Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
Exhibit 10.3.46
LICENSE AGREEMENT
THIS license agreement (hereinafter "License) is made between THE DOW
CHEMICAL COMPANY (hereinafter "DOW"), a corporation duly formed and existing
under the laws of the State of Delaware, having a place of business at 2030
Willard H. Dow Center, Abbott Road, Midland, Michigan 48674, United States of
America, and Neoprobe Corporation (hereinafter "NEOPROBE"), a corporation duly
formed and existing under the laws of the State of Delaware, having a place of
business at 425 Metro Place North, Dublin, Ohio 43017-1367;
WITNESSETH:
WHEREAS, DOW is engaged in certain research and development involving
certain radioactive conjugated agents used for localization in specific tissue;
and
WHEREAS, DOW has proprietary rights in technology relating to said agents,
including: patent rights, know-how, and other industrial property rights; and
WHEREAS, NEOPROBE desires to undertake the further development and
commercial exploitation of said agents; and
WHEREAS, NEOPROBE desires to obtain an exclusive, global license for DOW's
technology relating to said agents; and
WHEREAS, DOW is willing to grant said license to NEOPROBE; and
WHEREAS, DOW and NEOPROBE have signed a Confidentiality Agreement, effective
from September 16,1988; and
WHEREAS, DOW and NEOPROBE have signed a Letter of Intent, effective January
29,1996 which terms are included in this License.
NOW, THEREFORE, DOW and NEOPROBE, in consideration of the mutual covenants
contained herein, hereto agree as follows:
ARTICLE 1
DEFINITIONS
When used in this License, the following terms shall have the meanings set
out below, unless the context requires otherwise. The singular shall be
interpreted as including the plural and vice versa, unless the context clearly
indicates otherwise.
1.1 "AFFILIATE" means a corporation or any other entity that at any time
during the term of this License directly or indirectly through one or more
intermediaries is CONTROLLED by the designated Party, but only for so long as
the relationship exists. A corporation or other entity shall no longer be an
AFFILIATE when through loss, divestment, dilution or other reduction of a
Party's ownership, the Party losses CONTROL of such corporation or other entity.
Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
1.2 "ANTIBODY or ANTIBODIES" as used herein means one or more antibodies
directed against carcinoma associated antigens and selected from:
(a) certain antibodies developed by Dr. Jeffrey Schlom and his associates at
the Laboratory of Tumor Immunology and Biology, National Cancer Institute,
National Institutes of Health under a CRADA, and further described as:
(1) monoclonal antibodies COL-1 through 15 which are directed
against various restricted epitopes of the 180,000 dalton
carcinoembryonic antigen complex, and
(2) some forty (40) monoclonal antibodies directed against the
purified TAG-72 antigen and designated CC1 through 92,
including CC49; and
(b) successor antibodies to the above, developed by DOW or NIH/NCI under the
above CRADA (during the term of the CRADA) as replacements therefor in the
FIELDS.
1.3 "APPROVAL" means final approval by a HEALTH AUTHORITY in any country
where applicable in the TERRITORY, for commercial marketing of PRODUCT,
including approval of final labeling and price approval.
1.4 "CDA" means a confidential disclosure agreement, Confidentiality
Agreement, effective from September 16, 1988, between the Parties. A copy is
attached as Appendix B.
1.5 "CONFIDENTIAL INFORMATION" means any information of either Party
regarding TECHNOLOGY, PATENTS, any samples of ANTIBODY or PRODUCT, financial
terms of this License, and business development plans for the PRODUCT. and does
not include information excluded under Article 8.2.
1.6 "CONTROL" or "CONTROLLED" shall mean, in the case of a corporation,
ownership or control, directly or indirectly, of more than fifty percent (50%)
of the shares of stock entitled to vote for the election of directors and, in
the case of an entity other than a corporation, ownership or control, directly
or indirectly, of more than 50% of the assets or the ability to direct the
management and affairs of such entity.
1.7 "CRADA" means an Cooperative Research and Development Agreement between
DOW and PHS, effective from February 1, 1987 until it expired on February 1,
1995, and its amendments, for the development of ANTIBODIES by Dr. Jeffrey
Schlom and his associates at the Laboratory of Tumor Immunology and Biology,
National Cancer Institute, National Institutes of Health (NIH/NCI). A copy, with
amendments, is attached as Appendix D.
1.8 "DMF" means DOW's drug master file and supporting documentation for the
preparation of the PRODUCT for FIELD (II) on file at the FDA.
1.9 "DOE" means the United States Department of Energy and corresponding
agencies of other countries in the TERRITORY.
1.10 "EFFECTIVE DATE" means the date of the last signature of the Parties to
this License.
1.11 "FDA" means the United States Food and Drug Administration or any
successor U.S. governmental agency performing similar functions.
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Treatment underRule 24b-2
1.12 "FIELD (I)" means Radioimmunoguided Surgery(TM) or RlGS(R) (trademarks
of NEOPROBE) procedure which is defined as the injection into a human of either
a RADIOLABELLED ANTIBODY joined to a LINKER or a RADIOLABELLED RECEPTOR LIGAND
joined to a LINKER followed by the use of a hand-held radioactivity detecting
probe (and not a gamma scanner) topically or during surgery to detect tumor
lesions. Such procedure includes administration to a patient of a RADIOLABELLED
ANTIBODY followed by the elapse of time for the RADIOLABELLED ANTIBODY to
preferentially concentrate in any neoplastic tissue in the patient and for the
background radioactivity in the patient to decrease, and the detection of such
preferentially concentrated RADIOLABELLED ANTIBODY by a detector probe placed in
juxtaposition with tissue suspected of containing said RADIOLABELLED ANTIBODY;
and any surgical method claimed in NEOPROBE's U.S. Patent 4,782,840, or any
reissue or extension thereof, or any corresponding patent application or patent
in any country in the TERRITORY. This FIELD does not include the use of
RADIOLABELLED ANTIBODIES at doses or energies high enough to exert, or be
reasonably expected to exert, a cytotoxic or cytocidal effect on tumor cells (an
effect sometimes referred to as radioimmunotherapy). This FIELD does not include
the use of monoclonal antibodies, radiolabelled or modified in other ways, for
external imaging. This FIELD is intended to comprise a medical use in humans of
a PRODUCT that requires government APPROVAL by a HEALTH AUTHORITY prior to
commercialization. Specifically excluded are the fields encompassed within the
TTA and CRADA.
1.13 "FIELD (II)" means the use in humans for radioimmunotherapy ("RIT") of
either a RADIOLABELLED ANTIBODY with a LINKER intended to destroy cancer cells
which is subject to the terms of the CRADA or a RADIOLABELLED RECEPTOR LIGAND
joined to a LINKER at doses or energies high enough to exert, or be reasonably
expected to exert, a cytotoxic or cytocidal effect on tumor cells. This FIELD is
intended to comprise a medical use in humans of a PRODUCT that requires
government APPROVAL by a HEALTH AUTHORITY prior to commercialization.
1.14 "FIELDS" means collectively FIELD (I) and FIELD (II).
1.15 "GMPs" means the Good Manufacturing Practices as defined from time to
time in the United States Food, Drug and Cosmetics Act and related regulations
or any successor laws or regulations governing the manufacture of the PRODUCT in
the United States.
1.16 "HEALTH AUTHORITY" means the agency corresponding to the FDA of each
country in the TERRITORY, including but not limited to the Center of
Pharmaceutical Speciality ("CPS") procedure agency (or any successor agency) for
WESTERN EUROPE.
1.17 "LETTER OF INTENT" means the letter agreement between the Parties
effective January 29,1996, concerning the subject matter of this License. A copy
is attached as Appendix C.
1.18 "LINKERS" means bifunctional organic molecules used to join ANTIBODIES
or RECEPTOR LIGANDS with radionuclides used in PRODUCT
1.19 "NET SALES" shall mean the amount invoiced on sales of PRODUCT by
NEOPROBE and its AFFILIATES to a THIRD PARTY, less the following deductions to
the extent included in the amounts invoiced:
(i) trade, cash or quantity discounts actually allowed, granted from
the invoiced amount and taken; and
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Treatment underRule 24b-2
(ii) amounts repaid or credited by reason of rejections, defects or
returns or because of retroactive price reductions; and
(iii) insurance, if included in the amount invoiced; and
(iv) rebates paid pursuant to government regulations; and
(v) taxes or governmental charges for export/import fees or radioactive
waste disposal fees by governmental authorities in the TERRITORY on the
sales of PRODUCT to said THIRD PARTY, if included in said invoiced
amount, whether denominated as value added taxes, sales taxes, or
excise taxes, to the extent included in said invoiced amount.
NET SALES shall not include sales between or among NEOPROBE and its AFFILIATES.
1.20 "NRC" means the United States Nuclear Regulatory Commission, and
corresponding agencies of any foreign government in the TERRITORY.
1.21 "PATENTS" means all patent applications and patents, together with any
continuations, divisions, reissues and extensions of the foregoing which claims
cover the process or manufacture, use or sale of LINKER, ANTIBODY or PRODUCT in
the FIELDS in the TERRITORY which are owned, licensed or controlled by DOW or
which become owned, licensed or controlled by DOW during the life of this
License. The PATENTS existing which claims cover the FIELDS in the TERRITORY on
the EFFECTIVE DATE are listed in APPENDIX A, which is attached hereto and made a
part hereof. APPENDIX A shall be amended from time to time, at NEOPROBE's
request, but no more frequently than once yearly, unless required to provide
information to compute the payments due under this License.
1.22 "PRODUCT" means a RADIOLABELLED pharmaceutical composition or
formulation joined to a LINKER, as a finished, packaged, product suitable for
shipment and use in one of the FIELDS.
1.23 "RADIOLABELLED" means PRODUCT labeled, either with or without a LINKER
present, with a radionuclide selected from 1231, 1251, 13l1 or the lanthanide
series of radioisotopes, excluding Gd.
1.24 "RECEPTOR LIGAND" means any site specific compound for human in vivo
use, other than ANTIBODY, known to the public as of January 29, 1996, capable of
delivery of the PRODUCT containing it to an intended tumor cell, except for
compounds containing dendrimers, peptides or carbohydrates.
1.25 "TECHNOLOGY" means information, know-how, trade secrets, and data,
relating to the manufacture of ANTIBODY, LINKER or PRODUCT or its use in the
FIELDS which DOW owns as of the EFFECTIVE DATE or is otherwise lawfully in the
possession of DOW during the TRANSFER PERIOD. The TECHNOLOGY includes all
unpublished technical information regarding the formulations, toxicology,
clinical data and results done by or reasonably available to DOW, preclinical
data (including pharmaceutical and toxicological), animal data, compositions,
process of making, DMF information, testing, packing, shipping, handling, and
using ANTIBODY, LINKER and PRODUCT, and production techniques, packaging and
handling techniques, quality control procedures, stability data, confidential
material specifications, and files to which DOW has the right to disclose and
license to third parties. Such TECHNOLOGY EXPRESSLY EXCLUDES process
information, know-how, trade secrets, and data, relating to the manufacture of
precursors to LINKERS.
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1.25 "TERRITORY" means worldwide, EXCLUDING any countries prohibited or
restricted under Article 11.
1.26 "THIRD PARTY" means anyone, other than NEOPROBE and its AFFILIATES.
Thus THIRD PARTY includes, without limitation, physicians, hospitals, clinics,
hospice facilities, patients, distributors, sublicensees, formularies, and
radiopharmacies.
1.27 "TRANSFER PERIOD" means from the EFFECTIVE DATE until December 1, 1996.
1.28 "TTA" means the Technology Transfer Agreement between the Parties
having an effective date of July 29,1992 and its amendments.
ARTICLE 2
GRANT OF LICENSE
2.1 Grant of License - DOW hereby grants to NEOPROBE, and NEOPROBE hereby
accepts:
(a) an EXCLUSIVE license to use the TECHNOLOGY to make, have made, use, sell
and have sold PRODUCT in the TERRITORY in FIELD (I), and an exclusive license
under the PATENTS listed in Appendix A to make, have made, use, sell and have
sold PRODUCT in the TERRITORY in FIELD (I). This License shall be fully
exclusive, to the exclusion of DOW and its AFFILIATES, but subject to Article
2.3, and so long as this License is in effect; and
(b) an EXCLUSIVE license to use the TECHNOLOGY to make, have made, use, sell
and have sold PRODUCT which contains RECEPTOR LIGAND in the TERRITORY in FIELD
(II), and an EXCLUSIVE license under the PATENTS listed in APPENDIX A to make,
have made, use, sell and have sold PRODUCT which contains RECEPTOR LIGAND in the
TERRITORY in FIELD (II). This License shall be fully exclusive, to the exclusion
of DOW and its AFFILIATES, but subject to Article 2.3, and so long as this
License is in effect; and
(c) a NON-EXCLUSIVE license to use the TECHNOLOGY to make, have made, use,
sell and have sold PRODUCT which contains ANTIBODY in the TERRITORY in FIELD
(II), and a NON-EXCLUSIVE license under the PATENTS listed in APPENDIX A to
make, have made, use, sell and have sold PRODUCT which contains ANTIBODY in the
TERRITORY in FIELD (II). This grant shall be become fully exclusive, to the
exclusion of DOW and its AFFILIATES, but subject to Article 2.3, upon NEOPROBE
obtaining a license from NCI (or from the appropriate governmental entity), and
so long as this License is in effect.
2.2 SUBLICENSING - The exclusive license under Article 2.1 (a) and (b) to
NEOPROBE includes the right to sublicense third parties, whether or not
AFFILIATES of NEOPROBE, including the right to enter into distributor contracts.
NEOPROBE will make and will be responsible for all payments to DOW as a result
of sublicensee and AFFILIATE sales of PRODUCT in the FIELDS in the TERRITORY.
NEOPROBE will also be responsible for the observance by all sublicensees of all
applicable provisions of this License, and will use its best efforts to cause
all sublicenses to observe the covenants in this License (i.e., regarding
confidentiality, maintenance of records and reporting of NET SALES and royalty
payments, exchanges of information and adverse reaction information). All such
sublicenses shall be in writing.
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
If NEOPROBE desires to sublicense under Article 2.1 (c), it must do so in
accord with the terms of this License and the provisions of the CRADA.
Notification of PHS is required.
2.3 Reservations - DOW reserves the following rights.
2.3.1 DOW reserves the right to make, have made, and use LINKER or
PRODUCT in FIELD (II) in the TERRITORY for the purposes of:
(i) process research;
(ii) basic research and development; and
(iii) publication of results obtained prior to the EFFECTIVE DATE with
a copy to NEOPROBE.
2.3.2 DOW reserves the right for DOW to proceed, solely at its option
and expense, to research, develop, make, have made, use, sell, have sold and
license in the TERRITORY the following compounds and complexes for use within
FIELD (II):
(i) RECEPTOR LIGANDS that are proprietary to other than NEOPROBE; and
(ii) PRODUCTS with any radionuclide (including Gd) other than (123)I,
(125)I, (13l)I and the lanthanide series (excluding Gd).
2.3.3 DOW reserves the right for DOW to proceed, solely at its option
and expense, to research, develop, make, have made, use, sell ,have sold and
license, in the TERRITORY OUTSIDE the FIELDS:
(i) LINKER; and
(ii) complexes of LINKER with any metal including (123)I, (125)I,
(131)I and the lanthanide series; and
(iii) products and antibodies joined with other linkers with any metal,
including but not limited to (123)I, (125)I, (131)I and the lanthanide
series.
2.4 Supply of LINKER for PRODUCT - DOW and NEOPROBE may enter into a
separate commercial supply agreement under which DOW will supply NEOPROBE's
requirements of LINKER for PRODUCT on mutually agreed terms and conditions. This
Article 2.4 shall not imply an obligation on either Party to enter into a
commercial supply agreement. If NEOPROBE employs a third party manufacturer for
LINKER for PRODUCT, DOW shall assist NEOPROBE with TECHNOLOGY transfer to such
manufacturer, but only that TECHNOLOGY which DOW is willing or able to disclose.
2.5 Results Available to DOW - NEOPROBE shall make available to DOW or DOW's
licensees at no cost all results obtained using LINKERS in PRODUCTS for use by
DOW or DOW's licensees in accord with. Article 2.3.
2.6 CRADA - For NEOPROBE to attain exclusivity under Article 2.1(c) for
PRODUCTS containing ANTIBODY for FIELD (II), it is contingent upon NEOPROBE also
acquiring an exclusive license from NCI under the CRADA rights within a
reasonable time period or acquiring a non-exclusive grant from
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NCI. DOW shall be notified when such grant from NCI has been obtained by
NEOPROBE and a copy of the signed pages(s) of that agreement provided to confirm
the grant. At NEOPROBE's option, a copy of the agreement may be provided to DOW.
ARTICLE 3
TECHNOLOGY TRANSFER
3.1 Initial TECHNOLOGY Transfer - Part of the TECHNOLOGY has been
transferred to NEOPROBE regarding ANTIBODY and PRODUCT in FIELD (I) under a CDA
which shall be superseded by this License as of its EFFECTIVE DATE. All
TECHNOLOGY heretofore disclosed by DOW to NEOPROBE regarding ANTIBODY, LINKER
and PRODUCT (regardless of field of use) shall be deemed to have been disclosed
pursuant to this License and shall be subject to the provisions of this License
(including, but not limited to, Article 8 hereof). Further TECHNOLOGY transfer
may be carried out by oral, written or electronic means. It is contemplated that
TECHNOLOGY on ANTIBODY, LINKER and PRODUCT in FIELD existing on the EFFECTIVE
DATE or generated during the course of TECHNOLOGY transfer hereunder will have
been completely transferred within the TRANSFER PERIOD.
3.1.1 The Parties may arrange for meetings of their research and
development personnel from time to time during the TRANSFER PERIOD to facilitate
the transfer regarding PRODUCT, LINKER, ANTIBODY and TECH NO LOGY.
3.1.2 If DOW has any samples of LINKER available which can be provided,
NEOPROBE may request a portion of such samples during the TRANSFER PERIOD.
3.2 Costs - DOW will provide five (5) work days of 8 hours per day (200
hours) free of charge to NEOPROBE of technical support at a mutually agreed site
in the United States during the TRANSFER PERIOD. When possible for DOW,
additional work days will be provided by DOW when requested by NEOPROBE, until
one (1) year from the EFFECTIVE DATE, and DOW shall be reimbursed at the rate of
one thousand dollars ($1,000.00) per day or on a pro rata basis. All of DOW's
reasonable out-of-pocket expenses, e.g. travel, food, lodging, and normal
associated expenses, incurred to comply with Article 3.1 during the TRANSFER
PERIOD shall be paid by NEOPROBE. DOW shall supply such charges by invoice for
items over twenty-five dollars (US$25.00).
3.3 Adverse Drug Experience Reporting -
3.3.1 During the TRANSFER PERIOD each Party agrees to report to the
other Party, according to Article 16.1, any serious adverse reactions or any
side effects which occur or other adverse events with PRODUCT as promptly as
possible. Any such reactions or side effects must be reported (in full detail if
requested) irrespective of whether there is a causal connection with the PRODUCT
being administered or whether the causal connection is unclear or presumed to be
not likely. Reports shall be in English or accompanied by an English
translation.
For purposes of this reporting covenant, a serious adverse event is a
reaction which meets one or more of the following criteria:
- a reaction which is life threatening or fatal;
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Treatment underRule 24b-2
- a reaction which resulted in hospitalization, or if the patient was
already hospitalized, a reaction which prolonged hospitalization;
- a reaction which resulted in severe or permanent disability;
- a reaction which involved congenital anomaly or overdose, or cancer
which was not already present at the beginning of treatment with
PRODUCT; or
- a reaction which is considered to be important, significant or
otherwise medically serious.
3.3.2 The Parties also agree to report to each other in writing on a
mutually agreed periodic basis during the TRANSFER PERIOD for PRODUCT any and
all other adverse reactions or side effects (in full detail if requested)
regardless of seriousness or frequency of occurrence and irrespective of whether
there is a causal connection with the PRODUCT being administered or whether the
causal connection is unclear or presumed to be not likely.
3.3.3 If an adverse reaction occurs in a blinded Clinical Trial which
has not been unblinded, the adverse reaction will not be reported as in Article
3.3.1 or 3.3.2 above until the subject has been unblinded, in accordance with
the trial protocol or otherwise as may be required for regulatory, medical or
other reasons.
3.3.4 NEOPROBE, its AFFILIATES, sublicensees and contractors (parties
under contract with NEOPROBE or its AFFILIATES for the conduct of clinical
studies or obtention of registration for PRODUCT in the TERRITORY) shall be free
to include such reports from DOW in their required reporting of adverse drug
experiences to the HEALTH AUTHORITIES in the TERRITORY
3.3.5 After the TRANSFER PERIOD and during the life of this License,
NEOPROBE shall make all reports required under Article 3.3 to the appropriate
HEALTH AUTHORITIES in the TERRITORY.
3.3.6 NEOPROBE is aware that NCI has been conducting clinical trials using
PRODUCT containing ANTIBODY for FIELD (II). DOW and NEOPROBE do not warrant that
they have knowledge of or access to any adverse reports that may exist from
those trials.
3.4 Clinical Trials - PRODUCT containing ANTIBODY for FIELD (II)
3.4.1 During the TRANSFER PERIOD NEOPROBE shall attempt to obtain any
clinical data available to Dr. Jeffery Schlom and his associates who have been
running clinical trials. If NEOPROBE is successful at obtaining a license from
NCI under FIELD (II) for PRODUCT containing ANTIBODY, then such data should form
a portion of that license.
3.4.2 As of the EFFECTIVE DATE, DOW is no longer supplying LINKER or
ANTIBODY or PRODUCT to NCI for their clinical trials.
3.5 Restricted Information - Neither Party shall be obligated to
disclose to the other any information that it is contractually or legally
prohibited from disclosing to the other. In the event such a restriction
applies, the affected Party will notify the other Party, and the Parties will
use their good faith efforts, in-
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Treatment underRule 24b-2
cluding obtaining necessary consents or permits, to accomplish disclosure of
such information by consent or lawful means.
3.6 DOW's Assistance to NEOPROBE - After submission of the file in the
TERRITORY, NEOPROBE may ask for DOW's expertise to answer the rapporter's or
other HEALTH AUTHORITY'S questions, even after the end of the TRANSFER PERIOD.
If possible, DOW shall provide such reasonable assistance, at the expense of
NEOPROBE.
ARTICLE 4
TRANSFER PERIOD
4.1 Transfer Period - The Parties anticipate that the TRANSFER PERIOD will
be required to: a) complete the initial TECHNOLOGY transfer; b) conduct a Good
Clinical Practices and Good Laboratory Practices audit of existing data and
records; c) attempt to obtain access by NEOPROBE from NCI to any ongoing
clinical trial data in the TERRITORY for PRODUCT containing ANTIBODY for FIELD
(II); and d) permit access by the FDA to DOW's DMF or to the information
contained therein; and if necessary, permit access to the DMF by other HEALTH
AUTHORITIES.
4.2 Contact Persons - No later than thirty (30) days following the EFFECTIVE
DATE, NEOPROBE and DOW will each advise the other of their associates
responsible for handling the transition in as smooth and efficient a manner as
possible.
ARTICLE 5
NEOPROBE DEVELOPMENT, OTHER ACTIVITY, DILIGENCE
5.1 Development and Marketing Efforts for PRODUCT - NEOPROBE shall use its
best efforts to carry out remaining developmental work on PRODUCT as it believes
necessary and to file applications with the HEALTH AUTHORITIES as NEOPROBE deems
necessary. For purposes of this License, "best efforts" shall mean efforts
reasonably consistent with those efforts used by NEOPROBE with regard to its
developmental work and commercial activities for its own products deemed to have
similar commercial potential, consistent with its business, research and
development practices, and applicable legal and regu latory requirements. For
NEOPROBE to have been deemed by DOW to have used their best efforts, DOW expects
that in the TERRITORY NEOPROBE should:
5.1.1 Discuss with NCI concerning NEOPROBE's planned activities for
PRODUCT containing ANTIBODY for FIELD (II) after the EFFECTIVE DATE (NEOPROBE
may provide this License to NCI under confidentiality but with all financial
terms and FIELD (I) terms removed). All such discussions with NCI during the
term of this License shall be under confidentiality and shall be an exception
under Article 8.2;
5.1.2 Assume all liability (indemnification) for any Clinical Trials on
PRODUCT in the TERRITORY in the FIELDS which are done under NEOPROBE's direct
supervision and protocols after the EFFECTIVE DATE;
5.1.3 NEOPROBE shall provide DOW, by June 1, 1997, an initial
development plan and milestone schedule for the commercialization of RlGS(TM)
for FIELD (I) and RIT for FIELD (II) using the DOW licensed TECHNOLOGY and
PATENTS. DOW shall have the right to review NEOPROBE's supporting materials for
these development programs.
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5.1.4 NEOPROBE shall provide DOW with a semiannual development report
outlining NEOPROBE's efforts to commercialize RIGS(TM) for FIELD (I) and RIT for
FIELD (II) using the DOW licensed TECHNOLOGY and PATENTS.
5.1.5 Begin Phase I/II Clinical Trials in the TERRITORY and Phase
II/III Clinical Trials in Europe and the United States for PRODUCT for the
FIELDS in accord with the NEOPROBE development plan.
NEOPROBE will promptly notify DOW of the occurrence of all of the preceding
events under Article 5.1 and supply DOW with proper notification and
certification of the occurrence of first commercial sale in each FIELD.
Because DOW is aware that despite NEOPROBE's best efforts, the dates in the
development plan may not be met, and upon NEOPROBE's discussion with DOW of the
reasons for the delay, and DOW's consent (which will not unreasonably be
withheld), these dates may be extended by a writing signed by both Parties while
retaining all the other terms of this License.
5.2 Development Progress Reports - NEOPROBE will provide DOW with semiannual
progress reports (reports to be verbal with one written annual report per year)
of its development and registration activity, including submission(s) to HEALTH
AUTHORITIES and APPROVAL(s) in the TERRITORY, until the PRODUCT is commercially
launched for both FIELDS throughout the TERRITORY
5.3 Failure to Attain APPROVAL -
5.3.1 If NEOPROBE fails to meet any of the dates specified in Article
5.1 and the reason for the failure was deemed by DOW to be beyond NEOPROBE's
control, e.g. delays by HEALTH AUTHORITIES, then the force majeure terms of
Article 15 apply to Article 5.1 and an extension in time equal to the force
majeure event shall automatically occur or NEOPROBE may terminate this License
under Article 14.
5.3.2 If NEOPROBE fails to meet any performance times specified in
Article 5.1 and the reason for the failure was reasonably deemed by DOW to be
within NEOPROBE's control, then DOW shall either extend the date with a written
copy of the new date provided under Article 16 and penalize NEOPROBE the
additional sum of 10% of the APPROVAL fees in Article 7.2 or terminate this
License under Article 14. NEOPROBE may indicate to DOW which option it prefers.
If this failure occurs more than once for reasons within NEOPROBE's control,
then the choice of above option resides with DOW.
5.3.3 The provisions of Article 5.3 shall be subject to the dispute
resolutions available under Article 17.
5.4 Clinical and Preclinical Studies - NEOPROBE shall carry out such further
studies, at its expense, of ANTIBODY, LINKER and PRODUCT as it deems necessary
or advisable to develop the PRODUCT and in order to file such forms for APPROVAL
with the HEALTH AUTHORITIES for commercialization in the TERRITORY for both
FIELDS.
5.5 NEOPROBE Responsibility - NEOPROBE shall be solely responsible for the
planning, design and execution of all its developmental work and
commercialization with ANTIBODY, LINKER and PRODUCT for the TERRITORY after the
EFFECTIVE DATE using TECHNOLOGY and PATENTS. NEOPROBE shall make any required
reports to NCI if the PRODUCT falls within the CRADA.
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
5.6 Regulatory Costs - All regulatory costs for APPROVALS in the TERRITORY
shall be borne by NEOPROBE after the EFFECTIVE DATE.
5.7 Future Research - Upon the EFFECTIVE DATE, NEOPROBE agrees that any
research conducted by DOW on ANTIBODY, LINKER or PRODUCT at NEOPROBE's request
during the TRANSFER PERIOD shall be paid by NEOPROBE. Any research conducted by
DOW on ANTIBODY, LINKER or PRODUCT after the TRANSFER PERIOD shall be in accord
with Article 2.3. DOW will draft any resulting patent applications and/or retain
title to the patents conceived or reduced to practice during the TRANSFER
PERIOD, but NEOPROBE will be exclusively licensed under this License for the
TERRITORY for the FIELDS so long as this License is in effect.
ARTICLE 6
PATENT RIGHTS
6.1 DOW to Maintain PATENTS - DOW shall be responsible at its own cost and
expense for prosecuting the patent applications in PATENTS and for maintaining
and extending the PATENTS listed on APPENDIX A. DOW shall use good faith efforts
to prosecute, issue and maintain all PATENTS in APPENDIX A.
6.2 NEOPROBE to Assist DOW in extension or restoration of PATENTS - Although
DOW shall be responsible for extension or restoration of PATENTS listed on
APPENDIX A, NEOPROBE agrees to provide DOW with reasonably requested records,
information and assistance to achieve the extension or restoration of any
PATENTS in the TERRITORY.
6.3 Notice of Patent Lapse - DOW shall promptly advise NEOPROBE of the
grant, lapse, nullification, revocation, surrender, or invalidation of any of
the PATENTS.
6.4 Validity, Non-Infringement -
6.4.1 DOW DOES NOT WARRANT that the manufacture, use and sale of the
ANTIBODY, LINKER or PRODUCT do not fall within the scope of third party patents
or the industrial property rights of a third party. However, to the best of
DOW's knowledge, information and belief, that as of the EFFECTIVE DATE, the
manufacture, use and sale of the ANTIBODY, LINKER or PRODUCT for the FIELDS does
not fall within the scope of third party patents which are not owned or licensed
by DOW.
6.4.2 Abbott Hold Harmless - By the terms of an Agreement between
Abbott Laboratories ("Abbott") and DOW effective October 23, 1995 (copy attached
hereto as APPENDIX E), NEOPROBE shall be considered as a Related Party and
granted a royalty free non-exclusive worldwide immunity from suit under Abbott
Patent Rights to make, have made, use, sell and have sold Macrocyclic Compounds
and compositions containing Macrocyclic Compounds; therefore, macrocyclic
LINKERS are included. Promptly after the EFFECTIVE DATE, DOW shall notify Abbott
in accord with Article 2.2 thereof.
6.5 Disclaimer of Warranties as to Patents - Other than as stated in Article
6.4, DOW makes no representation that the inventions covered in any PATENTS are
patentable or that the PATENTS are or will be valid or enforceable, nor does DOW
warrant or represent that the exercise of the rights licensed hereunder is free
of infringement of patent rights of third parties. Should any infringement or
damages be alleged, suit brought or damages collected therefore, no damages are
permitted to be collected from DOW.
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
6.6 Prosecution of PATENTS by NEOPROBE - If NEOPROBE can obtain NCI's
written consent (together with OTT and/or any other required agency) to assume
the prosecution and maintenance of the patents under this License where CRADA
rights are concerned and such proof is provided to DOW, then DOW will consider
such proposal where all claims in the patent relate only to subject matter
exclusively licensed under this License to NEOPROBE and where DOW has no
interest in retaining other rights to the claims. It is understood that if this
event should occur, such patents will be exclusively licensed to NEOPROBE, not
assigned. Royalties and payments due DOW under Article 7 would continue.
6.7 Copies of PATENTS - After the EFFECTIVE DATE, DOW shall supply to
NEOPROBE's counsel indicated in Article 16.1 with a copy of each issued patent
in English or if not in English then with a copy of the last set of claims as
amended for issue in English. Copies of prosecution shall be supplied upon
NEOPROBE's request. If during prosecution issues arise that are of a significant
nature to the retention of the patent, DOW's counsel shall confer with
NEOPROBE's counsel on the best course of action. All decisions remain with DOW.
ARTICLE 7
PAYMENTS AND ROYALTIES
7.1 Initial Payment - NEOPROBE will pay to DOW within ten (10) days from the
EFFECTIVE DATE an initial payment of Two Million (US$2,000,000) Dollars paid in
fully registerable common stock with the number of shares owed computed from a
twenty (20) day trailing average of the closing price on the NASDAQ stock market
just prior to January 29, 1996 (the effective date of the LETTER OF INTENT)
(i.e., $16.025/share = 124,805 shares). Such stock shall be registerable on
demand by DOW with piggy back registration rights with all costs for such
registration paid by NEOPROBE. This payment will not be creditable against
future royalty payments or any other payments made under this License and is
nonrefundable.
7.2 Payments on Approvals - NEOPROBE will make additional fixed sum payments
to DOW, which payments will not be creditable against future royalty payments,
in the following amounts and events:
* (US$*) Dollars upon first APPROVAL of a PRODUCT for either FIELD
(I) or FIELD (II) that uses TECHNOLOGY. Such fee shall be due even if
the PATENTS have expired.
7.3 Sublicensing Fees - DOW shall be paid by NEOPROBE * percent (* %) of all
licensing revenue received for sublicensing in FIELD (I) or FIELD (II) which
includes DOW's TECHNOLOGY or PATENTS. Thus, if NEOPROBE sublicenses the
ANTIBODY, LINKER or PRODUCT such that a third party (nonaffiliated to NEOPROBE)
sells the ANTIBODY, LINKER or PRODUCT, then NEOPROBE shall pay DOW * (* %)
percent of all payments (i.e., up front fees, milestone payments, minimum annual
fees, etc.) received by NEOPROBE and, in addition, the royalty of * (* %)
percent of the earned royalty received by NEOPROBE.
7.4 Earned Royalties for PATENTS - NEOPROBE will pay DOW an earned royalty
of * Percent (* %) of NET SALES of PRODUCT, the manufacture, use or sale of
which would infringe a valid, unexpired claim of one or more of the PATENTS
UNDER APPENDIX A. (For example, if PRODUCT is manufactured in France under a
PATENT and that PRODUCT (including components or kits such as ANTIBODY or
LINKER) is sold in the TERRITORY of Algeria, then NEOPROBE would pay DOW this
earned royalty of *% on all NET SALES on the PRODUCT in Algeria.)
* Omitted and filed separately under Rule 24b-2 pursuant to which Neoprobe
Corporation has requested confidential treatment of this information.
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
No royalties are due under this Article 7.4 under any claim of a PATENT
which is held invalid by a court of competent jurisdiction from which no appeal
is or can be taken
No royalties are due under this Article 7.4 after the last to expire PATENT
on APPENDIX A expires and after any patent term restoration or extension term
ceases.
7.5 Royalties for TECHNOLOGY License - This fee is completely paid under
Articles 7.2 and 7.7.
7.6 Royalties for Equity and Research - Royalty shall not include equity
investments and research contract revenues received by NEOPROBE.
7.7 Achievement of Milestone Payments - A one time payment is due DOW the
first year that total NET SALES for PRODUCTS in FIELD (I) and FIELD (II) that
use DOW TECHNOLOGY achieve the following levels:
Net Sales Milestone Payments
----------------------------
Sales Achieve Payment
(Millions $US) (Millions $US)
---------------------------------------
* *
---------------------------------------
* *
---------------------------------------
* *
---------------------------------------
These milestone payments are not creditable against royalties.
These Milestone Payments shall be due until the last to expire PATENT
expires or until ten (10) years from the first APPROVAL, whichever event occurs
later in time.
7.8 Minimum Annual Payments - Commercial sale of the PRODUCT for both
FIELDS is expected in the TERRITORY. After the first year upon receipt of the
first APPROVAL for either FIELD (I) or FIELD (II) by any HEALTH AUTHORITY and
for the whole term where NEOPROBE would manufacture, use or sell a PRODUCT which
would infringe a valid, unexpired claim of one or more of the PATENTS listed in
APPENDIX A, then NEOPROBE shall pay DOW the following minimum annual royalty:
Minimum Annual Royalties
--------------------------
YEAR**
January 1 US$
---------------------------
2 -4 *
---------------------------
5 - on *
---------------------------
**The calendar year in which first
Approval is obtained is year zero
All the above sums include any and all taxes required to be paid or withheld
by NEOPROBE on DOW's behalf. The earned royalty may be credited against this
minimum fee. The minimum fee may be paid in earned royalty and/or cash.
* Omitted and filed separately under Rule 24b-2 pursuant to which Neoprobe
Corporation has requested confidential treatment of this information.
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment under Rule 24b-2
Minimum annual royalty payments are due at the same time as any fourth
quarter earned royalty payments under Articles 7.3, 7.4, 7.5 and 7.6 in
accordance with Article 7.10.
7.9 Payments - A report, including: the amount of payment with the date the
payment was made; an itemized payment listing; and date of this License under
which payment is being made and the number _________, shall be sent to:
The Dow Chemical Company
Royalty Accounting
2020 Building
Midland. Ml 48674
With payment by wire transfer to THE DOW CHEMICAL COMPANY and sent to:
Citibank of New York
New York, NY
For the account of The Dow Chemical Company
7.10 Quarterly Royalty Reports and Payments - Within sixty (60) days after
the close of each calendar quarter, NEOPROBE shall submit a report on the NET
SALES of PRODUCT in the FIELD for the TERRITORY in sufficient detail to enable a
calculation of the royalty due in accord with Article 7 and payment of the
royalty (if any) due.
7.11 Books of Account - NEOPROBE shall maintain true and complete books of
account containing an accurate record of all data necessary for the proper
computation of royalty payments due from it or on behalf of any AFFILIATE. Such
records shall be maintained for at least five (5) years after the date of the
Pertinent royalty payment.
7.12 Audit Right - DOW shall have the right, either through a certified
public accountant employed by DOW or through a firm of independent public
accountants to whom NEOPROBE has no reasonable objection, to examine the books
of account of NEOPROBE at reasonable times within three (3) years after the end
of the calendar year to which they relate (but not more than once in each
calendar year) for the purpose of verifying the correctness of any report
concerning diligence or payment of royalties under Articles 5 and 7,
respectively. Such examination shall be made during normal business hours at the
place of business of NEOPROBE. The information furnished as a result of any such
examination shall be maintained in confidence on the terms specified in Article
8. The fees and expenses of such an audit shall be borne by DOW. If any such
audit shows any underpayment or overcharge, a correcting payment or refund shall
be made within thirty (30) days of NEOPROBE' receipt of the auditors' statement.
If such error is material (meaning +5%), then if NEOPROBE owes DOW from such
material error, NEOPROBE shall be subject to a penalty as if the payment were
deemed late in accord with Article 7.14. Should NEOPROBE fail to make any
correcting payment within sixty (60) days from receipt of the auditors'
statement, then DOW shall have the rig ht to terminate this License under
Article 14.5.
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Treatment underRule 24b-2
7.13 Withholding Tax Payments - If any taxes for DOW's account, withholding
or otherwise, are levied by any taxing authority in the TERRITORY in connection
with the receipt by DOW of any amounts payable under Article 7 of this License
according to any tax treaty or agreement between the United States AND ANY
country in the TERRITORY, then NEOPROBE shall have the right to pay such taxes
to the local tax authorities and the payment to DOW of the net amount due after
reduction by the amount of such taxes, together with
(i) evidence of payment of such taxes and a translation thereof into
English,
(ii) indication of the amount of such tax paid, and
(iii) indication of the country in the TERRITORY and the authority to
whom it was paid, and comply with NEOPROBE's royalty reporting
obligations under this License.
However, if DOW still requires further information, the report due under Article
7.10 may also be requested by DOW and NEOPROBE shall promptly provide that
information.
7.14 Late Payments - Royalty payments not remitted or deposited by the due
date shall bear interest at the current prime rate plus 2% established by a
leading New York bank, such as CitiBank, as published in The Wall Street
Journal. Should NEOPROBE fail to make any late payment within sixty (60) days
from its due date, then DOW shall have the right to terminate this License under
Article 14.5 upon fifteen (15) days written notice to NEOPROBE to allow cure.
ARTICLE 8
CONFIDENTIALITY
8.1 Each Party shall use good faith efforts to retain in confidence and not
disclose to any third party each other's Confidential Information (which
includes, but is not limited to, TECHNOLOGY, PATENTS, and any samples of
ANTIBODY, LINKER or PRODUCT) disclosed pursuant to the terms of this License.
Such "good faith efforts" shall mean the same degree of care, but no less than a
reasonable degree of care, as the receiving Party uses to protect its own
Confidential Information of a like nature. NEOPROBE shall use the same good
faith efforts with respect to the DOW TECHNOLOGY already in its possession.
8.2 Excepted from the obligation of confidence under Article 8.1 is that
information which:
(a) is available, or becomes available, to the general public without
fault of the receiving Party; or
(b) is obtained by the receiving Party without an obligation of
confidence from a third party (other than the FDA or a HEALTH
AUTHORITY) who is rightfully in possession of such information
and is under no obligation of confidentiality to the disclosing
Party concerning such information; or
(c) is required by law or by court order to be disclosed by the
receiving Party in which cases the receiving Party will use its
best efforts to limit such disclosure to that required by law and
to maintain the confidentiality of the disclosed information to
the extent possible; or
(d) must be necessarily disclosed to HEALTH AUTHORITIES to permit
NEOPROBE to sell PRODUCT in the FIELD; or
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
(e) may be disclosed in accord with Article 2.3.1, 3.3.6 or 3.4.1; or
(f) is necessary to disclose to the NIH/NCI under a CRADA for either
FIELD or to obtain the license contemplated under Article 2.1(c);
or
(g) is released from confidentiality in writing by the disclosing
Party.
For the purpose of Article 8.1, a specific item of TECHNOLOGY shall not be
deemed to be within the foregoing exceptions merely because it is embraced by
more general information in the public domain or in the possession of the
receiving Party. In addition, any combination of features shall not be deemed to
be within the foregoing exceptions merely because individual features are in the
public domain or in the possession of the receiving Party, but only if the
combination itself and its principle of operation are in the public domain or in
the possession of the receiving Party.
8.3 Notwithstanding the provisions of Article 8.1, if the receiving Party
becomes legally compelled to disclose any of the disclosing Party's TECHNOLOGY,
the receiving Party shall promptly advise the disclosing Party of such required
disclosure in order that the disclosing Party may seek a protective order or
such other remedy as the disclosing Party may consider appropriate in the
circumstances. The receiving Party shall disclose only that portion of the
TECHNOLOGY which it is legally required to disclose. Such a disclosure shall not
release the receiving Party with respect to the TECHNOLOGY so disclosed except
to the extent of permitting the required disclosure.
8.4 Disclosure to AFFILIATES, Contractors - NEOPROBE may disclose
TECHNOLOGY to its AFFILIATES, sublicensees, consultants and, when permitted
herein, its clinical investigators, contractors (parties under contract with
NEOPROBE or its AFFILIATES for the custom manufacturing or shipping of PRODUCT,
conduct of clinical studies or obtention of registration in the TERRITORY), as
may be necessary to exercise the rights granted hereunder and to register and
prepare for commercialization of PRODUCT, and to commercialize PRODUCT under
this License, under conditions of confidentiality at least as stringent as those
set out in Articles 8.1, 8.2 and 8.3.
8.5 Document Return - In the event of termination of this License under
Article 14.2, 14.3 (if the breach is by NEOPROBE), 14.4, 14.5 or 14.6 prior to
its normal expiration, NEOPROBE will cease its use of the TECHNOLOGY and other
CONFIDENTIAL INFORMATION provided hereunder and, on DOW's request, within sixty
(60) days either return all such CONFIDENTIAL INFORMATION, including any copies
thereof, or will promptly destroy the same and certify such destruction to DOW;
except that such CONFIDENTIAL INFORMATION as is or has become no longer subject
to confidentiality under Article 8.1 need not be returned or destroyed.
Notwithstanding the foregoing, NEOPROBE may retain such documents as are
necessary for it to discharge its surviving obligations hereunder and its legal
obligations to the governmental authorities for counterpart agencies to DOE and
NRC; and NEOPROBE may retain such copies of documents as may be necessary for
the defense of product liability or other litigation or similar proceedings
relating to ANTIBODY or PRODUCT, and may retain one copy thereof in its legal
department as a record of what was transmitted.
8.6 Survival of Confidentiality - Termination of this License for any
reason shall not relieve the Parties of their obligations under Article 8. The
provisions of Article 8 shall survive termination of this License for twenty
(20) years.
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
8.7 Confidentiality Agreement Extension - The CDA was expanded in scope in
the LETTER OF INTENT. All disclosures between the Parties since the effective
date of the CDA with regard to the subject matter of this License are deemed to
have been disclosed under that CDA. After the EFFECTIVE DATE this License shall
supersede the CDA with respect to the present subject matter for PRODUCT for the
FIELDS.
ARTICLE 9
THIRD PARTY INFRINGEMENT CLAIMS
9.1 Defense of Third Party Patent Claims - If a claim is brought by a third
party that manufacture, use or the sale of LINKER or PRODUCT in the TERRITORY
(regardless of use) infringes a patent of such third party, NEOPROBE will give
prompt written notice to DOW of such claim if it concerns a PATENT or
TECHNOLOGY. DOW shall have the sole discretion and right to seek to dispose of
said claim or to conduct the defense of any suit resulting from such claim if
outside the FIELDS in the TERRITORY. NEOPROBE at its option and expense may
participate in any Suit resulting from such claim that directly affects its
market in the FIELDS in the TERRITORY.
If the claim brought by a third party that manufacture, use or the sale of
ANTIBODY in the TERRITORY (regardless of use) infringes a patent of such third
party, NEOPROBE will give prompt written notice to DOW and NCI of such claim if
it concerns a PATENT or TECHNOLOGY. DOW shall have the sole discretion and right
to seek to dispose of said claim or to conduct the defense of any suit resulting
from such claim in the FIELDS in the TERRITORY. DOW shall confer with NCI as
required under the CRADA or the Commercial License for FIELD (I). NEOPROBE at
its option and expense may participate in any suit resulting from such claim
that directly affects its market in the FIELDS in the TERRITORY.
9.2 Mutual Decisions - From the EFFECTIVE DATE and using their good faith
efforts, NEOPROBE and DOW shall discuss any claim or suit brought by a third
party for patent infringement that such third party's patent is infringed by the
manufacture, use or sale of ANTIBODY, LINKER or PRODUCT by NEOPROBE or its
AFFILIATES in the FIELDS in the TERRITORY. Specifically, NEOPROBE and DOW shall
mutually try to agree on: the strategy for such suit or claim, e.g. whether to
negotiate a set tlement, sue or withdraw from the country in the TERRITORY in
which infringement is claimed; the basis to be determined for sharing the costs
of litigation, damages awarded, and royalty to be paid to the third party; which
Party should conduct the defense or if both NEOPROBE and DOW should jointly
defend; the consequences of such decisions, such as amendment to this License
with regard to royalties due to DOW; and any obligations or royalty payment
modifications due NCI for ANTIBODY
9.3 Third Party License - The Parties shall use their good faith efforts
(either individually or together) to negotiate any necessary agreement for
royalty payment to third parties with a view to enabling the PRODUCT to be
commercialized in the FIELDS in the TERRITORY. As of the EFFECTIVE DATE, DOW is
not aware of the need for any such third party license that is not already
obtained .
ARTICLE 10
PATENT ENFORCEMENT LITIGATION
10.1 Prosecution by DOW - DOW, at its sole discretion, may take action on
its own behalf and expense to institute any action or proceeding by reason of
infringement of any of the PATENTS. If either Party learns of any infringement
of a PATENT or misappropriation of trade secrets or TECHNOLOGY by a third party,
it shall promptly notify the other Party.
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Treatment underRule 24b-2
DOW shall have the first right, at its own expense, to prosecute all
litigation against a third party infringer who may be infringing a PATENT.
NEOPROBE shall provide all reasonable cooperation, including any necessary use
of its name, required to prosecute such litigation. NEOPROBE shall be consulted
concerning the litigation. DOW will bear the costs and shall be entitled to any
recovery obtained from such litigation, settlement or compromise thereof.
10.2 Prosecution by NEOPROBE - If DOW does not prosecute such infringer or
otherwise abate such infringement (which infringement must be of commercial
significance to NEOPROBE in DOW's reasonable business opinion) within ninety
(90) days after giving or receiving notification of such infringement in the
TERRITORY, unless an extension of the term is mutually agreed upon by the
Parties, then, NEOPROBE shall have the right to prosecute such infringer at its
own expense in the FIELDS in the TERRITORY and shall be entitled to retain any
recovery obtained from such litigation, settlement or compromise thereof.
NEOPROBE's cost of litigation in any quarter may be credited against up to fifty
(50%) percent of the royalties due to DOW under Articles 7.4, 7.5 and 7.6 in the
following quarter. However, NEOPROBE shall place all royalties due to DOW in
escrow from the date of filing the suit until the action or proceeding is
finally concluded whereupon:
if the PATENT in the country in the TERRITORY is held valid (whether
infringed or not), then the royalties in escrow (after deduction of
NEOPROBE's cost of litigation as referred to hereinabove) shall be paid
to DOW; or
if the PATENT in the country in the TERRITORY is held invalid (whether
infringed or not), then the royalties in escrow shall be paid to
NEOPROBE.
At NEOPROBE's request, DOW shall cooperate with NEOPROBE in such
litigation, including joining in said litigation. DOW shall also cooperate, at
NEOPROBE's expense, by way of providing access to evidence and witnesses
available to DOW.
10.3 Prosecution by neither NEOPROBE or DOW - If DOW decides, after
consulting with NEOPROBE, that neither DOW nor NEOPROBE will defend the PATENT
in a FIELD in the particular country in the TERRITORY, then the royalty for that
PATENT for that FIELD in that country becomes zero (0%) percent upon that
decision date
10.4 Invalidity - In the event that a PATENT in the TERRITORY is finally
declared invalid or unenforceable in a judicial or administrative proceeding
from which no appeal is or can be taken, then from and after that date no
royalties shall be paid on the basis of that PATENT in the relevant country of
the TERRITORY, subject to the provisions of Article 10.2, provided, however,
that royalties due for other PATENTS in the TERRITORY not so held invalid or
unenforceable or royalties for use of TECHNOLOGY shall not be affected.
10.5 Settlement - Any settlement of an infringement suit, whether brought
by DOW or by NEOPROBE, shall be subject to the consent of both Parties, which
consent shall not be unreasonably withheld.
10.6 Cooperation - Each Party shall cooperate with the other Party to the
extent reasonably requested in any legal action:
(i) brought by a third party against one Party or
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Treatment underRule 24b-2
(ii) brought by a third party against both of them or
(iii) taken against a third party by either Party
regarding PATENTS in the FIELDS in the TERRITORY, and each Party shall have the
right to participate in any defense, compromise or settlement to the extent
that, in its judgment, it may be prejudiced thereby. In addition, NEOPROBE shall
not settle any claim or suit in any manner that shall adversely affect any
PATENTS, require any payment by DOW or reduce the royalty due to DOW hereunder
without the prior written consent of DOW, except as provided in Article 10.2.
ARTICLE 11
U.S. EXPORT CONTROL AND GOVERNMENT LICENSES
11.1 Compliance - NEOPROBE agrees to comply with all necessary United
States governmental regulations with respect to export of TECHNOLOGY and any
PRODUCT, ANTIBODY, RADIOLABELLED PRODUCT or LINKER in the TERRITORY. NEOPROBE
agrees to not export or re-export any TECHNOLOGY, PRODUCT, ANTIBODY,
RADIOLABELLED PRODUCT or LINKER received from DOW or the direct products of such
TECHNOLOGY to any prohibited country listed in the U.S. Export Administration
Regulations unless properly authorized by the U.S. Government. NEOPROBE shall be
responsible for the acts of its AFFILIATES, contractors, consultants and
sublicensees. NEOPROBE assumes all liability if it or its AFFILIATES fails to
obtain any of the necessary licenses or commits any violations of the United
States Export Laws or Regulations (15 C.F.R. Section 700 et seq.).
11.2 DOE, NRC Licenses - NEOPROBE agrees to obtain all necessary licenses
and to comply with all applicable regulations of agencies similar to DOE and NRC
in the TERRITORY with respect to PRODUCT and RADIOLABELLED PRODUCT.
11.3 Clearances - NEOPROBE agrees to obtain all necessary clearances from
any government in the TERRITORY for export or re-export with respect to the
TECHNOLOGY or PRODUCT, RADIOLABELLED PRODUCT, ANTIBODY or LINKER.
ARTICLE 12
PRODUCT LIABILITY AND INDEMNIFICATION
12.1 Indemnity by DOW - DOW shall indemnify and hold NEOPROBE, its agents,
directors, officers, employees and AFFILIATES harmless from and against any and
all liabilities, claims, demands, damages, costs, expenses or money judgments
(including reasonable attorneys' fees and expenses) incurred by or rendered
against any of them for personal injury, sickness, disease or death or property
damage which directly arise out of:
(a) the intentional misconduct or negligence of DOW; or
(b) the breach by DOW of its warranties given in Article 6.6 of this
License or in any applicable supply agreement under Article 2.4;
provided, however, that NEOPROBE shall give DOW notice in writing as soon as
practicable of any such claim or lawsuit and shall permit DOW to undertake the
defense thereof at DOW's expense. However,
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Treatment underRule 24b-2
(i) NEOPROBE will cooperate in such defense by providing access to
witnesses and evidence available to it. NEOPROBE shall have the
right to participate in any defense to the extent that in its
judgment, NEOPROBE may be prejudiced thereby; and
(ii) in any claim or suit in which NEOPROBE seeks indemnification by
DOW, NEOPROBE shall not settle, offer to settle or admit
liability or damages in any such claim or suit without the prior
written consent of DOW
12.2 Indemnity by NEOPROBE - NEOPROBE shall indemnify and hold DOW and
AFFILIATES, and their respective agents, directors, officers, employees harmless
from and against any and all liabilities, claims, demands, damages, costs,
expenses or money judgments (including reasonable attorneys' fees and expenses)
incurred by or rendered against any of them for personal injury, sickness,
disease or death or property damage which arise out of
(i) the manufacturing, testing, use, promotion, sale or distribution
of ANTIBODY, LINKER, RADIOLABELLED PRODUCT or PRODUCT by NEOPROBE
or its AFFILIATES, except for those instances provided in Article
12.1 for which DOW is obligated to indemnify NEOPROBE; or
(ii) the breach by NEOPROBE of any of its representations, warranties
or covenants contained in this License or any agreement
contemplated by the terms of this License,
provided, however, that DOW shall give NEOPROBE notice in writing accord with
Article 16 as soon as practicable of any such claim or lawsuit and shall permit
NEOPROBE to undertake the defense thereof at NEOPROBE's expense. However,
(i) DOW will cooperate in such defense by providing access to
witnesses and evidence available to it. DOW shall have the right
to participate in any defense to the extent that in its judgment,
DOW may be prejudiced thereby; and
(ii) In any claim or suit in which DOW seeks indemnification by
NEOPROBE, DOW shall not settle, offer to settle or admit
liability or damages in any such claim or suit without the prior
written consent of NEOPROBE.
ARTICLE 13
TECHNOLOGY WARRANTY, DISCLAIMER, INSURANCE
13.1 Belief of Accuracy - DOW represents that the TECHNOLOGY, and any other
CONFIDENTIAL INFORMATION transferred or provided to NEOPROBE hereunder, are
believed to be accurate and complete as of their current status at DOW at the
EFFECTIVE DATE and that DOW's interpretations and conclusions drawn therefrom
were made in good faith and in the exercise of DOW's sci entific judgment as of
the dates of the documents contained therein, and that to the best of DOW's
knowledge, data subject to regulations regarding Good Laboratory Practices and
Good Clinical Practices, GMP and other FDA regulations, is in compliance with
such regulations. However, DOW does not warrant or represent that such
information is or will be sufficient to obtain APPROVAL to market PRODUCT or
to commercially produce RADIOLABELLED PRODUCT or PRODUCT or to commercialize
PRODUCT with HEALTH AUTHORITIES in the TERRITORY.
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
NEOPROBE represents that it will be solely relying on its own evaluation of
the TECHNOLOGY and the other CONFIDENTIAL INFORMATION transferred or provided to
it hereunder and on its own medical and scientific expertise in using the same
in its development and commercialization of PRODUCT in each FIELD.
13.2 Insurance - NEOPROBE agrees to carry such liability insurance as would
reasonably be expected of a company of NEOPROBE's net worth operating in the
pharmaceutical industry and sufficient to meet any governmental requirements.
Written assurance that such insurance is in effect must be provide to DOW by the
EFFECTIVE DATE. NEOPROBE agrees to maintain such insurance for the term of this
License.
ARTICLE 14
TERM AND TERMINATION
14.1 Term - Unless terminated under the provisions of this Article 14, this
License shall continue in effect until the expiration of all PATENTS listed on
APPENdix A or until ten (10) years from the first APPROVAL for TECHNOLOGY,
whichever occurs last, provided, however, that Articles 8, 11, 12, 13, and 18
contained in this License shall survive termination of this License.
When this License expires under this Article 14.1, the licenses granted
under this License shall be paid-up; however, any payments still due under
Article 7.7 will continue until paid in full.
14.2 Failure to Use License - If NEOPROBE and its AFFILIATES shall have
(i) discontinued selling PRODUCT in commercial quantities using their
best efforts in accord with Article 5 to commercialize; or
(ii) not commercialized PRODUCT in accord with Article 5; or
(iii) not paid the minimum annual royalty required in full when due
under Article 7.8,
then NEOPROBE shall have the right to terminate this License upon ninety (90)
days written notice.
If termination under this Article 14.2 results, then NEOPROBE shall
promptly supply to DOW all registration information for HEALTH AUTHORITIES that
is available to NEOPROBE or its AFFILIATES for use by DOW, its AFFILIATES or
sublicensees, at no cost to DOW, all rights granted by the License together with
the rights received under the CRADA that are DOW's.
If this License is terminated under Article 5.3 when within NEOPROBE's
control, then NEOPROBE shall promptly supply to DOW all registration information
for HEALTH AUTHORITIES that is available to NEOPROBE or its AFFILIATES for use
by DOW, its AFFILIATES or sublicensees without compensation to NEOPROBE by DOW
together with the rights received under the CRADA that are DOW's..
14.3 Termination for Breach - In the event of a material breach by either
DOW or NEOPROBE of any of the obligations contained in this License, the other
Party shall be entitled to terminate this License by notice in writing under
Article 16 provided that such notice shall specify the breach or breaches
complained of. If the said breach or breaches are capable of remedy, the Party
committing such breach or breaches shall be entitled to a period of sixty (60)
days from the delivery of such notice in which to remedy or to
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
undertake to remedy the same. In the case the defaulting Party shall fail to
remedy the breach or to undertake to remedy the breach to the satisfaction of
the injured Party, the injured Party shall have the right to cancel this License
in whole or, if reasonable to the injured Party, only terminate those rights and
obligations relating to the particular breach by simply notification to the
Party in default. Failure of a Party to exercise its rights under this Article
14.3 shall not be construed as a waiver as to future breaches whether or not
they are similar.
14.4 Termination by NEOPROBE - NEOPROBE may surrender and terminate this
License on ninety (90) days written notice to DOW in accord with Article 16.
NEOPROBE will disclose to DOW its reasons for any such termination.
14.5 Termination by DOW - DOW shall have the right to terminate this
License immediately on written notice to NEOPROBE if:
(a) NEOPROBE shall cease to carry on business or shall go into
liquidation or a receiver shall be appointed to NEOPROBE's
assets; or
(b) NEOPROBE shall become bankrupt or insolvent or unable to meet any
of its financial obligations in full on their due dates; or
(c) NEOPROBE fails to meet any of its payments in full when due in
accord with Article 7; or
(d) NEOPROBE fails to meet its diligence requirements under Article
5; or
(e) NEOPROBE fails to maintain accurate records or to provide the
written reports required in accord with Article 7.
14.6 On Termination - NEOPROBE shall, upon termination of this License by DOW
under Articles 14.2, 14.3 or 14.5 or termination by NEOPROBE under Article 14.2,
14.3 or 14.4:
(a) return to DOW all copies of documents containing TECHNOLOGY and
any materials received from DOW under confidentiality and
CONFIDENTIAL INFORMATION concerning ANTIBODY, LINKER,
RADIOLABELLED PRODUCT and PRODUCT in the FIELDS;
(b) pay to DOW all payments and royalties due or accrued at the
termination date within thirty (30) days after termination, and
pay to DOW all payments due under Article 7.7, but if termination
under Article 14.3 (if breach by NEOPROBE) or 14.5, then Article
7.7, if applicable, shall be accelerated and due within said
thirty (30) days; and
(c) make no further use of any kind of any and all TECHNOLOGY
disclosed hereunder by DOW, except to the extent such information
has become public knowledge other than through fault of NEOPROBE,
and make no further use of the surviving PATENTS; and
(d) take all steps necessary and execute any instruments required to
assign all the rights relative to-any government health
registrations of PRODUCT in each FIELD held by NEOPROBE to DOW or
to DOW's designee and to assist DOW or its designee to obtain new
government health registrations for the PRODUCT in each FIELD,
and, if such new registrations are obtained by DOW or its
designee, NEOPROBE agrees to notify the
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
HEALTH AUTHORITIES to cancel all those registrations of PRODUCT
in each FIELD which are in the name of NEOPROBE, subject to
reimbursement by DOW of NEOPROBE's out-of-pocket expenses of
obtaining such registrations (except in the case of termination
for breach by NEOPROBE); and
(e) assign to DOW any distributorships, PRODUCT manufacturing
agreements and sublicense agreements, to the extent they are
specific to the PRODUCT or RADIOLABELLED PRODUCT or LINKER or
ANTIBODY for at least one FIELD and are assignable and to the
extent such agreements were previously agreed with DOW to survive
termination of this License; or, at DOW's option, terminate such
agreements as are terminable unilaterally by NEOPROBE.
14.7 Survival of Certain Obligations - On termination of this License: the
obligations of confidentiality set forth in Article 8 shall survive for the time
stated therein; adverse reaction reporting set forth in Article 3.5 shall
survive; Export Control compliance set forth in Article 11 shall survive; and
the indemnification obligations set forth in Article 12 shall also survive as to
all claims or actions arising from events which occurred before termination.
ARTICLE 1 5
FORCE MAJEURE
15.1 Event of Force Majeure - In the event that performance under this
License, or any obligation hereunder, is hindered, delayed or prevented by
reason of acts of God, strikes, lockouts, labor troubles, intervention of any
governmental authority,-fire, riots, insurrections, invasions, war or other
reason of simi lar nature beyond the reasonable control of the Party and are
without its fault or negligence, then performance of that act shall be excused
for the period of the delay and the period for the performance of that act shall
be extended for an equivalent period.
15.2 Notification. Upon occurrence of an event of force majeure, the
affected Party shall promptly notify the other Party in writing, setting forth
the nature of the occurrence, its expected duration and how that Party's
performance is affected. The affected Party shall resume the performance of its
obligations as soon as practicable after the force majeure event ceases.
ARTICLE 16
NOTICES
16.1 Official -Any notice, request or communication specifically provided
for or permitted to be given under this License must be in writing and may be
delivered by courier service, registered mail, or electronic transmission such
as facsimile or electronic mail, and shall be deemed effective as of the time of
actual delivery thereof to the addressee. For purposes of notice the addresses
of the Parties shall be as follows:
DOW: The Dow Chemical Company
2030 Willard H. Dow Center
Midland, Michigan 48674
U.S.A.
Attention: Michael J. Mintz, PhD
Director
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
External Technology
Telephone: 517 - 636 - 9458
Facsimile: 517 - 636 - 8127
with a copy to:
The Dow Chemical Company
Patent Department
1790 Building, Washington Street
Midland, Michigan 48674
Attention: Karen L. Kimble, JD
Senior Counsel
Telephone: 517 - 636 - 1687
Facsimile: 517 - 638 - 9786
NEOPROBE: Neoprobe Corporation
425 Metro Place North
Suite 400
Dublin, Ohio 43017-1367
Attention: David C. Bupp
President and
Chief Operating Officer
Telephone: 614 - 793 - 7500
Facsimile: 614 - 793 - 7522
with a copy to:
MUELLER AND SMITH, L.P.A.
MUELLER-SMITH BUILDING
7700 Rivers Edge Drive
Columbus, Ohio 43235
Attention: J. K. Mueller, Jr., Esq.
Telephone: 614 - 436 - 0600
Facsimile: 614 - 436 - 0057
16.2 Transition - For purposes of coordination during the TRANSFER PERIOD,
the addresses of the Parties shall be as follows:
DOW: The Dow Chemical Company
1707 Building
Midland Michigan 48674
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
Attention: Dr. William Dowd
Director
Materials R & D
Telephone: 517 - 636 - 1360
Facsimile: 517 - 638 - 9547
NEOPROBE: Neoprobe Corporation
425 Metro Place North
Suite 400
Dublin, Ohio 43017-1367
Attention: Dr. William A. Eisenhardt
Telephone: 614 - 793 - 7500
Facsimile: 614 - 793 - 7520
16.3 Each Party may change its address and its representative for notice by
the giving of notice thereof in the manner hereinabove provided.
ARTICLE 17
DISPUTE RESOLUTION
17.1 Choice of Law - This License shall be governed by the laws of Ohio,
excepting its conflict of laws principles, in all respects of validity,
construction and performance, except that all questions concerning the
construction, validity, coverage or infringement of PATENTS shall be decided in
accordance with the patent law of the country where the patent was granted.
17.2 Disputes - Both Parties shall make good faith efforts to resolve any
questions concerning construction and performance under this License, excluding
PATENTS and antitrust issues, by:
17.2.1 Notice, contact and resolution, all proceedings and documents in
English, between the Parties listed under Article 16.1 within one hundred twenty
(120) days from the date of the notice by negotiation either by telephone or by
meeting in Detroit, Michigan; and
17.2.2 If unsuccessful under Article 17.2.1, then senior executive
management with settlement authority and patent counsel of DOW and NEOPROBE
shall meet at a mutually agreeable location within sixty (60) days from a date
of notice that Article 17.2.1 failed to resolve the issues. Patent counsel shall
present the legal and factual arguments to such executives in English, with
supporting evidence if necessary, and resolution by these executives is expected
within ten (10) days, which may be reduced to writing in English as an amendment
to this License; and
17.2.3 If such executives have not met or resolved the issues under
Article 17.2.2, then within seventy five (75) days from the date of the notice
under Article 17.2.1, the Parties shall submit the issues to arbitration in
Chicago, IL, in English, in accordance with the Rules of the American
Arbitration Association ("AAA"), which may be modified by the Parties, and
judgment shall not be binding. The Parties agree that the following procedures
shall be adhered to even though they may, in part, not be in full conformance
with said Rules:
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
(a) Three Arbitrators shall be selected from a list of at least 20
arbitrators selected by the AAA composed of patent counsel with
chemistry or pharmaceutical expertise who are practicing or
retired partners in law firms or in-house corporate patent
counsel, not affiliated with the Parties, with at least 10 years
of experience in patent law and knowledge of the pertinent laws
of any country relevant to the dispute. Each Party shall select
one Arbitrator and then the two Arbitrators shall select the
third. The arbitration proceedings and reports shall be in
English. The time from the beginning of submission for
arbitration and conclusion of any oral or written proceedings
shall not exceed six (6) months; and
(b) Limited discovery to only that which each Party has a
substantial, demonstrable need, and shall be conducted in the
most expeditious and cost-effective manner. The Arbitrators shall
resolve any issues with regard to the discovery. Decision by the
Arbitrators shall be given in writing within thirty (30) days
from the end of oral proceedings; and
(c) Although the decision by the Arbitrators is non-binding, should
either Party then litigate in a Court of competent jurisdiction
for the Parties, either Party may introduce the decision reached
by Arbitration with its supporting evidence.
ARTICLE 18
ASSIGNMENT
18.1 Assignment - Neither Party to this License shall assign any rights
hereunder without the prior written consent of the other Party, such consent not
to be unreasonably withheld. It being agreed, however, that without such consent
being required from DOW, NEOPROBE may assign to its AFFILIATES.
18.2 Consolidation, Reorganization or Merger- Should NEOPROBE be
consolidated, reorganized or merged with another entity, NEOPROBE may assign or
otherwise transfer this License to the successor entity or the assignee so long
as such assignment or transfer shall be accompanied by a sale or other trans fer
of all or substantially all of NEOPROBE's business and assets related to
ANTIBODY or PRODUCT without DOW's prior written consent, but NEOPROBE must
promptly notify DOW in accord with Article 16.1.
In any event where NEOPROBE is consolidated, reorganized or merged with
another entity and this License is assigned to them, then such AFFILIATE or
entity formed must have agreed to be bound by all terms of this License.
Notification that they are so bound (with documentation if requested by DOW),
must be supplied promptly to DOW in accord with Article 16.1.
18.3 Effect on Successors and Assignees - This License shall inure to the
benefit of and be binding upon such successors and permitted assignees.
ARTICLE 19
MISCELLANEOUS PROVISIONS
19.1 Amendments - This License may be amended only in writing executed by
both Parties.
19.2 Entirety of Agreement - This License sets forth the entire agreement
and understanding between the Parties hereto with respect to PRODUCT in the
FIELDS for their commercialization in the TERRITORY. The Parties agree that this
License is in compliance with the LETTER OF INTENT. No other agreements (e.g.,
the TTA; the ADDENDUM to the TTA, effective July 29,1992; the
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Omitted Portions of this Exhibit are Subject to a Request for Confidential
Treatment underRule 24b-2
AMENDMENT EXTENSION of the TTA, effective January 1,1995; the SECOND AMENDMENT
to the TTA, effective April 15,1996; the License for the 12 technology under the
terms of Articles 2.6 and 3.4(c) of the TTA, effective October 10, 1995; and the
License under the terms of Article 1.3(b) of the TTA, effective May 1, 1996
between the Parties is altered by this License and such other agreements remain
in full force and effect.
19.3 Severability - If any term or provision under this License is deemed
invalid under the laws of a particular country or jurisdiction, the invalidity
shall not invalidate the whole License but it shall be construed as if not
containing that particular term or provision and the rights and obligations of
the Parties shall be construed and enforced accordingly. The Parties shall
negotiate in good faith a substitute provision in compliance with the law to as
nearly as possible retain the Parties intent in legally valid language.
19.4 Waivers, Cumulative Remedies - A waiver by either Party of any term or
condition of this License in any one instance shall not be deemed construed to
be a waiver of such term or condition for any similar instance in the future or
of any subsequent breach hereof. All rights, remedies, undertakings, obliga
tions and agreements contained in this License shall be cumulative and none of
them shall be a limitation of any other remedy, right, undertaking, obligation
or agreement of either Party.
19.5 Public use - NEOPROBE shall not make any public statements regarding
this License without (a) DOW's prior written approval of such press release or
statement with regard to the use of D O W 's name, logos or trademarks and (b)
DOW's review and recommendations with regard to the description of DOW
TECHNOLOGY. If the DOW TECHNOLOGY or PATENTS is discussed in any public document
for the SEC or public offering, DOW shall have the right to review and recommend
changes to any description of the DOW TECHNOLOGY or PATENTS.
19.6 Headings- Headings in this License are included herein for ease of
reference and shall not affect the meaning of the provisions of this License,
nor shall they have any other legal effect.
19.7 Other Documents - Each Party agrees to execute such additional papers
or documents in customary legal form and to make such governmental filings or
applications as may be necessary or desirable to effect the purposes of this
License and carry out its provisions.
IN WITNESS WHEREOF, the Parties have duly executed this License in
duplicate by their appropriate authorized representative. Separate signature
pages are acceptable in facsimile form to each Party and the counterpart
original signatures shall have the date from the facsimile. This License shall
be deemed to have met all the conditions of the LETTER OF INTENT even if it is
not signed by both Parties by May 1, 1996.
THE DOW CHEMICAL COMPANY NEOPROBE CORPORATION
By s/ Fred P. Corson By s/ David C. Bupp
-------------------------------- -------------------------------------
Name: Fred P. Corson Name: David C. Bupp
Title: Vice President Title: President and
Research and Development Chief Operating Officer
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