Restructuring Agreement W/hoechst Marion Roussel

EXHIBIT 99.2


ARIAD PHARMACEUTICALS, INC. HAS OMITTED FROM THIS EXHIBIT 99.2 PORTIONS OF THE AGREEMENT FOR WHICH ARIAD PHARMACEUTICALS, INC. HAS REQUESTED CONFIDENTIAL TREATMENT FROM THE SECURITIES AND EXCHANGE COMMISSION. THE PORTIONS OF THE AGREEMENT FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED ARE MARKED WITH BRACKETS AND AN ASTERISK AND SUCH CONFIDENTIAL PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.


RESTRUCTURING AGREEMENT
(SRC RESEARCH AND DEVELOPMENT PROGRAM)


THIS SRC RESTRUCTURING AGREEMENT (this "Agreement") is entered into this 31st day of December, 1999, by and between HOECHST MARION ROUSSEL (France), a stock company formed under the laws of France ("HMR S.A."), and ARIAD PHARMACEUTICALS, INC., a Delaware corporation ("ARIAD").


W I T N E S S E T H:


WHEREAS, HMR S.A., as successor in interest to Roussel Uclaf S.A., a French corporation, and ARIAD are parties to that certain Collaborative Research and License Agreement dated as of November 6, 1995 (the "RU Agreement"); and


WHEREAS, HMR S.A. and ARIAD have been engaged in the Research and Development Program;


WHEREAS, the parties have decided that it is in their respective best interests to restructure their relationship regarding the Research and Development Program and to terminate the RU Agreement; and


WHEREAS, Aventis Pharmaceuticals Inc., a Delaware corporation (formerly known as Hoechst Marion Roussel, Inc.), and ARIAD have simultaneously herewith entered into that certain Restructuring Agreement (the "Restructuring Agreement"), which provides for, among other things, the restructuring of the transactions related to the formation and operation of the Hoechst-ARIAD Genomics Center, LLC.


NOW, THEREFORE, in consideration of the mutual covenants contained herein, and for other good and valuable consideration, the parties hereto, intending to be legally bound, hereby agree as follows:


1. DEFINITIONS. Unless otherwise provided herein, all capitalized terms used herein shall have the meanings set forth on SCHEDULE 1 hereto.


2. ASSIGNMENT AND ASSUMPTION OF ARIAD OWNED TECHNOLOGY, JOINT TECHNOLOGY AND ROUSSEL OWNED TECHNOLOGY. As of the Effective Time, HMR S.A. hereby sells, assigns


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and transfers to ARIAD all of its right, title and interest in and to, and ARIAD hereby accepts such sale, assignment and transfer of, ARIAD Owned Technology (if any), Joint Technology and ROUSSEL Owned Technology (as such terms are defined in Schedule 1), each as in existence as of the Effective Time, and including without limitation the Joint Technology and ROUSSEL Owned Technology listed on SCHEDULE 2 hereto (collectively, the "Assigned Technology"). To the best of HMR S.A.'s knowledge, Schedule 2 contains a true and complete list of all patent applications and patents claiming any element of the Joint Technology or ROUSSEL Owned Technology.


[*]


In furtherance of the foregoing, the Assigned Technology


[*]


does and shall grant


[*]


provided, however, that


[*]


set forth in this sentence, and the right to


[*]


.


3. TANGIBLE MATERIALS. In furtherance of the provisions of Section 2 hereof, HMR S.A. will deliver to ARIAD, no later than January 31, 2000, such manuals, standard operating procedures, assay methods, process descriptions and the like, and all other tangible materials (including without limitation copies of research results and other records, copies of relevant portions of laboratory notebooks, biological materials and chemical materials) that are ARIAD


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Owned Technology, Joint Technology or ROUSSEL Owned Technology), including without limitation the items listed on SCHEDULE 3 hereto (collectively, the "Tangible Materials"); provided, however, that a reasonable additional period of time shall be permitted for the delivery as promptly as practicable to ARIAD of Tangible Materials relating to the deconvolution of certain libraries.


4. UNDERTAKINGS.


(a) In furtherance of the provisions of Sections 2 and 3 hereof, designated representatives of HMR S.A. and its Affiliates shall meet with designated representatives of ARIAD at the location in France and on the dates set forth on Schedule 4 hereof, at which meeting HMR S.A. shall review and discuss with ARIAD the status of the Research and Development Program as concluded as of the Effective Time and the Assigned Technology. The identities of the persons who will attend such meeting on behalf of HMR S.A. and its Affiliates, and on behalf of ARIAD, are set forth on Schedule 4.


(b) After transferring all Assigned Technology (including Tangible Materials) to ARIAD, HMR S.A. shall, as soon as practicable after the Effective Time and subject to the proviso in the last sentence of Section 11(b) hereto, take all steps necessary to destroy, delete and/or remove all data and information relating to Compounds (including screening of such Compounds), the Research and Development Program and the Assigned Technology, whether the same is in written form or in electronic form and contained in the computers, databases and other electronic media of HMR S.A. and its Affiliates and successors, to the extent that the isolation and destruction, deletion and/or removal of such data and information is feasible. Notwithstanding anything to the contrary contained in this Agreement, (i) HMR S.A. and its Affiliates shall be entitled to retain and use copies of publicly available materials, and (ii) patent counsel for HMR S.A. and its Affiliates shall be entitled to retain and use copies of data and information relating to Assigned Technology applicable to, and for the sole purpose of, supporting the patentability, including without limitation the utility or industrial applicability, of Compounds, compounds and methods of HMR S.A. or its Affiliates, described on Schedule 2; it being understood that access by HMR S.A. and its Affiliates to the data and information relating to the Assigned Technology for the purposes described in clause (ii) of this sentence is strictly limited to inventors and in-house and outside patent counsel for HMR S.A. and its Affiliates.


(c) After the Effective Time, ARIAD shall undertake and assume all costs and expenses associated with the Assigned Technology, including without limitation those related to prosecution of patent rights (except as set forth in Schedule 2), but only to the extent such costs and expenses relate to its ownership or actions, events or omissions occurring after the Effective Time. HMR S.A. shall have no responsibility for costs and expenses relating to the Assigned Technology (except as set forth on Schedule 2) or to ARIAD's possession of, or actions, events or omissions associated with, the Assigned Technology occurring after the Effective Time. Except as provided in the RU Agreement, ARIAD shall have no responsibility for costs and expenses relating to the Assigned Technology or to HMR S.A.'s or its Affiliates' possession of, or actions, events or omissions associated with, the Assigned Technology occurring prior to the Effective Time.


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(d) Except as set forth in Section 4(b) hereof, HMR S.A. acknowledges and agrees that neither it nor any of its Affiliates shall use any Assigned Technology for any purpose following the Closing.


5. TERMINATION OF RU AGREEMENT. As of the Effective Time, the RU Agreement shall be terminated in its entirety (including, without limitation, any survival provisions) and, notwithstanding anything in the RU Agreement to the contrary, the parties shall have no rights or obligations thereunder.


6. CONSIDERATION.


(a) ONE-TIME PAYMENT UPON [*]. In the event that ARIAD shall enter into any transaction with a third party, which transaction will provide such third party directly or indirectly with rights to [*], ARIAD shall,


[*]


. For purposes of clarification,


[*]
.


(b) MILESTONES. ARIAD shall, [*] days following the occurrence of the triggering event, pay to HMR S.A. the following milestone payments with respect to


[*]


:


(i)


[*]


; and


(ii)


[*]


.


(c) FURTHER PAYMENTS.


(i) Until such time as the condition in Section 6(e) hereof is achieved, ARIAD shall pay HMR S.A.:


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(A) an amount based on the [*] equal to [*] actually received by
ARIAD or any of its Affiliates in each Fiscal Year;


(B) an amount based on [*] equal to [*] actually received by ARIAD
or any of its Affiliates in each such Fiscal Year;


(C) an amount based on [*] equal to [*] actually received by ARIAD
or any of its Affiliates in each Fiscal Year; and


(D) an amount equal to [*] actually received by ARIAD or any of
its Affiliates with respect to [*], as the case may be, by
licensees of ARIAD or any of its Affiliates in each Fiscal
Year; provided, however, that the amounts payable by ARIAD to
HMR S.A. in each Fiscal Year under the preceding clause (D)
shall be:


(x) [*] by licensees of ARIAD or any of its Affiliates of
[*];


(y) [*] by licensees of ARIAD or any of its Affiliates of
[*]; and


(z) [*] by licensees of ARIAD or any of its
Affiliates of [*].


In furtherance of the foregoing and for purposes of clarification, if a product is


[*]


then, unless (i) such product is
[*]


or (ii)
[*]
the payment on the [*] shall be calculated using the


[*]
.


(ii) Such amounts shall be paid by ARIAD within ninety (90) days after the end of each Fiscal Quarter in which Net Sales are made by ARIAD or any of its Affiliates or payments from licensees are received. Such payments shall be accompanied by a report showing the quantity and Net Sales of each Human Therapeutic Product or Human Therapeutic Non-Field Product sold by ARIAD or any Affiliate or licensee in each country and a calculation of the amount due pursuant to this Section 6(c).


(iii) ARIAD and its Affiliates shall keep, and shall cause its licensees to keep, for five (5) years from the date of each such payment complete and accurate records of


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sales by ARIAD and its Affiliates and licensees of each Human Therapeutic Product or Human Therapeutic Non-Field Product in sufficient detail to allow the accruing of such payments to be determined accurately. HMR S.A. will have the right for a period of three (3) years after receiving any report or statement with respect to payments due and payable to appoint at its expense an independent certified public accountant reasonably acceptable to ARIAD to inspect the relevant records of ARIAD and its Affiliates to verify such report or statement. ARIAD and its Affiliates shall each make its records available for inspection by such independent certified public accountant during regular business hours at such place or places where such records are customarily kept, upon reasonable notice from HMR S.A., solely to verify the accuracy of the reports and payments. At the written request of HMR S.A., and as part of the exercise by HMR S.A. of the aforesaid right to inspect the records of ARIAD and its Affiliates, ARIAD will exercise its rights to inspect the records of its licensees (and ARIAD will ensure that its agreements with its licensees permit such inspection) and provide HMR S.A. with the results of such inspection. Such inspection right shall not be exercised more than once in any calendar year nor more than once with respect to sales of any Human Therapeutic Product or Human Therapeutic Non-Field Product in any given period. HMR S.A. agrees to hold in strict confidence all information concerning such payments and reports, and all information learned in the course of any audit or inspection, except to the extent necessary for HMR S.A. to reveal such information in order to enforce its rights under this Agreement or if disclosure is required by law. The results of each inspection, if any, shall be binding on both parties. HMR S.A. shall pay for such inspections, except that in the event that there is any upward adjustment in aggregate amounts payable for any Fiscal Year shown by such inspection of more than two percent (2%) of the amount paid, ARIAD shall pay for such inspection.


(d) LATE PAYMENTS. Payments not made within the time periods set forth in Sections 6(a), 6(b) and 6(c) hereof, respectively, shall bear interest at a rate of the lesser of (i) one percent (1%) per month and (ii) the maximum rate allowed under applicable law, from the due date until paid in full.


(e) MAXIMUM PAYMENTS. The maximum aggregate amount of payments due by ARIAD to HMR S.A. pursuant to Sections 6(b) and 6(c) hereof shall be


[*]
by ARIAD and its Affiliates and licensees.


7. DISCLAIMER. EXCEPT AS OTHERWISE PROVIDED IN SECTIONS 9(f) AND 9(g) OF THIS AGREEMENT, HMR S.A. MAKES NO WARRANTIES OR REPRESENTATIONS OR WARRANTIES WHATSOEVER, WHETHER EXPRESSED OR IMPLIED, IN RESPECT OF THE ASSIGNED TECHNOLOGY OR ARIAD'S ABILITY TO PURSUE RESEARCH, DEVELOPMENT OR COMMERCIALIZATION ACTIVITIES WITH RESPECT TO THE ASSIGNED TECHNOLOGY AND HEREBY DISCLAIMS WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF OTHERS WITH RESPECT TO ANY AND ALL OF THE FOREGOING.


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8. INDEMNIFICATION. ARIAD shall indemnify, defend and hold harmless HMR S.A., its Affiliates and their respective directors, officers, employees and agents, and their respective successors, heirs and assigns (the "HMR S.A. Indemnitees"), against any liability, damage, loss or expense (including reasonable attorneys' fees and expenses of litigation) incurred by or imposed upon the HMR S.A. Indemnitees, or any one of them, in connection with any claims, suits, actions, demands or judgments of third parties, including, without limitation, personal injury and product liability matters (except in cases where such claims, suits, actions, demands or judgments result from the gross negligence or willful misconduct on the part of HMR S.A.) arising out of the development, testing, production, manufacture, promotion, import, sale or use by any person of any Human Therapeutic Product or Human Therapeutic Non-Field Product which is manufactured or sold by ARIAD, or by an Affiliate, licensee, distributor or agent of ARIAD.


9. REPRESENTATIONS AND WARRANTIES OF HMR S.A. As of the Effective Time, HMR S.A. hereby represents and warrants to ARIAD as follows:


(a) ORGANIZATION. HMR S.A. is a corporation duly organized, validly existing and in good standing under the laws of France.


(b) AUTHORIZATI ...