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Agritope - RESEARCH AND DEVELOPMENT AGREEMENT
RESEARCH AND DEVELOPMENT AGREEMENT
BETWEEN
AGRITOPE, INC.,
AND
VILMORIN & CIE
Dated December 5, 1997
TABLE OF CONTENTS
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SECTION PAGE - ------- ----
1. Definitions............................................................................................ 1
2. Advisory Groups........................................................................................ 3
2.1 Project Advisory Committee.................................................................... 3
2.2 Scientific Advisory Board..................................................................... 4
3. Annual Project Selection............................................................................... 4
4. Selection of Projects at Other Times................................................................... 5
5. Preferred Access; Scope................................................................................ 5
5.1 Right of First Refusal; Failure to Submit Project............................................. 5
5.2 Remedy for Breach............................................................................. 6
5.3 Tomatoes Excluded............................................................................. 6
6. Project Funding........................................................................................ 6
6.1 Amount........................................................................................ 6
6.2 Payment....................................................................................... 6
6.3 Decision Not to Fund.......................................................................... 6
6.4 Minimum Funding............................................................................... 7
7. Conduct of Research.................................................................................... 7
7.1 Location...................................................................................... 7
7.2 Exchange of Technical Information............................................................. 7
7.3 Staffing...................................................................................... 7
7.4 Progress Reports; Research Results............................................................ 8
7.5 Termination................................................................................... 8
8. Ownership and Marketing Rights......................................................................... 8
8.1 Technology; No Transfer....................................................................... 8
8.2 Research License.............................................................................. 8
8.3 Projects that Utilize Agritope Technology, Research Expertise
and Facilities................................................................................ 8
8.4 Baseball Arbitration.......................................................................... 10
8.5 Projects that Utilize Vilmorin Technology and Agritope's Research
Expertise and Facilities...................................................................... 10
8.6 Projects That Utilize Both Agritope Technology and Vilmorin
Technology.................................................................................... 11
8.7 Completion of Defaulted Research Project...................................................... 11
8.8 Most Favored Customer......................................................................... 12
8.9 Access to Technology and Personnel............................................................ 12
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9. Licenses............................................................................................... 12
9.1 Calculation of Royalties...................................................................... 12
9.2 Royalty Payments.............................................................................. 13
9.3 Reports and Records........................................................................... 14
9.4 Audits........................................................................................ 14
9.5 License to Improvements....................................................................... 15
9.6 Sublicenses................................................................................... 15
10. Patents................................................................................................ 15
10.1 Patents to Agritope Technology................................................................ 15
10.2 Patents for New Technology.................................................................... 15
10.3 Patents for Modified Crops.................................................................... 16
10.4 Status of Patent Applications................................................................. 16
10.5 Patent Maintenance............................................................................ 16
10.6 Election Not to Prosecute or Maintain......................................................... 16
10.7 Patent Costs.................................................................................. 16
11. Infringement by Others................................................................................. 17
11.1 Notice of Infringement........................................................................ 17
11.2 Cooperation................................................................................... 17
12. Representations and Warranties of Agritope............................................................. 17
12.1 Authority..................................................................................... 17
12.2 Ownership..................................................................................... 17
12.3 Noninfringement............................................................................... 17
13. Representations and Warranties of Vilmorin............................................................. 18
13.1 Authority..................................................................................... 18
13.2 Ownership..................................................................................... 18
13.3 Noninfringement............................................................................... 18
14. Covenants of Agritope and Vilmorin..................................................................... 18
14.1 Commercially Reasonable Efforts............................................................... 18
14.2 Marking of Products........................................................................... 18
14.3 Insurance..................................................................................... 18
14.4 Taxes......................................................................................... 19
14.5 Government Approvals.......................................................................... 19
15. Conditions to Effectiveness............................................................................ 19
16. Indemnification........................................................................................ 19
16.1 Indemnification by Agritope................................................................... 19
16.2 Indemnification by Vilmorin................................................................... 19
16.3 Patent Indemnification........................................................................ 20
16.4 Insurance Proceeds............................................................................ 20
16.5 Procedure for Indemnification................................................................. 20
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16.6 Other Claims.................................................................................. 22
16.7 No Beneficiaries.............................................................................. 23
17. Confidentiality........................................................................................ 23
17.1 Confidentiality Obligation.................................................................... 23
17.2 Use........................................................................................... 23
17.3 Return........................................................................................ 23
17.4 Scope......................................................................................... 23
17.5 Required Disclosure........................................................................... 23
17.6 Patent Applications........................................................................... 24
17.7 Enforcement................................................................................... 24
18. Public Announcements................................................................................... 24
18.1 Scientific Publications....................................................................... 24
18.2 Terms of Agreements........................................................................... 24
19. Term and Termination................................................................................... 24
19.1 Term.......................................................................................... 24
19.2 Termination by Vilmorin....................................................................... 25
19.3 Termination by Agritope....................................................................... 25
19.4 Effect........................................................................................ 25
20. Baseball Arbitration Procedure......................................................................... 25
20.1 Parties....................................................................................... 25
20.2 Proposals..................................................................................... 25
20.3 Decision...................................................................................... 26
20.4 Rules......................................................................................... 26
20.5 Mediation; Process............................................................................ 26
21. Miscellaneous.......................................................................................... 26
21.1 No Agency..................................................................................... 26
21.2 Hiring of Employees........................................................................... 26
21.3 Agreements with Third Parties................................................................. 26
21.4 Cooperation; Additional Documents............................................................. 26
21.5 Notices....................................................................................... 27
21.6 Governing Law................................................................................. 27
21.7 Assignment.................................................................................... 27
21.8 Entire Agreement.............................................................................. 27
21.9 Attorney Fees................................................................................. 27
21.10 Arbitration................................................................................... 27
21.11 Severability.................................................................................. 28
21.12 Force Majeure................................................................................. 28
21.13 Captions...................................................................................... 29
21.14 Modification and Waiver....................................................................... 29
EXHIBIT A PLANT SPECIES
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RESEARCH AND DEVELOPMENT AGREEMENT
BETWEEN
AGRITOPE, INC. ("Agritope") 8505 SW Creekside Place Beaverton, Oregon 97008-7108 U.S.A.
Tel: (503) 641-6115 Fax: (503) 520-6196
and VILMORIN & CIE ("Vilmorin")
71, rue de Beaubourg
75003 Paris
France
Tel: (33) 144 78 10 81
Fax: (33) 142 71 58 96
BACKGROUND AND OBJECTIVES
A. Agritope owns certain molecular genetic technology and know-how that can be applied to multiple crops. Vilmorin owns certain proprietary germplasm that may benefit from application of Agritope's technology and know-how. Vilmorin wishes to have Agritope carry out research and development projects with the goal of transforming Vilmorin's germplasm to confer commercially desirable characteristics.
B. This Agreement sets forth the terms and conditions under which the parties will enter into agreements for specific research and development projects. The research is a preliminary step towards possible commercialization of the transformed germplasm developed under the terms of this Agreement.
C. Concurrently with the execution of this Agreement, Agritope and Vilmorin are entering into a stock purchase agreement (the "Stock Purchase Agreement"), pursuant to which Vilmorin has agreed to purchase shares of Agritope capital stock upon the terms and conditions set forth therein.
AGREEMENT
Agritope and Vilmorin agree as follows:
1. Definitions. Capitalized terms used but not defined elsewhere in this Agreement shall have the meanings assigned to them in this Section 1.
"Affiliates" means persons or entities directly or indirectly,
through one or more intermediaries, controlling, controlled by, or
under common control with the specified entity.
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"Agritope Technology" means Technology owned by Agritope or
licensed to Agritope by third parties with authority to use it as
contemplated by this Agreement.
"Competing Modified Crop" means, when used in reference to a
Crop or Modified Crop, a genetically altered version of germplasm owned
by a third party for the same plant species as the referenced Crop or
Modified Crop.
"Crop" means each vegetable and flower plant species listed on
Exhibit A. Vilmorin may add a Crop to Exhibit A by notice to Agritope
if Vilmorin either has newly commenced marketing of that Crop or has
undertaken actions intended to lead to Vilmorin's marketing of that
Crop, provided that Agritope has not previously entered into an
agreement or commitment with a third party that would be violated by
such addition.
"Field of Use" means with respect to Vilmorin the Crops listed
on Exhibit A and with respect to Agritope everything else.
"Indemnifiable Losses" means, with respect to any claim by an
Indemnitee for indemnification under Section 16 hereof, any and all
losses, liabilities, costs and expenses (including, without limitation,
the costs and expenses of any and all actions, demands, assessments,
judgments, settlements and compromises relating thereto and reasonable
attorney fees and expenses in connection therewith, including attorney
fees before and at trial and in connection with any appeal or petition
for review) suffered by such Indemnitee with respect to such claim.
"Indemnifying Party" means any party required to pay any other
person pursuant to Section 16 hereof.
"Indemnitee" means any party who is entitled to receive
payment from an Indemnifying Party pursuant to Section 16 hereof.
"Indemnity Payment" means the amount an Indemnifying Party is
required to pay an Indemnitee pursuant to Section 16 hereof.
"Insurance Proceeds" means those monies (i) received by an
insured from an insurance carrier or (ii) paid by an insurance carrier
on behalf of the insured, in either case net of any applicable premium
adjustment, retrospectively rated premium, deductible, retention, cost
or reserve paid or held by or for the benefit of such insured.
"Modified Crop" means the genetically altered version of a
Crop that results from a Research Project.
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"New Technology" means any Technology resulting from Research
Projects carried out by Agritope with the funding of Vilmorin as
contemplated by this Agreement, but excluding Modified Crops. New
Technology does not include Technology that is or becomes available to
the public on a royalty-free basis.
"Patent" means a patent, supplemental protection certificate,
plant variety protection certificate, or similar right to exclude
others from making, using, or selling the relevant invention, plant or
genetic material.
"Research Products" means commercially marketable Technology
or other results from Research Projects carried out by Agritope with
the funding of Vilmorin as contemplated by this Agreement, including
(without limitation) gene constructs, gene sequences and markers, and
promoters, but excluding Modified Crops. Research Products does not
include Technology or results that are or become available to the
public on a royalty-free basis.
"Research Project" means each research and development project
performed by Agritope with funding from Vilmorin.
"Technology" means all proprietary DNA sequences, genes,
promoters, gene constructs, and genetic transformation systems and
techniques, inventions and know-how that may be utilized in plant
genetic, plant biological or agricultural research or production
activities or otherwise.
"Trade Secrets" means all confidential information owned by
any party relating to the use or production of Technology. Confidential
information of one party ("Disclosing Party") shall no longer
constitute Trade Secrets when it (i) becomes publicly known without
fault of the other party or its Affiliates, (ii) is or has been
received in good faith by the other party without restriction on use or
disclosure from a third party having no obligation of confidentiality
to Disclosing Party; or (iii) is or has been independently developed by
the other party without reference to Confidential Information received
from Disclosing Party, as evidenced by the other party's written
records.
"Vilmorin Technology" means Technology owned by Vilmorin or
licensed to Vilmorin by third parties with authority to use it as
contemplated by this Agreement.
2. Advisory Groups.
2.1 Project Advisory Committee. Agritope shall establish a Project Advisory Committee consisting of up to four members, two of whom shall be designated by Vilmorin. The purpose of the Project Advisory Committee shall be to make advisory recommendations to Agritope regarding Research Projects to be conducted by Agritope and funded by Vilmorin.
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2.2 Scientific Advisory Board. In addition to the Project Advisory Committee, Vilmorin shall be entitled to name one scientist to sit on the Agritope Scientific Advisory Board as its representative.
3. Annual Project Selection. On an annual basis, Agritope shall decide which research projects it would like to conduct and Vilmorin shall decide which research projects it would like to have conducted by Agritope. The principal steps of the annual project selection process, and the deadlines by which they are to be completed, are outlined below:
Date Action
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May 1 Agritope and Vilmorin each submit proposed annual
Research Projects to the Project Advisory Committee.
Research Project proposals submitted by Agritope and
Vilmorin to the Project Advisory Committee shall
disclose each proposed project in sufficient detail
to enable the Project Advisory Committee to evaluate
the different projects and to offer suggestions and
proposals. The description of each project shall
include,...
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