify GCOR and its

Affiliates, directors, officers, employees and agents, and defend and save each

of them harmless, from and against any and all losses, damages, liabilities,

costs and expenses (including reasonable attorneys’ fees and expenses) in

connection with any and all liability suits, investigations, claims or demands

(collectively, “Losses”) arising from or occurring as a result of or in

connection with (a) any breach by SGI of any representation or warranty

pursuant to Section 14.1, or (b) the gross negligence or willful misconduct on

the part of SGI or its Affiliates or Sublicensees in performing any activity

contemplated by this Agreement, except for those Losses for which GCOR has an

obligation to indemnify SGI pursuant to Section 16.2, as to which Losses each

Party shall indemnify the other to the extent of their respective liability for

the Losses.

 

16.2         Indemnification by GCOR.  GCOR shall indemnify SGI, its Affiliates

and their respective directors, officers, employees and agents, and defend and

save each of them harmless, from and against any and all Losses arising from or

occurring as a result of or in connection with (a) any breach by GCOR of any

representation or warranty pursuant to Section 14.1, or (b) the gross

negligence or willful misconduct on the part of GCOR or its Affiliates or

Sublicensees in performing any activity contemplated by this Agreement, except

for those Losses for which SGI has an obligation to indemnify GCOR and its

Affiliates pursuant to Section 16.1, as to which Losses each Party shall

indemnify the other to the extent of their respective liability for the Losses.

 

16.3         Indemnification Procedure.

 

16.3.1      Notice of Claim.  The indemnified Party shall give the

indemnifying Party prompt written notice (an “Indemnification Claim Notice”)

of any Losses or discovery of fact upon which such indemnified Party intends to

base a request for indemnification under Section 16.1 or 16.2, but in no event

shall the indemnifying Party be liable for any Losses that result from any

unreasonable delay in providing such notice. 

Each Indemnification Claim Notice must contain a description of the

claim and the nature and amount of such Loss (to the extent that the nature and

amount of such Loss are known at such time). 

The indemnified Party shall furnish promptly to the indemnifying Party

copies of all papers and official documents received in respect of any

Losses.  All indemnification claims in

respect of a Party, its Affiliates or their respective directors, officers,

employees and agents (collectively, the “Indemnitees” and each an “Indemnitee”)

shall be made solely by such Party to this Agreement (the “Indemnified Party”).

 

16.3.2      Third Party Claims.  The obligations of an indemnifying Party

under this Article 16 with respect to Losses arising from claims of any Third

Party that are subject to

 

32

 

indemnification as

provided for in Section 16.1 or 16.2 (a “Third Party Claim”) shall be governed by

and be contingent upon the following additional terms and conditions:

 

(a)           Control of Defense.  At its option, the indemnifying Party may

assume the defense of any Third Party Claim by giving written notice to the

Indemnified Party within thirty (30) days after the indemnifying Party’s

receipt of an Indemnification Claim Notice. 

The assumption of the defense of a Third Party Claim by the indemnifying

Party shall not be construed as an acknowledgment that the indemnifying Party

is liable to indemnify any Indemnitee in respect of the Third Party Claim, nor

shall it constitute a waiver by the indemnifying Party of any defenses it may

assert against any Indemnitee’s claim for indemnification.  Upon assuming the defense of a Third Party

Claim, the indemnifying Party may appoint as lead counsel in the defense of the

Third Party Claim any legal counsel selected by the indemnifying Party subject

to approval of the indemnified Party. 

In the event the indemnifying Party assumes the defense of a Third Party

Claim, the Indemnified Party shall immediately deliver to the indemnifying

Party all original notices and documents (including court papers) received by

any Indemnitee in connection with the Third Party Claim.  Should the indemnifying Party assume the

defense of a Third Party Claim, the indemnifying Party shall not be liable to

the Indemnified Party or any other Indemnitee for any legal expenses

subsequently incurred by such Indemnified Party or other Indemnitee in

connection with the analysis, defense or settlement of the Third Party Claim.

 

(b)         Right to Participate in Defense.  Without limiting Section 16.3.2(a), any

Indemnitee shall be entitled to participate in, but not control, the defense of

such Third Party Claim and to employ counsel of its choice for such purpose; provided,

however, that such employment shall be at the Indemnitee’s own expense

unless (i) the employment thereof has been specifically authorized by the

indemnifying Party in writing, or (ii) the indemnifying Party has failed to

assume the defense and employ counsel in accordance with Section 16.3.2(a) (in

which case the Indemnified Party shall control the defense).

 

(c)         Settlement.  With respect to any Losses relating solely

to the payment of money damages in connection with a Third Party Claim and that

will not result in the Indemnitee’s becoming subject to injunctive or other

relief or otherwise adversely affect the business of the Indemnitee in any

manner, and as to which the indemnifying Party shall have acknowledged in

writing the obligation to indemnify the Indemnitee hereunder, the indemnifying

Party shall have the sole right to consent to the entry of any judgment, enter

into any settlement or otherwise dispose of such Loss, on such terms as the

indemnifying Party, in its sole discretion, shall deem appropriate.  With respect to all other Losses in

connection with Third Party Claims, where the indemnifying Party has assumed

the defense of the Third Party Claim in accordance with Section 16.3.2(a), the

indemnifying Party shall have authority to consent to the entry of any

judgment, enter into any settlement or otherwise dispose of such Loss provided

it obtains the prior written consent of the Indemnified Party (which consent

shall not be unreasonably withheld or delayed).  The indemnifying Party shall not be liable for any settlement or

other disposition of a Loss by an Indemnitee that is reached without the

written consent of the indemnifying Party. 

Regardless of whether the indemnifying Party chooses to defend or

prosecute any Third Party Claim, no Indemnitee shall admit any liability with

respect to, or settle, compromise or discharge, any Third Party Claim without

the prior written consent of the indemnifying Party.

 

33

 

(d)           Cooperation.  Regardless of whether the indemnifying Party

chooses to defend or prosecute any Third Party Claim, the Indemnified Party

shall, and shall cause each Indemnitee to, cooperate in the defense or

prosecution thereof and shall furnish such records, information and testimony,

provide such witnesses and attend such conferences, discovery proceedings,

hearings, trials and appeals as may be reasonably requested in connection

therewith.  Such cooperation shall

include access during normal business hours afforded to the indemnifying Party

to, and reasonable retention by the Indemnified Party of, records and

information that are reasonably relevant to such Third Party Claim, and making

Indemnitees and other employees and agents available on a mutually convenient

basis to provide additional information and explanation of any material

provided hereunder, and the indemnifying Party shall reimburse the Indemnified

Party for all its reasonable out-of-pocket expenses in connection therewith.

 

(e)           Expenses.  Except as provided above, the reasonable and

verifiable costs and expenses, including fees and disbursements of counsel,

incurred by the Indemnified Party in connection with any claim shall be

reimbursed on a [***] basis within [***] of invoice, by the indemnifying

Party, without prejudice to the indemnifying Party’s right to contest the

Indemnified Party’s right to indemnification and subject to refund in the event

the indemnifying Party is ultimately held not to be obligated to indemnify the

Indemnified Party.

 

ARTICLE

17 — FORCE MAJEURE

 

No Party (or any of its

Affiliates) shall be held liable or responsible to the other Party (or any of

its Affiliates) nor be deemed to have defaulted under or breached the Agreement

for failure or delay in fulfilling or performing any term of the Agreement when

such failure or delay is caused by or results from causes beyond the reasonable

control of the affected Party (or any of its Affiliates) including fire,

floods, embargoes, war, acts of war (whether war be declared or not),

insurrections, riots, civil commotion, acts of God or acts, acts of terrorism,

earthquake, failure of utilities or omissions or delays in acting by any

governmental authority (collectively, “Events of Force Majeure”); provided,

however, that the affected Party shall exert all reasonable efforts to

eliminate, cure or overcome any such Event of Force Majeure and to resume

performance of its covenants with all possible speed.  Notwithstanding the foregoing, to the extent that an Event of

Force Majeure continues for a period in excess of [***], the affected Party

shall promptly notify in writing the other Party of such Event of Force Majeure

and within [***] of the other Party’s receipt of such notice, the Parties

agree to negotiate in good faith either (i) to resolve the Event of Force

Majeure, if possible, (ii) to extend by mutual agreement the time period to

resolve, eliminate, cure or overcome such Event of Force Majeure, (iii) to

amend this Agreement to the extent reasonably possible, or (iv) to terminate

this Agreement.

 

ARTICLE

18 — ASSIGNMENT

 

This Agreement may not be

assigned or otherwise transferred, nor, except as expressly provided hereunder,

may any right or obligations hereunder be assigned or transferred to any

Third-Party by either Party without the consent of the other Party, such

consent not to be unreasonably withheld; provided, however, that

either Party may, without such consent but with

 

34

 

notification,

assign this Agreement and its rights and obligations hereunder to any of its

Affiliates or in connection with the transfer or sale of all or substantially

all of its business, or in the event of its merger or consolidation.  Any permitted assignee shall assume all

rights and obligations of its assignor under this Agreement.

 

ARTICLE

19 — SEVERABILITY

 

Each Party hereby agrees

that it does not intend to violate any public policy, statutory or common laws,

rules, regulations, treaty or decision of any government agency or executive

body thereof of any country or community or association of countries.  Should one or more provisions of this Agreement

be or become invalid, the Parties hereto shall substitute, by mutual consent,

valid provisions for such invalid provisions which valid provisions in their

economic effect are sufficiently similar to the invalid provisions that it can

be reasonably assumed that the Parties would have entered into this Agreement

with such provisions.

 

In case such provisions

cannot be agreed upon, the invalidity of one or several provisions of this

Agreement shall not affect the validity of this Agreement as a whole, unless

the invalid provisions are of such essential importance to this Agreement that

it is to be reasonably assumed that the Parties would not have entered into

this Agreement without the invalid provisions.

 

ARTICLE

20 — INSURANCE

 

During the term of this Agreement and thereafter for

the period of time required below, each Party shall maintain an ongoing basis [***] in the minimum amount of [***] per occurrence and [***] annual aggregate combined single

limit for bodily injury and property damage liability; and commencing not later

than [***] and thereafter for the

period of time required below, each Party shall obtain and maintain on an

ongoing basis [***] (including [***] under this Agreement) in the amount

of at least [***] per occurrence

and annual aggregate combined single limit for [***].  All of such

insurance coverage shall be maintained with an insurance company or companies

having an [***] and an aggregate

deductible not to exceed [***] per

occurrence.

 

Not later than [***]

with respect to the [***]

coverage, and not later than [***]

prior to the [***] with respect to

the [***], each Party shall

provide to the other a certificate(s) evidencing all such required coverage

hereunder.  Thereafter each Party shall

maintain such insurance coverage without interruption during the term of this

Agreement and for a period of at least [***]

after the expiration or termination of the term and shall provide certificates

evidencing such insurance coverage without interruption on an [***] basis (by no later than the [***] for such coverage) during the period

of time for which such coverage must be maintained.

 

Each Party’s insurance shall [***] and shall state that [***] of any cancellation or material

change in the insurance policy.  The

Parties expressly acknowledge that this Article 20 is based on the obligations

of [***] and its sublicensees

under the [***].  In the event the [***] is terminated or is otherwise irrelevant to the

Exploitation of Products pursuant to this Agreement, the Parties will discuss

and agree on an appropriate level of insurance coverage and term of such

coverage to be obtained and maintained by each of the Parties.

 

35

 

ARTICLE

21 - DISCLAIMER OF WARRANTIES

 

EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH

IN ARTICLE 14, THE PARTIES MAKE NO REPRESENTATIONS AND GRANT NO WARRANTIES,

EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR

OTHERWISE, AND THE PARTIES EACH SPECIFICALLY DISCLAIM ANY OTHER WARRANTIES,

WHETHER WRITTEN OR ORAL, OR EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF

QUALITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR ANY

WARRANTY AS TO THE VALIDITY OF ANY PATENTS OR THE NON-INFRINGEMENT OF ANY

INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

 

ARTICLE

22 - MISCELLANEOUS

 

22.1.        Notices. 

Any consent, notice or report required or permitted to be given or

made under this Agreement by one of the Parties hereto to the other shall be in

writing, delivered personally or by facsimile (and promptly confirmed by

personal delivery, first class air mail or courier), first class air mail or

courier, postage prepaid (where applicable), addressed to such other Party at

its address indicated below, or to such other address as the addressee shall

have last furnished in writing to the address or in accordance with this

Section 22.1 and (except as otherwise provided in this Agreement) shall be

effective upon receipt by the addressee.

 

If to SGI:

Seattle Genetics, Inc.

21823 30th Drive S.E.

Bothell, WA 98021

Attention:  Chief Executive Officer

 

With copy to:

Venture Law Group

4750 Carillon Point

Kirkland, WA  98033

Attention: Sonya F.

Erickson

 

If to GCOR:

Genencor International,

Inc.

925 Page Mill Road

Palo Alto, CA 94304-1013

Attention:  Chief Business Officer, Health Care

 

With copy to:

Genencor International, Inc.

925 Page Mill Road

Palo Alto, CA 94304-1013

 

36

 

Attention:  General Counsel

 

22.2.        Applicable Law.  The Agreement shall be governed by and construed in

accordance with the laws of the State of Delaware, without regard to the

conflict of law principles thereof.

 

22.3.        Dispute Resolution.  The Parties agree that if any dispute or

disagreement arises between GCOR on the one hand and SGI on the other in

respect of this Agreement, they shall follow the following procedure in an

attempt to resolve the dispute or disagreement.

 

(a)           The Party claiming that such a

dispute exists shall give notice in writing (“Notice of Dispute”) to the

other Party of the nature of the dispute;

 

(b)           Within [***] of receipt of a Notice

of Dispute, a nominee or nominees of GCOR and a nominee or nominees of SGI

shall meet in person and exchange written summaries reflecting, in reasonable

detail, the nature and extent of the dispute, and at this meeting they shall

use their reasonable endeavors to resolve the dispute;

 

(c)           If, within a further period of [***],

the dispute has not been resolved, the President of SGI and the Chief Business

Officer, Health Care of GCOR shall meet at a mutually agreed upon time and

location for the purpose of resolving such dispute;

 

(d)           If, within a further period of [***],

the dispute has not been resolved or if, for any reason, the required meeting

has not been held, then (i) if the dispute relates to a Development Decision,

the compound will default to “no go” for any further joint development, subject

to Sections 7.4 and 15.6.3; or (b) if the dispute does not relate to a

Development Decision, the dispute shall be resolved pursuant to paragraph (e)

of this Section 22.3.

 

(e)           The Parties agree that they will

mediate such dispute before taking any adversarial action such as

litigation.  The mediation shall take

place in [***]

and be conducted by an experienced mediator mutually selected by the Parties

or, if the Parties cannot agree on a mediator, shall be asked to propose a list

of five qualified people which each Party shall rank in order of preference,

the person with the highest total ranking being chosen.  The mediation shall proceed through at least

one joint mediation session or its equivalent to determine whether the Parties

are capable of reaching a mediated agreement. 

If the mediator is satisfied that the Parties are working to an

agreement, the Parties agree to continue the mediation process until an agreement

is reached or the mediator is satisfied that the Parties are not progressing in

the mediation process.  Upon the

conclusion of the mediation process the parties shall be free to proceed with

litigation according to the terms of this agreement.

 

(f)            In the event of a dispute regarding

any payments owing under this Agreement, all undisputed amounts shall be paid

promptly when due and the balance, if any, promptly after resolution of the

dispute.

 

37

 

22.4.        Entire Agreement.  This Agreement contains the entire understanding of the

Parties with respect to the subject matter hereof.  All express or implied agreements and understandings, either oral

or written, heretofore made are expressly superseded by this Agreement.  This Agreement may be amended, or any term

hereof modified, only by a written instrument duly executed by both Parties

hereto.

 

22.5.        Independent Contractors.  SGI and GCOR each acknowledge that they

shall be independent contractors and that the relationship between the two

Parties shall not constitute a partnership, joint venture or agency.  Neither SGI nor GCOR shall have the

authority to make any statements, representations or commitments of any kind,

or to take any action, which shall be binding on the other Party, without the

prior consent of the other Party to do so.

 

22.6.        Affiliates.  Each Party shall cause its respective Affiliates to comply

fully with the provisions of this Agreement to the extent such provisions

specifically relate to, or are intended to specifically relate to, such

Affiliates, as though such Affiliates were expressly named as joint obligors

hereunder.

 

22.7.        Waiver. 

The waiver by either Party hereto of any right hereunder or the

failure to perform or of a breach by the other Party shall not be deemed a

waiver of any other right hereunder or of any other breach or failure by said

other Party whether of a similar nature or otherwise.

 

22.8.        Counterparts.  This Agreement may be executed in two or more counterparts,

each of which shall be deemed an original, but all of which together shall

constitute one and the same instrument.

 

IN WITNESS WHEREOF, the

Parties have executed this Agreement as of the date first set forth above.

 

	

   

  	

  SEATTLE GENETICS, INC.

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Clay B.

  Siegall

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  Name:

  	

  Clay B. Siegall

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  Title:

  	

  President &

  CSO

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  GENENCOR INTERNATIONAL, INC.

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Debby Jo

  Blank

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  Name:

  	

  Debby Jo Blank,

  M.D.

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  Title:

  	

  CBO/Sr. V.P.

  Healthcare

  	

   

  
							

 

38Seattle Genetics - Genencor Stock Purchase Agreement

Exhibit 10.2

 

SEATTLE

GENETICS, INC.

COMMON

STOCK

PURCHASE AGREEMENT

 

 

 

 

Dated as of January 4, 2002

 

 

SEATTLE

GENETICS, INC.

Common Stock Purchase Agreement

                This

Common Stock Purchase Agreement (this “Agreement”) is made as of January

4, 2002 between Seattle Genetics, Inc., a Delaware corporation with an office

at 21823 30th Drive S.E., Bothell, WA 98021(the “Company”),

and Genencor International, Inc., a Delaware corporation with an office at 925

Page Mill Road, Palo Alto, California 94304 (the “Purchaser”).

RECITALS

                WHEREAS,

it is a condition of the Collaboration Agreement of even date herewith (the “Collaboration

Agreement”) by and between the Company and Purchaser that the Purchaser

purchase from the Company $3,000,000 of shares of Common Stock, $0.001 par

value per share (“Common Stock”), of the Company in a private placement;

and

                WHEREAS,

the Company and the Purchaser wish to set forth the terms and conditions upon

which the Company will issue and sell such shares to the Purchaser;

                NOW,

THEREFORE, in consideration of the premises and mutual covenants and

conditions contained herein, the Company and the Purchaser hereby agree as

follows:

ARTICLE I

PURCHASE AND SALE OF SHARES

1.01         Purchase Price and Closing.  The Company will issue and sell to the Purchaser

and, subject to the terms and conditions of this Agreement, the Purchaser will

purchase from the Company that number of unregistered shares of Company’s

Common Stock (the “Shares”) equal to $3,000,000.00 divided by average

closing price (based on a trading day from 9:30 a.m. to 4:00 p.m. (New York

time)) of the Company’s Common Stock as reported on the Nasdaq National Market

for the thirty (30) trading days ending one (1) day prior to the Closing.  The purchase and sale will take place at a

closing (the “Closing”) to be held on the date, at the location and at

the time of execution of this Agreement by both the Company and Purchaser,

subject to the satisfaction of all of the conditions to the Closing specified

in Article II herein.  At the Closing the

Company will issue and deliver a certificate evidencing the Shares to the

Purchaser against payment of the full purchase price therefor by wire

transfer of immediately available funds to an account designated by the

Company.

1.02         Restrictions on Transfer.  Except as may be contemplated by this

Agreement, the Purchaser hereby agrees that without the prior written consent

of the Company, the Purchaser will not, directly or indirectly, during the

period beginning on the date hereof and ending on the one (1) year anniversary

of the date hereof: (a) offer, pledge, announce the intention to sell, sell,

contract to sell, sell any option or contract to purchase, purchase any option

or contract to sell, grant any option, right or warrant to purchase, or otherwise

transfer or dispose of any Shares; or (b) enter into any swap, option, future,

forward or other agreement that transfers, in whole or in part, any of the

economic consequences of ownership of the Shares, regardless of whether any of

the  transactions described in clause

(a) or (b) above is to be settled by delivery of Shares, in cash or otherwise,

and the Purchaser further represents that it understands and agrees that all

certificates evidencing any of the Shares, whether upon initial issuance or

upon any transfer thereof, shall bear a legend until the expiration of such

lock-up period, prominently stamped or printed thereon, reading substantially

as follows:

“THE SECURITIES

REPRESENTED BY THIS CERTIFICATE MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE

TERMS OF AN AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH

IS ON FILE WITH THE SECRETARY OF THE COMPANY.”

1.03         Representations and Warranties by

the Purchaser.  The Purchaser

represents and warrants to the Company that: (a) it is an “accredited investor”

as defined in Rule 501(a) under the Securities Act of 1933, as amended; (b) it

will acquire the Shares for its own account, for the purpose of investment and

not with a view to distribution or resale thereof; (c) the execution of

this Agreement and the consummation of the transactions contemplated hereby

have been duly authorized by all necessary action on the part of the Purchaser,

and this Agreement has been duly executed and delivered, and constitutes a

valid, legal, binding and enforceable agreement of the Purchaser, except (i) as

limited by applicable bankruptcy, insolvency, reorganization, moratorium and

other laws of general application affecting enforcement of creditors’ rights

generally and (ii) as limited by laws relating to the availability of specific

performance, injunctive relief or other equitable remedies; (d) it has

taken no action which would give rise to any claim by any other person for any

brokerage commissions, finders’ fees or the like relating to this Agreement or

the transactions contemplated hereby; (e) it has had the opportunity to

ask questions of and receive answers from representatives of the Company

concerning the terms of the offering of the Shares and to obtain additional

information concerning the Company and its business, and has all of the

information necessary for it to evaluate the merits and risks of an investment

in the Shares and can bear the economic risks of such investment.  The acquisition by the Purchaser of the

Shares shall constitute a confirmation of the representations and warranties

made by the Purchaser as at the date of such acquisition.  The Purchaser further represents that it

understands and agrees that, until registered under the Securities Act or transferred

pursuant to the provisions of Rule 144 as promulgated by the Commission, all

certificates evidencing any of the Shares, whether upon initial issuance or

upon any transfer thereof, shall bear a legend, prominently stamped or printed

thereon, reading substantially as follows:

2

 

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE

NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE

STATE SECURITIES LAWS.  THESE SECURITIES

MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED

WITHOUT AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE

SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS, OR

THE AVAILABILITY OF AN EXEMPTION FROM THE REGISTRATION PROVISIONS OF THE

SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS.”

ARTICLE II

CONDITIONS TO CLOSING

2.01         Conditions of the Purchaser’s

Obligation.  The obligation of the

Purchaser to purchase and pay for the Shares at the Closing is subject to the

satisfaction of the following conditions, any one or more of which may be

waived by the Purchaser:

3

 

(a)           Documentation at Closing.  The Purchaser shall have received prior to

or at the Closing all of the following documents or instruments, or evidence of

completion thereof, each in form and substance satisfactory to the Purchaser:

(i)            A copy of the Certificate of

Incorporation of the Company, certified by the Secretary of State of the State

of Delaware, a copy of the resolutions of the Board of Directors of the Company

evidencing the approval of this Agreement, the issuance of the Shares and the

other matters contemplated hereby, and a copy of the Bylaws of the Company, all

of which shall have been certified by the Secretary of the Company to be true,

complete and correct in every particular, and certified copies of all documents

evidencing other necessary corporate or other action and governmental

approvals, if any, with respect to this Agreement and the Shares.

(ii)           A certificate of the Secretary of the

Company which shall certify the names of the officers of the Company authorized

to sign this Agreement, the certificate for the Shares and the other documents,

instruments or certificates to be delivered pursuant to this Agreement by the

Company or any of its officers, together with the true signatures of such

officers.  The Purchaser may

conclusively rely on such certificate until it shall receive a further

certificate of the Secretary or an Assistant Secretary of the Company canceling

or amending the prior certificate and submitting the signatures of the officers

named in such further certificate.

(iii)          A certificate of the President or

Chief Executive Officer of the Company stating that all covenants and

conditions required to be performed prior to or at the Closing have been

performed as of the Closing and that all the representations and warranties

contained in Section 3 herein are true and correct as of the Closing.

(iv)          Certificates of Good Standing and

Existence for the Company from the Secretaries of State of the States of

Delaware and Washington, as the case may be.

(b)           Performance.  The Company shall have performed and

complied with all agreements, obligations and conditions contained in this

Agreement that are required to be performed or complied with by it on or before

the Closing.

(c)           Consents,

Waivers, Etc.  The Company shall have obtained all

consents or waivers, if any, necessary to execute and deliver this Agreement,

issue the Shares and to carry out the transactions contemplated hereby and

thereby.  All corporate and other action

and governmental filings necessary to effectuate the terms of this Agreement,

the Shares and other agreements and instruments executed and delivered by the

Company in connection herewith shall have been made or taken, except for any

post-sale filing that may be required under federal or state securities

laws.  In addition to the documents set

forth above, the Company shall have provided to the Purchaser any other

information or copies of documents that it may reasonably request.

(d)           Collaboration Agreement.  The Purchaser and the Company shall have

entered into the Collaboration Agreement.

(e)           Investors’ Rights Agreement.  The Company’s Amended and Restated

Investors’ Rights Agreement dated as of December 22, 1999 (the “Rights

Agreement”) shall have been amended to include the Purchaser as a party

such that the Purchaser is entitled to registration pursuant to Sections 1.3

and 1.4 of the Rights Agreement with respect to the Shares as though the

Purchaser were a Holder (as defined in the Rights Agreement) and the Shares

were Registrable Securities (as defined in the Rights Agreement) for the

purposes of registration pursuant to Sections 1.3 and 1.4, and provisions

related thereto, of the Rights Agreement (provided, however, that the Purchaser

shall not be able to initiate a request for registration pursuant to Section

1.4, but may include their Registrable Securities in any S-3 registration

statement initiated pursuant to Section 1.4 by other Holders of Registrable Securities).

4

 

2.02         Conditions of the Company’s

Obligation.  The obligation of the

Company to sell the Shares at the Closing is subject to the satisfaction of the

following conditions:

(a)           Consents,

Waivers, Etc.  The Company shall have obtained all

consents or waivers, if any, necessary to execute and deliver this Agreement,

issue the Shares and to carry out the transactions contemplated hereby and

thereby.  All corporate and other action

and governmental filings necessary to effectuate the terms of this Agreement,

the Shares and other agreements and instruments executed and delivered by the

Company in connection herewith shall have been made or taken, except for any

post-sale filing that may be required under federal or state securities laws.

(b)           Collaboration Agreement.  The Purchaser and the Company shall have

entered into the Collaboration Agreement.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company hereby represents and warrants to the

Purchaser as follows:

3.01         Corporate Action.  The Company has all necessary corporate

power and has taken all corporate action required to enter into and perform

this Agreement.  This Agreement is a

valid and legally binding obligations of the Company, enforceable in accordance

with its terms.  The issuance, sale and

delivery of the Shares in accordance with this Agreement, have been duly

authorized by all necessary corporate action on the part of the Company.  The issuance of the Shares is not subject to

preemptive rights or other preferential rights in any present stockholders of

the Company that have not been waived and will not conflict with any provision

of any agreement or instrument to which the Company is a party or by which it

or its property is bound and to which the Company has not obtained appropriate

waivers.

3.02         No Conflict.  The execution and delivery of this Agreement

by the Company does not, and the consummation of the transactions contemplated

hereby will not, conflict with, or result in any material violation of, or

default under (with or without notice or lapse of time, or both), or give rise

to a right of termination, cancellation, modification or acceleration of any

obligation under (i) any provision of the Certificate of Incorporation of

the Company or Bylaws of the Company, (ii) any mortgage, indenture, lease,

contract or other agreement or instrument, permit, concession or license to

which the Company or any of its properties or assets is subject or

(iii) any judgment, order, decree, applicable to the Company or its

properties or assets.

3.03         Status of Shares.  Subject to the accuracy of the Purchaser’s

representations and warranties in this Agreement, the offer, sale and issuance

of the Shares in conformity with the terms of this Agreement constitute

transactions exempt from the registration or qualification requirements of the

laws of any applicable state or U.S. jurisdiction.  The Shares have been duly authorized for issuance to the

Purchaser and, when issued and delivered in accordance with the terms hereof

and after payment of the purchase price therefor, will be duly authorized,

validly issued, fully-paid and non-assessable, issued in compliance with

applicable state and federal securities laws and free of restrictions on transfer

other than restrictions on transfer under this Agreement and applicable state

and federal securities laws.  The

issuance of the Shares is not subject to preemptive or other similar rights.  No further approval or authority of the

stockholders or the Board of Directors of the Company will be required for the

issuance and sale of the Shares.

5

 

3.04         Organization, Good Standing and

Qualification.  The Company is a

corporation duly organized and validly existing under the laws of the

jurisdiction of its incorporation and has all requisite corporate power and

authority to carry on its business.  The

Company is duly qualified to transact business and is in good standing in each

jurisdiction in which the failure so to qualify would have a material adverse

effect on its business or properties.

 

3.05         Capitalization.  The authorized capital stock of the Company

consists of 100,000,000 shares of Common Stock and 5,000,000 shares of

Preferred Stock.  As of December 31,

2001, the issued and outstanding capital stock of the Company consisted of

29,322,741 shares of Common Stock and no shares of Preferred Stock.  The shares of issued and outstanding capital

stock of the Company have been duly authorized and validly issued, are fully

paid and non-assessable and have not been issued in violation of or are not

otherwise subject to any preemptive or other similar rights.  The Company has reserved 4,800,000 shares of

Common Stock for issuance upon the exercise of stock options granted or

available for future grant under the Company’s Stock Option Plans and 300,000

shares of Common Stock reserved for sale under the Company’s Employee Stock

Purchase Plan.

 

3.06         SEC

Documents.

 

(a)           The

Company has timely filed all reports, schedules, registration statements and

other documents required to be filed by the Company with the Securities and

Exchange Commission on or after the date of filing with the Securities and

Exchange Commission of the Company’s Final Prospectus for its initial public

offering on March 7, 2001 through the date hereof (such documents as

supplemented and amended from time to time, collectively, the “Company SEC

Documents”).  As of their respective

filing dates, or in the case of registration statements, their respective

effective dates, none of the Company SEC Documents (including all exhibits and

schedules thereto and documents incorporated by reference therein) contained

any untrue statement of a material fact or omitted to state a material fact

required to be stated therein or necessary in order to make the statements

therein, in light of the circumstances under which they were made, not

misleading, and the Company SEC Documents complied when filed, or in the case

of registration statements, as of their respective effective dates, in all

material respects with the then applicable requirements of the Securities Act

or the Securities Exchange Act of 1934, as the case may be, and the rules and

regulations promulgated by the Securities and Exchange Commission thereunder.

 

(b)           The financial statements (including

the notes thereto) of the Company included in the Form 10-Q (subject, in the

case of the Form 10-Q, to year-end audit adjustments), complied in all material

respects with the then applicable accounting requirements and the published

rules and regulations of the Securities and Exchange Commission with respect

thereto, were prepared in accordance with generally accepted accounting

principles during the periods involved (except as may have been indicated in

the notes thereto) and fairly present the financial condition of the Company as

at the dates thereof and the results of their operations, stockholders’ equity

and cash flows for periods then ended.

 

3.07         Governmental Permits.  Except as described in the Company SEC Documents,

the Company owns, possesses or has obtained all licenses, permits,

certificates, consents, orders, approvals and other authorizations from, and

has made all declarations and filings with, all federal, state, local and other

governmental authorities (including foreign regulatory agencies), all

self-regulatory organizations and all courts and other tribunals, domestic or

foreign, necessary to own or lease, as the case may be, and to operate its

properties and to carry on its business as conducted as of the date hereof,

except where the failure to own, possess, obtain or make would not,

individually or in the aggregate, have a material adverse effect, and the

Company has not received any actual notice of any proceeding relating to

revocation or modification of any such license, permit, certificate, consent,

order, approval or other authorization, except as described in the Company SEC

Documents.

 

6

 

3.08         Prior Offerings.  All offers of capital stock of the Company

before the date of this Agreement were at all relevant times duly registered or

exempt from the registration requirements of the Securities Act and were duly

registered or subject to an available exemption from the registration

requirements of the applicable state securities or Blue Sky laws.

 

3.09         No Defaults; No Litigation.  The Company is not in violation of its

Certificate of Incorporation, or Bylaws or in material default in the

performance of observance of any obligation, agreement, covenant or condition

contained in any material contract, indenture, mortgage, loan agreement, deed,

trust, note, lease, sublease, voting agreement, voting trust, or other

instrument or material agreement to which the Company is a party which, singly

or in the aggregate, could reasonably be expected to result in any material

adverse change in the condition, financial or otherwise, or in the business

affairs or business prospects of the Company. 

There is no action, suit or proceeding before or by any court or governmental

agency or body, domestic or foreign, now pending, or, to the knowledge of the

Company, threatened against or affecting the Company which, singly or in the

aggregate, could reasonably be expected to result in any material adverse

change in the condition, financial or otherwise, or in the business affairs or

business prospects of the Company.

 

3.10         Taxes.  The Company has filed all material tax returns required to be

filed, which returns are true and correct in all material respects, and the

Company is not in default in the payment of any taxes, including penalties and

interest, assessments, fees and other charges shown thereon due or otherwise

assessed other than those being contested in good faith and for which adequate

reserves have been provided or those currently payable without which were

payable pursuant to said returns or any assessments with respect thereto.

 

3.11         Insurance.  The Company maintains insurance of the type

and in the amount that the Company reasonably believes is adequate for the business,

including, but not limited to, liability insurance for clinical testing and

insurance covering all real and personal property owned or leased by the

Company against theft, damage, destruction, acts of vandalism and all other

risks customarily insured against by similarly situated companies, all of which

insurance is in full force and effect.

 

3.12         Intellectual Property.  The Company, to the best of its knowledge in

the course of diligent inquiry, owns or is licensed to use all patents, patent

applications, inventions, trademarks, trade names, applications for

registration of trademarks, service marks, service mark applications,

copyrights, know-how, manufacturing processes, formulae, trade secrets,

licenses and rights in any thereof and any other intangible property and assets

that are material to the business of the Company as now conducted and as

proposed to be conducted (in this Agreement called the “Proprietary Rights”),

or is seeking, or will seek, to obtain rights to use such Proprietary Rights

that are material to the business of the Company as proposed to be

conducted.  The Company does not have

any knowledge of, and the Company has not given or received any notice of, any

pending conflicts with or infringement of the rights of others with respect to

any Proprietary Rights or with respect to any license of Proprietary Rights

that are material to the business of the Company.  No action, suit, arbitration, or legal, administrative or other

proceeding, or investigation is pending, or, to the best knowledge of the

Company, threatened, which involves any Proprietary Rights, nor, to the best

knowledge of the Company, is there any reasonable basis therefor.

7

 

3.13         No Integrated Offerings.  Neither the Company, nor any person acting

on its behalf, has directly or indirectly made any offers or sales of any

security or solicited any offers to buy any security under circumstances that

would require registration under the Securities Act of the issuance of the

Shares to the Purchaser.  The issuance

of the Shares to the Purchaser will not be integrated with any other issuance

of the Company’s securities (past, current or future) for purposes of the

Securities Act or any applicable rules of Nasdaq (or of any national securities

exchange on which the Company’s Common Stock is then traded).  The Company will not make any offers or

sales of any security (other than the Shares) that would cause the offering of

the Shares to be integrated with any other offering of securities by the

Company for purposes of any registration requirement under the Securities Act

or any applicable rules of Nasdaq (or of any national securities exchange on

which the Company’s Common Stock is then traded).

 

ARTICLE IV

OTHER AGREEMENTS

 

4.01         Publicity.  The parties agree to issue a joint press

release announcing this Agreement and the transactions contemplated hereby

following execution of this Agreement. 

Any proposed announcement, press release or other public disclosure

concerning this Agreement and/or any of the transactions or relationships

contemplated hereby shall be mutually approved by both parties (which approval

shall not be unreasonably withheld). 

The Purchaser agrees and acknowledges that this Agreement and the

transactions contemplated hereby may be disclosed by the Company in filings

made with the Securities and Exchange Commission and filed as an exhibit to

such required filings.  Notwithstanding

the foregoing or any other Agreements regarding the confidentiality of the

Collaboration Agreement, the Company agrees to seek Confidential Treatment of

certain matters set forth in the Collaboration Agreement (including but not

limited to items specifically requested by Purchaser) and shall allow the

Purchaser to participate and shall cooperate with Purchaser with regard to any

Confidential Treatment Requests filed either by the Purchaser or by the Company

with the Securities and Exchange Commission.

 

4.02         Rule 144 Information.  Until the earlier of (i) the date on which

the Shares may be resold by the Purchaser without registration and without

regard to any volume limitations by reason of Rule 144(k) under the Securities

Act or any other rule of similar effect or (ii) all of the Shares have been

sold, the Company shall file all reports required to be filed by it under the

Securities Act and the Securities Exchange Act of 1934, as amended, and shall

take such further action to the extent reasonably required to enable the

Purchaser to sell the Shares pursuant to Rule 144 under the Securities Act (as

such rule may be amended from time to time).

 

4.03         Listing of Shares.  If required by the rules and regulations of

any national securities exchange or automated quotation system, the Company

agrees to promptly secure the listing of the shares upon each national

securities exchange or automated quotation system upon which shares of its

Common Stock are listed and, so long as Purchaser owns any of the shares, shall

maintain such listing of all shares.

 

4.04         No Manipulation of Stock.  The Company has not taken and will not, in

violation of applicable law, take any action outside the ordinary course of

business designed to or that might be reasonably expected to cause or result in

unlawful manipulation of the price of the Common Stock to facilitate the sale

or resale of the Shares.

 

8

 

ARTICLE V

MISCELLANEOUS

5.01         Survival.  Notwithstanding any investigation made by

any party to this Agreement, all covenants, agreements, representations and

warranties made by the Company and the Purchaser in this Agreement and in the

certificates for the Shares delivered pursuant to this Agreement shall survive

for a period of eighteen (18) months after the execution of this Agreement.

5.02         No Waiver.  No failure or delay on the part of any party

to this Agreement in exercising any right, power or remedy hereunder shall

operate as a waiver thereof; nor shall any single or partial exercise of any

such right, power or remedy preclude any other or further exercise thereof or

the exercise of any other right, power or remedy hereunder.

5.03         Amendments, Waivers and Consents.  Any provision in this Agreement to the

contrary notwithstanding, and except as hereinafter provided, changes in or

additions to this Agreement may be made, and compliance with any covenant or

provision set forth herein may be omitted or waived, if the party requesting

such change, addition, omission or waiver shall obtain consent thereto in

writing from the other party.  Any

waiver or consent may be given subject to satisfaction of conditions stated

therein and any waiver or consent shall be effective only in the specific

instance and for the specific purpose for which given.

5.04         Addresses for Notices.  All notices, requests, demands and other

communications provided for hereunder shall be in writing and mailed or

delivered to each applicable party at the address set forth below or at such

other address as to which such party may inform the other parties in writing in

compliance with the terms of this Section.

If to the Purchaser:  Genencor International, Inc., 925 Page Mill

Road, Palo Alto, California 94304; Attention General Counsel and Chief

Financial Officer; or at such other address as shall be designated by the Purchaser

in a written notice to the Company complying as to delivery with the terms

hereof.

If to the Company:  Seattle Genetics, Inc, 21823 30th

Drive S.E., Bothell, WA 98021, Attention: General Counsel and Chief Financial

Officer, with a copy to:  Venture Law

Group, 4750 Carillon Point, Kirkland, WA 98033, Attention:  Sonya F. Erickson; or at such other address

as shall be designated by the Company in a written notice to the Purchaser

complying as to delivery with the terms hereof.

All such notices, requests, demands and other

communications shall, when mailed (which mailing must be accomplished by

certified mail, postage prepaid; express overnight courier service; or

registered mail, return receipt requested) be effective upon receipt.

5.05         Binding Effect; Assignment.  This Agreement shall be binding upon and

inure to the benefit of the Company and the Purchaser and their respective

heirs, successors and assigns, except that neither party shall have the right

to assign its rights hereunder or any interest herein without the prior written

consent of the other party.

5.06         Entire Agreement.  This Agreement and the documents referred to

herein constitute the entire agreement between the parties and supersedes any

prior understandings or agreements concerning the subject matter hereof.

9

 

5.07         Severability.  The provisions of this Agreement are

severable and, in the event that any court of competent jurisdiction shall

determine that any one or more of the provisions or part of a provision

contained in this Agreement shall, for any reason, be held to be invalid,

illegal or unenforceable in any respect, such invalidity, illegality or

unenforceability shall not affect any other provision or part of a provision of

this Agreement.

5.08         Governing Law.  This Agreement shall be governed by and

construed in accordance with the internal laws of the State of Delaware without

regard to its conflicts of laws principles to the contrary.

5.09         Headings.  Article, Section and subsection headings in

this Agreement are included herein for convenience of reference only and shall

not constitute a part of this Agreement for any other purpose.

5.10         Counterparts.  This Agreement may be executed in

counterparts, each of which shall be enforceable against the party actually executing

the counterpart, and all of which together shall constitute one instrument.

[REMAINDER OF PAGE INTENTIONALLY

LEFT BLANK]

 

10

 

IN WITNESS

WHEREOF, the parties hereto have caused this Agreement to be executed as of the

date first above written.

 

 

	

   

  	

  SEATTLE GENETICS, INC.

  
	

   

  	

   

  
	

   

  	

  By: /s/ Clay B. Siegall

  
	

   

  	

  Name: Clay B. Siegall

  
	

   

  	

  Title: President &

  CSO

  
	

   

  	

   

  
	

   

  	

  GENENCOR INTERNATIONAL,

  INC.

  
	

   

  	

   

  
	

   

  	

  By: /s/ Debby Jo Blank

  
	

   

  	

  Name: Debby Jo Blank,

  M.D.

  
	

   

  	

  Title: CBO/Sr. V.P.

  Healthcare

  

 

11

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