COLLABORATIVE RESEARCH AND LICENSE AGREEMENT

EXHIBIT 10.10


COLLABORATIVE RESEARCH AND LICENSE AGREEMENT
The Dow Chemical Company - Symyx Technologies


This COLLABORATIVE RESEARCH AND LICENSE AGREEMENT (the "Agreement"), effective as of January 1, 1999 (the "Effective Date"), is made by and between Symyx Technologies, a California corporation having a principal place of business at 3100 Central Expressway, Santa Clara, California 95051 ("Symyx"), and The Dow Chemical Company, a Delaware corporation, having a principal place of business at 2030 Willard H. Dow Center, Midland, Michigan 48674 ("TDCC").


BACKGROUND


A. Symyx owns and is developing novel, proprietary methods for the
combinatorial preparation and screening of novel materials and has
conducted certain materials discovery research focused on the discovery
and enhancement of [******] and other materials; and


B. TDCC owns and is developing proprietary process technology related to
manufacture of [******] ; and


C. Symyx and TDCC desire to collaborate to research, develop and
commercialize certain [******] on the terms and conditions set forth
below.


NOW, THEREFORE, for and in consideration of the covenants, conditions and undertakings set forth herein, it is agreed by and between the parties as follows:


ARTICLE 1
DEFINITIONS


1.1 "Added Value" shall have the meaning set forth in Section 5.2.1(i).


1.2 "Affiliate" shall mean any entity directly or indirectly controlling, controlled by or under common control with, a party to this Agreement. For purposes of this Agreement, the direct or indirect ownership of fifty percent (50%) or more of the outstanding voting securities of an entity, or the right to receive fifty percent (50%) or more of the profits or earnings of an entity shall be deemed to constitute control. In addition, any entity directly or indirectly owned or controlled by, or owning or controlling, TDCC or Symyx at the maximum control or ownership right legally permitted in a country where such entity exists, shall be deemed to constitute control provided that it in fact results in actual control over the management, business and affairs of such entity.


1.3 "Agreement Compound" shall mean any Lead Compound [******] .


1.4 "Combinatorial Chemistry Technology" shall mean Combinatorial Chemistry Patent Rights and Combinatorial Chemistry Know-How.


-1-


* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions. 2


1.4.1 "Combinatorial Chemistry Patent Rights" shall mean (i) all U.S. patent applications claiming any inventions or discoveries related to Combinatorial Chemistry, (ii) all divisions, substitutions, continuations, continuation-in-part applications, and reissues, re-examinations and extensions of (i) above, (iii) foreign counterparts of any of the preceding of (i) or (ii) above, and (iv) patents, utility models or similar grants of rights issuing from any of the preceding of (i), (ii) or (iii) above .


1.4.2 "Combinatorial Chemistry Know-How" shall mean inventions, information, data, or materials related to Combinatorial Chemistry, excluding any inventions claimed in the Combinatorial Chemistry Patent Rights.


1.4.3 [******]


1.5 "Confidential Information" shall mean any information disclosed by one party (or by an Affiliate of a party on behalf of that party) to the other party or its representatives in connection with this Agreement which is in written, graphic, machine readable or other tangible form and is marked "Confidential" or "Proprietary" or in some other manner to indicate its confidential nature. Confidential Information may also include information that is disclosed orally or by observation, provided that such information is designated as confidential at the time of disclosure and confirmed in writing as confidential within thirty (30) days after such disclosure.


1.6 [******]


1.7 [******] .


1.8 [******] .


1.9 [******]


1.10 "Direct Modification" shall have the meaning set forth in Section 4.1.3.


1.11 "Discovery Tools" shall have the meaning set forth in Section 2.8.


1.12 "[******] " shall have the meaning set forth in Section 2.5.


1.13 "Executive Committee" shall have the meaning set forth in Section 3.6.


1.14 "Field" means the discovery, development and use of [******] to make [******] in a defined reaction agreed upon by the parties. The Fields are set forth in Exhibit A.


1.15 "FTE" shall mean a full-time employee or independent contractor utilized for the conduct of the Research Program or, in the case of less than full-time dedication, a full-time equivalent person-year, based on a total of forty-six and 1/4 (46.25) weeks or one thousand eight hundred fifty (1,850) hours per year, of work on or directly related to the Research Program.


-2- * Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions. 3


1.16 "Independent TDCC Research" shall have the meaning set forth in Section 2.3.3.


1.17 "Joint Invention" shall have the meaning set forth in Section 7.1.


1.18 "Lead Compound" shall mean a Library Compound which meets the specific [******] properties established either in the Research Plan or by the Research Committee for identifying a Lead Compound. The procedure for identifying a Lead Compound is set forth on Exhibit B hereto. It is understood and agreed that any Library Compound that is transferred from Symyx to TDCC and subsequently commercialized by or under authority of TDCC or its Affiliates shall be deemed a Lead Compound.


1.19 "Library Compound" shall mean any compound or mixture or composition of matter screened or prepared by or on behalf of Symyx in the course of the Research Program in order to determine its usefulness [******] in connection with a Field. However, any compound, mixture or composition of matter provided to Symyx by TDCC (or by an Affiliate of TDCC on behalf of TDCC) for screening as a [******] provided under another agreement shall not be deemed to be a Library Compound.


1.20 "Manufacturing Costs" shall mean (i) all direct and indirect costs related to the manufacture by TDCC or its Affiliates of Products, including costs for personnel, materials, quality control, regulatory compliance, administrative expenses, subcontractors, fixed and variable manufacturing overhead costs and business unit or division costs reasonably allocable to the manufacture of Products, as determined and allocated in accordance with generally accepted accounting principles, consistently applied, excluding costs for excess manufacturing capacity not reasonably related to projected demand for Products, or (ii) with respect to Products purchased from a Third Party vendor, reasonable amounts actually paid to the vendor for such Products in arm's length transactions.


1.21 "Net Income" shall mean the pro forma amounts attributable to royalties, license and other fees projected to be received, and projected Net Sales with respect to a Product, less the projected: (a) Manufacturing Costs for such Product; and (b) reasonable expenses incurred by TDCC or its Affiliates in connection with the marketing, shipping or sale of the Product, and general and administrative expenses relating thereto, all as determined and allocated in accordance with generally accepted accounting principles, consistently applied.


1.22 "Net Sales" shall mean the invoice price billed by TDCC or its Affiliates to Third Parties for the sale of Products, after deduction of (1) cash, trade and/or quantity discounts actually allowed; (2) amounts repaid or credited by reason of rejections or returns of goods, recalls, chargebacks, defects, rebates (including government mandated rebates); (3) freight, postage, and duties paid for and separately identified on the invoice or other documentation maintained in the ordinary course of business, and (4) excises, sales taxes, value added taxes, and duties actually paid and separately identified on the invoice or other documentation maintained in the ordinary course of business. Net Sales shall also include the amount of fair market value of all other consideration received by TDCC or its Affiliates in respect of sale of Products, whether such consideration is in


-3- * Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions. 4


cash, payment in kind, exchange or another form. In the case of a transfer of Products between TDCC and one of its Affiliates or between two Affiliates of TDCC for any purpose other than research, development or sampling, Net Sales shall where feasible be determined as provided in Section 5.2.1(vii).


1.23 [******] .


1.24 "Outside Technology" shall have the meaning set forth in Section 2.3.3.


1.25 "Product" shall mean any product that (i) contains an Agreement Compound, and/or (ii) contains a reaction product or other chemical derivative of an Agreement Compound, (iii) utilizes in its manufacture any method or process within the Program Technology developed by Symyx or developed jointly by Symyx and TDCC, or (iv) utilizes an Agreement Compound in its manufacture, [******] .


1.26 "Program Experiment" shall have the meaning set forth in Section 2.1.1(b).


1.27 "Program Technology" shall mean Program Patents and Program Know-How.


1.27.1 "Program Know-How" shall mean inventions, information, data, or materials developed by Symyx or TDCC or jointly by Symyx and TDCC in each case in the course of the Research Program that are useful for the manufacture, use or sale of Agreement Compounds or Products; provided, however, that Program Know-How shall not include any Combinatorial Chemistry Technology, Outside Technology, any invention claimed in the Program Patents or results of Independent TDCC Research.


1.27.2 "Program Patents" shall mean (i) all U.S. patent applications claiming any inventions or discoveries conceived and reduced to practice in the course of the Research Program by Symyx or TDCC or jointly by Symyx and TDCC, or conceived by Symyx before the Research Program and reduced to practice in the Research Program, which claim an Agreement Compound or a Product, or method or process for the manufacture of an Agreement Compound or Product, or a composition-of-matter containing an Agreement Compound or Product, or a method or process for the use of an Agreement Compound in or for the manufacture of a Product, in each case that are necessary or materially useful for the manufacture, use or sale of Agreement Compounds or Products in the Field, (ii) all divisions, substitutions, continuations, continuation-in-part applications, and reissues, re-examinations and extensions of (i) above, (iii) foreign counterparts of any of the preceding of (i) or (ii) above, and (iv) patents, utility models or similar grants of rights issuing on any of the preceding of (i), (ii) or (iii) above. It is understood and agreed that Program Patents shall not include any Combinatorial Chemistry Technology or results of Independent TDCC Research.


1.28 "Research Committee" shall have the meaning set forth in Section 3.1.


1.29 "Research Plan" shall have the meaning set forth in Section 2.1.


-4- * Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions. 5


1.30 "Research Program" shall mean the program of research conducted by Symyx and/or TDCC on a collaborative basis under this Agreement for the purpose of identifying and optimizing Agreement Compounds for use [******] in the Field. It is understood that the Research Program does not include screening of compounds, mixtures or compositions of matter provided to Symyx by TDCC (or by an Affiliate of TDCC on behalf of TDCC) for screening [******] , which research is to be conducted under terms of a separate agreement.


1.31 "Research Program Term" shall have the meaning described in Section 2.2.


1.32 "Sublicensee" shall mean, with respect to a particular Product, a Third Party to whom TDCC or its Affiliate has granted a license or sublicense to make, use and sell such Product.


1.33 "Symyx Patents" shall mean all U.S. patent applications filed on or before or claiming priority on or before the date five (5) years after the end of the Research Program claiming any inventions or discoveries owned or controlled by Symyx (or by any wholly-owned subsidiary of Symyx) which claim an Agreement Compound or a Product, or method or process for the manufacture of an Agreement Compound or Product, or a composition-of-matter containing an Agreement Compound or Product, or a method or process for the use of an Agreement Compound in or for the manufacture of a Product, in each case that are necessary or materially useful for the manufacture, use or sale of Agreement Compounds, or Products in the Field [******] , (ii) all divisions, substitutions, continuations, continuation-in-part applications, and reissues, re-examinations and extensions of (i) above, (iii) foreign counterparts of any of the preceding of (i) or (ii) above, and (iv) patents, utility models or similar grants of rights issuing on any of the preceding of (i), (ii) or (iii) above. Notwithstanding the foregoing, it is understood and agreed that "Symyx Patents" shall not include patent applications or patents claiming inventions made by Symyx or its wholly-owned subsidiary (solely or jointly) in collaboration with, or as part of a research program funded by, a Third Party if such collaboration or research program is not directed to [******] .


1.34 "Third Party" shall mean any party other than Symyx and its Affiliates, TDCC and its Affiliates, and their permitted assignees.


ARTICLE 2
RESEARCH PROGRAM


2.1 Research Program. Subject to the terms and conditions set forth herein, Symyx and TDCC shall conduct the research activities in the Fields in a collaborative effort in accordance with an agreed upon written plan describing the research activities to be conducted by each party (the "Research Plan"). The initial Research Plan has been agreed upon by the parties in writing prior to the Effective Date.


2.1.1 Responsibility - Symyx. During the term of the Research Program, Symyx shall use efforts that are reasonable in the circumstances and consistent with professional standards


-5- * Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions. 6


applicable to research in the Field as well as relevant standards applied by Symyx in conducting research outside the Research Program, to conduct research activities in accordance with the Research Plan to identify, discover or synthesize [******] in the Fields by preparing and screening Library Compounds as set forth in the Research Plan.


(a) Compounds Already Identified. Symyx shall make available for evaluation in the Research Program any compound, mixture or composition of matter which was screened or prepared by or on behalf of Symyx prior to the Effective Date or during the Research Program Term and is both (i) owned or controlled by Symyx to the extent that no obligations to any Third Party will be violated by use of the compound, mixture or composition in the Research Program and (ii) believed by Symyx to be potentially useful as a Lead Compound or a precursor of a Lead Compound.


(b) FTEs and Experiments. During each calendar year quarter of the Research Program Term, Symyx shall, in its discretion taking into consideration what is required to achieve the objectives of the Research Plan, either (i) utilize [******] FTEs to conduct the Research Program or [******] . Each FTE utilized by Symyx shall be qualified for the activities assigned to him or her under the Research Program. The FTEs will include FTEs for Chemistry, Engineering, Database and Software. [******] The Program Experiments conducted by Symyx during the Research Program will be selected consistent with the objectives set forth in the Research Plan. Duplication of Program Experiments during the Research Program will be avoided unless required as a control or for other valid research purposes consistent with the objectives set forth in the Research Plan.


(c) Other Responsibilities. Symyx shall use reasonable efforts to ensure that the most efficient and effective Combinatorial Chemistry Technology reasonably available to Symyx are made available for conducting the Research Program. At TDCC's request, Symyx will use commercially reasonable efforts to provide samples of up to ten (10) grams of any Lead Compound; however, if such sample cannot be provided at a commercially reasonable cost, Symyx will so notify TDCC and the parties shall meet to discuss how to proceed. Notwithstanding any other provision of this Agreement, Symyx shall not, without its consent, be required to perform research activities other than in accordance with the Research Plan, [******] 2.1.2 Responsibility - TDCC. During the Research Program Term, TDCC shall (i) conduct research activities in accordance with the Research Plan to identify, discover or synthesize [******] in the Fields, and (ii) to provide Symyx technical information and technical support reasonably necessary to conduct of the Research Program in accordance with the Research Plan. TDCC's efforts in conduct of the Research Program shall be reasonable in the circumstances and consistent with professional standards applicable to research in the Field as well as relevant standards applied by TDCC in conducting research outside the Research Program. Notwithstanding any other provision of this Agreement, TDCC shall not, without its consent, be required to disclose proprietary information to Symyx which is not essential to conduct of the Research Program or to provide equipment or materials.


-6- * Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions. 7


2.1.2 Responsibility - TDCC. During the Research Program Term, TDCC shall (i) conduct research activities in accordance with the Research Plan to identify, discover or synthesize [******] in the Fields, and (ii) to provide Symyx technical information and technical support reasonably necessary to conduct of the Research Program in accordance with the Research Plan. TDCC's efforts in conduct of the Research Program shall be reasonable in the circumstances and consistent with professional standards applicable to research in the Field as well as relevant standards applied by TDCC in conducting research outside the Research Program. Notwithstanding any other provision of this Agreement, TDCC shall not, without its consent, be required to disclose proprietary information to Symyx which is not essential to conduct of the Research Program or to provide equipment or materials.


2.2 Research Program Term. The Research Program Term shall commence on the Effective Date and, unless earlier terminated, continue thereafter for a period [******] or such other period as the parties may mutually agree in writing.


2.3 Exclusivity and Independent Research.


2.3.1 In the Field. During the Research Program Term, Symyx shall not conduct any research activities outside the Research Program, on its own behalf or on behalf of any Third Party, directed to [******] within the scope of the Field. In addition, during the Research Program Term, Symyx shall not knowingly provide Library Compounds to a Third Party for use in [******].


2.3.2 Other [******] Research by Symyx. It is understood that Symyx will conduct research activities outside the Research Program ("Other [******] Research") during the Research Program Term for itself and/or Third Parties for the purpose of [******] other than in the Field. In the event some Symyx employees work on both the Research Program and the Other [******] Research, Symyx shall use good faith commercially reasonable efforts to avoid potential conflicts or overlaps between the Research Program and Other [******] Research and misappropriation of any Confidential Information. It is understood that the Library Compounds are regularly used by Symyx and that Symyx can use and screen the Library Compounds for any use on its own behalf or for Third Parties, including without limitation for Other [******] Research, except to the extent that Symyx has granted to TDCC exclusive rights to screen and optimize the Library Compounds in the Field as set forth in Section 2.3.1. In the event that Symyx becomes aware of information, data, materials or inventions which Symyx believes may advance the Research Program, in the course of conducting research outside of the Research Program at its own expense or in collaboration with a Third Party, Symyx will make available these information, data, materials and inventions for use in the Research Program to the extent it is free to do so without violating obligations to any Third Party; provided, however, it is understood that this provision shall not impose, or be construed to impose, any obligation on Symyx to identify or make itself aware of any such information, data, materials and inventions.


2.3.3 Independent TDCC Research. It is understood that this Agreement shall not prohibit TDCC from conducting research activities outside of and independent from the Research


-7- * Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions. 8


Program ("Independent TDCC Research") during the Research Program Term for itself and/or with Third Parties for the purpose of [******]. In the event some TDCC employees work on both the Research Program and the Independent TDCC Research, TDCC shall use good faith commercially reasonable efforts to avoid potential conflicts or overlaps between the Research Program and Independent TDCC Research and misappropriation of any Confidential Information of Symyx. In the event that TDCC in the course of conducting research outside of and independent from the Research Program discovers information, data, materials or inventions ("Outside Technology") which TDCC believes may advance the Research Program, TDCC may make such Outside Technology available for use in the Research Program the extent it is free to do so without violating obligations to any Third Party, and it is understood that such Outside Technology shall not be deemed to be Program Technology; provided, however, that information, data, materials or inventions made in the Research Program shall be deemed to be Program Technology whether or not such information, data, materials or inventions were made using Outside Technology.


2.4 Changes to Fields. The initial Fields activated in the Research Plan shall be two or more Fields designated in the Research Plan. During the Research Program Term, TDCC and Symyx may agree to conduct research in one or more additional Fields, or to amend Exhibit A to create a new Field. In the event that TDCC and Symyx agree to a new Field, this will be documented by appropriate written modifications to the Research Plan, including criteria for identifying a Lead Compound in such Field, and appropriate modifications in writing to the staffing plan of the Research Program activities in connection with such Field. TDCC and Symyx may also agree to discontinue activity in one or more Fields by written modifications to the Research Plan. Appropriate modifications or adjustments to staffing of the Research Program will be agreed to reflect any changes in activity of the Fields. The Research Committee described in Section 3.1 shall in general provide direction for any changes in Fields and make formal recommendations to the Executive Committee. Symyx shall not unreasonably refuse to agree to changes proposed by TDCC to change activity in the Fields. TDCC shall not unreasonably refuse to agree to adjustments in staffing of the Research Program proposed by Symyx as a consequence of any changes in the activity of the Fields.


2.5 [******]


2.6 Research Records. Symyx and TDCC shall maintain records of the Research Program (or cause such records to be maintained) in sufficient detail and in good scientific manner as will properly reflect the work done and results achieved in the performance of the Research Program (including information sufficient to establish dates of conception and reduction to practice of inventions). Access to such records shall be granted as provided in Sections 5.1.3 and 7.2.


2.7 Development and Commercialization of Agreement Compounds and Products. TDCC and its Affiliates shall be responsible for all expenses incurred for the development and commercialization of Agreement Compounds and Products by TDCC and its Affiliates under the terms of this Agreement.


-8- * Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to
the omitted portions. 9


2.8 Discovery Tools. It is understood that Symyx has been at its own expense developing and intends to continue to develop [******] (collectively, the "Discovery Tools"), and that Symyx intends to offer some or all of these Discovery Tools to TDCC and/or TDCC Affiliates and possibly to Third Parties, either through sale of equipment and supplies and/or licenses to intellectual property or some other means selected at Symyx's discretion. Symyx agrees to provide TDCC a proposal (the "Tools Proposal") setting forth a summary of terms which in Symyx's opinion are essential and on which Symyx is willing to license and/or sell such Discovery Tools to TDCC on or before April 1, 1999, and Symyx and TDCC agree to negotiate in good faith to enter into a written agreement for such license and/or sale of Discovery Tools for a period of sixty (60) days following delivery of the Tools Proposal, it being understood that such written agreement shall set forth mutually agreed terms and conditions on which Symyx will license and/or sell Discovery Tools on a non-exclusive basis as reasonably required for internal research use by TDCC and/or TDCC's Affiliates. In order to provide TDCC an opportunity to be one of Symyx's first customers to exploit the Discovery Tools for [******] applications, Symyx will not ship or deliver the Discovery Tools to any of the companies listed in Exhibit C earlier than one year after the date Symyx notifies TDCC such Discovery Tools are available for shipment to TDCC, provided that TDCC or TDCC's Affiliates enter into a written agreement with Symyx to purchase and/or license Discovery Tools on or before sixty (60) days after Symyx has delivered the Tools Proposal to TDCC, and such agreement is not breached by TDCC. Symyx shall also not knowingly deliver Discovery Tools to a Third Party which Symyx has reason to know at the time of contracting to deliver same would be used for the benefit of any of the companies on Exhibit C during the period, if any, that Symyx is obligated not to license or sell Discovery Tools to such companies. It is understood and agreed that the terms for sale of Discovery Tools by Symyx to TDCC are to be mutually agreed in writing and this ...