LICENSE AGREEMENT
This AGREEMENT made this 27th day of October, 1994 by and between
NORTHWESTERN UNIVERSITY ("NORTHWESTERN"), an Illinois corporation having a
principal office at 000 Xxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxx 00000, and IMMTECH
INTERNATIONAL INC. ("COMPANY"), a Delaware corporation having a principal office
at 0000 Xxxxx Xxxxxx, Xxxxx 000, Xxxxxxxx, Xxxxxxxx 00000 (hereinafter
"IMMTECH").
WITNESSETH THAT:
WHEREAS, NORTHWESTERN represents that Xxxxx Xxxxxxxx, Xxxx Xxxxxx,
and Xxxxx Xxxxxxxx (the Inventors) all being employees of NORTHWESTERN at the
time of the invention, have made certain inventions in the field of "Immunoassay
for Identifying Alcoholics and Monitoring Alcohol Consumption" (NU 9134), and
that a patent has been applied for thereon, having United States Serial Number
07/765,169 in September 1991.
WHEREAS, NORTHWESTERN, subject to U.S. government obligations has
the right to make, use, sell, and grant licenses under the INVENTION and PATENT
RIGHTS as defined herein; and NORTHWESTERN wishes to have the INVENTION, as
defined by the PATENT RIGHTS, utilized for the public interest; and
WHEREAS IMMTECH desires to obtain a license to manufacture, sell,
and use the INVENTION and PATENT RIGHTS defined herein and upon the terms and
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the promises and the faithful
performance of the covenants contained herein, IT IS AGREED:
1.0 DEFINITIONS
For the purposes of this Agreement, and solely for that purpose, the
terms hereinafter set forth shall be defined as follows:
1.1 "INVENTION" shall mean the invention as described in EXHIBIT A,
and/or as covered in the PATENT RIGHTS and/or TECHICAL INFORMATION
1
1.2 "PATENT RIGHTS" shall mean any United States patent for the
INVENTION together with any divisional, continuation, or other
continuation-in-part applications based thereon, and any patents resulting from
any of said applications, and any reissues or extensions based on any such
patents, and any foreign counterparts pending or issued thereof.
1.3 "LICENSED PRODUCT" shall mean any products or processes
employing any INVENTION as described in EXHIBIT A, or as described by any valid
claim in an unexpired patent, which patent application or patent is included in
the PATENT RIGHTS.
1.4 "FIELD OF USE" shall mean the exclusive use of the INVENTION and
PATENT RIGHTS for QUANTITATIVE diagnostics.
1.5 "NET SALES PRICE" shall mean the gross sales price of any
LICENSED PRODUCT made and sold pursuant to this Agreement, less allowances to
customers for damaged or returned products and the amounts of discounts,
transportation charges, and all sales and excise taxes and duties paid,
absorbed, or allowed.
1.6 "AFFILIATE" shall mean any corporation or other legal entity (a)
owning or controlling, directly or indirectly, more than fifty percent of the
voting capital shares of IMMTECH, (b) more than fifty percent of the voting
capital shares of which are owned or controlled, directly or indirectly, by
IMMTECH; or (c) more than fifty percent of the voting capital shares of which
are owned or controlled, directly or indirectly, by a legal entity which owns or
controls, directly or indirectly more than fifty percent of the voting capital
shares of IMMTECH.
1.7 "QUANTITATIVE DIAGNOSTICS" shall mean the use of immunoassays
that yield a quantitative answer and are generally performed via enzyme-linked
antibody methodology.
1.8 "TECHNICAL INFORMATION" shall mean NORTHWESTERN's technical
information and know-how relating to the INVENTION, including technical data,
plans, specifications, and drawings.
2.0 LICENSE
2.1 NORTHWESTERN hereby grants to IMMTECH and IMMTECH hereby accepts
from NORTHWESTERN, upon the terms and
2
conditions herein specified, a worldwide, exclusive, and non-assignable (except
as herein specified) License to use the INVENTION and PATENT RIGHTS to test,
evaluate, and develop the INVENTION and LICENSED PRODUCT covered hereby and to
make, have made, use and sell the products in the FIELD OF USE thereof during
the term of this Agreement, and during the term of any extension thereof, unless
sooner terminated as hereinafter provided.
2.2 NORTHWESTERN hereby grants to IMMTECH and IMMTECH hereby accepts
from NORTHWESTERN, upon the terms and conditions herein specified, the right to
extend the License granted hereunder to its sublicensee(s). IMMTECH shall
promptly notify NORTHWESTERN in writing that a sublicense has been granted no
later than thirty (30) days after the effective date of the sublicense. IMMTECH
may negotiate such terms as it chooses for each sublicense, provided that
NORTHWESTERN shall receive a royalty for all sales made by sublicensee(s) at the
rate provided for in this Agreement.
2.3 If IMMTECH shall so notify NORTHWESTERN in writing as provided
in Section 2.2 of this Agreement, any sublicensee(s) to whom the License shall
have been extended pursuant to Section 2.2. hereof may make the reports and
royalty payments specified in Paragraph 3.0. hereof directly to Northwestern on
behalf of IMMTECH. For all other sublicensees, IMMTECH shall make said royalty
payments to Northwestern. For all sublicensees, Northwestern shall notify
IMMTECH and/or the smblicensee of the address to which payment should be sent.
2.4 NORTHWESTERN retains a non-exclusive, royalty-free, irrevocable
License to make, have made and use the INVENTION, PATENT RIGHTS and LICENSED
PRODUCT for its own non-commercial uses.
2.5 Outside the scope of the License between NORTHWESTERN and
IMMTECH no other, further, or different license or right, and no further power
to sublicense is hereby granted or implied.
3.0 ROYALTIES, RECORDS AND REPORTS
3.1 During the term of this Agreement, unless sooner terminated,
IMMTECH shall pay to NORTHWESTERN, in the manner hereinafter provided, earned
royalties at the rate of six percent (6%) of the NET SALES PRICE of all LICENSED
PRODUCT sold by IMMTECH, for the first Ten Million Dollars ($10,000,000) sales,
and at the rate of four percent (4%) for
3
sales exceeding Ten Million Dollars, anywhere in the world.
3.2 IMMTECH shall pay to NORTHWESTERN with respect to all
sub-licenses granted by IMMTECH hereunder, a royalty at the rate of thirty
percent (30%) of all royalties earned by IMMTECH under such sub-licenses.
3.3 LICENSED PRODUCT shall be considered sold when sold or invoiced,
and if not sold or invoiced, when delivered to a third party.
3.4 IMMTECH shall be responsible for the performance hereunder of
all obligations including payment of royalties, keeping of records, and
reporting by IMMTECH and any sublicensee(s) to whom the License shall have been
extended pursuant to this Agreement.
3.5 So long as this Agreement remains in force, IMMTECH shall
deliver to NORTHWESTERN, within sixty (60) days after the first day of January,
April, July and October of each year, a true and accurate report, giving such
particulars of the business conducted by IMMTECH and its sublicensee(S) during
the preceding three (3) months under this Agreement as are necessary to
accurately account for sales subject to royalties under this Agreement.
3.6 Simultaneously with the delivery of each report required by the
preceding paragraph 3.4, IMMTECH shall pay to NORTHWESTERN the net royalties and
any other such payment due under this Agreement for the period covered by such
report. If no royalties are due, it shall be so reported.
3.7 All payments from IMMTECH to NORTHWESTERN shall be in U.S.
dollars. Royalties for sales made by IMMTECH in foreign currencies shall be paid
to Northwestern in U.S. Dollars at a conversion rate equal to the quarter
average of daily composite closing exchange rates for the quarter in which sales
were made as published by the Wall Street Journal.
3.8 In case of any delay in payment by IMMTECH to NORTHWESTERN not
occasioned by force majeure, interest at the rate of one percent (1%) per month,
assessed from the thirty-first day after the due date of said payment, shall be
due by IMMTECH without any special notice.
3.9 Royalties shall accrue in accordance with this Agreement, upon
the first sale of LICENSED PRODUCT.
3.10 IMMTECH shall keep full, true, and accurate
4
books of account containing all particulars which may be necessary for the
purpose of showing the amount payable to NORTHWESTERN by way of royalty as
aforesaid or by way of any other provision hereunder. Said books of account
shall be kept at IMMTECH'S principal place of business. Said books and the
supporting data shall be available for inspection by Northwestern at reasonable
times upon reasonable notice to IMMTECH for three (3) years following the end of
the calendar year to which they pertain, to inspection by NORTHWESTERN for the
purpose of verifying IMMTECH'S royalty statements, or IMMTECH'S compliance in
other respects with this Agreement.
3.11 IMMTECH shall reimburse NORTHWESTERN for all out-of-pocket
costs of filing, prosecution and maintenance for all patent applications and all
patents issuing thereon filed and made at the request of IMMTECH. All such
patents and patent applications shall become part of the PATENT RIGHTS licensed
to IMMTECH hereunder. Such reimbursements shall be made to NORTHWESTERN within
sixty (60) days of receipt of invoice by IMMTECH. Any reimbursements made by
IMMTECH hereunder shall be creditable by IMMTECH in full against royalty payable
by it pursuant to Article 3.1 above.
4.0 AUDITING
4.1 NORTHWESTERN and its representatives will be entitled, upon the
provision of reasonable notice to IMMTECH, to cause a certified public
accountant ("CPA") reasonably acceptable to IMMTECH, to audit such records of
IMMTECH. Such audits shall occur during regular business hours, at the audited
party's place of business, and not more frequently than twice per year, nor more
than twice with respect to any fiscal year. Each such audit shall be designed
solely to determine correct amounts payable by one party to the other pursuant
to the terms of this Agreement, and to answer specific additional questions to
be mutually agreed upon by both parties. While such audit may disclose
information relating to the nature of goods sold and the sales price of said
goods, under no circumstances shall IMMTECH be required to disclose any
confidential information not directly relevant to the calculation of royalties.
The CPA will be under confidentiality obligations to the audited party to
disclose to the auditing party only the correct amounts payable or receivable by
the auditing party, and the answers to such specific agreed upon questions. In
the event that an audit reveals any underpayment or undercredit or royalties
and/or milestone payments by IMMTECH subject to the provisions herein, IMMTECH
will promptly pay or credit to NORTHWESTERN, as the case may be, the full
5
amount of that underpayment or undercredit, together with interest thereon at a
rate of one percent (1%) per month, assessed from the thirty-first day after
said payment was due. In the event that the audit reveals an underpayment or
undercredit of in excess of five percent (5%), IMMTECH or sublicensee, as the
case may be, will promptly pay the entire cost of that audit.
5.0 PERFORMANCE
5.1 IMMTECH shall use its commercially reasonable efforts to
commence and maintain regular commercial production and sale of LICENSED
PRODUCT.
5.2 IMMTECH shall employ its commercially reasonable efforts to
develop Licensed Products, and, consistent with prudent and reasonable business
practices, to apply for and obtain approval from the FDA for the use and sale of
Licensed Products and to market Licensed Products after such approval is
obtained.
5.3 IMMTECH shall use commercially reasonable efforts consistent
with prudent business practice to pursue any necessary studies and to seek
approvals in countries other than the United States of America to market
Licensed Products.
5.4 IMMTECH shall use commercially reasonable efforts, and shall
cause its Affiliates to use their respective commercially reasonable efforts, to
market Licensed Products after appropriate regulatory approval is obtained.
5.5 NORTHWESTERN, at its discretion, and with the consent of
IMMTECH, may utilize IMMTECH'S patent expertise by requesting advice and
assistance from IMMTECH on the preparation, filing, prosecution and maintenance
of any patent application or patent related directly to the LICENSED PRODUCT.
IMMTECH agrees to provide such patent assistance and advice to NORTHWESTERN.
IMMTECH does not warrant the results of any legal and/or patent advice offered
to NORTHWESTERN pursuant to this Agreement. All final decisions regarding the
course of preparation, filing, prosecution and maintenance shall rest with
NORTHWESTERN in its sole discretion.
6.0 TERM AND EXTENSION
6.1 This License shall continue until the expiration of the last to
expire of any patents under PATENT RIGHTS, or
6
for ten (10) years after date of execution of this Agreement in the event no
patent issues.
7.0 TERMINATION
7.1 If IMMTECH shall become bankrupt or insolvent and/or if the
business of IMMTECH shall be placed in the hands of a Receiver, Assignee, or
Trustee, whether by the voluntary act of IMMTECH or otherwise, this License will
be deemed to have automatically terminated as of a date seven (7) days prior to
that event, provided, however, that such termination shall not terminate any
obligations which may have accrued prior thereto.
7.2 Notwithstanding the provisions of Article 5.1, upon any breach
or default under this Agreement by IMMTECH, NORTHWESTERN may terminate this
License by sixty (60) days written notice by registered mail to IMMTECH. Said
notice shall become effective at the end of said period, unless during said
period IMMTECH shall cure such breach or default and notify NORTHWESTERN
thereof.
7.3 IMMTECH may terminate this License at any time upon ninety (90)
days written notice by registered mail to NORTHWESTERN.
7.4 Upon termination of this License for any reason, all rights
granted hereunder shall revert to NORTHWESTERN for the sole benefit of
NORTHWESTERN.
7.5 IMMTECH's termination of this License shall not operate to
terminate any sublicenses made by IMMTECH hereunder. The rights of any and all
said sublicensee(s) shall be preserved on the condition that said sublicensee(s)
agrees to and performs all terms and conditions of IMMTECH pursuant to this
Agreement.
7.6 IMMTECH's responsibilities and obligations to report to
NORTHWESTERN and pay royalties to NORTHWESTERN as to any LICENSED PRODUCTS
produced or sold by IMMTECH or its sublicensees under this Agreement prior to
termination or expiration hereof shall survive such termination or expiration.
7.7 In the event that this Agreement is terminated by either party,
IMMTECH agrees to provide NORTHWESTERN with names and addresses of sublicensees
and copies of all Sublicense Agreements between IMMTECH and sublicensees.
7
8.0 ASSIGNMENT
8.1 This Agreement may be assigned by NORTHWESTERN. This Agreement
may be assigned by IMMTECH to the successor of its entire business, or to an
entity acquiring significant ownership interest in IMMTECH, or to any partly or
wholly-owned subsidiary, but shall not be otherwise assignable by IMMTECH
without the prior written consent of NORTHWESTERN which consent shall not be
unreasonably withheld.
9.0 INFRINGEMENT
9.1 NORTHWESTERN agrees to protect its patents within the PATENT
RIGHTS from infringement and prosecute infringers when in its reasonable
judgement such action may be proper and justified. IMMTECH shall have the right
to xxx infringers in its own name if NORTHWESTERN elects not to do so within one
hundred twenty (120) days following NORTHWESTERN'S receipt of knowledge of such
infringement.
9.2 In the event either party hereto shall initiate or carry on
legal proceedings to enforce the PATENT RIGHTS against an alleged infringer, the
other party hereto shall fully cooperate with the party initiating or carrying
on such proceedings.
9.3 In the event NORTHWESTERN shall institute suit or other legal
proceedings to protect or enforce PATENT RIGHTS as provided herein, it shall
have sole control of such suit and shall retain any recovery awarded as a result
of such suit.
9.4 In the event IMMTECH shall institute suit or other legal
proceedings to protect or enforce PATENT RIGHTS as provided herein, NORTHWESTERN
shall have the option to join in such proceedings and shall be entitled to be
represented by counsel of its own choosing. From any recovery awarded as a
result of any suit or legal proceedings, IMMTECH (i) may deduct the full amount
of its expenses of prosecuting the same (including attorney's fees and court
costs); (ii) shall pay to NORTHWESTERN, to the extent possible after full
payment of (i) above, the full amount of NORTHWESTERN's costs of participating
in the same; (iii) shall pay to NORTHWESTERN, after full payment of (i) and (ii)
above, the applicable percentage determined under section 3.1 hereof, of any
remainder; and (iv) may retain the balance. IMMTECH shall not discontinue or
settle any such suit or legal proceedings brought by it without obtaining prior
concurrence of NORTHWESTERN, and giving NORTHWESTERN a timely opportunity to
continue such proceedings
8
in its own name, under its sole control, at its sole expense, and at its sole
recovery.
10.0 SEVERABILITY
10.1 Should any part or provision of this Agreement be unenforceable
or otherwise in conflict with or in violation of the law of any jurisdiction,
the remainder of this Agreement shall remain binding upon the parties.
11.0 INDEMNITY AND NEGATION OF WARRANTIES
11.1 IMMTECH agrees to indemnify, hold harmless and defend
NORTHWESTERN, its officers, employees, and agents against any and all claims,
suits, losses, damages, costs, fees, and expenses resulting from or arising out
of the production or use of the LICENSED PRODUCTS by IMMTECH, its sublicensees,
and others purchasing, using and/or receiving the LICENSED PRODUCTS.
11.2 IMMTECH shall maintain, prior to sale of any LICENSED PRODUCTS,
appropriate insurance, in good standing, at least in the amount of five million
dollars ($5,000,000) the amount subject to change from time to time as
designated by NORTHWESTERN in writing, naming NORTHWESTERN as additional
insured. IMMTECH shall deliver to NORTHWESTERN, a certificate of such insurance
providing for not less than thirty (30) days notice to NORTHWESTERN of
cancellation or material change in the terms of such insurance.
11.3 Nothing in this Agreement shall be construed as:
11.31 a warranty or representation by NORTHWESTERN as to the
validity or scope of any Patent Rights; or
11.32 a warranty or representation that anything made, used,
sold or otherwise disposed of under any license granted in
this Agreement is or will be free from infringement of patents
of third parties; or;
11.33 an obligation by NORTHWESTERN to bring or prosecute
actions or suits against third parties for infringement.
11.4 NORTHWESTERN makes no representation other than
9
those specified in this Agreement. NORTHWESTERN MAKES NO EXPRESS OR IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF LICENSED
PRODUCT.
12.0 GENERAL
12.1 IMMTECH shall not use the name of any Inventor listed in PATENT
RIGHTS, of any institution with any Inventor has been or is connected, nor of
NORTHWESTERN, nor any adaptation of any of them, in any advertising, promotional
or sales literature, without prior written consent obtained from NORTHWESTERN in
each case. Similarly, NORTHWESTERN shall not use the name of IMMTECH or any
officer, employee or agent of IMMTECH, nor any adaptation of same, in any
advertising or promotional literature without prior consent obtained from
IMMTECH in each case.
12.2 Any notice required or permitted to be given by this Agreement
shall be given postpaid first class certified mail; unless otherwise stated:
TO LICENSEE: IMMTECH INTERNATIONAL INC.
0000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: Mr. T. Xxxxxxx Xxxxxxxx
TO LICENSOR: NORTHWESTERN UNIVERSITY
Technology Transfer Program
0000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000-0000
Attn : Administrator
Such addresses may be altered by written notice. If no time limit is specified
for a notice required or permitted to be given under this Agreement, the time
limit therefor shall be twenty (20) full business days, not including the day of
mailing.
12.3 This Agreement and its effect is subject to and shall be
construed and enforced in accordance with the internal laws of the State of
Illinois, United States of America.
12.4 The parties to this Agreement recognize and agree that each is
operating as an independent contractor and not as an agent of the other.
10
12.5 The captions herein are for convenience only and shall not be
deemed to limit or otherwise affect the construction thereof.
12.6 Any waiver by either party of the breach of any term or
condition of this agreement will not be considered as a waiver of any subsequent
breach of the same or any other term or condition hereof.
13.0 ENTIRE AGREEMENT
13.1 This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter of this Agreement,
and merges all prior discussions between them. Neither of the parties shall be
bound by any conditions, definitions, warranties, or representations with
respect to the subject matter of this Agreement unless as duly set forth on or
subsequent to the date hereof in writing signed by a proper and duly authorized
representative of the party to be bound thereby.
11
IN WITNESS WHEREOF, the parties hereto have hereunto set their hands
and duly executed this Agreement as of the day and the year first above written.
NORTHWESTERN UNIVERSITY
ATTEST: [ILLEGIBLE] By: /s/ C. Xxxxxxx Xxxx
----------------------- ----------------------------------
C. Xxxxxxx Xxxx, Ph.D.
Vice President for Research
Date: November 8, 1994 Date: November 8, 1994
------------------------- -------------------------------
IMMTECH INTERNATIONAL INC.
ATTEST: Xxxx Xxxx Xxxx By: [ILLEGIBLE]
----------------------- ---------------------------------
Date: November 17, 1994 Date: November 17, 1994
------------------------- -------------------------------
--------------------------------
OFFICIAL XXXX
XXXX XXXX XXXX
NOTARY PUBLIC, STATE OF ILLINOIS
MY COMMISSION EXPIRES 6-28-98
--------------------------------
12
