1
EXHIBIT 10.57
NOTE: CERTAIN CONFIDENTIAL PORTIONS OF THIS
AGREEMENT HAVE BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.
LICENSE AGREEMENT
THIS AGREEMENT, effective January 1, 1998, is between Soltec Research PTY
Limited ("SOLTEC"), an organization organized under the laws of Australia
(A.C.N. 006 363 891), having an address at ▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and Connetics Corporation ("CONNETICS"), a corporation organized
under the laws of Delaware, having an address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇.▇.▇.
WHEREAS, SOLTEC owns or is licensed under all rights of whatsoever nature for
the Territory for a clobetasol propionate quick-break foam (defined below as the
"Product"); and
WHEREAS, pursuant to the Exclusive Option Letter Agreement dated March 25, 1996,
as amended and the Feasibility Evaluation Agreement dated March 5, 1997
(collectively attached as Exhibit A), CONNETICS (under its former name,
Connective Therapeutics, Inc.) has acquired from SOLTEC an exclusive Option for
a license to the exclusive rights to certain Technology, including the right to
grant sub-licenses, under SOLTEC's entire rights in and to the Product for the
Territory; and
WHEREAS, CONNETICS wishes to exercise its Option for the Product;
NOW, THEREFORE, IT IS HEREBY AGREED as follows:
1. DEFINITIONS
1.1 "Affiliate" shall mean in respect of either party any corporation or
business entity controlled by, controlling, or under common control with
SOLTEC or CONNETICS, respectively. For this purpose "control" shall mean
the direct or indirect beneficial ownership of at least fifty percent
(50%) of the voting stock of, or at least fifty percent (50%) interest
in the income of, such corporation or other business entity, or such
other relationship as, in fact, constitutes actual control.
1.2 "Market Exclusivity" shall mean the absence of sales of a clobetasol
propionate quick-break foam or Equivalent quick break foam product by
any party other than CONNETICS, its Affiliates or its sub-licensees. The
determination as to whether of any such product is "Equivalent" shall be
made in good faith, including comparison of its formulation,
characteristics and positioning against that of the Product.
1.3 "MEDEVA" shall mean Medeva PLC, having a registered office at ▇▇ ▇▇.
▇▇▇▇▇'▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇, i.e., the organization that is
SOLTEC's assignee for the Patent Rights.
1.4 "Territory" shall mean the NAFTA countries (i.e., The United States of
America, its territories and posessions, Canada and Mexico). Upon
conclusion of SOLTEC's negotiations with MEDEVA (as referenced in
Section 2.2) the parties shall confer in
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good faith on expanding the Territory (and, as appropriate, other
provisions corresponding to such expanded Territory) to include such of
the other the countries of the world for which the Product, the Product
Information, and a license under national applications corresponding to
PCT/GB96/00490 (if necessary) are available, any such expansion of the
Territory to be memorialized by an amendment to this Agreement signed by
SOLTEC and CONNETICS.
1.5 "NDA" shall mean a new drug application filed with the United States
Food and Drug Administration ("FDA").
1.6 "Net Sales" shall mean the proceeds actually received by CONNETICS and
its Affiliates from the sale of Product to purchasers who are not
Affiliates, less:
(a) trade, quantity and cash discounts actually allowed and taken;
(b) credits actually allowed on account of the rejection or return or
billing error relating to any Product previously billed and paid;
(c) freight, other transportation and insurance costs;
(d) taxes imposed on account of such sale (including, without
limitation, sales, value-added and distribution taxes); and
(e) rebates and adjustments, including charge backs.
1.7 "Patent(s)" shall mean all patents, and patent applications and any
patents issuing therefrom, together with any extensions, reissues,
reexaminations, substitutions, renewals, divisions, continuations,
continuations-in-part and counterparts thereof or therefor, licensed to
or owned by SOLTEC presently or hereafter during the term of this
Agreement, that directly claim or relate to the manufacture, use or sale
of the Product, including without limitation, PCT/GB96/00490, filed
March 1, 1996 and corresponding national applications U.S. Serial No.
08/913,144, Canada Serial No. _________ and ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇▇.
1.8 "Product" shall mean clobetasol propionate quick-break foam,
substantially as described in the Product Specification (copy attached
as Exhibit B).
1.9 "Product Information" shall mean all information relating to the
specification of the Product and information relating to the manufacture
(including method, conditions, and process equipment), testing
(including quality control standards, assay methods and stability
studies), storage and use of the Product now or hereafter during the
term of this Agreement in the possession or under the control of SOLTEC.
1.10 "Proprietary Information" shall mean any information of value, not
generally known to the public, including (but not limited to):
(a) the Product Information; the development status of the Product;
Product indications and modes of administration; technical
information, such as clinical, biological, pharmaceutical and
characterizing data; and know-how; and
(b) business information, such as reports; records; customer lists;
supplier lists; marketing and sales plans; financial information;
costs; and pricing information.
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1.11 "Quarter" shall mean in respect of each calendar year, a period of three
consecutive calendar months beginning January 1, April 1, July 1 and
October 1 and ending March 31, June 30, September 30 and December 31,
respectively.
1.12 "Transfer Date" shall mean January 1, 1998.
1.13 "Valid Claim" shall mean a claim of an issued, unexpired Patent in the
Territory that has not been abandoned for any reason, which, but for the
license to CONNETICS hereunder would be infringed by CONNETICS'
manufacture, use or sale of a Product, which claim has not been held
invalid or unenforceable by a decision of a court of competent
jurisdiction, unappealable or unappealed within the time allowed for
appeal, and which has not been admitted to be invalid through reissue,
reexamination or disclaimer.
1.14 "Up-front Payment(s)" shall mean payments received by CONNETICS from a
sub-licensee in the nature of license fees, option fees and like
payments on account of the grant of a license or an option to obtain a
license to manufacture use or sell the Product (excluding payments to
reimburse or defray the direct costs of CONNETICS' research and
development on the Product).
1.15 "Net Revenue" shall mean the gross revenue received by CONNETICS from a
sublicensee in respect of such sublicensee's sales of Product, less any
tax impost or other governmental charge assessed against such revenue
(other than an income tax).
1.16 The phrase "duly authorized representatives" shall mean Affiliates,
assignees, sub-licensees, consultants, contractors or the like, as
authorized in writing from time to time by CONNETICS, as appropriate
from the context of usage.
1.17 "Commencement of Commercial Marketing" shall mean CONNETICS first arms'
length sale of the Product to a third party forming part of a continuous
program or campaign designed to market the Product in the Territory
during the term of this Agreement.
1.18 "Technology" shall have the meaning as set forth in the Exclusive Option
Letter Agreement attached hereto as Exhibit A.
2. LICENSE GRANT/ACQUISITION OF RIGHTS
2.1 With effect from the Transfer Date and for the consideration referred to
in Section 5 below SOLTEC hereby exclusively licenses the following
rights in the Territory free from all liens, interests or equities,
charges and encumbrances, namely: the Product and the Product
Information.
2.2 With effect from the Transfer Date (prospectively or retroactively) and
for the consideration referred to in Section 5 and, to the extent
required to enable CONNETICS to develop, manufacture, use and/or sell
the Product directly or indirectly, SOLTEC hereby grants (or agrees to
grant) to CONNETICS an exclusive license under the Patents in the
Territory with the right to sub-license, and a non-exclusive license
under
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the Patents to have the Product manufactured outside the Territory. To
the extent necessary for the foregoing, SOLTEC agrees to use its best
efforts to obtain the grant of such license rights from MEDEVA
(including substantially the representations, warranties and provisions
as set forth in Exhibit C) without obligation of CONNETICS to make any
payments in addition to those required pursuant to Section 5 of this
Agreement; SOLTEC shall provide CONNETICS with a copy of any agreement
with MEDEVA concerning such license rights promptly after its execution.
2.3 SOLTEC undertakes to do all such acts and provide all such formal
licenses as may be legally permissible and appropriate to ensure that
CONNETICS is licensed under all SOLTEC's rights (including
sub-contracting and sub-licensing) to use, manufacture, distribute and
market, directly or indirectly, the Product in the Territory as from the
Transfer Date.
3. TECHNOLOGY TRANSFER AND ASSISTANCE
3.1 Promptly after the Transfer Date SOLTEC shall complete the transfer and
communication of the Product Information to CONNETICS. Until such
transfer is completed, SOLTEC will allow CONNETICS or its duly
authorized representatives to inspect and/or to be provided with copies
of all such information.
3.2 At CONNETICS' request, SOLTEC shall promptly provide to CONNETICS such
technical assistance and the services of its suitably qualified staff as
may reasonably be required to assist CONNETICS or its duly authorized
representatives to acquire a proper understanding of and use the Product
Information, whether at CONNETICS' premises, at SOLTEC's premises, or at
such other locations as may be mutually agreed to. The obligation to
provide such assistance shall terminate twelve months after the
beginning of manufacture of the Product by or for CONNETICS.
3.3 Of the technical assistance and services provided for in Section 3.2,
included in the compensation payable to SOLTEC pursuant to Sections 5.1
and 5.2 and not subject to any additional compensation by CONNETICS
shall be:
1. Provision of the formula, manufacturing methods, test
specifications, packaging specification and raw material
specifications developed for the Product under the Feasibility
Evaluation Agreement.
2. Written reports on formulation development and stability studies
conducted by SOLTEC as part of the development process including
the feasibility study, to the extent necessary for inclusion with
CONNETICS' regulatory submissions.
3. Review and comment on drafts of appropriate sections in
CONNETICS' regulatory submissions.
4. Information on technical improvements to the Products as and when
they become available.
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5. Participation in the drafting, prosecution, maintenance and
enforcement of patents as provided for in Sections 6.2 to 6.6 and
Exhibit C.
6. Safety data and post-marketing information as provided for in
Section 4.3.
3.3 Of the technical assistance and services provided for in Section 3.2,
the following shall be compensated by CONNETICS at the rate of A$150.00
per person hour plus out of pocket expenses (e.g., materials, coach
class transportation, lodging and meals):
1. Additional experimentation addressing manufacturing problems,
formulation trouble-shooting and the like, if any.
2. Prompt responses to CONNETICS' or manufacturer's queries with
regard to the technology.
The first forty (40) person hours attributable to the foregoing shall be
provided as included in the compensation payable to SOLTEC pursuant to
Sections 5.1 and 5.2 and not subject to any additional compensation by
CONNETICS.
4. PRODUCT DEVELOPMENT
4.1 It shall be CONNETICS' responsibility to apply for and obtain all
governmental licenses, registrations, authorizations and approvals
required for the purposes of manufacturing, packaging, advertising,
selling or using the Product in the Territory.
4.2 All governmental licenses, registrations, authorizations and approvals
required for the purposes of manufacturing, packaging, advertising,
selling or using the Product in the Territory shall be and remain the
property of CONNETICS.
4.3 CONNETICS and SOLTEC shall make available to each other during the term
of this Agreement all safety data obtained, including any details
regarding complaints and adverse event reports relating to the use of
the Product.
5. CONSIDERATION
5.1 CONNETICS agrees to pay SOLTEC a "License Fee" of [1] U.S. Dollars [1]
payable as follows: [1] U.S. Dollars [1] upon signing this License
Agreement, [1] U.S. Dollars [1] upon filing of CONNETICS' NDA for a
Product, and [1] U.S. Dollars [1] upon approval of CONNETICS' NDA for a
Product, each such payment due within one (1) month of CONNETICS'
accomplishment of the respective milestone.
5.2 CONNETICS will pay SOLTEC a royalty on Net Sales of Product, Net Revenue
and Up-front Payments in the Territory as follows:
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1 Confidential treatment has been requested for the language which has been
omitted. All such omitted material has been filed separately with the SEC.
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(a) [1] percent [1] of Net Sales by CONNETICS or an Affiliate of
Product in a country in the Territory where such Product is
covered by a Valid Claim of a Patent;
(b) [1] percent [1] of Net Sales by CONNETICS or an Affiliate of
Product in a country in the Territory where such Product is not
covered by a Valid Claim of a Patent, but where CONNETICS retains
Market Exclusivity;
(c) [1] percent [1] of Net Sales by CONNETICS or an Affiliate of
Product in a country in the Territory where such Product is not
covered by a Valid Claim of a Patent and where CONNETICS does not
retain Market Exclusivity;
(d) [1] percent [1] of Net Revenue received by CONNETICS on sales of
Product by an unaffiliated third party sub-licensee of CONNETICS;
and
(e) [1] percent [1] of Up-front Payments received by CONNETICS.
5.3 All royalties payable pursuant to this Agreement shall be paid within
two (2) months after the close of the Quarter during which the Net Sales
were actually made, or Net Revenue or Up-front Payments were received.
Each royalty payment shall be accompanied by a statement that sets forth
Net Sales, Net Revenue and Up-front Payments during the Quarter in
question and the royalty payment due thereon.
5.4 Unless the parties agree otherwise in writing, the royalties of Section
5.2 will be paid in U.S. Dollars. Royalties with respect to amounts
other than U.S. Dollars shall be computed in U.S. Dollars by converting
the currency of such country at the average exchange rate for U.S.
Dollars prevailing over the last business day of each month of the
Quarter during which the Net Sales were actually made, or Net Revenue or
Up-front Payments were received. The exchange rate shall be the rates
published by the Wall Street Journal, and if it does not publish any
such rate or if it is no longer published, a comparable publication to
be agreed upon from time to time by the parties.
5.5 If the royalties provided for under this Agreement are greater than the
maximum royalties permitted by the laws or regulations of a particular
country, the royalty payment with respect to sales in such country shall
be equal to such maximum permitted royalty.
5.6 If any taxes, withholding or otherwise, are levied by any taxing
authority in connection with the accrual or payment of royalties under
this Agreement, CONNETICS shall have the right to pay such taxes to the
local taxing authorities on behalf of SOLTEC and to remit to SOLTEC in
full satisfaction of its royalty obligations under this Agreement the
net amount due after reduction by the amount of such taxes, together
with evidence of payment of such taxes.
5.7 No royalty shall be made with respect to any sale or transfer of a
Product between and among CONNETICS, its Affiliates, its sub-licensees
and their distributors where such sale or transfer is made in the course
of a subsequent royalty-generating transaction hereunder. No multiple
royalties shall be payable on account of the sale of any Product,
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1 Confidential treatment has been requested for the language which has been
omitted. All such omitted material has been filed separately with the SEC.
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regardless of whether or not more than one patent, or patent and other
intellectual property rights, exist(s) covering such Product in any
country. No royalty shall be payable with respect to reasonable and
customary quantities of samples provided free of charge to physicians
and free "trade goods" including indigent patient programs.
5.8 CONNETICS shall keep records of all items in a manner and in sufficient
detail to determine Net Sales in accordance with Section 1.6, Net
Revenue and Up-front Payments and otherwise in accordance with generally
accepted accounting principles in effect in the respective country where
royalties are due and to regularly maintain such records in sufficient
detail to permit calculation of royalties. Such records shall be
retained for three (3) years after the end of the relevant Quarter.
5.9 SOLTEC shall have the right to nominate an independent firm of certified
public accountants reasonably acceptable to CONNETICS to verify records
of CONNETICS and for three (3) years thereafter, the calculation of any
royalties payable under this Agreement with respect to the preceding
calendar year. Such verification shall not occur more than once each
calendar year during the term of this Agreement and shall be conducted
during normal business hours. The fees and expenses of the accountants
performing such verification shall be borne by SOLTEC unless the
royalties payable for the period being verified by the accountants
exceeds by more than five percent (5%) the royalties actually paid by
CONNETICS to SOLTEC in which case such fees and expenses will be
reimbursed by CONNETICS to SOLTEC upon demand. The accountants appointed
hereunder shall not be authorized to disclose to SOLTEC any information
other than the accuracy or inaccuracy of the item(s) to be verified.
5.10 Upon verification of a difference between royalties payable and
royalties paid, as provided in Section 5.9, the difference shall be
remitted to SOLTEC (in the case of underpayment), or to CONNETICS (in
the case of overpayment) within twenty (20) days of notice thereof. If
any underpayment of royalty for a Quarter exceeds five percent (5%) of
the royalty owed, then the amount of the difference shall bear interest,
calculated on a daily basis, from the date upon which it should have
been paid until the date of payment at a rate equal to the prime rate as
publicly announced by Citibank NA plus one percent (1%), payable on
demand.
5.11 The royalties payable hereunder shall be reduced by the amount of any
consideration CONNETICS pays if required to obtain a patent license from
a third party in order to make, use or sell the licensed Technology
portion of the Product in the Territory.
5.12 CONNETICS' payments under any clause of this Agreement are not
refundable for any reason whatsoever including, but without limitation,
failure of any Valid Claim of a Patent to issue in any country in the
Territory.
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6. PATENTS
6.1 SOLTEC confirms that the Patents represent the only patent protection it
and its Affiliates and related companies owns or has applied for in
relation to the hydroalcoholic quick-break foam delivery system as
pertains to the Product.
6.2 SOLTEC shall retain title to the Patents (except to the extent owned by
MEDEVA) and to any patent rights and know-how related to the Product
developed solely by SOLTEC in the future. CONNETICS shall retain title
to any patent rights and know-how related to the Product developed
solely by CONNETICS in the future. Any patent rights and know-how
related to the Product developed jointly by SOLTEC and CONNETICS in the
future shall be owned in equal undivided half interests by SOLTEC and
CONNETICS.
6.3 SOLTEC (except to the extent a patent is owned by MEDEVA) shall be
responsible for the prosecution and maintenance of the Patents at
SOLTEC's expense, in consultation with CONNETICS. Soltec shall keep
CONNETICS promptly informed of the status of prosecution of the Patents,
including providing copies of all material correspondence with the U.S.
or other Patent Office(s).
6.4 CONNETICS shall assist SOLTEC in prosecuting the Patents, including the
right to comment upon and make suggestions for such prosecution. SOLTEC
agrees to give CONNETICS' comments and suggestions due consideration and
not to unreasonably refuse to implement same. If SOLTEC decides to
discontinue prosecution or maintenance of any or all of the Patents, at
its option CONNETICS may elect to continue such prosecution and
maintenance at its own expense, upon which election title to such
Patent(s) shall be assigned to CONNETICS.
6.5 If either party learns that a third party is infringing the Patents, it
shall promptly notify the other in writing. The parties shall use
reasonable efforts in cooperation with each other to stop such patent
infringement without litigation. If such efforts are unsuccessful,
SOLTEC shall have the responsibility to remove the infringement of the
Patents, including, without limitation, initiating suit. If SOLTEC
decides not to take such steps to remove the infringement within three
(3) months of discovering or being notified of the infringement,
CONNETICS may, but shall not be required to do so. Any legal action
taken under this section will be at the expense of the party by whom
suit is filed and will be controlled by the party bringing suit. The
party not bringing suit may choose to be represented in any such action
by counsel of its own choice at its own expense. If CONNETICS elects to
bring suit, for the duration of such litigation CONNETICS' royalty
payments shall be calculated according to Section 5.2(c). The party
bringing suit shall be reimbursed for its costs associated with bringing
suit with the proceeds of any damages or costs recovered. Any moneys
remaining shall be split between the parties on an equitable basis
proportional to their respective damage from the infringement. If both
parties bring suit, equitable apportionment of the costs and damages to
be recovered shall be agreed upon before the filing of the suit.
6.6 If a notice of infringement is received by, or a suit is initiated
against either SOLTEC or CONNETICS with respect to the Product as made,
used or sold in the Territory, the parties will in good faith discuss
the best way to respond.
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7. COVENANTS, REPRESENTATIONS AND WARRANTIES
7.1 SOLTEC and CONNETICS each covenant not to disclose any of the Product
Information to any third party save as may be required for the purposes
of this Agreement, in connection with a sub-license consistent herewith,
or to comply with any regulatory obligations or Court order (and in such
cases to take reasonable steps to preserve the confidentiality of the
Product Information) and save for information which enters into the
public domain through no fault of SOLTEC, CONNETICS and their duly
authorized representatives.
7.2 Within the Territory, SOLTEC shall not use, manufacture, distribute or
market the Product or a hydroalcoholic quick-break foam containing a
steroid or a steroid salt for dermal application, which is encompassed
by the Technology that is the subject of CONNETICS' Option, nor shall
SOLTEC authorize or purport to authorize any person firm or company
other than CONNETICS and its duly authorized representatives to do so.
7.3 CONNETICS shall actively and diligently develop and commercialize the
Product in the Territory and covenants to:
(a) apply for NDA or equivalent in the United States of America
within three (3) years of the Transfer Date;
(b) to effect Commencement of Commercial Marketing of the Product in
the United States of America or Canada within five (5) years of
the Transfer Date;
(c) to pay royalties of not less than US [1] cumulatively in the four
(4) consecutive Quarters beginning with the first Quarter after
the Commencement of Commercial Marketing; and
(d) to pay royalties of not less than US [1] cumulatively in the four
(4) consecutive Quarters following the period set forth in
Section 7.3(c) above.
7.3 SOLTEC represents and warrants to CONNETICS in the terms set out in
Exhibit D.
7.4 CONNETICS represents and warrants to SOLTEC in the terms set out in
Exhibit E.
7.5 SOLTEC agrees to promptly inform CONNETICS of any inquiries of it for
purchase of the Product in the Territory and CONNETICS agrees to
promptly inform SOLTEC of any inquiries of it for purchase of the
Product outside the Territory.
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1 Confidential treatment has been requested for the language which has been
omitted. All such omitted material has been filed separately with the SEC.
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8. INDEMNIFICATION
8.1 SOLTEC hereby undertakes to indemnify CONNETICS from and against all
liabilities and obligations incurred or arising in connection with or
arising out of any default by SOLTEC under the terms of this Agreement,
save to the extent that such default arises out of any negligence,
wrongful act or default of CONNETICS.
8.2 CONNETICS hereby undertakes to indemnify SOLTEC from and against all
liabilities and obligations incurred or arising in connection with or
arising out of any default by CONNETICS under the terms of this
Agreement, save to the extent that such default arises out of any
negligence, wrongful act or default of SOLTEC.
8.3 CONNETICS agrees to carry sufficient liability insurance to cover its
indemnification obligations under this Agreement. As soon as practicable
upon execution of this Agreement, CONNETICS will provide SOLTEC with
certificate(s) of insurance evidencing this coverage.
9. GENERAL TERMS AND CONDITIONS
9.1 In order to facilitate this Agreement it will be necessary for the
parties to exchange certain Proprietary Information, each recipient of
which agrees to retain such Proprietary Information in strict confidence
and not to disclose or transfer to any party or use other than as
authorized by the terms of this Agreement or otherwise in writing by the
discloser. The parties hereby acknowledge that such Proprietary
Information can constitute "inside information" for securities purposes
and the responsibility to refrain from any unauthorized disclosure,
trading or other such use. These obligations of confidentiality and
non-use shall not apply to Proprietary Information: (a) that was
previously known to the recipient as evidenced by recipient's written
records, b) that is lawfully obtained by recipient from a source
independent of the discloser, or c) that is now or becomes public
knowledge other than by breach of this Agreement. These obligations of
confidentiality and non-use shall survive the expiration or termination
of this Agreement.
9.2 Arbitration and Applicable Law
Any dispute, controversy or claim arising out of or relating to this
Agreement, or the breach or termination thereof shall be dealt with in
the following manner:
(a) The dispute, controversy or claim shall first be referred to the
chief executive officer of each of SOLTEC and CONNETICS for
resolution at a place to be agreed between such chief executive
officers and, failing agreement, at the head office of CONNETICS.
(b) If the dispute, controversy or claim is not settled or agreed
between such chief executive officers within a period of one (1)
month, then it shall be settled by arbitration in accordance with
the rules of the American Arbitration Association then in effect.
Judgment upon the award rendered by the arbitrators may be
entered in
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any court having jurisdiction thereof. In any arbitration
pursuant to this section, the award shall be rendered by a
majority of the members of a board of arbitration consisting of
three members, one being appointed by each party and the third
being appointed by mutual agreement of the two arbitrators
appointed by the parties. The place of arbitration shall be
Hawaii.
(c) This Agreement shall be interpreted and enforced in accordance
with, and any arbitrators shall apply, the law of the State of
California (regardless of that jurisdiction's or any other
jurisdiction's choice of law principles), and the parties
stipulate to jurisdiction and venue in the state and federal
courts located within the State of California.
9.3 Notices
Any notice required or permitted by the terms of this Agreement shall be
given by registered mail, prepaid and properly addressed, or delivered
by hand to SOLTEC or CONNETICS at the respective addresses first given
above or at such other address as either party hereto may designate by
notice pursuant hereto. Any such notice shall be deemed to have been
given when received. All notices to CONNETICS shall be sent to the
attention of its President, with a copy to Vice President, Intellectual
Property. All notices to SOLTEC shall be sent to the attention of its
Managing Director.
9.4 Term and Termination
(a) This Agreement shall come into force with effect from the
Transfer Date and shall remain in force for the longer of:
expiration of the last to expire Patent having a Valid Claim in
the Territory, or ten (10) years from the Commencement of
Commercial Marketing.
(b) If either party hereto breaches any of the material terms of this
Agreement, and fails to remedy such breach within two (2) months
after written notice thereof from the other party pursuant to
Section 9.3, the other party may at its option terminate this
Agreement immediately upon written notice pursuant to Section 9.3
to the breaching party, upon which event all rights of the
breaching party shall terminate upon the effective date of
termination specified in such notice.
(c) CONNETICS may, immediately upon written notice to SOLTEC,
terminate this Agreement if SOLTEC fails to obtain the grant of
license rights from MEDEVA substantially as provided for in
Section 2.2 and Exhibit C.
(d) SOLTEC may terminate this Agreement by notice to CONNETICS in the
event that CONNETICS shall have become insolvent or bankrupt, or
shall have made an assignment for the benefit of creditors, or
there shall have been appointed a trusted or receiver for all or
a substantial part of its property, or any case or proceeding
shall have been commenced or other action taken by or aginst
CONNETICS in bankruptcy or seeking reorganization, liquidation,
dissolution,
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winding-up, arrangement, composition or readjustment of its debts
or any other similar relief, and any such event shall have
continued for more than 60 days undismissed, unbonded and
undischarged.
(e) Termination of this Agreement shall not release either party from
any liability or obligation which has accrued prior to such
termination and which remains to be performed under the terms of
this Agreement, nor release either party from any obligation that
is intended to survive termination of this Agreement.
9.5 Independent Parties/Announcements/Publicity
Notwithstanding anything herein to the contrary, the parties' status
with each other shall be, at all times during the term of this
Agreement, that of an independent contractors. Nothing in this Agreement
shall be construed to give either party the power or authority to act or
make representations for, or on behalf of, or to bind or commit the
other. Accordingly, the parties shall endeavor to provide each other
courtesy copies in advance of any public statements, whether verbal or
written, including, but not limited to shareholder reports,
prospectuses, communications with stock market analysts, press releases
or other communications with the media.
9.6 Force Majeure
Neither party shall be liable for failure to perform any duty or
obligation that party may have under this Agreement where such failure
has been occasioned by any Force Majeure which shall mean and include
government regulation, fire, strike, inevitable accident, national
emergency, or any other cause outside the reasonable control of the
party having the duty so to perform. Such failure to perform shall only
be excusable under the provisions of this Section for so long as, and to
the extent that, the same is rendered impossible by Force Majeure. The
party claiming that Force Majeure has occurred shall send to the other
party within five working days of the first occurrence of Force Majeure
full particulars thereof including its date of first occurrence and of
the cause or event giving rise to it. Notwithstanding the relief granted
to any party by this Section, the relevant party shall nevertheless use
its reasonable endeavors in any situation where it has invoked this
Section to perform its relevant obligations as soon as possible after
Force Majeure has ceased.
9.7 Assignment
Save as otherwise agreed this Agreement may not be assigned by either of
the parties but CONNETICS shall be entitled to assign or delegate
performance of this Agreement to any company which is an Affiliate of
CONNETICS provided that such Affiliate first agrees with SOLTEC to be
bound by the terms of the Agreement as if named as a party thereto. For
the avoidance of doubt the provisions of this sub-section shall not
prevent CONNETICS, or any Affiliate to which it has assigned its rights,
from sub-licensing the rights granted to CONNETICS hereunder provided
that such sub-licensing shall be effected on terms which are not
inconsistent or in conflict with the terms of this
13
SOLTEC/CONNETICS
Clobetasol License Agreement
Page 13
Agreement and further provided that CONNETICS shall remain responsible
for royalty payments in accordance with the terms of this Agreement on
Products sold by such sub-licensee as if such sales had been made by
CONNETICS.
9.8 Survival
(a) The covenants and agreements set forth in Section 2.1 and the
non-exclusive license of Section 2.2 shall survive any expiration
of this Agreement and remain in full force and effect.
(b) The covenants and agreements set forth in Sections 4.2, 8 and 9
shall survive any termination or expiration of this Agreement and
remain in full force and effect regardless of the cause of
termination.
9.9 Nonwaiver of Rights
No failure or delay on the part of a party in exercising any right
hereunder will operate as a waiver of, or impair, any such right. No
single or partial exercise of any such right will preclude any other or
further exercise thereof or the exercise of any other right. No waiver
of any such right will be deemed a waiver of any other right hereunder.
9.10 Headings
Section headings contained in this Agreement are included for
convenience only and form no part of the agreement between the parties.
9.11 Validity of Provisions and Severability
If any provision of this Agreement is or becomes or is deemed to be
invalid, illegal, or unenforceable in any jurisdiction: such provision
will be deemed amended to conform to applicable laws of such
jurisdiction so as to be valid and enforceable, or, if it cannot be so
amended without materially altering the intention of the parties, it
will be stricken; the validity, legality and enforceability of such
provision will not in any way be affected or impaired thereby in any
other jurisdiction; and the remainder of this Agreement will remain in
full force and effect.
9.12 Entire Agreement
This Agreement sets forth the entire agreement of the parties with
respect to the subject matter hereof. This Agreement may not be modified
except by a writing signed by the parties.
[Signature Page Follows]
14
SOLTEC/CONNETICS
Clobetasol License Agreement
Page 14
IN WITNESS WHEREOF, the parties hereto have entered into this Agreement
as of the day and year first above written.
CONNETICS CORPORATION SOLTEC RESEARCH PTY LTD.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------- -----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President & CEO Sales and Marketing Director
Date January 1, 1998 Date January 1, 1998
--------------- ---------------
15
SOLTEC/CONNETICS
Clobetasol License Agreement
EXHIBIT A
March 25, 1996 - VIA FACSIMILE AND FEDEX
▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇
Sales & Marketing Director
SOLTEC RESEARCH PTY LTD.
▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇
Re: Pharmaceutical Mousse Delivery System Technology
Exclusive Option Letter Agreement
Dear ▇▇. ▇▇▇▇▇▇:
This will confirm that Connective Therapeutics, Inc. ("Connective") is
interested in obtaining from Soltec Research Pty Ltd. ("Soltec") an exclusive
option for the Pharmaceutical Mousse Delivery System Technology, exemplified as
employed with betamethasone valerate as the active agent in the Betamousse
product described in the MCA Marketing Authorisation Application under the
Marketing Authorisation Type and Number PL0039/0488 (the "Technology").
Connective agrees to pay Soltec an Option Fee in the amount of [1] U.S. Dollars
[1] in exchange for an exclusive option (the "Option") effective March 25, 1996,
for one or more licenses (each, the "License") including the following:
Exclusive rights, including the right to grant sub-licenses, under all
intellectual property (including Soltec's know-how and U.S. Patent
Application Serial No. 403,110, filed March 14, 1995) pertaining to the
Technology for the NAFTA territory, each such License covering the
Technology as employed with a particular active agent and/or use (the
"Product").
An up-front payment (the "License Fee") of [1] Dollars [1] payable as
follows: [1] U.S. Dollars [1] upon signing the License agreement, [1]
U.S. Dollars [1] upon filing of Connective's NDA for a Product covered
by the License, and [1] U.S. Dollars [1] upon approval of Connective's
NDA for a Product covered by the License. Connective's Option Fee of [1]
U.S. Dollars [1] shall be fully creditable against the first License Fee
arising upon exercise of the Option granted hereunder.
----------
1 Confidential treatment has been requested for the language which has been
omitted. All such omitted material has been filed separately with the SEC.
16
SOLTEC/CONNETICS
Clobetasol License Agreement
The remaining terms (including a royalty reasonably related to the value
of the Technology for the Product) of each License are to be negotiated
in good faith between the parties upon exercise of Connective's Option.
For purposes of the License contemplated for the betamethasone valerate
Product, it is agreed that Connective's royalty payments will be no more
than [1] percent [1] of Connective's net sales (to be defined), nor more
than [1] percent [1] of net sales by an unaffiliated third party
Connective sub-licensee.
Connective's Option shall include all active agents and/or uses of the
Technology set forth in Exhibit A hereto. Connective is further granted the
right of first refusal, on a most favored nations basis, for any additional or
subsequently identified uses of the Technology for Products having current
therapeutic application with active ingredients prescribed by physicians and any
over-the counter versions of prescription Products developed by Connective
hereunder (excluding the surgical antiseptic and pediculocide uses previously
licensed by Soltec, and cosmetic, over-the-counter products including those
currently under discussions between Soltec and third parties), pursuant to
which:
Soltec shall first offer a License for any such additional or
subsequently identified use to Connective prior to offering same to any
third party, such License to be on terms no less favorable than those to
be offered to such third party, and
Connective may notify Soltec of any such additional or subsequently
identified use and receive a License thereto upon payment of the License
Fee of [1] Dollars [1], payable as set forth above.
If Connective fails to exercise this Option within One Hundred Twenty (120) days
of the effective date, then the Option shall expire and Connective shall forfeit
one-half of the Option Fee, the other half to be promptly refunded to
Connective. If Connective timely exercises the Option for any Product, then its
option for all other active agents and/or uses of the Technology as set forth in
Exhibit A and right of first refusal shall extend for ten (10) years from the
effective date.
Soltec represents and warrants that it has the full right and authority to
convey the License for the Technology to Connective, and further that there has
been no sale assignment, license or transfer to any person, firm or corporation
which would be inconsistent with these representations and warranties.
If this is acceptable to Soltec, please have this fax executed by Soltec's duly
authorized representative and transmit the signed agreement to me via fax at
▇▇▇-▇▇▇-▇▇▇▇ along with payment instructions for the Option Fee, to be paid
within 10 business days of Connective's
----------
1 Confidential treatment has been requested for the language which has been
omitted. All such omitted material has been filed separately with the SEC.
17
SOLTEC/CONNETICS
Clobetasol License Agreement
receipt of the signed fax. We will send both originals of this Option Letter
Agreement, which may be executed in counterparts, via FedEx for Soltec's
execution and the return one fully executed original to the attention of ▇▇.
▇▇▇▇▇ ▇▇▇▇▇ at Connective.
Very truly yours,
CONNECTIVE THERAPEUTICS, INC. UNDERSTOOD AND ACCEPTED:
SOLTEC RESEARCH PTY LTD.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By /s/ Soltech Research Pty Ltd.
--------------------------- ----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Ph.D.
Vice President, Name
Commercial Development -----------------------------------
Title
-----------------------------------
Date March 25, 1996 Date March 25, 1996
------------------------- -----------------------------------
c: Mr. ▇▇▇▇▇ ▇▇▇▇▇▇ A210.4
18
SOLTEC/CONNETICS
Clobetasol License Agreement
EXHIBIT A
[TO MARCH 25, 1996 LETTER AGREEMENT]
ACTIVE AGENTS AND TECHNOLOGY USES
[1]
----------
1 Confidential treatment has been requested for the language which has been
omitted. All such omitted material has been filed separately with the SEC.
19
SOLTEC/CONNETICS
Clobetasol License Agreement
March 5, 1997 - VIA FAX AND FEDEX (tel. # +61 3 ▇ ▇▇▇ ▇▇▇▇)
▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇
SOLTEC RESEARCH PTY LTD.
▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇
Re: Feasibility Evaluation Agreement
Dear Geoff:
This will confirm our verbal agreement with respect to further evaluating the
feasibility of two active agents, hydrocortisone and clobetasol propionate, in
Soltec's pharmaceutical mousse delivery system, each a Product pursuant to
Connective's Option under the Exclusive Option Letter Agreement dated March 25,
1996 (as amended June 14, 1996, collectively the "Option Agreement").
1. Soltec agrees to develop and optimize two (2) prototype pharmaceutical
mousse formulations, respectively of [1] and [1] (% active ingredient
without inclusion of propellant weight), to the point of submitting the
prototypes for development evaluation by Connective. This development
activity shall include (a) submission of preliminary prototype samples
and (b) submission of a feasibility evaluation submission addressing
optimization of compounding and formulation for stabilization of the
indicated active ingredient(s), outline of manufacturing options that
could successfully be transferred to a contract manufacturer such as
CCL, and transfer to Connective of a fifty to one hundred (50-100) units
for its independent analysis and evaluation. Upon submission, sufficient
data will be provided to ensure a reasonable stability of the prototypes
under recommended storage condition(s), including three (3) months
stability data, minimally generated at reduced (2-8 degrees),
recommended and elevated (40-50 degrees) temperatures., along with all
other data/information generated during the prototype development
process (e.g., comparative results from other formulation tested,
analytical test methods used in the evaluation). The feasibility
evaluation submission will be completed by August 1, 1997.
2. For your services and all other obligations assumed hereunder,
Connective agrees to pay Soltec [1] U.S. Dollars [1] per prototype,
payable as follows: [1] U.S. Dollars [1] within one (1) month of
Connective's receipt of each initial prototype and accompanying detailed
information, and [1] U.S. Dollars [1] within one (1) month of
Connective's receipt of the feasibility evaluation and samples. In
addition, Connective agrees to reimburse Soltec's costs for any
analytical method development and assays up to [1] U.S. Dollars [1] per
Product. The maximum amount payable under this Agreement is [1] U.S.
Dollars [1].
3. Connective shall notify Soltec whether it wishes to exercise its Option
for each Product within three (3) months of receipt of the feasibility
evaluation and samples. Failure to exercise Connective's Option shall
release Soltec to offer the evaluated formulation for license to third
parties without further obligation to Connective, but shall not affect
Connective's Option for subsequently developed formulations using the
same active agent(s). Upon any decision not to exercise Connective's
Option, Connective shall cooperate with Soltec through the return of
such Soltec-generated and transfer of such Connective-generated
information and materials as will be of assistance to Soltec in any
continuing efforts to license the evaluated formulation to third
----------
1 Confidential treatment has been requested for the language which has been
omitted. All such omitted material has been filed separately with the SEC.
20
SOLTEC/CONNETICS
Clobetasol License Agreement
parties; Soltec and Connective shall negotiate in good faith an
appropriate return to Connective for its participation in the initial
evaluation and for such assistance. Connective shall be entitled to
retain at least one copy of any Soltec-generated information and
materials.
4. Upon Connective's exercise of the Option for either or both Product(s),
Connective and Soltec shall proceed to negotiate in good faith the terms
of one or more Development and License Agreement(s) therefor, including
payment by Connective of the License Fee of [8] Dollars [1] per Product
as set forth in the Option Agreement. Under the Development and License
Agreement(s) contemplated hereunder:
Soltec and Connective shall establish a development plan,
timetable, funding and division of responsibilities;
Connective shall acquire exclusive OTC and Rx rights for
the clobetasol propionate Product within the NAFTA Terrirory;
Connective shall acquire exclusive OTC and Rx rights for
the hydrocortisone Product within the NAFTA Territory, such OTC
rights to be contingent on Connective using its best efforts for
diligent OTC commercialization, consistent with good business
judgment and development/commercialization of the hydrocortisone
Product for the RX market;
Soltec and Connective shall discuss in good faith
commercialization of the Product(s) outside the NAFTA Territory,
pursuant to which Connective may acquire exclusive or
co-exclusive OTC and Rx rights outside the NAFTA Territory or
shall be entitled to royalties consistent with Connective's
participation in development of the Product(s) and the extent to
which such participation is relevant to development outside the
NAFTA Territory, any such OTC rights for the hydrocortisone
Product to be contingent on the parties using their best efforts
for diligent OTC commercialization, consistent with good
business judgment and development/commercialization of the
hydrocortisone Product for the RX market;
Soltec and Connective agree that any intellectual
property, whether patentable or not, developed as a result of
the feasibility evaluation and subsequent development shall be
treated as confidential, and the individual or joint ownership
of any patents or other intellectual property rights resulting
therefrom shall be determined in accordance with the Patent Laws
of the United States, depending upon whether inventor(s) from
one or both parties could be named in a corresponding patent
application. Soltec and Connective shall cooperate in all
decisions regarding the drafting, filing and prosecution of
applications for patent on all such inventions jointly approving
all decisions regarding jointly held subject matter or having an
effect on rights in the NAFTA territory and the sole owner
giving due consideration to the comments and suggestions of the
other with regard to rights outside the NAFTA territory; and
Connective shall pay Soltec a royalty on Connective's or
unaffiliated third party sub-licensee's net sales of Products at
rates to be negotiated based on industry standards using as a
point of reference the royalty structure from Connective's
betamethasone valerate mousse license, the stage of development
of the Product upon commencement of Connective's participation,
and the parties' respective investments in the Product(s)
development.
----------
1 Confidential treatment has been requested for the language which has been
omitted. All such omitted material has been filed separately with the SEC.
21
SOLTEC/CONNETICS
Clobetasol License Agreement
5. In order to facilitate the evaluation under this Agreement, it will be
necessary to exchange certain data, other proprietary information and
samples, the recipient of which agrees to retain in strict confidence
and not to use, disclose or transfer to any party other than for the
purposes of this Agreement or as authorized by the provider, except for
that which: a) was previously known to as evidenced by written records,
b) is lawfully obtained from a source independent of the provider, or c)
is now or becomes public knowledge other than by breach of this
Agreement. These obligations of confidentiality and non-use shall
survive the expiration or termination of this Agreement for a period of
ten (10) years.
6. Soltec and Connective each confirm that this Agreement does not conflict
with its duties and obligations under any other agreement to which it is
a party, and that each will inform the other should any conflict or
possible conflict of duties and obligations arise during the term of
this Agreement.
7. The terms of this Agreement can be modified only by the mutual written
agreement of the parties. This Agreement will be interpreted and
enforced in accordance with the laws of California, notwithstanding the
choice of law principles of California or those of any other
jurisdiction.
If the foregoing terms and conditions are agreeable to Soltec, please sign and
date both duplicate originals of this Letter Agreement and return one original
to ▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice President, Intellectual Property at Connective. We look
forward with pleasure to this next venture in the continuing relationship
between Soltec and Connective.
Very truly yours,
UNDERSTOOD AND ACCEPTED:
CONNECTIVE THERAPEUTICS, INC. SOLTEC RESEARCH PTY LTD.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By /s/ Soltech Research Pty Ltd.
------------------------------------- --------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Ph.D.
Vice President, Corporate Development Name
------------------------------
Title
------------------------------
Date March 5, 1997 Date March 5, 1997
----------------------------------- ------------------------------
22
SOLTEC/CONNETICS
Clobetasol License Agreement
EXHIBIT B
CLOBETASOL PROPIONATE QUICK BREAK FOAM
SPECIFICATION
[1]
----------
1 Confidential treatment has been requested for the language which has been
omitted. All such omitted material has been filed separately with the SEC.
23
SOLTEC/CONNETICS
Clobetasol License Agreement
EXHIBIT C
To the extent necessary for the license granted by SOLTEC to CONNETICS pursuant
to Section 2.2 of the Agreement, SOLTEC agrees to use its best efforts to obtain
the grant of such license rights from MEDEVA, without obligation of CONNETICS to
make any payments in addition to those required pursuant to Section 5 of this
Agreement, including substantially the representations, warranties and
provisions as set forth below.
1. An exclusive license for CONNETICS to develop, manufacture, use and/or
sell the Product directly or indirectly under MEDEVA's Patents in the
Territory with the right to sub-license, and a non-exclusive license
under the Patents to have the Product manufactured outside the
Territory.
2. Confirmation that the Patents represent the only patent protection
MEDEVA and its Affiliates and related companies owns or has applied for
in relation to the hydroalcoholic quick-break foam delivery system
encompassed by the Technology that is the subject of CONNETICS' Option
or that otherwise would be infringed by the unlicensed manufacture, use
or sale of the Product.
3. SOLTEC shall endeavor in good faith to secure from MEDEVA such
additional rights as may be required for the purpose of expanding the
Territory, as provided in Section 1.4 of the Agreement, to the fullest
extent possible.
4. Patent preparation, prosecution, maintenance and enforcement provisions
at least equivalent to those obtained by SOLTEC from MEDEVA in the June
19, 1996 Amendment to the Purchase Agreement Dated 26 April 1994
(attached as part of Exhibit F to the License Agreement effective June
14, 1996 between SOLTEC and CONNETICS under its prior name, Connective
Therapeutics, Inc.) and to the extent possible, consistent with the
following:
A. MEDEVA shall be responsible for the prosecution and maintenance
of MEDEVA's Patents at MEDEVA's expense, in consultation with
SOLTEC and CONNETICS.
B. MEDEVA shall keep SOLTEC and CONNETICS promptly informed of the
status of prosecution of MEDEVA's Patents, including providing
copies of all material correspondence with the U.S. or other
Patent Office(s).
C. SOLTEC and CONNETICS shall assist MEDEVA in prosecuting MEDEVA's
Patents in the Territory, including the right to comment upon and
make suggestions for such prosecution. MEDEVA shall give SOLTEC's
and CONNETICS' comments and suggestions due consideration and not
unreasonably refuse to implement same.
D. If MEDEVA decides to discontinue prosecution or maintenance of
any or all of MEDEVA's Patents, at its option CONNETICS may elect
to continue such prosecution and maintenance at its own expense,
upon which election title to such Patent(s) shall be assigned to
CONNETICS.
E. If MEDEVA, SOLTEC or CONNETICS learns that a third party is
infringing the Patents in the Territory, it shall promptly notify
the others in writing. MEDEVA, SOLTEC and CONNETICS shall use
reasonable efforts in cooperation with each other to stop such
patent infringement without litigation. If such efforts are
unsuccessful, SOLTEC shall have the authority and responsibility
to remove the infringement of the Patents in the Territory,
including, without limitation, initiating suit in its own name;
MEDEVA shall provide such documents and do such acts as are
necessary therefor. If SOLTEC decides
24
SOLTEC/CONNETICS
Clobetasol License Agreement
EXHIBIT C
not to take such steps to remove the infringement within three
(3) months of discovering or being notified of the infringement,
CONNETICS may, but shall not be required to remove the
infringement of the Patents in the Territory, including, without
limitation, initiating suit in its own name; MEDEVA shall provide
such documents and do such acts as are necessary therefor. Any
legal action taken under this section will be at the expense of
the party by whom suit is filed and will be controlled by the
party bringing suit. MEDEVA and the party not bringing suit may
choose to be represented in any such action by counsel of its own
choice at its own expense.
F. If MEDEVA, SOLTEC or CONNETICS learns that a third party is
infringing the Patents outside the Territory, it shall promptly
notify the others in writing. MEDEVA, SOLTEC and CONNETICS shall
use reasonable efforts in cooperation with each other to stop
such patent infringement without litigation. If such efforts are
unsuccessful, any legal action taken will be at the expense of
the party by whom suit is filed and will be controlled by the
party bringing suit. CONNETICS and the party not bringing suit
may choose to be represented in any such action by counsel of its
own choice at its own expense.
G. If a notice of infringement is received by, or a suit is
initiated against either MEDEVA, SOLTEC or CONNETICS with respect
to the Product, MEDEVA, SOLTEC and CONNETICS will in good faith
discuss the best way to respond.
H. MEDEVA shall have no grant-back, option or other right with
respect to any patent rights and know-how related to the Product
developed solely by SOLTEC, solely by CONNETICS, or jointly by
SOLTEC and CONNETICS in the future.
25
SOLTEC/CONNETICS
Clobetasol License Agreement
EXHIBIT D
SOLTEC'S REPRESENTATIONS AND WARRANTIES
For the purpose of the following representations and warranties, where any
statement is qualified by the expression "to the best of SOLTEC's knowledge and
belief" or any similar expression, that statement shall be deemed to include an
additional statement that it has been made after due and careful inquiry. The
term "Delivery System" where used below shall mean SOLTEC's hydroalcoholic
mousse delivery system encompassed by the Technology that is the subject of
CONNETICS' Option, itself and when used in conjunction with any active
ingredient.
SOLTEC hereby represents and warrants as follows:
1. CAPACITY
SOLTEC has all requisite power and authority to enter into and perform
this Agreement.
2. ACCURACY OF INFORMATION.
2.1 The information given in Exhibit B to this Agreement is true and
accurate in all material respects and is not misleading because of any
omission or ambiguity or for any other reason.
2.2 To the best of SOLTEC's knowledge and belief the Product Information is
at the date hereof complete and accurate in all material respects in
relation to the matters it is expressed to relate to, will be kept
complete and accurate until the same is handed over to CONNETICS, and
comprises all information necessary to enable the Product to be
manufactured to the specification (as set out in Exhibit B) and to the
same quality as the Product is (or other equivalent products are)
currently manufactured by or with the assistance of SOLTEC.
2.3 To the best of SOLTEC's knowledge and belief the information provided to
CONNETICS regarding the Product and the Delivery System is not
misleading and is complete and accurate in all material respects and
where SOLTEC has provided data or information which has been extracted
from any other source that information has been correctly extracted is
not misleading and accurately reflects the source material. To the best
of SOLTEC's knowledge information and belief there are no other facts or
matters which render any such information misleading in any material
respects. SOLTEC is not aware of any other fact or matter which has not
been disclosed to CONNETICS and which in the reasonable opinion of
SOLTEC (given the scope of SOLTEC's business and expertise) may have a
material adverse affect on the business of using, manufacturing,
marketing and/or distributing the Product.
3. INVESTIGATIONS
To the best of SOLTEC's knowledge and belief there are not pending or in
existence and SOLTEC is not aware of any event or circumstance which
might give rise to any investigations or inquiries by or on behalf of
any government or other body with respect to or affecting the Product
and or the Delivery System.
26
SOLTEC/CONNETICS
Clobetasol License Agreement
EXHIBIT D
4. COMPETITIVE PRODUCTS
4.1 There is no product due to be launched (or licensed to a third party) in
the Territory by SOLTEC or any of its Affiliates following the date
hereof which is reasonably anticipated to be competitive with the
Product and/or the Delivery System.
4.2 SOLTEC has no agreements or arrangements for the manufacture,
distribution or sale of the Product with any other party, except to the
extent that SOLTEC's agreement(s) with MEDEVA pertains to the Patents.
5. LITIGATION
5.1 Neither SOLTEC, nor to SOLTEC's knowledge any Affiliate, is engaged in
any litigation, arbitration, administration or criminal proceedings
whether as Plaintiff, Defendant or otherwise with respect to the
Product, the Delivery System or the Patents. No litigation, arbitration,
administrative or criminal proceedings by or against SOLTEC in relation
to the same is threatened and there is no fact or circumstances known to
SOLTEC which SOLTEC reasonably believes is likely to give rise to any
such litigation or arbitration, administrative or criminal proceedings.
5.2 SOLTEC is not and has never been a party to any undertaking or assurance
given to any court or governmental body, agency or department with
respect to the Product or the Delivery System that could affect the
ability of CONNETICS to sell the Product.
5.3 SOLTEC has not received any claim for damages or compensation in the
five years prior to the date hereof arising out of any injury to any
person caused or alleged to have been caused by the Product, the
Delivery System, the Product Information or any ingredients of the
Product.
5.4 SOLTEC has not received and is not aware of any complaint or
investigation concerning or relating to the Product and/or the Delivery
System and so far as SOLTEC is aware no regulatory authority or any
other governmental authority is carrying out any investigation into the
efficacy or safety of the Product and/or the Delivery System, that could
affect the ability of CONNETICS to sell the Product.
6. COMPLIANCE WITH LEGISLATION
6.1 SOLTEC has at all relevant times tested and developed the Product in
accordance with all legislation relevant to the scope of its business
activities to the best of its ability.
7. INTELLECTUAL PROPERTY
7.1 No claim has been made or threatened against SOLTEC alleging any
infringement by the Product and/or the Delivery System of any trademark,
patent or other intellectual property rights of any third party.
7.2 No claim is outstanding or threatened by SOLTEC alleging any
infringement of the Patents and SOLTEC is not aware of any circumstances
which might give rise to such a claim.
7.3 SOLTEC has not granted any license under the Product Information or the
Patents in respect of the Product or the Delivery System (except
MEDEVA's license for betamethasone valerate) and
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SOLTEC/CONNETICS
Clobetasol License Agreement
EXHIBIT D
CONNETICS will not require any other license of intellectual property
rights in respect of manufacture, use or sale of the Delivery System.
7.4 SOLTEC has no interest in or rights to or over any trademarks or patents
or other intellectual property rights relating specifically to the
Product and/or the Delivery System and/or a quick break foam product
currently considered by SOLTEC to be equivalent to the Technology, other
than the Patents and the other rights referred to herein.
7.5 To the best of SOLTEC's knowledge and belief none of the processes or
materials used in the Delivery System, the Product or the testing,
manufacture or processing thereof infringes any right of any other
person relating to intellectual property or otherwise or involves the
unlicensed use of know-how or confidential information in circumstances
which might entitle that person to make a claim against SOLTEC or
CONNETICS or to require the use of such know-how or confidential
information to cease.
7.7 To the best of SOLTEC's knowledge and belief the Patents will when
granted be valid patents granting effective and enforceable protection
to CONNETICS in respect of the Product, its use, manufacture and sale.
8. MISCELLANEOUS
8.1 To conduct its business in a proper and businesslike manner so as to
ensure that the same remains of good character and reputation.
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SOLTEC/CONNETICS
Clobetasol License Agreement
EXHIBIT E
CONNETICS' REPRESENTATIONS AND WARRANTIES
CONNETICS hereby represents and warrants as follows:
1. CONNETICS has all requisite power and authority to enter into and
perform this Agreement.
2. To provide for and maintain a sales organization and a marketing program
reasonably adequate and competent to promote, sell and stimulate
interest in the Product in the Territory.
3. To take all commercially reasonable steps to promptly obtain FDA
approval of the product.
4. To conduct its business in a proper and businesslike manner so as to
ensure that the same remains of good character and reputation.
5. To actively and diligently promote and advertise the sale of the Product
in the Territory.
