ACLARA BioSciences Inc. Contracts
Sample Business Contracts
Supply Agreement - Third Wave Technologies Inc. and ACLARA BioSciences Inc.
SUPPLY AGREEMENT
This Supply Agreement, together with exhibits attached hereto
("Agreement"), effective as of October 15, 2002 (the "Effective Date"), is
entered into by and between Third Wave Technologies, Inc., organized under the
laws of Delaware and having its principal place of business at 502 S. Rosa Road,
Madison, Wisconsin 53719 ("TWTI"), and ACLARA BioSciences, Inc., organized under
the laws of Delaware and having its principal place of business at 1288 Pear
Avenue, Mountain View, California 94043 ("ACLA"). TWTI and ACLA may each be
referred to herein individually as a "Party" or, collectively, as "Parties."
Recitals
Whereas, TWTI has technology and intellectual property for, among other
things, genetic analysis and life science research and testing, including test
kits, components, and other products and services based upon its Invader(R)
platform and/or Cleavase(R) enzymes; and
Whereas, ACLA has technology and intellectual property for, among other
things, genetic analysis and life science research and testing, including
products, services, and components based upon ACLA's eTag(TM) technology; and
Whereas, TWTI and ACLA entered into a Development and Commercialization
Agreement, dated October 24, 2001, which the Parties wish to terminate and
supersede in its entirety (except as set forth in the License Agreement); and
Whereas, TWTI and ACLA are entering into the License Agreement (as defined
below) which terminates the Development and Commercialization Agreement and
provides ACLA with certain rights including without limitation, the right to
commercialize certain assay products that perform multiplexed gene expression
using ALCA's eTag technology and TWTI's Invader(R) technology and Cleavase(R)
enzymes; and
Whereas, TWTI and ACLA are entering into this Agreement in order to set
forth the terms and conditions for supply of Cleavase(R) enzymes to be used in
Licensed Product under the License Agreement.
Now, Therefore, in consideration of the promises and undertakings set forth
herein, the Parties agree as follows:
ARTICLE 1
Definitions
Capitalized terms not otherwise defined herein will have the meaning set
forth below:
Confidential treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality request.
Omissions are designated as * * *. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission.
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1.1 Terms from the License Agreement. Each of the terms "Cleavage Enzyme,"
"Cleavase Enzyme," "Confidential Information," "Development and
Commercialization Agreement," "Diagnostic Procedures," "Enabled Customer," "End
User," "GAAP," "Gene Expression Field," "Genotyping Field," "Intellectual
Property Rights," "InvaderCreator Access Agreement," "Invader Reaction,"
"Licensed Product," "Multiplexed Invader Application," "Patents," "Probe Set,"
and "Target," shall have the meaning given to the particular term in the License
Agreement.
1.2 "Acceptance Certificate" shall mean a certificate of analysis signed
and dated by an ACLA employee qualified and duly authorized to certify that the
results of assays conducted on an indicated shipment of Cleavage Enzyme
hereunder conforms to the Specifications therefor and indicating acceptance of
such shipment. The Acceptance Certificate shall include without limitation a
description of the pertinent assay(s) conducted, the date on which it was (they
were) conducted, and the results of the assay(s).
1.3 "Certificate of Nonconformance" shall mean a certificate of analysis
signed and dated by an ACLA employee qualified and duly authorized to certify
that the results of assays conducted on an indicated shipment of Cleavage Enzyme
hereunder do not conform to the Specifications therefor and indicating the
reason(s) for non-conformance. The Certificate of Nonconformance shall include
without limitation a description of the pertinent assay(s) conducted, the date
on which it was (they were) conducted, and the results of the assay(s).
1.3 "Control" means, (A) with respect to an item of Technology or an
Intellectual Property Right, possession by TWTI of the power and authority,
whether arising by ownership, license, or other authorization, to disclose and
deliver the particular Technology to ACLA, and to grant and authorize the
licenses, and sublicenses, as applicable, of or within the scope granted to ACLA
in Section 2.10 of this Agreement and in the License Agreement without giving
rise to any of the following: (i) a violation of the terms of any written
agreement with any Third Party; (ii) a violation or infringement of any Patent,
copyright, trade secret, or other Intellectual Property Right of any Third
Party; (iii) TWTI being required to pay any royalty or other consideration to
any Third Party that would not have been required had a license not been
provided under this Agreement; (iv) a violation of any law, regulation, rule,
code, order or other requirement of any federal, state, foreign, local, or other
government body or the need for any additional permits, payments,
authorizations, or approvals under any such law, regulation, rule, code, order
or requirement. Notwithstanding, the provisions of clause (iii) of this Section
1.3, an item of Technology or an Intellectual Property Right shall be deemed to
be Controlled by TWTI for purposes of clause (iii) above, if ACLA agrees in
writing to (A) reimburse TWTI for all amounts payable to a Third Party that
would not have been required had a license not been provided under this
Agreement or pay such amounts directly to such Third Party, at the election of
TWTI, and (B) reimburse TWTI for fifty percent (50%) of any upfront, licensing,
milestone or other consideration payable to such Third Party, (but excluding
from this clause (B): (1) consideration payable as a result solely of the
exercise of rights under such item of Technology or Intellectual Property Rights
by other than entities acting by or under authority of the ACLA (i.e. running
royalties) and (2) amounts included in clause (A) above).
1.4 "Deposit Materials" means, with respect to each particular Cleavage
Enzyme that is identified in Exhibit 2.2, as amended from time to time in
accordance with this
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Agreement, instructions, specifications, Standard Operating Procedure and other
descriptions of the composition and manufacturing process, quality control and
assurance, fill and finish, and storage procedures and production lot records of
such Cleavage Enzyme, including a description of the suppliers, raw materials,
processes, equipment, and instruments used for the manufacture, quality control
and assurance, fill and finish, and storage procedures of such Cleavage Enzyme.
Deposit Materials shall include working cell stock and plasmids derived from
TWTI's master cell line for each such particular Cleavage Enzyme and one
milligram (1 mg) of unexpired Cleavage Enzyme (not necessarily manufactured from
the working cell stock). Each item within the Deposit Materials shall be
provided in sufficient detail and quantity as reasonably necessary to enable
ACLA or its contract manufacturer to manufacture such Cleavage Enzyme in the
same manner as such manufacture is performed by TWTI; provided that Deposit
Materials shall not be required to include any Technology that is not Controlled
by TWTI.
1.5 "Failure to Supply," "Failed to Supply," and the like, means, with
respect to each Cleavage Enzyme identified in Exhibit 2.2, as amended from time
to time in accordance with this Agreement, that TWTI did not supply in the
particular calendar month at least *** of the total quantity of such Cleavage
Enzyme that TWTI was obligated to supply in such calendar month under this
Agreement for any reason.
1.6 "License Agreement" means that certain written agreement by and
between ACLA and TWTI titled "License Agreement" entered into and effective on
even date herewith.
1.7 "Lot" shall mean, with respect to a particular Cleavage Enzyme, (i)
the quantity of enzyme purified from a single fermentation culture or (ii)
enzyme purified from multiple fermentation cultures and pooled.
1.8 "Manufacturing Entity" shall have the meaning as set forth in Exhibit
2.11 hereto.
1.9 "Pre-Shipment Sample" shall mean a sample of a Lot delivered to ACLA
pursuant to Section 2.8(g) for the purpose of determining whether said Lot
conforms to the Specifications.
1.10 "Quality Assurance Certificate" shall mean a certificate of analysis
signed and dated by a TWTI employee qualified and duly authorized to certify
that the results of assays conducted on a particular Lot of Cleavage Enzyme
conforms to the Specification, for such Cleavage Enzyme, as amended from time to
time. The Quality Assurance Certificate shall include a description of the
pertinent assay(s) conducted, the date on which it was (they were) conducted,
and the results of the assay(s).
1.11 "Release Condition" means, with respect to each Cleavage Enzyme
identified in Exhibit 2.2, as amended from time to time in accordance with this
Agreement, that: (i) TWTI has Failed to Supply the quantities of such Cleavage
Enzyme that TWTI was obligated to supply under this Agreement in any ***
consecutive calendar months or any *** consecutive calendar months, and (ii)
such failures have caused ACLA to be unable to meet its supply obligations to
_____________
*** Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
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Non-Affiliate Third Parties or to meet its and/or its Affiliates own internal
use needs, all in accordance with ACLA's rights in the License Agreement, as
reasonably demonstrated by ACLA.
1.12 "Specification" means:
(a) with respect to each Cleavage Enzyme set forth in Exhibit 2.2 as
of the Effective Date, the written specifications for such Cleavage Enzyme set
forth in Exhibit 2.2 as of the Effective Date, as such specifications are
modified solely by mutual written agreement of the Parties in accordance with
this Agreement; and
(b) with respect to a Cleavage Enzyme not set forth in Exhibit 2.2 as
of the Effective Date, but added to Exhibit 2.2 from time to time in accordance
with Section 2.4(d), the written specifications for the Cleavage Enzyme as
initially mutually agreed upon by both Parties in writing for purposes of supply
under this Agreement, as such specifications are subsequently modified solely by
mutual written agreement of the Parties in accordance with this Agreement; and
(c) with respect to functional and quality control tests for
analyzing a particular Cleavage Enzyme for conformance with its Specifications,
the written specifications for such functional or quality control test as set
forth in Exhibit 2.2 as such specifications are subsequently modified solely by
mutual written agreement of the Parties and mutually agreed in writing from time
to time in accordance with this Agreement.
1.13 "Standard Operating Procedures" shall mean TWTI's written protocol
for performing quality control assays under this Agreement relating to the
analysis of a particular quantity of Cleavage Enzyme to determine whether such
quantity conforms to the applicable Specifications prior to release of such
quantity of Cleavage Enzyme identified on Exhibit 2.2, as amended from time to
time in accordance with this Agreement, including, without limitation, the
applicable quantitative measurement of the activity and level of contaminants of
such quantity of Cleavage Enzyme. Standard Operating Procedures shall be written
in a style and shall include a level of detail sufficient for a qualified
microbiologist to understand and implement the protocol.
1.14 "Statement of Non-Compliance" shall mean a certificate of analysis
signed and dated by an ACLA employee qualified and duly authorized to certify
that the results of assays conducted on an indicated shipment of Cleavage Enzyme
hereunder does not conform to the Specifications therefor. The Statement of
Non-Compliance shall include a description of the pertinent assay(s) conducted,
the date on which it was (they were) conducted, and the results of the assay(s).
1.15 "Term" shall have the meaning set forth in Section 7.1.
1.16 "Transfer Price" shall mean: (i) with respect to each Cleavage Enzyme
identified in Exhibit 2.2 as of the Effective Date, the price set forth in
Exhibit 1.16 as of the Effective Date, as subsequently modified solely in
accordance with this Agreement; and (ii) with respect to each Cleavage Enzyme
not identified in Exhibit 2.2 as of the Effective Date, the price to which the
Parties mutually agree in writing, subject to Section 2.4(d) of this Agreement,
as subsequently modified solely in accordance with this Agreement.
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1.17 "TWTI Technology" means (i) any and all Patent claims to the extent
Controlled by TWTI during the Term and claiming any composition, method,
product, or improvement, modification, enhancement, or adaptation thereof that
is or are necessary or useful to manufacture each particular Cleavage Enzyme
identified in Exhibit 2.2, as amended from time to time in accordance with this
Agreement; (ii) any and all trade secrets and know how to the extent both
Controlled by TWTI during the Term and necessary or useful for the manufacture
of each particular Cleavage Enzyme identified in Exhibit 2.2, including without
limitation those embodied in the Deposit Materials for the particular Cleavage
Enzyme. For clarity, nothing herein shall require TWTI to disclose prior to a
Release Condition, any trade secrets except those embodied in the Deposit
Materials.
ARTICLE 2
SUPPLY
2.1 Terms and Conditions. All supply of each Cleavage Enzyme by TWTI to
ACLA shall be subject to the terms and conditions of this Agreement. ANY TERMS
OR CONDITIONS OF ANY PURCHASE ORDER OR ACKNOWLEDGMENT GIVEN OR RECEIVED WHICH
ARE ADDITIONAL TO OR INCONSISTENT WITH THIS AGREEMENT SHALL HAVE NO EFFECT AND
SUCH TERMS AND CONDITIONS ARE HEREBY EXCLUDED AND REJECTED.
2.2 Supply; Restricted Rights.
(a) General. Subject to the terms and conditions of this Agreement
and the License Agreement, TWTI shall supply each Cleavage Enzyme identified in
Exhibit 2.2, as amended from time to time in accordance with this Agreement, to
ACLA, and ACLA shall purchase from TWTI all of its requirements for Cleavage
Enzyme used as part of a Licensed Product, except to the extent that ACLA or a
Third Party appointed by ACLA manufactures Cleavage Enzyme in accordance with
Section 2.10.
(b) Limited Use. It is acknowledged and agreed that all Cleavage
Enzyme transferred to, or manufactured by or for, ACLA under this Agreement is
and shall be only for distribution and use under and in accordance with the
License Agreement as part of Licensed Products to perform Multiplexed Invader
Applications. Except for the rights expressly granted under the License
Agreement, no right, title, or interest of any nature whatsoever is or shall be
granted whether as a result of sale or transfer, by implication, estoppel,
reliance, or otherwise, with respect to any Cleavage Enzyme. Any distribution,
use, or other exploitation of Cleavage Enzyme not in accordance with this
Agreement or the License Agreement shall be considered to be unlicensed and is
hereby prohibited. ALL RIGHTS WITH RESPECT TO CLEAVAGE ENZYME THAT ARE NOT
SPECIFICALLY GRANTED IN THE LICENSE AGREEMENT ARE RESERVED TO TWTI. ACLA shall
use reasonable commercial efforts (i) to limit the use and other exploitation of
the Cleavage Enzyme supplied by TWTI, or manufactured by ACLA, under this
Agreement to use in accordance with the License Agreement, (ii) if it comes to
ACLA's attention, to terminate and cure promptly the unauthorized use and other
exploitation of Cleavage Enzyme supplied by TWTI, or manufactured by ACLA, under
this Agreement, which shall include without limitation providing prompt notice
of termination, and (iii) to obtain terms in its agreements with others pursuant
to this Agreement, which shall include without limitation
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the power to terminate all of the applicable party's rights with respect to, and
obtain the return of, all Cleavage Enzyme and TWTI Confidential Information
within thirty (30) days after notice of breach and failure to cure.
2.3 Forecasts. ACLA will provide forecasts as set forth in this Section
2.3 of the quantities of each Cleavage Enzyme in Exhibit 2.2 which are estimated
to be required by ACLA for distribution and use as part of Licensed Product in
accordance with the License Agreement and this Agreement. At least three (3)
calendar months prior to the start of each calendar quarter during the Term,
ACLA shall provide TWTI with a rolling written forecast ("Forecast") of the
quantities of each Cleavage Enzyme (identified by name and part number)
estimated by ACLA to be required for distribution and use in accordance with the
License Agreement, on a calendar month by calendar month basis, during such
calendar quarter. ACLA shall purchase, and TWTI shall supply, the quantities of
such Cleavage Enzyme set forth in each Forecast to the extent set forth in
Section 2.4.
2.4 Orders.
(a) Orders. Prior to the start of each calendar quarter during the
Term, ACLA shall place its firm order with TWTI, setting forth trade units,
delivery dates and shipping instructions with respect to each shipment, for
delivery in each calendar month of such calendar quarter, of that quantity of
each Cleavage Enzyme supplied by or on behalf of TWTI equal to or greater *** of
the quantity of such Cleavage Enzyme forecast for such month in the Forecast
provided for such calendar quarter in accordance with Section 2.3. TWTI shall
accept such orders from ACLA for each Cleavage Enzyme identified in Exhibit 2.2,
subject to the remaining terms and conditions of this Agreement, provided that
TWTI shall not be obligated to accept orders for any particular Cleavage Enzyme
for any particular calendar month to the extent that the quantity of the
particular Cleavage Enzyme ordered for delivery in such month exceeds *** of the
quantity of such Cleavage Enzyme forecast for such month in accordance with
Section 2.3; but TWTI shall use reasonable commercial efforts to fill orders for
such excess quantities from available supplies, taking into account TWTI's own
use, distribution and other obligations. ACLA shall not order any Cleavage
Enzyme that is intended to be distributed, used, or otherwise exploited other
than in accordance with the License Agreement.
(b) Minimum Order Quantities. ACLA shall order each Cleavage Enzyme
in the minimum order quantities provided for on Exhibit 2.2, as amended from
time to time in accordance with this Agreement.
(c) Form of Order. Within thirty (30) days of the Effective Date, the
parties shall mutually approve in writing a standard form of purchase order for
use by ACLA in ordering Cleavage Enzymes hereunder, such approval to not be
unreasonably withheld. For clarity, TWTI shall have the right to withhold its
approval of any form of purchase order that attempts to materially amend or
supplement the terms or conditions of this Agreement. All of ACLA's orders for
Cleavage Enzyme shall be made pursuant to such written purchase order form and
shall provide for shipment in compliance with Section 2.6. TWTI shall use
reasonable
_______________
*** Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
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commercial efforts to notify ACLA within ten (10) days from receipt of a
purchase order of its ability or inability to fill any amount(s) and delivery
date(s) of such order, provided that such notice will not waive any of the
supply obligations of TWTI hereunder.
(d) Enzyme Improvements; Changes. It is acknowledged that TWTI may
from time to time during the Term make additions, modifications or improvements
to Cleavage Enzyme identified in Exhibit 2.2 as well as to other Cleavage
Enzymes. If TWTI makes such an addition, modification or improvement, and
reasonably believes such new, modified or improved Cleavage Enzyme would be
useful generally as a component of Licensed Products under the License Agreement
then TWTI will promptly notify ACLA of such new, modified, or improved Cleavage
Enzyme, provided TWTI Controls such Cleavage Enzyme. TWTI shall provide ACLA
with a reasonable sample quantity provided that such Cleavage Enzyme is
available for production in commercial quantities, and has been supplied to a
minimum of three Third Parties. If requested by ACLA based upon its testing of
such samples, the Parties will amend Exhibit 2.2 to include such new, modified,
or improved Cleavage Enzyme for purchase under this Agreement; provided that the
Parties have agreed in writing to the Specifications for the new, modified, or
improved Cleavage Enzyme and the Parties have agreed in writing, subject to
Section 2.5(c), upon a Transfer Price for the Cleavage Enzyme. Subject to the
foregoing, Exhibit 2.2 may be amended only by mutual written agreement of TWTI
and ACLA.
(e) Specifications. The Parties may amend the Specifications for any
particular Cleavage Enzyme hereunder from time to time by mutual written
agreement. Without limiting the foregoing, it is understood that the
Specifications that exist as of the Effective Date are inadequate for full
testing of functional requirements for use of Cleavage Enzymes in Multiplexed
Invader Applications. Accordingly, the Parties hereby agree that promptly after
the Effective Date the Parties shall cooperate to specify and implement a
mutually agreeable functional assay that incorporates one or more Aclara
Components (each such assay, an "eTag Functional Assay"). The Parties shall use
commercially reasonable efforts to complete such development within sixty (60)
days of the Effective Date, and to incorporate such eTag Functional Assay into
the Specifications for the applicable Cleavage Enzyme and Standard Operating
Procedures therefor promptly thereafter.
2.5 Transfer Prices.
(a) Pricing. ACLA shall pay to TWTI in accordance with this Agreement
the Transfer Price for each Cleavage Enzyme supplied by TWTI under this
Agreement
(b) Escalation. Subject to Section 2.5(c) below, TWTI shall have the
right to increase the Transfer Price for each Cleavage Enzyme under this
Agreement in each calendar year by an amount that does not exceed the total
aggregate percentage increase in the CPI Index for the preceding calendar year.
As used herein, the "CPI Index" shall mean the US Bureau of Labor Statistic's
Consumer Price Index - All Urban Customers (CPI-U), US City Average, all items,
1982-84=100, not seasonally adjusted.
(c) Most Favored Pricing. If, during the Term, with respect to
quantities of a particular Cleavage Enzyme transferred to ACLA hereunder, the
Transfer Price hereunder and, if applicable, additional amounts payable to TWTI
in accordance with Section 4.6 of the License
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Agreement for such Cleavage Enzyme (such additional amounts, the "Transfer Price
Reconciliation") is greater than the Equivalent Enzyme Price for similar
quantities of Equivalent Enzyme charged to a Third Party in connection with an
arrangement on substantially similar terms, then the Transfer Price (together
with the Transfer Price Reconciliation, if applicable) for such Cleavage Enzyme
shall be reduced so that the Transfer Price (together with the Transfer Price
Reconciliation, if applicable) for such Cleavage Enzyme to be equal to the
Equivalent Enzyme Price, but only to the extent and for so long as such more
favorable Equivalent Enzyme Price is available to such Third Party.
For purpose of this Section 2.5(c) the following terms shall have the meanings
set forth below:
(i) "Equivalent Enzyme" means, with respect to a particular
Cleavage Enzyme, the same Cleavage Enzyme or any other functionally equivalent
nuclease enzyme supplied by TWTI to a Third Party.
(ii) "Equivalent Enzyme Price" means the fair market value of
all consideration (including all non-cash consideration) paid or payable to TWTI
by a Third Party with respect to the transfer of a particular Equivalent Enzyme.
(d) No Exhaustion. Notwithstanding any payment by ACLA to TWTI of a
Transfer Price for Cleavage Enzyme under this Agreement, ACLA acknowledges and
agrees that all amounts set forth as being payable pursuant to the License
Agreement from the sale of the Licensed Products shall be payable to TWTI. In
particular, no transfer of Cleavage Enzyme to ACLA shall be considered to
exhaust TWTI's right to receive payments under the License Agreement, it being
acknowledged that the Transfer Prices for Cleavage Enzyme have not been
established in a manner intended to fully compensate TWTI for the Cleavage
Enzyme or licenses under the License Agreement.
2.6 Delivery. All Cleavage Enzyme delivered to ACLA pursuant to the terms
of this Agreement shall be suitably packed for shipment in accordance with the
applicable Specifications, marked for shipment to the destination point
indicated in ACLA's purchase order, and shipped FOB (as defined under the
Uniform Commercial Code) point of shipment. Such packing, and the manner of
shipment, shall be sufficient to prevent damage, contamination, or degradation
during shipment and during unpacking at the destination. All freight, insurance
and other shipping expenses from the point of shipment shall be borne by ACLA.
The carrier shall be selected by ACLA and TWTI, provided that in the event no
agreement is reached, ACLA shall select the carrier. With respect to exact
delivery dates, TWTI shall use all reasonable commercial efforts to ship
quantities of Cleavage Enzyme for delivery on the dates specified in ACLA's
purchase orders submitted in accordance with this Agreement to the extent such
dates are consistent with the forecasted quantities TWTI is obligated to supply
hereunder. For clarity, it is understood and agreed that title to all Cleavage
Enzyme supplied by or on behalf of TWTI hereunder shall transfer to ACLA upon
acceptance thereof by ACLA in accordance with Section 2.8(a) below, however risk
of loss of Cleavage Enzyme shall transfer to ACLA at the time of delivery to the
carrier for transport to ACLA's designated point of delivery.
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2.7 Invoicing. TWTI shall submit invoices to ACLA no earlier than
shipment by TWTI. All invoices shall be sent to ACLA's address for notices
hereunder or such other address as designated by ACLA in writing, and each such
invoice shall state ACLA's aggregate and unit prices for the Cleavage Enzyme,
and shall separately itemize any insurance, taxes or other costs incident to the
transfer or shipment initially paid by TWTI but to be borne by ACLA hereunder.
In the event of any discrepancy, ACLA shall inform TWTI in writing within thirty
(30) days of receipt of a particular shipment, specifying the shipment, the
purchase order number, and the exact nature of the discrepancy between the order
and the shipment, or the exact nature of the discrepancy in the shipping or
other charges, as applicable, otherwise such shipment and applicable charges
shall be deemed correct.
2.8 Product Inspection.
(a) Specifications. TWTI shall, prior to shipment, analyze each Lot
from which Cleavage Enzymes will be shipped to ACLA hereunder for conformity to
the Specifications therefor. If the results of such analysis indicate that such
Lot of Cleavage Enzyme conforms to such Specifications therefor, TWTI may ship
Cleavage Enzyme from such Lot to ACLA, together with a Quality Assurance
Certificate. Within thirty (30) days of receiving a shipment of Cleavage Enzyme
and accompanying Quality Assurance Certificate, ACLA shall inform TWTI, pursuant
to Section 2.9, that said shipment either conforms to Specifications by
delivering to TWTI an Acceptance Certificate or does not conform to such
Specifications by delivering to TWTI a Statement of Non-Compliance. If ACLA does
not deliver an Acceptance Certificate, and does not deliver a Statement of
Non-Compliance, to TWTI within such thirty (30) day time period, the shipment
shall be deemed to be conforming and accepted by ACLA.
(b) Specifications Testing. In the event that the Specifications
include a functional requirement requiring in accordance with Standard Operating
Procedures an assay utilizing any reagent that is generally commercially
available from TWTI or otherwise not available from any Third Party, then TWTI
shall provide, at no charge to ACLA, reasonable quantities of such reagents to
perform such assay reasonably sufficient for ACLA to analyze shipments of
Cleavage Enzyme to ACLA for conformance with Specifications hereunder. If TWTI
does not provide such reagents for any particular shipment of Cleavage Enzymes
hereunder, then such shipment shall be deemed to fail such functional
requirement. Likewise, if the Specifications include a functional requirement
requiring in accordance with Standard Operating Procedures an eTag Functional
Assay (as defined in Section 2.4(e) above), then ACLA shall provide, at no
charge to TWTI, such software and reasonable quantities of such reagents
reasonably sufficient for TWTI to perform such eTag Assay to analyze Cleavage
Enzyme for shipment to ACLA for conformance with Specifications hereunder. If
ACLA does not provide such software or reagents for quantities of Cleavage
Enzyme to be supplied hereunder, then such functional requirement shall be
deemed to be excluded from the Specification for such quantities. Reagents and
software provided by one Party to the other Party pursuant to this Section
2.8(b) shall be used solely by the receiving Party for purposes of analyzing
Cleavage Enzyme to be supplied or supplied hereunder, as applicable, for
conformance with the applicable Specifications and for no other purpose.
(c) Replacement Shipments. Subject to the terms and conditions of
this Agreement, including Section 2.9 below, as soon as commercially practicable
but no later than
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sixty (60) days of receiving a Statement of Non-Compliance in accordance with
the foregoing, whether or not TWTI accepts ACLA's basis for rejection, TWTI
shall provide replacements for the shipment of Cleavage Enzyme subject to such
Statement of Non-Compliance and deliver, at TWTI's expense, to ACLA a
replacement shipment with an accompanying Quality Assurance Certificate for each
of such replacement shipment of Cleavage Enzyme. Within thirty (30) days of
receiving a shipment of Cleavage Enzyme and accompanying Quality Assurance
Certificate, ACLA shall inform TWTI pursuant to Section 2.9, that said shipment
either conforms to Specifications by delivering to TWTI an Acceptance
Certificate or does not conform to such Specifications by delivering to TWTI a
Statement of Non-Compliance. If ACLA does not deliver an Acceptance Certificate,
and does not deliver a Statement of Non-Compliance, to TWTI within such thirty
(30) day time period, the shipment shall be deemed to be conforming and accepted
by ACLA. Additionally, ACLA shall cooperate with TWTI in determining whether
issuance of a Statement of Non-Compliance was necessary or justified, and any
dispute with respect thereto shall be resolved in accordance with Section 2.9.
(d) Labeling. TWTI shall clearly label, in accordance with the
Specifications in Exhibit 2.2, each container containing Cleavage Enzyme for
supply hereunder with a unique Lot number, part number, description of contents
and other identifying information, as applicable.
(e) Good Manufacturing Practices. TWTI shall manufacture Cleavage
Enzymes for supply hereunder in accordance with applicable current Good
Manufacturing Practices (as defined by the U.S. Food and Drug Administration).
(f) Standard Operating Procedures. TWTI and ACLA shall analyze
Cleavage Enzymes using the applicable Standard Operating Procedures and shall
not deviate from the Standard Operating Procedures without the prior written
approval of the other Party, such approval not to be unreasonably withheld.
Within thirty (30) days of the Effective Date, TWTI shall provide ACLA with
copies of all Standard Operating Procedures used to test the Cleavage Enzymes
identified in Exhibit 2.2 for compliance with the Specification therefor, and
ACLA shall comply with such Standard Operating Procedures when analyzing
Cleavage Enzymes for compliance with the applicable Specifications. Within
thirty (30) days of any amendment to Exhibit 2.2 to include additional Cleavage
Enzymes, TWTI shall provide ACLA with the Standard Operating Procedures with
respect to such additional Cleavage Enzyme and the Parties will utilize such
Standard Operating Procedures with respect to testing such Cleavage Enzyme, and
neither Party shall deviate from such Standard Operating Procedures without the
prior written approval of the other Party, such approval not to be unreasonably
withheld.
(g) Pre-Shipment Samples. The Parties may agree in writing from time
to time that in order to facilitate the orderly shipment and acceptance of large
orders that TWTI will provide ACLA with a Pre-Shipment Sample for a particular
Lot that would be tested by ACLA to determine if such Lot conforms with
Specifications, and ACLA shall issue either a Certificate of Acceptance or a
Certificate of Nonconformance based upon such testing as appropriate and
otherwise in accordance with Section 2.9, and in accordance with Standard
Operating Procedures, prior to shipment of the order.
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(h) Inspection of TWTI Facilities. ACLA may, at reasonable times
during normal business hours and upon request made upon reasonable prior notice
to TWTI, not less than thirty (30) days or more than three (3) times per
calendar year, inspect TWTI's specific facilities used for manufacturing the
Cleavage Enzymes for ACLA, TWTI's manufacturing procedures for compliance with
Standard Operating Procedures, TWTI's inventory of Cleavage Enzymes required
under Section 2.13, and TWTI's batch records, work-in-progress, raw materials,
and production records for the Cleavage Enzymes supplied to ACLA under this
Agreement. All information observed by ACLA during the course of such inspection
shall be deemed to be the Confidential Information of TWTI under this Agreement
without requirement that it be marked or confirmed as such in writing.
(i) Technical Contacts. Within thirty (30) days of the Effective
Date, each Party shall notify the other Party in writing of the names, telephone
number, fax numbers, and e-mail addresses of at least one person to serve as the
Party's technical contact under this Agreement and at least one person to serve
as the Party's business contact under this Agreement. A Party may change its
business or technical contacts at any time with written notice to the other
Party.
2.9 Inspection and Rejection.
(a) Warranties. Subject to the terms and conditions of this
Agreement, TWTI warrants that the Cleavage Enzymes supplied by TWTI hereunder
will meet the Specifications for the applicable Cleavage Enzyme, in Exhibit 2.2,
at the time of delivery of the Cleavage Enzyme by TWTI to the carrier. Subject
to the terms and conditions of this Agreement, TWTI further represents and
warrants that title to all Cleavage Enzyme supplied by TWTI hereunder shall pass
to ACLA free and clear of all security interests, liens and other encumbrances
pursuant to Section 2.6. Notwithstanding anything to the contrary, ACLA's sole
and exclusive remedy, and TWTI's sole and exclusive liability, for a breach of a
warranty under this Section 2.9 and for any non-conforming Cleavage Enzyme under
Section 2.8 shall be to return the non-conforming Cleavage Enzymes to TWTI at
TWTI's expense for replacement or credit, at ACLA's option. Cleavage Enzymes
shall be considered non-conforming only if they fail to conform to the
Specifications. Notwithstanding the foregoing, nothing in this Section 2.9 shall
waive any rights ACLA may have with respect to backup manufacturing rights
provided for in Section 2.10(c) and/or under Release Conditions as defined in
Section 1.11.
(b) Non-Conforming Shipments. If within thirty (30) days from receipt
of a shipment of Cleavage Enzyme ACLA finds by analysis in accordance with the
Standard Operating Procedures for the applicable Cleavage Enzyme that the
Cleavage Enzyme does not comply with the applicable Specifications, ACLA shall
provide TWTI with a Certificate of Nonconformance for said shipment, such
Certificate of Nonconformance to include a written statement specifying the
nature and basis for the claim and a Statement of Non-Compliance for the
shipment. ACLA shall also return such non-conforming Cleavage Enzyme in
accordance with TWTI's reasonable instructions, at TWTI's expense; provided that
ACLA may retain a reasonable sample thereof solely for further testing,
including for example, testing pursuant to Section 2.9(d). ACLA and TWTI shall
cooperate to solve such a claim in good faith as quickly as possible. If ACLA
does not deliver an Acceptance Certificate, and does not deliver a
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Certificate of Nonconformance, to TWTI within such thirty (30) day time period,
after receipt of shipment, the shipment shall be deemed to be conforming and
accepted by ACLA.
(c) Third Party Verification. If, within a period of thirty (30) days
after TWTI's receipt from ACLA of a Statement of Non-Compliance, TWTI is unable
to verify that the applicable Cleavage Enzyme failed to conform to the
Specifications at the time of original delivery by TWTI to the carrier, then the
matter shall be submitted to and be finally decided by a nationally recognized
independent testing laboratory if requested by either Party. This laboratory
shall be selected by TWTI and approved in writing by ACLA, such approval not to
be unreasonably withheld and not to be delayed more than ten (10) days, if not
otherwise agreed in writing by both parties within five (5) days of either
Party's request.
(d) Third Party Testing. ACLA shall send a sample of the non
conforming shipment and a copy of the Certificate of Nonconformance to said
testing laboratory within ten (10) days of either Parties written request. Said
testing laboratory shall be requested by the Parties to complete its testing and
to render its written decision, supported by its description of procedures and
basis for its findings within thirty (30) days after being engaged to perform
said testing. The laboratory shall use the assays set forth in the
Specifications and Standard Operating Procedures for the applicable Cleavage
Enzyme. Each Party, at its own expense, shall reasonably assist and cooperate
with such laboratory in performing such testing by making available such
documentation (including Standard Operating Procedures), facilities, reagents
and other materials as the laboratory may request of the Party. The Parties
agree that the written decision of said testing laboratory shall be accepted as
final and binding. In case the laboratory test proves that the relevant Cleavage
Enzymes did not comply with the Specifications at the time of delivery by TWTI
to the carrier, then all cost and expense of transportation, shipping,
insurance, and the like related to the testing shall be paid by TWTI, otherwise,
TWTI shall transfer such Cleavage Enzyme back to ACLA and such cost and expense
shall be paid by ACLA together with the Transfer Price for the rejected Cleavage
Enzyme and any replacement Cleavage Enzyme.
(e) Credit or Refund. In the event that Cleavage Enzyme supplied by
or on behalf of TWTI under the terms of this Agreement is determined to be
non-conforming Cleavage Enzyme, TWTI shall credit ACLA for the full purchase
paid to TWTI, if any, for such non-conforming Cleavage Enzyme.
(f) Recalls. In the event that TWTI initiates a recall of a Lot, or
Lots, of Cleavage Enzyme supplied to ACLA hereunder ("Affected Lots") based on,
or arising out of, defects in materials or workmanship, improper manufacture of
such Cleavage Enzyme, contamination, or failure of the Cleavage Enzyme to meet
the Specifications, and if ACLA has accepted any Cleavage Enzyme from such
Affected Lots prior to the recall, then TWTI shall promptly, but in any case
within five (5) business days, notify ALCA in writing that TWTI has initiated a
recall of Cleavage Enzyme from Affected Lots. Such written notice shall identify
the Affected Lots to ACLA and shall contain a description of the defects giving
rise to the recall. TWTI shall bear any out-of-pocket costs and expenses
incurred by ACLA as required to implement the recall, or replacement, of any
Cleavage Enzyme from Affected Lots.
2.10 Shortage of Supply.
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(a) Escrow. Unless otherwise mutually agreed by the parties, within
thirty (30) days of the Effective Date TWTI shall enter into an escrow agreement
for the benefit of ACLA hereunder for the Deposit Materials with a mutually
agreed escrow agent on the terms and conditions presented by the escrow agent in
its standard escrow agreement, subject to the terms and conditions set forth in
this Section 2.10. Within fifteen (15) days after entering into such escrow
agreement, TWTI shall place in escrow with the escrow agent the Deposit
Materials for each Cleavage Enzyme that TWTI is obligated to supply under this
Agreement.
(i) Updates. TWTI shall update the Deposit Materials for each
Cleavage Enzyme in escrow at least each time the Specification for the Cleavage
Enzyme is modified in accordance with this Agreement, and otherwise as necessary
to maintain all Deposit Materials current, but no less often than once per
calendar year. Such updates shall include updates to the working stock and
plasmids as necessary to maintain un-expired working stock of Cleavage Enzyme
that performs to the then current agreed Specification, based upon the
expiration dates determined by TWTI.
(ii) Cleavage Enzyme Samples. Concurrent with TWTI's deposit in
escrow of the Deposit Materials for a Cleavage Enzyme under this Section
2.10(a), TWTI shall provide to ACLA a sample of Cleavage Enzyme manufactured
from the working cell stock derived from the master cell line for the Cleavage
Enzyme. ACLA shall analyze this sample using the applicable Standard Operating
Procedures and shall not deviate from the Standard Operating Procedures without
the prior written approval of TWTI, such approval not to be unreasonably
withheld, and shall, within thirty (30) days of receipt thereof, provide TWTI
with a Certificate of Acceptance or a Certificate of Nonconformance. In the
event of non-conformance, the procedures in Section 2.9 shall apply.
(iii) Release. The Deposit Materials for a Cleavage Enzyme will
be released to ACLA only upon the occurrence of a Release Condition for that
Cleavage Enzyme. It is acknowledged and agreed that TWTI may segregate the
Deposit Materials under separate escrow agreements for each Cleavage Enzyme so
that only those Deposit Materials pertaining to the manufacture of the
particular Cleavage Enzyme for which a Release Condition has occurred will be
released to ACLA. All Deposit Materials released to ACLA shall be treated as the
Confidential Information of TWTI, and shall be used only by ACLA, and its
contract manufacturer authorized in accordance with this Section 2.10, to
manufacture Cleavage Enzyme in accordance with this Section 2.10.
(iv) Audits. ACLA shall have the right to have an independent
technical auditor that is approved by TWTI, which approval will not be
unreasonably withheld, inspect and test the Deposit Materials from time to time,
but no more than once per year, to evaluate the sufficiency thereof for purposes
of ACLA's exercise of its rights under this Section 2.10; provided that the
auditor shall be required to enter into a reasonable confidentiality agreement
with TWTI. For the sake of clarity, such inspection and testing may include, at
the auditor's discretion, test production of Cleavage Enzyme from the working
stock/plasmids in the Deposit Materials.
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(v) Fees. ACLA shall be solely responsible for, and will
indemnify TWTI from and against, the fees payable to the escrow agent(s) in
connection with this Agreement or any escrow agreement entered into pursuant to
this Section 2.10(a).
(b) Backup Manufacturing License. Subject to the terms and conditions
of this Agreement, TWTI hereby grants to ACLA, and ACLA hereby accepts, a
non-exclusive, non-transferable (except as set forth in Section 8.2 and
2.10(b)(i)) license under the TWTI Technology, without right to grant or
authorize sublicenses, as necessary to make, and have made, solely to the extent
set forth in this Section 2.10 Cleavage Enzyme that complies with the
Specification of a Cleavage Enzyme for which a Release Condition has occurred,
and if such Release Condition occurred as a result of an event of the type
described in Section 8.3, has not been cured pursuant to Section 2.10(d),
provided that all Cleavage Enzyme manufactured under this Section 2.10 shall be
distributed and used solely as part of Licensed Product to perform Multiplex
Invader Applications under and in accordance with the License Agreement.
(i) Have Made Rights. ACLA may exercise its right to have
Cleavage Enzyme manufactured under this Section 2.10(b) solely through third
party contract manufacturers reasonably necessary to meet ACLA's requirements
for Cleavage Enzyme for distribution and use in accordance with the License
Agreement and subject to TWTI's approval, not to be withheld except with respect
to entities which make or sell products that TWTI reasonably considers to be
competitive with TWTI's products or TWTI Technology or are located in countries
outside the United States if TWTI has reasonable concerns with the protection
afforded to Intellectual Property Rights in the applicable country; and provided
that such third party manufacturer (A) enters into a reasonable confidentiality
agreement with ACLA (a copy of which is provided to TWTI in advance of
manufacture) that is at least as protective against the unauthorized use and
disclosure of Confidential Information of TWTI as the terms and conditions of
this Agreement and (B) agrees to supply and otherwise transfer the manufactured
Cleavage Enzyme only to ACLA and not to any other party.
(ii) Other Restrictions. Notwithstanding anything to the
contrary, ACLA shall not exercise any of its rights under this Section 2.10(b)
except to the extent expressly permitted in Section 2.10(c) and 2.10(d) below.
All Cleavage Enzyme obtained pursuant to this Section 2.10 is and shall be
subject to restriction as set forth in Section 2.2 above and the License
Agreement. No Deposit Material that is released to ACLA shall be used or
otherwise exploited except as necessary for ACLA to exercise its rights to
manufacture the applicable Cleavage Enzyme in accordance with this Section 2.10.
(c) Right to Manufacture. ACLA agrees that it will not exercise its
rights to manufacture, and have manufactured, a Cleavage Enzyme under the
license granted in Section 2.10(b) (the "Backup Manufacturing License") unless a
Release Condition has occurred with respect to the Cleavage Enzyme. ACLA shall
not manufacture or have manufactured any Cleavage Enzyme that is distributed,
used, or otherwise exploited other than in accordance with the License
Agreement.
(d) Cure by TWTI. In the event that a Release Condition arises out of
or results from an event of the type described in Section 8.3, ACLA's right to
exercise the Backup Manufacturing License with respect to a particular Cleavage
Enzyme shall continue in effect
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only until such time as TWTI (i) has supplied at ACLA's request, up to all
quantities of any Cleavage Enzyme that were the subject of a Failure to Supply
and (ii) demonstrated for three (3) consecutive months that it is able to supply
ACLA's requirements of that Cleavage Enzyme necessary for distribution and use
in accordance with the License Agreement. It is understood that at such time as
the provisions of (i) and (ii) above have been met, TWTI will have the right to
resume supply of Cleavage Enzyme with such resumption to be made over the course
of a phase in period in which supply by TWTI of the Cleavage Enzyme is ramped up
concurrent with a wind down by ACLA in the manufacture of the Cleavage Enzyme,
each as reasonably established to avoid disruptions in distribution and use of
Cleavage Enzyme in accordance with the License Agreement, and to minimize the
financial impact on ACLA. At the end of such phase-in period, which shall
include at least two (2) consecutive calendar months of supply by TWTI of ACLA's
full requirements of the Cleavage Enzyme necessary for distribution and use in
accordance with the License Agreement, ACLA shall discontinue all exercise of
the Backup Manufacturing License with respect to the applicable Cleavage Enzyme;
provided that the Backup Manufacturing License shall remain in effect during the
Term of this Agreement and may be further exercised by ACLA in accordance with
this Section 2.10 in the event that an additional Release Condition occurs with
respect to a Cleavage Enzyme. TWTI shall, prior to ACLA's discontinuation of the
Backup Manufacturing Rights, reimburse ACLA for ACLA's actual out of pocket
costs incurred to setup and validate manufacturing, to purchase or lease
equipment and to terminate and wind down such manufacturing capability,
including any purchase of unused inventory of raw materials, in each case
calculated in accordance with GAAP and reasonably necessary for ACLA to exercise
its rights in accordance with this Section 2.10 and manufacture ACLA's
reasonable requirement for quantities of Cleavage Enzyme for distribution and
use under the License Agreement. In such event, ACLA will assign and transfer to
TWTI all right, title, and interest in and to such equipment and raw materials,
not subject to any liens or encumbrances. Notwithstanding the foregoing, TWTI
shall have no obligation to purchase any equipment or raw materials that have
been damaged, or have otherwise been subject to misuse, abuse, neglect, or other
improper handling, maintenance, or conditions, all as reasonably determined.
(e) Assistance. In the event that a Release Condition occurs, TWTI
will use all reasonable commercial efforts to assist ACLA in securing supply
terms for raw materials that are similar to the terms in TWTI's agreements with
its suppliers of raw materials, and TWTI shall otherwise diligently cooperate
with ACLA without charge as necessary to enable ACLA to exercise its rights
under this Section 2.10 in accordance with this Agreement, including to identify
a third party contract manufacturer acceptable to both Parties.
(f) Sole Remedy. THIS SECTION 2.10 SHALL BE ACLA'S SOLE AND EXCLUSIVE
REMEDY, AND TWTI'S SOLE AND EXCLUSIVE LIABILITY, FOR A FAILURE TO SUPPLY BY
TWTI. For clarity, ACLA shall, with the exception of any reconciliation
payments, remain obligated to pay to TWTI in full all amounts in accordance with
the License Agreement notwithstanding any Failure to Supply or breach by TWTI
under this Agreement. ALL RIGHTS NOT EXPRESSLY GRANTED BY TWTI IN THIS SECTION
2.10 ARE RESERVED TO TWTI.
2.11 Manufacturing Entity. The Parties shall take such actions to form and
operate the Manufacturing Entity all as set forth in and in accordance with
Exhibit 2.11. For clarity, it is
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understood that ACLA shall have the right to exercise its rights under Section
2.10 through the Manufacturing Entity.
2.12 Third Party Contractors. TWTI shall have the right at any time to
satisfy its supply obligations to ACLA under this Agreement either in whole or
in part through arrangements with third parties engaged to perform services or
supply facilities or goods in connection with the manufacture, testing, and/or
packaging of Cleavage Enzyme, provided that TWTI shall remain responsible for
compliance with its obligations under this Agreement. Prior to having Cleavage
Enzyme manufactured by a Third Party, TWTI shall obtain ACLA's prior written
consent to the particular Third Party unless it is an Affiliate of TWTI or is
not listed in Exhibit 2.12, which consent shall not be unreasonably withheld or
delayed by ACLA.
2.13 Inventory. Beginning January 1, 2003, TWTI agrees that during the
following three (3) calendar quarters of the Term, it will maintain an inventory
of Cleavage Enzyme that is no less than one hundred fifty milligrams (150 mg) of
each Cleavage Enzyme that it is obligated to supply under this Agreement.
Thereafter, TWTI will maintain an inventory of no less than ten percent (10%) of
the average of the total quantity of Cleavage Enzyme ordered by ACLA, and which
TWTI was obligated to supply, in accordance with this Article 2 for delivery in
each of the three (3) calendar quarters immediately preceding the then current
calendar quarter.
ARTICLE 3
Payment Provisions
3.1 Payment. ACLA shall make full payment to TWTI for all Cleavage Enzyme
shipped hereunder no later than forty-five (45) days from the date of TWTI's
invoice; except that the balance of the Transfer Price for Cleavage Enzyme
provided to Enabled Customers, or used by ACLA, shall be paid to TWTI in
accordance with the License Agreement.
3.2 Mode of Payment. All payments shall be made by check or direct wire
transfer of United States Dollars in immediately available funds in the
requisite amount to such bank account as TWTI may from time to time designate by
written notice to ACLA; provided that all payments above One Million United
States Dollars (U.S. $1,000,000) shall be made by direct wire transfer.
3.3 Taxes. Transfer Prices do not include, and payments will be made
without reduction for, taxes (such as, without limitation, sales and withholding
taxes), fees or charges imposed by government authorities. If TWTI has the legal
obligation to collect and/or pay any such sales, use, excise, value added, or
similar taxes in connection with the transfer of Cleavage Enzyme hereunder, then
the appropriate amount shall be invoiced to and paid by ACLA, unless ACLA
provides TWTI with a valid tax exemption certificate authorized by the
appropriate taxing authority. Any such taxes, duties, fees, and charges shall
otherwise be the sole responsibility of, and shall be paid by, ACLA, and ACLA
shall indemnify TWTI from and against all such amounts. ACLA shall provide TWTI
with official receipts issued by the appropriate taxing authority, or such other
evidence, each as is reasonably requested by TWTI to establish that such amounts
have been properly paid. Notwithstanding the foregoing, TWTI shall be solely
responsible for its own income taxes. Subject to the foregoing, TWTI agrees to
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cooperate reasonably with ACLA regarding the formalities of shipment, customs
clearance, and the like, for shipments of Cleavage Enzyme outside the United
States if reasonably possible to reduce ACLA's taxes, without additional cost or
expense to TWTI, through the manner in which such formalities are handled and
whether they are handled by TWTI or ACLA.
3.4 Late Payment. Any payments or portions thereof due hereunder which are
not paid when due shall bear interest equal to the lesser of the prime rate as
reported by the Chase Manhattan Bank, New York, New York, on the date such
payment is due, plus an additional two percent (2%), or the maximum rate
permitted by law, calculated on the number of days after TWTI provides ACLA with
written notice that the payment is past due. This Section 3.4 shall in no way
limit any other remedies available to either Party.
ARTICLE 4
Labeling
All Cleavage Enzyme obtained by ACLA under this Agreement shall be labeled,
prior to distribution by ACLA to any other party, with the TWTI Marks in
accordance with Section 3.7 of the License Agreement and with the field of use
restrictions applicable in accordance with this Agreement and the License
Agreement.
ARTICLE 5
Confidentiality
5.1 Confidential Information. All Confidential Information provided by a
Party in connection with this Agreement will be treated as Confidential
Information provided by such Party under the License Agreement and will be
subject to the terms of the License Agreement. TWTI shall have the right to use
Confidential Information provided by ACLA to perform its obligations under this
Agreement. A breach of Article 7 of the License Agreement by a Party, however,
shall be treated as a breach of both this Agreement and the License Agreement.
5.2 Terms of Agreement; Press Release. Except to the extent required by
applicable law or as otherwise permitted in accordance with this Section 5.2,
neither Party shall disclose or make any public announcements concerning this
Agreement or the terms hereof without the prior written consent of the other
Party. Notwithstanding the foregoing, each Party shall have the right to issue a
press release in accordance with the License Agreement and to disclose this
Agreement, and its terms (i) to advisors and investors on a need-to-know basis
under conditions which reasonably ensure the confidentiality thereof; (ii) as
required by any court or other governmental body; (iii) as otherwise required by
law; (iv) in confidence to legal counsel of such parties; (v) in confidence, in
connection with the enforcement of this Agreement or rights under this
Agreement; (vi) in confidence, in connection with a merger, acquisition of stock
or assets, proposed merger or acquisition, or the like; or (vii) as required in
connection with any government or regulatory filings, including without
limitation filings with the SEC; provided that such disclosing Party shall: (a)
give reasonable advance written notice to the non-disclosing Party of the
proposed disclosure and the reason for such disclosure; (b) consider in good
faith comments and requests of the non-disclosing Party regarding such proposed
disclosure that are received by the disclosing Party within two (2) business
days after the non-disclosing Party's
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receipt of the proposed disclosure; and (c) use reasonable efforts to secure
confidential treatment of such disclosed information.
5.3 Proprietary Markings. Neither Party shall remove or obscure any
trademark, trade name, copyright notice, patent marking or other proprietary
notice from any Cleavage Enzyme or materials provided to it by the other Party
in connection with this Agreement.
ARTICLE 6
Representations and Warranties
6.1 Representations by TWTI. TWTI represents and warrants that as of the
Effective Date that: (i) it is duly organized and validly existing under the
laws of the jurisdiction of its incorporation and has full corporate power and
authority to enter into this Agreement; (ii) it has taken all corporate actions
necessary to authorize the execution and delivery of this Agreement and the
performance of its obligations under this Agreement; (iii) it has the rights to
grant the rights and licenses under Section 2.10; (iv) to TWTI's knowledge as of
the Effective Date, the making, using, and selling of Cleavage Enzyme identified
in Exhibit 2.2 does not require the infringement of the Intellectual Property
Rights of any Third Party; (v) the performance of its obligations under this
Agreement do not conflict with, or constitute a default under its charter
documents, any contractual obligation of TWTI or any court order; and (vi) that
all materials deposited in Escrow under Section 2.10(a) as of the Effective Date
are under TWTI Control.
6.2 Representations by ACLA. ACLA represents and warrants that, as of the
Effective Date: (i) it is duly organized and validly existing under the laws of
the jurisdiction of its incorporation and has full corporate power and authority
to enter into this Agreement; (ii) it has taken all corporate actions necessary
to authorize the execution and delivery of this Agreement and the performance of
its obligations under this Agreement; and (iii) the performance of its
obligations under this Agreement do not conflict with, or constitute a default
under its charter documents, any contractual obligation of ACLA or any court
order.
6.3 Disclaimer of Warranties. EXCEPT AS SPECIFICALLY SET FORTH IN THIS
ARTICLE 6 OR SECTION 2.9(a), NO PARTY MAKES ANY REPRESENTATION OR WARRANTY,
EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE OR USE, NON-INFRINGEMENT, AND ANY OTHER STATUTORY
WARRANTY.
ARTICLE 7
Term and Termination
7.1 Term. This Agreement will commence upon the Effective Date and, unless
earlier terminated, shall continue in effect until expiration or termination of
the License Agreement for any reason (the "Term").
7.2 Termination for Cause. Either Party shall have the right to terminate
this Agreement upon final determination, in accordance with Section 8.7 below,
of material failure by the other Party to comply with any term of this
Agreement. Subject to the foregoing, a failure
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of ACLA to make payment shall be considered such a material failure unless cured
within fifteen (15) days of receipt of written notice of such non-payment.
7.3 Cross Termination with License Agreement. This Agreement shall
terminate immediately without requiring any action by either Party upon any
termination or expiration of the License Agreement. Notwithstanding the
foregoing, in the event that the License Agreement expires in accordance with
Section 10.1 of the License Agreement, then TWTI will agree to extend the Term
of this Agreement until the later of ten (10) years after the Effective Date or
eight (8) calendar months after such expiration of the License Agreement,
provided that, in consideration of such agreement by TWTI, ACLA enters into a
written agreement with TWTI (the "Extension Agreement") that (i) prevents such
Cleavage Enzyme, and any Probe Sets and Licensed Products, from being used,
distributed, or otherwise exploited in any manner other than in the same manner
as was permitted by the License Agreement prior to its expiration, (ii)
obligates ACLA to make payments to TWTI in the same manner as was required under
the License Agreement prior to such expiration, and (iii) otherwise includes the
same terms and conditions as the License Agreement, excluding Section 6.4 and
provided that the period of confidentiality in Section 7.1 shall be extended by
a mutually agreed amount and ACLA's indemnity to TWTI in Section 9.2 shall be
modified to indemnify TWTI in an equivalent manner, but to reflect the fact that
ACLA may not be exercising licenses under TWTI's Intellectual Property Rights.
It is acknowledged and agreed that TWTI's agreement to extend the Term of this
Agreement would be provided in consideration for such agreement by ACLA,
including to pay the same amounts as set forth in the License Agreement after
expiration of Patents in the TWTI IP. Notwithstanding the foregoing, TWTI shall
no obligation to grant any additional rights or licenses to ACLA under TWTI's
Intellectual Property Rights in connection with such agreement between the
Parties, whether through implied licenses or exhaustion associated with the sale
of Cleavage Enzyme, or otherwise, and ACLA shall receive no rights or licenses
beyond those granted in the License Agreement. Notwithstanding the above, except
pursuant to the Extension Agreement, ACLA shall be under no obligation to
purchase Cleavage Enzyme from TWTI and TWTI shall be under no obligation to
supply Cleavage Enzyme to ACLA after the expiry of the License Agreement.
7.4 Consequences of Termination or Expiration.
(a) Return of Materials. Upon termination or expiration of this
Agreement each Party will promptly return all records and materials in its
possession or control containing or comprising the other Party's know-how or
other Confidential Information to which the former Party does not expressly
retain rights hereunder or under the License Agreement.
(b) Accrued Liability. Termination or expiration of this Agreement
for any reason shall not release either Party hereto from any liability which at
the time of such termination or expiration has already accrued to the other
Party prior to such time. Such termination or expiration will not relieve a
Party from accrued payment obligations or from obligations which are expressly
indicated in this Agreement to survive termination or expiration of this
Agreement.
(c) Survival. The following Articles and Sections of this Agreement
shall survive its termination or expiration: Articles 1, 3, 5, 6, and 8 and
Sections 2.2(b), 2.5(d), 2.8(a)
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(last sentence), 2.8(b) (last sentence), 2.9(a), 2.9(b) (last sentence), 2.9(c),
2.9(d), 6.3, 7.3 and 7.4. All obligations to make payments to TWTI shall survive
any expiration or termination of this Agreement. In addition, upon expiration,
but not earlier termination, ALCA's rights under Section 2.10(b) in the trade
secrets within the TWTI Technology shall survive; otherwise all rights and
licenses granted to ACLA under Section 2.10 shall terminate. To the extent
requested by TWTI in the event of any termination or expiration of this
Agreement, ACLA shall be obligated to purchase for delivery no later than thirty
(30) days thereafter, and in accordance with the terms and conditions of this
Agreement, including pricing, in effect prior to such termination or expiration,
the inventory of Cleavage Enzyme that TWTI was required to maintain under
Section 2.13.
ARTICLE 8
General Provisions
8.1 Relationship of the Parties. The Parties are independent contractors.
Nothing in this Agreement is intended or will be deemed to constitute a
partnership, agency or employer-employee relationship between the Parties.
Neither Party will incur any debts or make any commitments for the other Party.
8.2 Assignments. Except as expressly provided herein, neither this
Agreement nor any interest hereunder will be assignable, nor any other
obligation delegable, by a Party without the prior written consent of the other
Party; provided, however, that a Party shall have the right to assign and
otherwise transfer this Agreement as a whole without consent to any successor
that acquires all or substantially all of the business or assets of such Party
by way of merger, consolidation, other business reorganization, or the sale of
stock or assets, provided that the assigning Party notifies the other Party in
writing of such assignment, both the License Agreement and the InvaderCreator
Access Agreement are concurrently transferred in their entirety to such
successor in accordance with their terms, and such successor agrees in writing
to be bound by the terms and conditions of this Agreement, the License
Agreement, and the InvaderCreator Access Agreement. This Agreement shall be
binding upon successors and permitted assigns of the Parties. Any assignment not
in accordance with this Section 8.2 will be null and void.
8.3 Force Majeure. Except with respect to payment of money, no Party shall
be liable to the other for failure or delay in the performance of any of its
obligations under this Agreement for the time and to the extent such failure or
delay is caused by earthquake, riot, civil commotion, war, terrorist acts,
strike, flood, or governmental acts or restriction, or other cause that is
beyond the reasonable control of the respective Party. The excused Party shall
be excused for a time period reasonably sufficient to remedy the effects of such
an event. The Party affected by such force majeure will provide the other Party
with full particulars thereof as soon as it becomes aware of the same (including
its best estimate of the likely extent and duration of the interference with its
activities), and will use commercially reasonable efforts to overcome the
difficulties created thereby and to resume performance of its obligations as
soon as practicable. If the performance of any such obligation other than supply
of Cleavase Enzyme under this Agreement is delayed owing to such a force majeure
for any continuous period of more than one hundred eighty (180) days, the
Parties hereto will consult with respect to an equitable solution, including the
possibility of the mutual termination of this Agreement.
20
<PAGE>
8.4 Entire Agreement of the Parties; Amendments. This Agreement, the
License Agreement, the InvaderCreator Access Agreement, the Letter related to
the Transition Manufacturing Plan and the Letter related to InvaderCreator
Access Prior to Implementation of Updates, all entered into concurrently,
constitute and contain the entire understanding and agreement of the Parties
respecting the subject matter hereof and except as expressly provided in Section
2.1 of the License Agreement cancels and supersedes any and all prior and
contemporaneous negotiations, correspondence, understandings and agreements
between the Parties, whether oral or written, regarding such subject matter,
including, without limitation, the Development and Commercialization Agreement.
No waiver, modification or amendment of any provision of this Agreement will be
valid or effective unless made in writing and signed by the Parties.
8.5 Captions. The captions to this Agreement are for convenience only, and
are to be of no force or effect in construing or interpreting any of the
provisions of this Agreement.
8.6 Governing Law. This Agreement will be governed by and interpreted in
accordance with the laws of the State of California, applicable to contracts
entered into and to be performed wholly within the State of California,
excluding conflict of laws principles.
8.7 Dispute Resolution.
(a) General. Except as otherwise provided in this Section 8.7 below,
in the event of any controversy or claim arising out of, relating to or in
connection with any provision of this Agreement or the rights or obligations of
the Parties hereunder, either Party shall have the right to initiate dispute
resolution by sending written notice of the dispute, and an intent to arbitrate
such dispute, to the other Party; provided, however, that any dispute concerning
the scope, construction, validity, enforceability or infringement of any Patent
within the TWTI Technology shall be heard and decided in a court of competent
jurisdiction under the local patent laws of the jurisdictions having issued the
Patent or Patents in question. Within twenty (20) days after such notice
(either, a "Dispute Notice"), each Party shall cause its Chief Executive Officer
or the Chief Executive Officer's high-level executive (at the vice president
level or higher) to meet in person to negotiate in good faith a resolution to
the dispute within twenty (20) days of the first such meeting. If the dispute is
unresolved during such period, then any Party may initiate arbitration in
accordance with the commercial arbitration rules of the American Arbitration
Association ("AAA") then in force. The Parties shall use their commercially
reasonable efforts to conclude the arbitration within six (6) months after the
arbitrator has been appointed. The venue of such arbitration shall be in
Madison, Wisconsin for disputes brought by ACLA and Santa Clara County,
California for disputes brought by TWTI.
(b) Judgments. An award rendered pursuant to this Section 8.7 shall
be final and binding upon all parties participating in such arbitration. The
arbitrator may, upon competent proof, grant any remedy or relief that the
arbitrator deems just and equitable under the terms and conditions of this
Agreement. Nothing in this Agreement shall be deemed as preventing any Party
from seeking injunctive relief (or any other provisional remedy) from any court
having jurisdiction over the Parties and the subject matter of the dispute.
Judgment upon the award may be entered in any court having jurisdiction, or
application may be made to such court for judicial acceptance of the award
and/or an order of enforcement as the case may be.
21
<PAGE>
(c) Preliminary Injunctions. Notwithstanding anything to the contrary
in this Section 8.7, a Party shall have the right to seek a temporary
restraining order or preliminary injunction from any court of competent
jurisdiction in order to prevent immediate and irreparable injury, loss or
damage on a provisional basis, pending the decision of the arbitrator(s) on the
merits under this Section 8.7.
8.8 Notices and Deliveries. Any notice, request, delivery, approval or
consent required or permitted to be given under this Agreement will be in
writing and will be deemed to have been sufficiently given if delivered in
person, transmitted by telecopier (receipt verified) or by express courier
service (signature required) or five (5) days after it was sent by registered
letter, return receipt requested (or its equivalent), provided that no postal
strike or other disruption is then in effect or comes into effect within two (2)
days after such mailing, to the Party to which it is directed at its address or
facsimile number shown below or such other address or facsimile number as such
Party will have last given by notice to the other Party.
If to TWTI, addressed to:
Third Wave Technologies, Inc.
502 South Rosa Road
Madison, Wisconsin 53719
Attn.: President
Fax: 608-273-8618
With a copy to:
Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, California 94304-1050
Attn.: Ian B. Edvalson, Esq.
Fax: 650-493-6811
If to ACLA, addressed to:
ACLA BioSciences, Inc.
1288 Pear Avenue
Mountain View, California 94043
Attn.: President and CEO
Fax: 650-210-9271
With a copy to:
Latham & Watkins
135 Commonwealth Drive
Menlo Park, California 94025
Attn.: Michael W. Hall, Esq.
Fax: 650-463-2600
22
<PAGE>
8.9 No Consequential Damages. EXCEPT WITH RESPECT TO UNAUTHORIZED
EXPLOITATION OF THE OTHER PARTY'S INTELLECTUAL PROPERTY RIGHTS OR BREACH OF
CONFIDENTIALITY, IN NO EVENT WILL ANY PARTY OR ANY OF ITS RESPECTIVE AFFILIATES
BE LIABLE TO THE ANY OTHER PARTY OR ANY OF ITS AFFILIATES FOR SPECIAL, INDIRECT,
CONSEQUENTIAL, INCIDENTAL, EXEMPLARY, OR PUNITIVE DAMAGES, WHETHER IN CONTRACT,
WARRANTY, TORT, NEGLIGENCE, STRICT LIABILITY OR OTHERWISE, INCLUDING BUT NOT
LIMITED TO, LOSS OF PROFITS OR REVENUE OR CLAIMS OF CUSTOMERS OF ANY OF THEM OR
OTHER THIRD PARTIES FOR SUCH DAMAGES.
8.10 Waiver. A waiver by any Party of any of the terms and conditions of
this Agreement in any instance will not be deemed or construed to be a waiver of
such term or condition for the future, or of any subsequent breach hereof. All
rights, remedies, undertakings, obligations and agreements contained in this
Agreement will be cumulative and none of them will be in limitation of any other
remedy, right, undertaking, obligation or agreement of either Party.
8.11 Severability. When possible, each provision of this Agreement will be
interpreted in such manner as to be effective, valid, and enforceable under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid, or unenforceable under applicable law, or causes an Intellectual
Property Right of either Party to be unenforceable, such provision will be
ineffective only to the extent of such prohibition, unenforceability, or
invalidity, without invalidating the remainder of this Agreement. The Parties
will make a good faith effort to replace the applicable provision with a valid
one, or one that remedies the unenforceability of the Intellectual Property
Rights, as applicable, which the Parties agree has effect that is consistent
with the original provision. In the event the Parties do not agree upon such a
substitute provision, either Party shall have the right to terminate this
Agreement by providing sixty (60) days written notice of termination to the
other.
8.12 Compliance with Laws. Notwithstanding anything to the contrary
contained herein, all rights and obligations of ACLA and TWTI are subject to
prior compliance with, and each Party shall comply with, all United States and
foreign export and import laws, regulations, and orders, and such other United
States and foreign laws, regulations, and orders as may be applicable, including
obtaining all necessary approvals required by the applicable agencies of the
governments of the United States and foreign jurisdictions.
23
<PAGE>
8.13 Counterparts. This Agreement may be executed simultaneously in any
number of counterparts, any one of which need not contain the signature of more
than one Party but all such counterparts taken together will constitute one and
the same agreement.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their respective duly authorized officers as of the Effective Date, each copy
of which will for all purposes be deemed to be an original.
Third Wave Technologies, Inc. ACLARA BioSciences, Inc.
By: ____________________________________ By:_________________________________
Name: __________________________________ Name: ______________________________
Title: _________________________________ Title: _____________________________
Date: __________________________________ Date: ______________________________
24
<PAGE>
EXHIBIT 1.16
Transfer Price
CLEAVASE *** AND CLEAVASE ***:
--------------------------------------------------------------------------------
Volume Price per microgram Total Invoice Price
--------------------------------------------------------------------------------
*** *** ***
--------------------------------------------------------------------------------
*** *** ***
--------------------------------------------------------------------------------
*** *** ***
--------------------------------------------------------------------------------
CLEAVASE X AND CLEAVASE XI:
--------------------------------------------------------------------------------
Transfer Price ***
--------------------------------------------------------------------------------
__________________
***Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
<PAGE>
Exhibit 2.2
Cleavage Enzyme(s)
***
***
***
***
_______________
*** Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
<PAGE>
Exhibit 2.11
Manufacturing Entity
A. Formation of Manufacturing Entity. Subject to the terms and conditions of
this Agreement, this Exhibit 2.11 and such other terms and conditions as would
be required to allow ACLA to exercise its Back Up Manufacturing rights *** TWTI
and ACLA shall organize and establish upon the occurrence of a Trigger Event (as
defined in Paragraph A.5 of this Exhibit 2.11 below) the entity, as described in
this Exhibit 2.11 (the "Manufacturing Entity"), ***.
1. Form. Unless otherwise agreed in writing by the Parties, the
Manufacturing Entity shall ***.
2. Control. Subject to the terms and conditions of this Agreement and
this Exhibit 2.11, TWTI and ACLA agree that ***. Accordingly, *** in accordance
with this Agreement and the License Agreement. Without limiting the foregoing,
the Manufacturing Entity shall ***.
2. Formation and Governance Documents and Agreements. Except to the
extent that terms are expressly required by this Agreement, all terms regarding
formation, governance, and operation of the Manufacturing Entity shall be
determined ***.
3. Capitalization. TWTI and ACLA will be ***. Manufacturing Entity shall
have ***. Without limiting the foregoing, the Manufacturing Entity shall ***.
Notwithstanding anything to the contrary, TWTI ***.
4. Trigger Events. For purposes of this Exhibit 2.11, "Trigger Event"
means the occurrence of any of the following:
(i) Failure to Supply. a Failure to Supply has occurred;
(ii) Filing of a Petition in Bankruptcy. the filing by TWTI, in any
court or agency pursuant to any statute or regulation of the United States or of
any individual state or foreign country, of a petition in bankruptcy or for the
appointment of a receiver or trustee for TWTI or all or substantially all of its
assets, or of a petition for any other equivalent proceedings in any such court
or agency;
(iii) Involuntary Bankruptcy. if TWTI is served with an involuntary
petition against it in bankruptcy, or a petition for the appointment of a
receiver or trustee for TWTI, or all or substantially all of TWTI's assets, or
for any other equivalent proceedings, under any such
__________________
***Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
<PAGE>
statute or regulation and in any such court or agency, and such petition is not
dismissed with sixty (60) days after the filing thereof; or
(iv) Dissolution for Benefit of Creditors. if TWTI shall propose or
be a party to any dissolution or liquidation of TWTI, or if TWTI shall make an
assignment of all or substantially all of its assets for the benefit of
creditors.
B. Backup Manufacturing Agreement. Except for the agreement described in this
Paragraph B of this Exhibit 2.11 and the rights and licenses therein, ***.
Promptly after formation of the Manufacturing Entity and upon written request by
ACLA, TWTI and Manufacturing Entity shall enter into a written agreement (the
"Backup Manufacturing Agreement") pursuant to which (i) TWTI shall grant to the
Manufacturing Entity a non-exclusive, non-transferable license under the TWTI
Technology, without right to grant or authorize sublicenses, as necessary to
make, and have made Cleavage Enzyme that complies with the Specification of any
Cleavage Enzyme for which a Release Condition has occurred, and if such Release
Condition occurred as a result of an event of the type described in Section 8.3
of the Agreement, has not been cured pursuant to Section 2.10(d) of the
Agreement, solely for purposes of supply to ACLA (and no other party) of its
requirements of such Cleavage Enzyme for purposes of ACLA exercising its rights
and licenses under the License Agreement and (ii) Manufacturing Entity shall
covenant not exercise its rights to manufacture, and have manufactured, a
Cleavage Enzyme unless a Release Condition has occurred with respect to the
Cleavage Enzyme and the Deposit Materials for the particular Cleavage Enzyme
have been released to ACLA. The Backup Manufacturing Agreement shall include
reasonable and customary terms and conditions for a license under these
conditions and the applicable terms and conditions from this Agreement including
Sections 2.10(b) through (f) with the Manufacturing Entity being substituted for
ACLA thereunder mutatis mutandis. Additionally, the Backup Manufacturing
Agreement shall include other terms and conditions reasonable and customary in
such a license under the circumstances, including a covenant that Manufacturing
Entity engage in only those activities that are reasonably necessary to
manufacture Cleavage Enzyme for supply to ACLA for distribution and use solely
in accordance with this Agreement and the License Agreement.
C. Tax Matters. The Parties shall mutually designate the "tax matters partner"
of the Manufacturing Entity within the meaning of Section 6231(a)(7) of the
United States Internal Revenue Code of 1986, as amended (the "Code"), so as to
minimize the tax implications of the Manufacturing Entity to the Parties. Except
to the extent specifically provided in the Code or the any regulation issued by
the United States Treasury Department relating to the Code (or the laws of
relevant non-Federal taxing jurisdictions), the tax matters partner shall
cooperate with the other Party with regard to tax matters, including the
authority to make (or decline to make) any available tax elections so as to
minimize the tax implications of the Manufacturing Entity to the Parties.
______________
*** Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
<PAGE>
D. No publicity. Without the prior written approval *** shall not issue, nor
authorize or cause any other party to do so on its behalf, any public
announcement or other public statement.
E. Information Rights. *** agrees promptly to provide *** with such information
as it may reasonably request related to the operation of the Manufacturing
Entity. Without limiting the foregoing, *** shall cause the Manufacturing Entity
to maintain complete and accurate books and records regarding all finances and
operations of the Manufacturing Entity in a manner reasonably determined by ***,
and *** shall have full access to and audit rights of such books and records at
all times upon request.
F. Indemnification. *** shall indemnify, defend and hold *** and its Affiliates,
agents, employees, officers and directors *** harmless from and against the
entirety of any and all Third Party actions, suits, proceedings, hearings,
investigations, charges, complaints, claims, demands, injunctions, judgments,
orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid
in settlement, liabilities, obligations, taxes, liens, losses, expenses, and
fees, including court costs and reasonable attorneys' fees and expenses
(collectively, "Claims"), that *** may suffer resulting from, or arising out of,
or relating to the ***; ***.
H. Term/Wind up of the Manufacturing Entity. The term of the Manufacturing
Entity shall continue until expiration or termination of this Agreement. Any
time after termination of the Backup Manufacturing Agreement for any reason or
expiration of the Manufacturing Entity's term, TWTI shall ***.
J. Compliance with Laws. Notwithstanding anything to the contrary and with the
exception of those activities within the control of ***, and the Manufacturing
Entity shall be obligated in the Backup Manufacturing Agreement to comply with,
any and all laws, rules, regulations, codes, orders, ordinances, and other
requirements (including common law) ("Laws") of any international, national,
federal, state, foreign, provincial, municipal, local, or other governmental
body, including without limitation obtaining all necessary approvals and
licenses and complying with all export, import, and tax Laws. With the exception
of activities within the control of *** in accordance with applicable Law all
amounts that may be necessary or prudent for the Manufacturing Entity to pay
under applicable Law.
K. Further Assurances. Each Party agrees to execute, acknowledge and deliver
such further instruments, and to do all such other acts, as it agrees are
reasonable or necessary to carry out the purposes of this Exhibit 2.11 including
without limitation, as may be necessary to perfect and give notice to Third
Parties of ACLA's rights hereunder. Additionally, *** hereby covenants to
operate Manufacturing Entity solely in accordance with this Exhibit 2.11 and
solely for the purposes of supply to ACLA of Cleavage Enzymes in accordance with
Section 2.10 of the Agreement reasonably required for its exercise of its rights
under the License Agreement and for no other purpose.
________________
*** Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
<PAGE>
Exhibit 2.12
Restricted Entities
(The Restricted Entities listed below are intended to include both the parent
entities and their respective Affiliates)
***
***
***
***
_______________
*** Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.