EX-10.28 12 ex10-28.txt EXHIBIT 10.28 1 Exhibit 10.28 CONFIDENTIAL ***PORTIONS OF THE EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT UNDER RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED. THE COMPLETE EXHIBIT, INCLUDING THE PORTIONS FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED, HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. FUNDED RESEARCH COLLABORATION AGREEMENT THIS AGREEMENT is made December 22, 1998, ("Effective Date") by and between ProdiGene, Inc., a Delaware company having a principal place of business at 1500 Research Parkway, Suite 220, College Station, Texas 77845 (hereinafter "ProdiGene") and Genencor International, Inc., a Delaware company having a principal place of business at 4 Cambridge Place, 1870 South Winton Road, Rochester, New York 14618 (hereinafter "GCI")(collectively the "Parties"). WHEREAS, the Parties have entered into a Confidentiality Agreement ("Confidentiality Agreement" incorporated herein and attached hereto as APPENDIX A) dated March 25, 1997, including the addendum dated August 4, 1997, an Agreement for the Provision of Samples ("Samples Agreement" incorporated herein and attached hereto as APPENDIX B) dated April 30, 1997, and an Agreement Related to Plant Expression of Enzymes dated October 10, 1997, ("Enzymes Agreement"); WHEREAS, the Parties wish to expand the scope of their collaboration and have entered into negotiations related thereto; WHEREAS, as a result of these discussions, the Parties desire to enter into a relationship as set forth herein to further the development of an expression system for the commercial exploitation of certain enzymes for industrial use; NOW THEREFORE, the Parties agree as follows: I. DEFINITIONS 1.1 "Elected Research Program" shall mean a field of research elected or specified hereunder by the Parties for the allocation of FTEs during the Term of this Agreement. 1.2 "Target Compound" shall mean a compound designated in an Elected Research Program for transgenic expression in plants. Such Target Compounds may comprise proteins, including microbial, plant or animal enzymes, or other compounds determined as suitable for expression in plants. 1.3 The "Exclusive Collaboration Field" shall mean ***, and technology related to their production, manufacture, purification, application and/or use. 2 1.4 "Affiliate" shall mean any corporation or business entity directly or indirectly owned or controlled by a Party by virtue of ownership of at least fifty percent (50%) of the stock and having the right to vote for directors thereof or otherwise control the management of the corporation or business entity. 1.5 "Exclusivity Period" shall mean a *** period commencing at the Effective Date. In the event that GCI exercises its Exclusivity Option under this Agreement, the Exclusivity Period shall be a *** period commencing at the Effective Date. 1.6 "FTE" shall mean a one-year allocation to an Elected Research Program of a scientist having a doctorate, masters or equivalent experience applicable to the expression of heterologous proteins in plants, or persons with technical expertise appropriate to conduct or participate in an Elected Research Program who are under the guidance of such scientist. 1.7 "Project Form" shall mean (i) when executed by one Party, that Party's proposal to initiate an Elected Research Program, and (ii) when executed by both Parties, the Parties mutual agreement to engage in an Elected Research Program. A Project Form shall include identification of the Target Compounds, Elected Research Program Field, the duration of the Elected Research Program, resource and FTE allocation, timelines, milestones, success criteria and market opportunities. The Project Form shall be in the form provided in APPENDIX C. 1.8 "Elected Research Program Field" shall mean the field of research proposed for an Elected Research Program to which research exclusivity of Section 2.9 applies. 1.9 "Steering Committee" shall mean a committee made up of two (2) representatives from each of ProdiGene and GCI who shall be designated by ProdiGene and GCI, respectively. 1.10 "Background Technology" shall mean any technology, data, results, biological materials, processes, reports, or other information owned or controlled by either Party as of the Effective Date. 1.11 "Background Patent Rights" shall mean any patent or patent application, both foreign and domestic, including any and all divisions, continuations, continuations-in-part, reissues, re-examination applications, extensions, supplementary protection certificates, certificates of addition, inventor's certificates, including international counterparts thereof owned and/or controlled as of the Effective Date by either Party. 1.12 "Invention(s)" shall mean any technology, data, discoveries, results, biological materials, processes, reports, or other information conceived and/or reduced to practice which result from an Elected Research Program pursuant to this Agreement. 2 3 1.13 "Net Sales" shall mean the gross amount invoiced with respect to a product to a Party or Affiliate thereof, less: *** II. ELECTION OF RESEARCH PROGRAMS 2.1 Initiation and Administration of Elected Research Programs. The Steering Committee shall meet promptly after the execution of this Agreement and at least quarterly thereafter to discuss the initiation of Elected Research Program(s). The initiation of Elected Research Program(s) shall be pursuant to agreement of the Parties as memorialized in a Project Form according to the procedure provided below. (a) A Party may propose an Elected Research Program by completing, signing and forwarding to the other Party a Project Form which describes the proposed Elected Research Program. (b) The Party receiving a completed Project Form shall consider in good faith the proposed research as described in the Project Form and respond in writing to the proposing Party within 30 days of receipt of the executed Project Form in accordance with the following: (i) If the receiving Party agrees to participate in the proposed Elected Research Program, it shall give notice by returning a duly executed copy of the Project Form to the proposing Party. The fully executed Project Form shall be sufficient memorialization of the mutual agreement of the Parties to perform the research described therein and shall be the basis for an Elected Research Program to which the terms of this Agreement apply; or (ii) If the receiving Party does not agree to participate in the proposed Elected Research Program, it may decline to execute the Project Form or, alternatively, may notify the proposing Party that the receiving Party agrees to pursue the proposed Elected Research Program only under modified conditions. (c) Elected Research Program(s) which are initiated as provided in subsection (b) above shall commence immediately upon mutual execution of the applicable Project Form and shall be performed essentially as provided in the Project Form. The terms of this Agreement, including those provided in sections 2.4 through 2.9, shall govern all Elected Research Program(s), except as provided in Section 2.2 herein. 3 4 2.2 The Parties may mutually agree to the allocation of FTEs funded as provided herein to the research program described in the Enzymes Agreement. In such event, the terms of the Enzymes Agreement shall continue to control such research program despite funding under this Agreement. Notwithstanding the above, FTEs allocated hereunder to the Enzymes Agreement research program shall be funded at the rates provided in this Agreement. 2.3 Elected Research Programs may pertain to the following subject matter: (a) Elected Research Program(s) Pursuant to Mutual Agreement. The Parties may agree to initiate an Elected Research Program(s) related to any plan of research within the Exclusive Collaboration Field, or such other research field as the Parties may mutually agree upon, provided that at least *** Elected Research Programs shall be initiated during the Term. (b) GCI Elected Research Programs. GCI may elect to initiate an Elected Research Program comprising a Target Compound from within the Elected Research Program Fields listed in Sections 2.3(b)(i) through 2.3(b)(v). For the avoidance of ambiguity, the programs provided in this subsection with respect to Target Compound(s) are not intended to be limiting in any way with respect to potential programs which may be elected under Section 2.3(a): *** (c) Exploratory Programs. The Parties may mutually agree to initiate a program intended to analyze, on an exploratory basis, the commercial and/or technical feasibility or desirability of plant expression of certain genes. Exploratory programs shall not exceed the transgenic expression and/or analysis of *** genes. Allocation to such programs shall not exceed *** of the total funding provided pursuant to Section 5.1(a) or 5.5. 2.4 ProdiGene and GCI agree to submit quarterly reports to the Steering Committee detailing progress relating to their responsibilities pursuant to an Elected Research Program and any pertinent findings, results, conclusions or other information resulting from an Elected Research Program. 2.5 With respect to the conduct of an Elected Research Program, the Steering Committee will make decisions including: (a) reviewing the general direction and course of the research; (b) determining appropriate allocation of funding to Elected Research Program(s) provided hereunder and communicating the agreement of the Parties related to such allocation; 4 5 (c) approving changes in the direction of the research; (d) reviewing and approving achievement of any milestones; (e) reviewing and advising with regard to patents and patent strategy; (f) making recommendations to respective management of the Parties or making decisions, if appropriate, on all decision points throughout the course of the research; and (g) review of the progress and/or desirability of Elected Research Programs. 2.6 Termination of Elected Research Programs. Elected Research Programs may be terminated as follows: (a) Upon completion of the Elected Research Program as described in the Project Form; (b) Upon mutual agreement of the Parties that technology, market, regulatory or other considerations suggest that continued investment of time, resources or money related to an Elected Research Program to develop and commercialize a Target Compound may be unsuitable or undesirable. Pursuant to this sub-section, the Parties may elect to hold discussions toward a mutually acceptable resolution, including alternative target proteins, the transfer or modification between the Parties of rights to commercialize products, or termination of the Elected Research Program, as appropriate. (c) Upon *** days notification to ProdiGene, GCI may elect to cancel an Elected Research Program. In the event that GCI elects to cancel an Elected Research Program under this subsection, ProdiGene may continue such program, provided that such continuance is not inconsistent with the terms of this Agreement, including Article 3 hereof. GCI agrees to negotiate in good faith with ProdiGene for a license to intellectual property exclusively licensed to GCI under Section 2.3(c) in the event that such license is necessary for the continuance or commercialization of the results of such canceled program by ProdiGene. 2.7 Intellectual Property Rights and Commercialization in Elected Research Programs. Intellectual property rights developed during or related to Elected Research Programs shall be treated as follows: (a) To the extent that either Party owns or controls Background Technology or Background Patent Rights, such Background Technology and Background Patent Rights shall remain the sole property of that Party to exploit in 5 6 any manner it chooses at its sole discretion, except to the extent provided for herein. (b) Each Party agrees to promptly, but no later than 30 days after the submission of an invention disclosure to a Party's legal department or counsel, advise the other Party in writing of any Invention(s) made pursuant to this Agreement. (c) Invention(s) made as a result of an Elected Research Program and any patents, copyrights or other intellectual property based on such Invention(s) shall be owned jointly by the Parties. Subject to Section 2.7(d) hereof, rights to commercialize such Invention(s) shall be as follows: (i) To the extent that Invention(s) are specific to ***, GCI grants to ProdiGene *** license to make, use, sell, offer to sell, have made, import and export, with the right to sublicense, products and processes specific to *** embodying such Invention(s), subject to the payment of a royalty or other mutually agreed upon compensation to GCI and to the rights of GCI pursuant to part (ii) hereof. Notwithstanding the above, GCI shall retain the right to use Inventions under this subsection for internal research purposes only. (ii) To the extent that Invention(s) relate to the Exclusive Collaboration Field, ProdiGene hereby grants to GCI *** license to make, use, sell, offer to sell, have made, import and export, with the right to sublicense, products or processes embodying such Invention(s), subject to the payment of a royalty or other mutually agreed upon compensation to ProdiGene, which royalty or other compensation will be the greater of *** of Net Sales of a product embodying such Invention(s) or *** of the gross margin received by GCI *** calculated in accordance with U.S. Generally Accepted Accounting Principles. Notwithstanding the above, ProdiGene shall retain the right to use Inventions under this subsection for internal research purposes only. (iii) To the extent that Invention(s) are not encompassed within subsections (i) or (ii) of this Section, the Parties shall each have the right to make, use, sell, offer to sell, have made, import and export, with the right to sublicense, such Invention(s), subject to further agreement between the Parties. (iv) In the event that ProdiGene is subject to a sale of substantially all of its business assets or equity to a third party, GCI shall be granted *** license to make, use, sell, offer to sell, have 6 7 made, import and export, with the right to sublicense, products or processes embodying such Invention(s) for any Inventions described in subsection 2.7(c)(i). (d) Royalty or compensation due to a Party pursuant to Section 2.7(c) shall be the subject of a written agreement between the Parties and shall take into consideration the existence of, or filing of applications for, intellectual property, the nature of the Invention(s) and its relative contribution to the product sold. In addition, or alternatively, to the royalty or compensation provided for in Section 2.7(c), the Parties may elect to enter into a separate supply agreement pursuant to which ProdiGene supplies raw materials and/or other goods useful for the production of protein products to GCI for processing and eventual sale. Any controversy arising between the Parties which is related to royalty or other compensation to which a Party may be entitled under Sections 2.7(c) may, upon request of a Party (the Requesting Party), be subject to arbitration in accordance with the Licensing Agreement Arbitration Rules of the American Arbitration Association with the following modifications: (i) *** (ii) Because prompt disposal of the dispute is important to both Parties, judgment shall be provided within *** of the request for arbitration. The judgment shall be supported by findings of fact and conclusions of law. Judgment by the arbitration panel may be entered in any court having competent jurisdiction thereof. In the event that judgment is not entered by the arbitration panel within *** of the request, no obligation shall remain to continue the arbitration; and (iii) If judgment rendered by the arbitration panel is equivalent to a standing offer previously rejected by the Requesting Party, the Requesting Party shall pay all expenses incurred by the other Party during the arbitration. (e) Preparation, filing, prosecution, maintenance and taking such other actions as are reasonably necessary or appropriate with respect to the development of intellectual property protection arising from an Elected Research Program as well as the costs thereof shall be undertaken by the Party having the right to commercialize the Invention(s) pertaining to such filed patents pursuant to Section 2.7(c). The Parties shall cooperate in the preparation and filing of any patent application relating to the Invention(s) including having any of their employees who are named as inventors review and comment on such patent applications and the prosecution related thereto, as well as having such employees execute necessary documents for the filing of such patent applications worldwide. 7 8 Each Party shall endeavor in good faith to coordinate its efforts with those of the other Party to minimize or avoid interference with the prosecution of the other Party's patent applications. Each Party shall provide the other with a copy of any patent application which relates to the Research, at least 20 days prior to filing the first of such applications in any jurisdiction, for review and comment by the other Party. In the event that Invention(s) are made as contemplated in Section 2.7(c)(iii) for which it is appropriate to file a patent application(s), the Parties, through the Steering Committee, will agree which Party is most appropriate to prepare, file and prosecute that patent application(s) based on the nature of the Invention(s) and the relative expertise of the Parties. (f) Either Party may discontinue its obligation to prepare, file, prosecute and maintain (including the costs related thereto) a particular patent or patent application filed by it pursuant to this Agreement by providing the other with thirty (30) days advance written notice (the "Discontinuance Election") of any decision to cease preparation, filing, prosecution and maintenance of that patent or patent application (a "Discontinued Patent"). In such case, the other Party may, at its sole discretion, continue preparation, filing and prosecution or maintenance of the Discontinued Patent at its sole expense. In such case, the acquiring Party shall own exclusively any such patent or patent application and patents maturing therefrom and the commercialization rights provided in Section 2.7(c); and the other shall execute such documents and perform such acts as may be reasonably necessary for the other Party to file or to continue prosecution or maintenance, including assigning ownership of such patent or patent application and maintaining such patents until such assignment of ownership is completed. The Discontinuance Election may be on a country-by-country basis or for a patent application or patent series in total. (g) ProdiGene represents and warrants to the best of its knowledge with respect to its Background Patent Rights that ProdiGene has title or right to the Background Patent Rights, and the grant of any license to GCI contemplated in this Agreement under such rights does not require the consent of a third party and is not encumbered by any agreement, assignment or other encumbrance that is inconsistent with the provisions of this Agreement and does not create any obligation on the part of GCI to any third party. Further, ProdiGene represents and warrants to the best of its knowledge with respect to the Background Technology, that it has ownership or license under such technology owned or controlled by ProdiGene and such ownership or licensure is not encumbered by any agreement, assignment or other encumbrance that prohibits ProdiGene from fulfilling its obligations under this Agreement or creates any obligation on the part of GCI to any third party. ProdiGene makes no representation or warranty regarding the freedom to operate, including with respect to any results of any Elected Research Program, under third party issued patents not encompassed within the Background Patent Rights and/or the Background Technology. 8 9 2.8 Confidentiality, Treatment of Samples and Publications. Confidentiality, samples and publications pursuant to this Agreement or any Elected Research Program shall be treated as follows: (a) The Parties agree that confidential information owned or developed by either Party and disclosed pursuant to this Agreement shall be considered within the terms of the Confidentiality Agreement; provided that the period of permissible disclosure thereunder shall be the term of this Agreement and the period of confidentiality provided in said Confidentiality Agreement will extend for five (5) years from the expiration of this Agreement. (b) The Parties agree that the terms of the Samples Agreement, except as specifically modified herein, will control with respect to any samples or materials provided from GCI to ProdiGene under this Agreement; provided that the Parties' obligations thereunder will extend for five (5) years from the expiration of this Agreement. (c) In the event that the terms of either of said Confidentiality Agreement or said Samples Agreement are inconsistent with the terms provided expressly herein, the terms of this Agreement shall control. (d) Neither Party will publish any material arising from any Elected Research Program without prior written approval of the other Party. Such approval shall not be unreasonably withheld but may be subject to a delay of up to (3) months total for assessment of the proposed publication and to enable preparation and filing of appropriate patent application(s). Both Parties will procure that any person involved or interested in an Elected Research Program will not publish or communicate material arising therefrom without first complying with the provisions of this Section. 2.9 Research Exclusivity. ProdiGene agrees that it will not perform research and/or development or enter into any commercial agreement in or related to an Elected Research Program with any third party during the term of such Elected Research Program, after which ProdiGene, subject to its obligations of confidentiality, exclusivity and to proprietary rights granted to GCI hereunder, may continue such research without regard to GCI. III. EXCLUSIVITY OF COLLABORATION 3.1 In consideration of payment pursuant to Section 5.4, ProdiGene agrees that it will not perform research and/or development or enter into any commercial agreement in the Exclusive Collaboration Field with any third party during the Exclusivity Period. ProdiGene further agrees that it will not engage in discussions with any third party regarding the Exclusive Collaboration Field during the Exclusivity Period. 9 10 3.2 ProdiGene hereby grants to GCI an option to extend the Exclusivity Period for an additional *** (Exclusivity Option). GCI shall exercise the Exclusivity Option, at its sole discretion, by notifying ProdiGene in writing prior to the expiration of the Exclusivity Period of its intent to exercise the Exclusivity Option. Upon exercise of the Exclusivity Option and in consideration of the extended Exclusivity Period conferred thereby, GCI shall pay to ProdiGene the amount provided in Section 5.5. 3.3 The exclusivity provided in this Article applies to any collaboration between ProdiGene and any third party, but shall not apply to *** IV. PRECEDENCE OF AGREEMENTS In the event of any conflict between the terms of the Enzymes Agreement or any other agreement between the Parties and this Agreement, this Agreement shall be controlling. V. PAYMENTS 5.1 Payments for Elected Research Program(s): (a) GCI shall pay to ProdiGene *** during the *** period immediately following the Effective Date as funding for Elected Research Programs. Funding provided in this Section shall be pursuant to the agreement of the Parties, and shall include payment for FTEs required to adequately staff Elected Research Program(s) and technical milestones, if any, which are appropriate to Elected Research Program(s). The funding provided in this Section shall constitute a total of at least *** FTEs and no more than *** FTEs over the Term. (b) Allocation of FTEs shall be not less than *** per annum and not more than *** per annum during the Term. The funding rate for FTEs allocated during the Term shall be as follows: (i) FTEs allocated during 1999 shall be at a rate of *** per FTE; (ii) FTEs allocated during 2000 shall be at a rate of *** per FTE; (iii) FTEs allocated during 2001 or thereafter shall be at a rate of *** per FTE. (c) Payment under Section 5.1(a) shall comprise two payments per year, the first payment being on the Effective Date or annual anniversary thereof (First Payment Date) and the second payment being six months after the Effective Date or annual anniversary thereof (Second 10 11 Payment Date) during the Term. The amount of each payment shall be as follows: (i) Within 30 days of the First Payment Date, GCI shall pay to ProdiGene the prorated amount of the projected FTE allocation for the *** period immediately following the First Payment Date. (ii) Within 30 days of the Second Payment Date, GCI shall pay to ProdiGene the prorated amount of the projected FTE allocation for the *** period immediately following the Second Payment Date, adjusted for the actual allocation of FTEs made in the previous *** period. (d) Agreed upon payments for technical milestones met during the Term with respect to Elected Research Program(s) shall be paid within 30 days of confirmation that such technical milestone has been met. 5.2 At quarterly intervals, ProdiGene will provide to GCI a statement detailing the resource and time expenditures which correspond to the payments made to ProdiGene by GCI under Section 5.1 or 5.5. 5.3 Any work performed by GCI shall be at GCI's sole expense. 5.4 In consideration of the Exclusivity Period as provided in Section 3.1, GCI shall pay to ProdiGene *** within 30 days of the execution of this Agreement. 5.5 In the event that GCI exercises its Exclusivity Period Option under Section 3.2, GCI shall pay to ProdiGene a total of *** during the extended Exclusivity Period as funding for Elected Research Program(s) during the extended Exclusivity Period. Funding provided in this Section shall be pursuant to the agreement of the Parties, and shall include payment for FTEs required to adequately staff Elected Research Program(s) and technical milestones, if any, which are appropriate to Elected Research Program(s). The funding provided in this Section 5.1(a) shall constitute a total of at least *** FTEs during the extended Exclusivity Period. Payment to ProdiGene pursuant to this Section 5.5 shall be in accordance with Section 5.1(c). VI. TERM AND TERMINATION 6.1 The Term of this Agreement shall be for three (3) years from the Effective Date, such term to be automatically renewable for a period of *** upon exercise of the Exclusivity Option provided in Section 3.2. 6.2 The Term of any Elected Research Program shall be the Term of this Agreement or the period of time for which FTEs are allocated, whichever is greater. 11 12 Accordingly, the Parties may agree in writing that the term of an Elected Research Program shall extend beyond the term of this Agreement. 6.3 Termination of the Agreement may occur upon the following: (a) Upon a material breach of the Agreement by the other Party. In the event that a Party wishes to terminate this Agreement due to a material breach, the terminating Party shall serve a written notice on the other Party thereby allowing the other Party sixty (60) days to remedy such breach. In the event that such breach has not been remedied within the prescribed sixty (60) days, the Agreement shall terminate automatically; (b) In the event that either Party becomes subject to Bankruptcy, insolvency, liquidation or similar proceedings, the other Party shall be entitled to terminate this Agreement forthwith; (c) Upon one-hundred eighty (180) days notice by GCI to ProdiGene; or (d) Upon failure of the Parties to reach and successfully consummate the sale of an equity interest in ProdiGene to GCI within one-hundred eighty (180) days of the Effective Date, GCI shall have the right, but not the obligation, to terminate immediately, provided that GCI must provide notice to ProdiGene of such termination within two hundred and ten (210) days of the Effective Date. In the event that GCI terminates under this subsection 6.3(d) and the failure of the Parties to reach and successfully consummate the sale of an equity interest is due to: (i) a failure of ProdiGene to obtain the necessary consents of its shareholders and/or Board of Directors to effectuate such sale to GCI or (ii) the terms of such issuance not being substantially similar to the Class B Convertible Preferred Shares rights, privileges and preferences as provided in ProdiGene's Certificate of Incorporation as filed with the Delaware Secretary of State and authenticated on August 28, 1998, ProdiGene shall refund, in its entirety, any payments made under Section 5.4 hereof. 6.4 Expiration of Term or termination of this Agreement pursuant to this Article shall not effect the vested rights of either Party under Articles 2, 4 and 7. VII. MISCELLANEOUS 7.1 Hold Harmless. With respect to GCI's rights under Section 2.7(c), ProdiGene shall hold GCI harmless for any activities thereunder which would otherwise infringe ProdiGene's Background Technology or Background Patent Rights. 12 13 7.2 Indemnification. Except as specifically provided herein, GCI agrees to indemnify and to hold ProdiGene, its officers, directors, and employees harmless from liabilities assessed to GCI or its affiliates which arise solely as a result of GCI's conduct under this Agreement or GCI's use of the results of this Agreement, except for liabilities caused by the negligence of ProdiGene. Furthermore, ProdiGene agrees to indemnify and to hold GCI, its officers, directors, and employees harmless from liabilities of any kind assessed to ProdiGene or its affiliates which arise solely as a result of ProdiGene's conduct under this Agreement or ProdiGene's use of the results of this Agreement, except for liabilities caused by the negligence of GCI. Indemnification hereunder is limited to research activities conducted under this Agreement. 7.3 Force Majeure. Each of the Parties hereto shall be excused from performance of its obligations and shall not be liable for damages to the other to the extent that such performance is prevented by circumstances beyond its effective control. Such excuse from performance shall continue so long as the condition responsible for such excuse continues and for a thirty (30) day period thereafter. For purposes of this Agreement, circumstances beyond the effective control of a Party which excuse that Party from performance shall include but shall not be limited to, act of God, regulations or laws of any government, injunction or judgment of any court, war, civil commotion, destruction of facility or materials by fire, earthquake, storm or other casualty, labor disturbance, epidemic and failure of public utilities or common carrier. 7.4 Relationship. ProdiGene and GCI are independent contractors. Nothing in this Agreement or the course of dealing of the Parties shall be construed to constitute the Parties hereto as partners, joint ventures or as agents or distributors for one another, or as authorizing any Party to obligate the other in any manner. 7.5 Non-Assignment. This Agreement shall not be assignable by any Party without the other Parties' prior written consent. In the event that such consent is given, this Agreement and the covenants herein contained shall be binding and inure to the benefit of ProdiGene and GCI and their heirs, assigns, successors and legal representatives. In the event that either Party hereto undergoes a divestiture or sale of assets or equity to a third party, the acquiring party takes such assets or equity subject to the rights and obligations provided in this Agreement and shall agree in writing to the terms hereof. 7.6 Entire Agreement/Amendment. This Agreement and the attachments hereto constitute and contain the entire agreement of the Parties respecting the subject matter hereof. This Agreement may only be amended by mutual written agreement of the Parties. 7.7 Warranty of Right and Authority. Each of the Parties represents and warrants to the other that it has the full right and authority to enter into this Agreement, and that it is 13 14 not aware of any impediment which would inhibit its ability to perform the terms and conditions imposed on it by this Agreement. Nothing contained herein shall be interpreted as a warranty, express or implied as to the patentability, enforceability or validity of any patent application or patent owned or controlled by either Party. 7.8 Further Acts and Instruments. Each Party agrees to execute, acknowledge and deliver such further instruments and do all such other acts as may be necessary or appropriate to effect the purpose and intent of this Agreement. 7.9 Severability. In the event any one or more of the provisions of this Agreement should for any reason be held by any court or authority having jurisdiction over this Agreement or either of the Parties hereto to be invalid, illegal or unenforceable, such provision shall be reformed within the jurisdiction of such court or authority to as nearly approximate the intent of the parties as possible, and if the provision is unreformable the Parties shall meet to discuss what steps should be taken to remedy the situation; otherwise and elsewhere this Agreement shall not be affected. 7.10 Captions. The captions to this Agreement are for convenience only and are to be of no force or effect in construing or interpreting the provisions of this Agreement. 7.11 Counterparts. This Agreement may be executed in two counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 7.12 Limitation of Liability. No Party shall be liable to another for indirect, incidental, consequential or special damages, including but not limited to lost profits, arising from or relating to any breach of this Agreement, regardless of any notice of the possibility of such damages. In no event shall either Party be liable for damages relating to lost profits or reasonable royalties or special damages due and payable to a third party on the basis of the other's sale of a product developed hereunder. 7.13 Publicity. Either Party's use of the other Party's name or disclosure of the existence or nature of this Agreement or the relationship created thereby to any third party shall be only with the prior written consent of the other Party, which consent will not be unreasonably withheld. 7.14 Interpretation. This Agreement has been jointly prepared by the Parties and their respective legal counsel and shall not be strictly construed against either Party. 7.15 Notices. Representatives for the receipt of payments, notices, records, reports and other information pursuant to this agreement shall be as follows: 14 15 For GCI: Attn: Legal Department Genencor International, Inc. 1870 S. Winton Rd. 4 Cambridge Place Rochester, NY 14618 For ProdiGene: Attn: ProdiGene, Inc. 1500 Research Parkway Suite 220 College Station TX 77845 7.16 Controlling Law. This Agreement shall be governed and construed in accordance with the Laws of the State of Delaware, excluding any choice of law rules which may direct the application of the law of any other jurisdiction. Questions effecting the construction and effect of any patent rights arising hereunder shall be determined by the laws of the country in which such patent rights have been applied for and/or granted. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized representatives. GENENCOR INTERNATIONAL, INC. PRODIGENE By: /s/ Stuart L. Melton By: /s/ John A. Howard -------------------------------- ----------------------------- Name: Stuart L. Melton Name: John A. Howard ------------------------------ --------------------------- Title: Senior Vice President Title: President and CEO ----------------------------- -------------------------- 15