Common use of Customer Improvements Clause in Contracts

Customer Improvements. All improvements to the Dry HPC Technology derived from, based on, or invented in whole or in part through Customer’s use of the Dry Workflow pursuant to this Agreement or using the Dry Workflow purchased herein, whether a Customer Improvement or not. and all Intellectual Property Rights therein, shall be owned by IM and if initially conceived, reduced to practice or developed by Customer (whether or not implemented by IM as set forth in Section 4.9.1), shall be assigned to IM as set forth in Section 4.2. IM hereby grants a non-exclusive. royalty-free license (i.e., IM shall not increase the HPC Site License or HPC Enabled Software License due to the implementation or use of such Improvement) to Customer to use any Improvement (other than an IM Improvement) on or with any Dry Workflow for which Customer continues to pay the HPC Site License fee and continues to license the HPC-Enabled Informatics Software. Notwithstanding the foregoing, no license to Customer to use Dry HPC Technology beyond the term or beyond the scope of any license granted to Customer to use Dry HPC Technology is intended or granted by the preceding sentence. Any notification of a proposed Customer Improvement shall comply with the procedure set forth in Section 4.9.2, below. Notwithstanding the foregoing, if IM wishes to commercialize any non-obvious Customer Improvement for sale to third parties, IM shall first negotiate with Customer in good faith to agree upon reasonable compensation to Customer in view of the contribution of the Customer Improvement to the value of the Dry Workflow or a component thereof. If the Parties cannot agree on such compensation then they shall follow the provisions of Section 4.9.3. 4.9.1 Any implementation by IM of Customer Improvements on Customer’s behalf shall be the subject of a separately executed statement of work between the parties that shall specify the commercial and other terms. 4.9.2 Customer may disclose Customer Improvements to IM pursuant to this paragraph. Before fully disclosing any Confidential Information with respect to a Customer Improvement to IM, Customer shall first send a written non-Confidential summary of the proposed Customer Improvement to the attention of the IM Legal Department. Within thirty (30) days of the non-confidential disclosure, IM shall inform Customer that IM either does or does not wish to receive a more detailed description of the proposed Customer Improvement that Customer may label as Confidential Information (“Formal Disclosure”). If IM does not wish to receive the more detailed’ description of the Customer Improvement, Customer may maintain such Customer Improvement as a trade secret. For the avoidance of doubt, the preceding sentence shall not change the provisions of this Agreement concerning ownership of Improvements. Furthermore, IM’s ability to sell, license and sub-license Dry HPC Technology shall not be limited by (i) the non-Confidential disclosure above or (ii) any disclosure by Customer to IM employees separate from any Formal Disclosure (other than disclosures to IM employees that are subject to the IP firewall described in Section 7.5.1 hereof) of a Customer Improvement that Customer decides to maintain as a trade secret. Within a reasonable time after its receipt of the Formal Disclosure, IM shall provide notice to Customer that either (a) IM does not wish to implement the proposed Customer Improvement, and that it is returning the Confidential Information (except as required for archival purposes), or (b) IM wishes to further study the feasibility of implementing or commercializing the Customer Improvement including a proposal on how to proceed. Notwithstanding the foregoing, during the one-year period following the Platform Assembly Confirmation of the Dry Workflow sold under this Agreement, Customer shall disclose no more than [*] potential Customer Improvements during any one of the [*] periods immediately following said Platform Assembly Confirmation for consideration by IM above. The restrictions set forth in Section 4.11 only shall apply to Customer Improvements for which there has been a Formal Disclosure (provided that the foregoing shall in no way change or reduce IM’s obligations pursuant to Section 7.5.1 hereof). References to obligations and disclosures Section 7.5 in this Section specifically exclude disclosures by Customer to IM employees related to improvements, changes or modifications to the Equipment and IM shall be free to sell, license and sub-license Dry HPC Technology relating to Equipment disclosed outside of the Formal Disclosure process. If Customer proposes an Customer Improvement following said [*] period, the parties will negotiate in good faith on a case by case basis any special terms and conditions that will be applicable to the sale to Third Parties of Equipment into which such future Customer Improvements may be implemented. 4.9.3 Notwithstanding Section 12.16 of this Agreement, in the event that the parties cannot agree for a period of [*] days after escalation to their respective chief executive officers to a reasonable compensation for a Section 4.9 proposal, then either party may submit the issue of the amount of compensation due to Customer if IM implements the Customer Improvement to final and binding arbitration, before a single, mutually-acceptable arbitrator, conducted in accordance with the Commercial Arbitration Rules of AAA, solely for determination of the reasonable compensation. If the parties are unable to select a mutually acceptable arbitrator, AAA shall appoint an arbitrator or provide a method for selection. Any arbitration proceedings shall be conducted in Phoenix, Arizona. Each party shall bear its own expenses, including attorneys’ fees, and the parties will share equally the costs and fees of the arbitrator. Prior to the actual arbitration hearing, each party shall provide the arbitrator a written proposal for a reasonable compensation that such party believes to be fair to both parties in the circumstances. The arbitrator must render a written decision within [*] days of the hearing in favor of one party’s proposal or the other, without modification. The arbitrator must determine the prevailing party by assessing the proposal, and its fairness in light of the relevant Intellectual Property Rights, technology contributions, and development and commercialization costs and expenses of each party, as well as the potential markets for the proposed application and whether third party Intellectual Property. Rights, development efforts, commercialization efforts or investment is required to commercialize the proposed application. The parties shall use all reasonable efforts to complete any arbitration subject to this section within [*] months from the filing of notice of a request for such arbitration. The parties undertake and agree that all arbitral proceedings shall be kept confidential, and all information, documentation, materials in whatever form disclosed in the course of such arbitral proceeding shall be used solely for the purpose of those proceedings. Nothing in this section shall require IM to implement the Customer Improvement following the decision of the arbitrator.

Customer Improvements. All improvements to the Dry HPC Technology derived from, based on, or invented in whole or in part through Customer’s use of the Dry Workflow pursuant to this Agreement or using the Dry Workflow purchased herein, whether a Customer Improvement or not. and all Intellectual Property Rights therein, shall be owned by IM and if initially conceived, reduced to practice or developed by Customer (whether or not implemented by IM as set forth in Section 4.9.1), shall be assigned to IM as set forth in Section 4.2. IM hereby grants a non-exclusive. royalty-free license (i.e., IM shall not increase the HPC Site License or HPC Enabled Software License due to the implementation or use of such Improvement) to Customer to use any Improvement (other than an IM Improvement) on or with any Dry Workflow for which Customer continues to pay the HPC Site License fee and continues to license the HPC-Enabled Informatics Software. Notwithstanding the foregoing, no license to Customer to use Dry HPC Technology beyond the term or beyond the scope of any license granted to Customer to use Dry HPC Technology is intended or granted by the preceding sentence. Any notification of a proposed Customer Improvement shall comply with the procedure set forth in Section 4.9.2, below. Notwithstanding the foregoing, if IM wishes to commercialize any non-obvious Customer Improvement for sale to third parties, IM shall first negotiate with Customer in good faith to agree upon reasonable compensation to Customer in view of the contribution of the Customer Improvement to the value of the Dry Workflow or a component thereof. If the Parties cannot agree on such compensation then they shall follow the provisions of Section 4.9.3. 4.9.1 Any implementation by IM of Customer Improvements on Customer’s behalf shall be the subject of a separately executed statement of work between the parties that shall specify the commercial and other terms. 4.9.2 Customer may disclose Customer Improvements to IM pursuant to this paragraph. Before fully disclosing any Confidential Information with respect to a Customer Improvement to IM, Customer shall first send a written non-Confidential summary of the proposed Customer Improvement to the attention of the IM Legal Department. Within thirty (30) days of the non-confidential disclosure, IM shall inform Customer that IM either does or does not wish to receive a more detailed description of the proposed Customer Improvement that Customer may label as Confidential Information (“Formal Disclosure”). If IM does not wish to receive the more detailed’ description of the Customer Improvement, Customer may maintain such Customer Improvement as a trade secret. For the avoidance of doubt, the preceding sentence shall not change the provisions of this Agreement concerning ownership of Improvements. Furthermore, IM’s ability to sell, license and sub-license [*] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. Dry HPC Technology shall not be limited by (i) the non-Confidential disclosure above or (ii) any disclosure by Customer to IM employees separate from any Formal Disclosure (other than disclosures to IM employees that are subject to the IP firewall described in Section 7.5.1 hereof) of a Customer Improvement that Customer decides to maintain as a trade secret. Within a reasonable time after its receipt of the Formal Disclosure, IM shall provide notice to Customer that either (a) IM does not wish to implement the proposed Customer Improvement, and that it is returning the Confidential Information (except as required for archival purposes), or (b) IM wishes to further study the feasibility of implementing or commercializing the Customer Improvement including a proposal on how to proceed. Notwithstanding the foregoing, during the one-year period following the Platform Assembly Confirmation of the Dry Workflow sold under this Agreement, Customer shall disclose no more than [*] potential Customer Improvements during any one of the [*] periods immediately following said Platform Assembly Confirmation for consideration by IM above. The restrictions set forth in Section 4.11 only shall apply to Customer Improvements for which there has been a Formal Disclosure (provided that the foregoing shall in no way change or reduce IM’s obligations pursuant to Section 7.5.1 hereof). References to obligations and disclosures Section 7.5 in this Section specifically exclude disclosures by Customer to IM employees related to improvements, changes or modifications to the Equipment and IM shall be free to sell, license and sub-license Dry HPC Technology relating to Equipment disclosed outside of the Formal Disclosure process. If Customer proposes an Customer Improvement following said [*] period, the parties will negotiate in good faith on a case by case basis any special terms and conditions that will be applicable to the sale to Third Parties of Equipment into which such future Customer Improvements may be implemented. 4.9.3 Notwithstanding Section 12.16 of this Agreement, in the event that the parties cannot agree for a period of [*] days after escalation to their respective chief executive officers to a reasonable compensation for a Section 4.9 proposal, then either party may submit the issue of the amount of compensation due to Customer if IM implements the Customer Improvement to final and binding arbitration, before a single, mutually-acceptable arbitrator, conducted in accordance with the Commercial Arbitration Rules of AAA, solely for determination of the reasonable compensation. If the parties are unable to select a mutually acceptable arbitrator, AAA shall appoint an arbitrator or provide a method for selection. Any arbitration proceedings shall be conducted in Phoenix, Arizona. Each party shall bear its own expenses, including attorneys’ fees, and the parties will share equally the costs and fees of the arbitrator. Prior to the actual arbitration hearing, each party shall provide the arbitrator a written proposal for a reasonable compensation that such party believes to be fair to both parties in the circumstances. The arbitrator must render a written decision within [*] days of the hearing in favor of one party’s proposal or the other, without modification. The arbitrator must determine the prevailing party by assessing the proposal, and its fairness in light of the relevant Intellectual Property Rights, technology contributions, and development and commercialization costs and expenses of each party, as well as the potential markets for the proposed application and whether third party Intellectual Property. Rights, development efforts, commercialization efforts or investment is required to commercialize the proposed application. The parties shall use all reasonable efforts to complete any arbitration subject to this section within [*] months from the filing of notice of a request for such arbitration. The parties undertake and [*] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. agree that all arbitral proceedings shall be kept confidential, and all information, documentation, materials in whatever form disclosed in the course of such arbitral proceeding shall be used solely for the purpose of those proceedings. Nothing in this section shall require IM to implement the Customer Improvement following the decision of the arbitrator.