***TEXT OMITTED AND FILED SEPARATELY
CONFIDENTIAL TREATMENT REQUESTED
Exhibit 10.9
FOURTH AMENDMENT TO COLLABORATIVE RESEARCH AND
DEVELOPMENT AGREEMENT DATED 1ST SEPTEMBER, 1995
This Amendment ("Amendment") dated February 27, 2001, is entered into by and
between:
E. I. du Pont de Nemours and Company, a corporation organized under the laws of
the State of Delaware and having its principal place of business at 0000 Xxxxxx
Xxxxxx, Xxxxxxxxxx, XX 00000 ("DuPont")
And
Genencor International, Inc., a corporation organized under the laws of the
State of Delaware and having its principal place of business at 000 Xxxx Xxxx
Xxxx, Xxxx Xxxx, XX 00000 ("Genencor")
Whereas:
X. XxXxxx and Genencor entered into a Collaborative Research and
Development Agreement dated 1st September, 1995 ("the Agreement");
X. XxXxxx and Genencor have amended the Agreement pursuant to letter
agreements dated 23rd July, 1997 (the "First Letter Amendment"), 31st
March, 1998 (the "Second Letter Amendment"), and 19th February, 1999
(the "Third Letter Amendment") together referred to hereafter as the
"Letter Agreements"; and
X. XxXxxx and Genencor wish further to amend the Agreement as set out
herein.
NOW THEREFORE, DuPont and Genencor enter into this Fourth Amendment and agree as
follows:
1. Unless otherwise indicated to the contrary all capitalized terms shall
bear the meaning assigned to them in the Agreement as amended by the
Letter Agreements.
2. The provision of the Agreement relating to the GEN III technical
milestone (Section 3.3 as amended by the Second Letter Amendment) shall
remain in full force and effect through [...***...]. If the Steering
Committee determines that no organism meeting the GEN III technical
milestones has been developed by that date, there will be no payment
for the GEN III Milestone.
3. The term of the Agreement shall be extended and the Agreement shall
terminate (unless terminated sooner as provided in the Agreement) on
31st December, 2001 (the earliest of any such dates being referred to
as the "Termination Date").
*CONFIDENTIAL TREATMENT REQUESTED
4. The provisions of the Agreement relating to the pre-commercial
milestone (Section 4.1 as amended), shall be amended to read:
4.1 "PRE-COMMERCIAL MILESTONE. DuPont will pay Genencor a
non-refundable, lump sum payment of [...***...] upon the cumulative
Bioprocess production of [...***...] of Compound X made under a Tier I
or II exemption, as defined by Toxic Substances Control Act, relating
to the use of intergeneric recombinant microorganisms during the
Pre-Commercial Phase, regardless of whether the so-produced Compound X
are made by DuPont, or for DuPont by a toll manufacturer, or by
Genencor.
5. Article 4 of the Agreement shall be amended by adding the following
Paragraph 4.2A
4.2A
(i) In the event that the Bioprocess is commercialized to
the extent that it is operating under a Tier I or II
exemption, as defined by Toxic Substances Control
Act, relating to the use of intergeneric recombinant
microorganisms, based on an organism developed during
the term of this Agreement (as extended) but the
CCOM, measured in accordance with Sections 4.3 and
4.4, is greater than [...***...], and the technical
milestones set out in Table IIIB are accomplished,
DuPont shall pay to Genencor the relevant milestone
payment set out in Table IIIB. The relevant technical
milestones shall be deemed to have been accomplished
when all [...***...] parameters have been achieved at
a scale of [...***...]or larger in at least
[...***...] batches. At its discretion the Steering
Committee may deem [...***...] consecutive successful
batches as meeting the relevant milestone.
(ii) In the event that CCOM, measured in accordance with
Sections 4.3 and 4.4, is [...***...] or less, the
provisions of Section 4.2 shall apply and any milestone
payment shall be based upon Table IIIA.
6. Section 4.4 of the Agreement shall be amended to read:
4.4 CCOM CALCULATION. The amount of the bonus Commercial Milestone
payment and applicable Royalty rate are determined by the
[...***...] calculation of the CCOM of Compound X in a
commercial scale manufacturing plant in accordance with
Article IV and Table IIIA herein and the following equation
for calculating CCOM:
CCOM = [...***...]
[...***...]
[...***...]
[...***...]
[...***...]
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*CONFIDENTIAL TREATMENT REQUESTED
(e) Each By-Product has an economic value depending on
whether it is sold, recycled, or disposed of upon
removal from Bioprocess. The actual costs and credit
for the disposition of By-Products shall be calculated
for use in determining CCOM of Compound X;
(f) The CCOM arrived at under the operation of Section 4.4
is solely for the purpose of determining a [...***...]
Commercial Milestone payment and Commercial Royalties
due to Genencor (subject to adjustment pursuant to
Section 6.5 as amended). Choice of actual manufacturing
processes and disposition methods of By-Products are
solely the responsibility of DuPont.
7. Table III shall be replaced by the following:
TABLE IIIA
CCOM IN COMMERCIAL SCALE MFG. PLANT BONUS MILESTONE PAYMENT
----------------------------------- -----------------------
[...***...] [...***...]
For CCOMs in between the stated rates, the bonus milestone payment to Genencor
will be interpolated
TABLE IIIB
[...***...]
8. Section 6.5 of the Agreement shall be amended to read:
ROYALTY PAYMENT: Subject to the end of year adjustment as provided
below, Commercial Royalties shall be calculated based upon the original
CCOM determined in accordance with Article IV hereof, as adjusted
annually based upon [...***...] for the current royalty year and shall
be paid monthly within sixty (60) days after the last day of each
month, for a period of [...***...] from the beginning of the Commercial
Phase or [...***...] from the Effective Date of the Agreement,
whichever period is [...***...]. At the end of each year when the
[...***...] for the relevant year is known, the parties shall
recalculate the CCOM for such year based on the [...***...] compared to
the [...***...] for the relevant year and from such recalculated CCOM
the parties shall determine the final sum for the Commercial Royalty
due to Genencor for the relevant year. In the event that the final sum
for the Commercial Royalty is less than the payments made during the
relevant royalty year, DuPont shall pay to Genencor the amount of such
shortfall with the first royalty payment of the following year. In the
event that the final sum for the Commercial Royalty exceeds the
payments made during the relevant royalty year, such excess shall be
credited against the first royalty payment due from DuPont to Genencor
in the following year.
9. R&D EXPENSES: Notwithstanding the provisions of Section 2.3 of the
Agreement (as amended pursuant to the Third Letter Agreement), DuPont
and Genencor agree that as of
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*CONFIDENTIAL TREATMENT REQUESTED
1st March, 2001 and for the remaining term of the Agreement as extended
by this Fourth Amendment, DuPont shall pay Genencor for R&D expenses
for work on the R&D Program at the rate of [...***...] per each of the
full time Scientific Personnel assigned to the R&D Program. The rate
set for Scientific Personnel includes the cost of Support Personnel and
overhead. It is anticipated that the level of staffing prior to the
effective date of the extension shall be [...***...] full time
Scientific Personnel. Furthermore it is anticipated that the level of
staffing during the first three months of the extension (March 1, 2001
- May 31, 2001) shall be between [...***...] full time Scientific
Personnel, although the actual number shall remain under the direction
and adjustment of the Steering Committee.
10. In the event that DuPont forms a [...***...] with [...***...] or any of
its subsidiaries or affiliates for commercialization of Compound X, the
parties agree to encourage the [...***...] and Genencor to enter into
discussions with regard to the possibility of Genencor entering into an
agreement with such [...***...] for further development of the
Bioprocess efficiency.
11. Section 1.9 of the Agreement (as amended pursuant to the Third Letter
Amendment) shall be further amended to read:
"Compound X" shall mean [...***...] and 1,3-propanediol and derivatives
of 1,3 propanediol. For the purposes of calculating the R&D-Based
Milestones under Article 3, CCOM and Pre-commercial and commercial
Milestone payments of Article 4, the Royalty Payments to GENENCOR under
Article 6, and for calculations under 10.6-10.7 of Article 10,
"Compound X" shall mean [...***...].
12. The first sentence of Section 2.1 of the Agreement shall be amended to
read:
Each Party will appoint two of its employees to serve on the Steering
Committee.
13. The first sentence of Section 1.8 of the Agreement shall be amended to
read:
DuPont will determine Commercial Specification for Compound X after
review and comment by Genencor.
14. Section 1.19 shall be amended to read:
"Pre-Commercial Phase" shall mean the period starting with the first
Bioprocess production of Compound X operated under a Tier I or II
exemption, as defined by Toxic Substances Control Act, relating to the
use of intergeneric recombinant microorganisms up to the cumulative
Bioprocess production of [...***...] of Compound X made under said
exemption.
15. Consistent with the Third Letter Amendment the parties hereby agree
that [...***...] Genencor, shall remain a consultant to DuPont for the
purpose of enhancing the successful commercialization of 1,3
propanediol produced by the Bioprocess. The parties will execute a
separate confidentiality agreement as necessary to implement such
consultancy.
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*CONFIDENTIAL TREATMENT REQUESTED
16. All other provisions of the Agreement, as amended by the Letter
Agreements, not specifically amended as set out herein, shall remain in
full force and effect.
[REST OF PAGE INTENTIONALLY LEFT BLANK]
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*CONFIDENTIAL TREATMENT REQUESTED
IN WITNESS WHEREOF, the Parties hereto have executed this Amendment
GENENCOR INTERNATIONAL, INC. E.I. DU PONT DE NEMOURS AND COMPANY
BY: /s/ Xxxxxx X. Xxxxxx By: /s/ (signature illegible)
------------------------------------ ------------------------------
Xxxxxx X. Xxxxxx
TITLE: Group Vice President TITLE: Business Director
Industrial Chemicals Bio-Based Materials
DATE: Feb. 27, 2001 DATE: 2/27/01
