This excerpt taken from the ZGEN 10-Q filed Nov 5, 2008.
Termination for Convenience
If Merck Serono elects to terminate its roles and responsibilities with respect to the development, marketing, distribution and sales of a Licensed Product pursuant to Section 4.2 and such termination is effective worldwide or terminates this Restated Agreement pursuant to Section 14.2, the following will apply with respect to the Licensed Product involved:
10.1 Patents and Trademarks.
(a) Notwithstanding any provision of Article Nine to the contrary, ZGI shall at its expense have control over the prosecution, maintenance, defense and enforcement of Patent Rights in and to Project Technology covering only such Licensed Product and over the use, registration and protection of the Licensed Product Trademarks applicable only to such Licensed
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Product; provided, however, that if ZGI elects to abandon any patent or trademark application or not to defend or enforce (or not to continue to attempt to defend or enforce) any such Patent Rights or Licensed Product Trademarks, it shall promptly so inform Merck Serono in sufficient time that Merck Serono may at its election continue to prosecute such application or bring (or continue) such enforcement action at Merck Seronos risk and expense.
(b) The trademark and service mark quality control and labeling and usage standards and procedures referred to in Section 8.6 with respect to any trademarks or service marks applicable only to such Licensed Product shall no longer be subject to approval by the parties, but nevertheless, to the extent applicable to such Merck Serono trademarks and service marks licensed to ZGI, shall be only such as are commercially reasonable and necessary to preserve Merck Seronos rights as licensor of any such mark.
10.2 Development and Commercialization.
Merck Serono shall have no further role or responsibility for the development, marketing, distribution or sales of that Licensed Product, nor any obligation to fund or bear any costs with respect thereto; provided, however, that Merck Serono will, at ZGIs request, (i) cooperate reasonably with ZGI at ZGIs expense to transition any then on-going Development Tasks conducted by or on behalf of Merck Serono with respect to such Licensed Product to ZGI and (ii) either sublicense or assign to ZGI (at Merck Seronos option) any Third Party Agreements to which it is a party to the extent such Third Party Agreements can be so transferred.
10.3 ZGI Territory.
All countries in the world shall automatically thereby be removed from the Territory and shall become part of the ZGI Territory with respect to that Licensed Product.
10.4 Milestone Fees.
Merck Serono shall have no further obligation to pay Milestone Fees with respect to that Licensed Product pursuant to Section 5.1 hereof.
The licenses granted by Merck Serono to ZGI under Article Eight with respect to such Licensed Product shall continue in effect for the duration of the Product Term, and subject to ZGIs obligations under this Restated Agreement with respect to such Licensed Product; provided, however, that the license to ZGI under Section 8.4 shall be expanded to include [ * ].
10.6 Supply of Licensed Product.
(a) Merck Serono shall transfer to ZGI all then-existing clinical and commercial stocks of the Licensed Product, and shall also complete any on-going manufacturing runs and supply the Licensed Product made in such runs to ZGI, in each such case [ * ], except with
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respect to stocks or manufacturing runs the costs of which were included in the quarterly accountings and balancing payments under the Original Agreement (which stocks and manufacturing runs shall be provided by Merck Serono under this clause without any further charge to ZGI).
(b) To the extent supplies in addition to those to be provided under subsection (a) above are required, Merck Serono shall, at all times between the effectiveness of its termination of such roles and responsibilities pursuant to Section 4.2 and [ * ], manufacture and supply to ZGI all of ZGIs and its Affiliates and Sublicensees worldwide requirements for the Licensed Product, provided such requirements do not exceed [ * ] of the requirements for the Licensed Product for that period described in Merck Seronos bona fide internal projections. ZGI shall exert [ * ] to find and qualify an alternative manufacturing source for such Licensed Product as promptly as possible, and, unless ZGI terminates this supply arrangement earlier at its option, ZGI, [ * ], shall purchase all of such requirements from Merck Serono, which Licensed Products will be supplied pursuant to a supply agreement [ * ].
(c) If and to the extent that any Merck Serono Production Technology in existence on the effective date of such termination that is applicable to such Licensed Product is not already covered by Merck Seronos licenses to ZGI under Section 8.4, the same shall hereby be deemed to be included in such licenses, but on a nonexclusive basis.
(d) Merck Serono shall promptly provide to ZGI a full disclosure of all Merck Serono Production Technology, if any, that shall not have prior thereto been provided to ZGI to the extent the same is reasonably necessary to enable an experienced cGMP manufacturer to manufacture the applicable Licensed Product. Merck Serono further agrees to cooperate in the transfer of manufacturing operations for such Licensed Product to ZGI or its designated Sublicensee or contract manufacturer and agrees to provide all information, data, and copies of documents constituting Merck Serono Production Technology reasonably necessary or useful for regulatory filings (including authorization to use such information, data and copies of documents in later regulatory filings) for such Licensed Product and to allow ZGI or such Sublicensee or contract manufacturer to manufacture such Licensed Product throughout the Product Term.