Exhibit 10.3
LICENSE AND SPONSORED RESEARCH AGREEMENT
THIS Agreement made and entered into this fifteenth day of September,
1998 by and between DUKE UNIVERSITY, a North Carolina not-for-profit
corporation, (hereinafter called the "LICENSOR"), having its principal office at
Xxxxxx, Xxxxx Xxxxxxxx 00000, and MicroIslet, Inc. a corporation organized under
the laws of California (hereinafter called the "LICENSEE"), having its principal
office at 0000 Xxxxxxxx Xxxxxx, Xxxxx 000, Xx Xxxxx, XX 00000.
WHEREAS, LICENSOR has certain SUBJECT TECHNOLOGY and PATENT RIGHTS
(hereinafter defined) relating to therapies for diabetes invented by Xx.
Xxxxxxxx X. Xxxxx, an employee of LICENSOR, which it is willing to make
available to LICENSEE subject to the terms of this Agreement in order that the
SUBJECT TECHNOLOGY and PATENT RIGHTS may be utilized in the public interest; and
WHEREAS, LICENSOR has the right to grant licenses to use SUBJECT
TECHNOLOGY and PATENT RIGHTS; and
WHEREAS, LICENSEE will obtain resources, proprietary technology, and
expertise to develop SUBJECT TECHNOLOGY and PATENT RIGHTS into useful products;
and
WHEREAS, LICENSEE wishes to commercialize products based on SUBJECT
TECHNOLOGY and PATENT RIGHTS;
NOW THEREFORE, in consideration of the premises and the faithful
performance of the covenants herein contained, IT IS AGREED:
ARTICLE 1 - DEFINITIONS
1.01 For the purposes of this Agreement, and solely for that purpose,
the terms and phrases set forth hereinafter in capital letters shall be defined
as follows:
a. "AFFILIATE" shall mean any party which directly or
indirectly controls, is controlled by, or is under
common control with any party to this Agreement. A
party shall be regarded as in control of another
party if it owns, or directly or indirectly, controls
at least fifty percent (50%) of the voting stock or
other ownership interest of the party, or if it
directly or indirectly possesses the power to direct
or to cause the direction of the management and
policies of the other party by any means whatsoever.
b. "APPROVAL" shall mean the registration of a LICENSED
PRODUCT with a REGULATORY AGENCY following approval
for marketing by the REGULATORY AGENCY.
c. "EFFECTIVE DATE" shall mean September 15, 1998.
d. "LICENSED PRODUCT" shall mean any product in any
field of use that infringes upon a valid claim of
PATENT RIGHTS or utilizes the SUBJECT TECHNOLOGY.
e. "NET SALES" shall mean the gross proceeds from sales
of LICENSED PRODUCTS by LICENSEE, its AFFILIATES, and
any sublicensees to unaffiliated third parties,
expressed in United States dollars less, first,
allowances for returns, chargebacks, and product
discounts actually given to customers; and, second,
import, export value added tax, excise and sales tax,
custom duties or other similar taxes or government
assessment collected on such sales; and, third,
rebates under the medical prescription drug rebate
and improved access to medicines requirements of the
Omnibus Budget Reconciliation Act of 1990.
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In the event that a LICENSED PRODUCT under this
Agreement is sold in a combination product containing
one or more active agreements or components, then NET
SALES on the combination product shall be calculated
using one of the following methods:
(i). By multiplying the price of the
combination product by the fraction A/A+B, where A is
the gross selling price, during the royalty-paying
period being considered, of the LICENSED PRODUCT sold
separately, and B is the gross selling price, during
the royalty period in question, of the active
ingredients or components sold separately; or
(ii). In the event that no such separate
sales are made of the LICENSED PRODUCT, NET SALES on
the combination product for royalty determination
shall be as reasonably allocated between such
LICENSED PRODUCT and other active ingredients or
components, based on their relative importance and
proprietary protection, as agreed by the parties. If
the parties fail to reach agreement, such allocation
shall be submitted to binding arbitration.
f. "OPTION PERIOD" shall mean a time period during which
LICENSEE shall have an option to acquire an
exclusive, worldwide, royalty-bearing license of
LICENSOR'S sole or joint rights to an INVENTION, said
time period beginning when LICENSOR notifies LICENSEE
that a new INVENTION has been made during the
RESEARCH PROGRAM and extending continuously for
ninety (90) days after said disclosure.
g. "PATENT RIGHTS" shall mean the PROVISIONAL
APPLICATION and all non-provisional patent
applications, continuations, continuations in part,
divisions, reissues, re-examinations, extensions or
other government actions which extend the subject
matter of the PROVISIONAL APPLICATION, and any
foreign patent applications, and any patent, patents
of addition, or other equivalent foreign patents
issuing, granted, or registered based on or resulting
from the PROVISIONAL APPLICATION and continuations in
part applications, and resulting patents that are
directed to subject matter described in the
PROVISIONAL APPLICATION. PATENT RIGHTS shall only
include applications that (i) cover the SUBJECT
TECHNOLOGY (ii) name Xx. Xxxxxxxx X. Xxxxx as an
inventor and (iii) are assigned to the LICENSOR.
h. "PROVISIONAL APPLICATION" shall mean a provisional
patent application to be filed by LICENSOR at the
United States Patent and Trademark Office within
forty-five [45] days after the EFFECTIVE DATE to
protect the SUBJECT TECHNOLOGY.
i. "PROCEEDS" shall mean all consideration, with the
sole exception of amounts received for research and
development, marketing and manufacturing expenses,
and bona fide equity investments not in excess of the
fair market value and any debt financing received by
LICENSEE from third parties pursuant to all business
activities relating to LICENSED PRODUCTS, including,
without limitation, the development, manufacture,
testing, marketing, sales, distribution, and
promotion of LICENSED PRODUCTS. PROCEEDS shall
include, without limitation, NET SALES of LICENSED
PRODUCTS by LICENSEE, its AFFILIATES, and its
sublicensees; all amounts received as payments in
consideration of establishing sublicense or other
alliances involving LICENSED PRODUCTS; all amounts
received as milestone payments for product
development; and all amounts received as sales
bonuses. In the event that PROCEEDS include non-cash
consideration, the parties will negotiate in good
faith to establish the cash value of such
consideration, and LICENSEE shall make a cash payment
to LICENSOR equal to [***] of the cash value so
determined.
[***] represents certain information on this page that has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
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j. "REGULATORY AGENCY" shall mean United States Food and
Drug Administration or a comparable agency legally
empowered to approve and regulate manufacture, sales,
or distribution of medical services and products in a
country outside the United States.
k. "RESEARCH PROGRAM" shall mean the research program
that is specified in detail in Exhibit B attached
hereto and made a part hereof.
l. "SUBJECT TECHNOLOGY" shall mean the technology
licensed hereunder described in detail in Exhibit A
attached hereto and made a part hereof, and
alterations thereto which have heretofore been
conceived and/or reduced to practice by LICENSOR, its
employees, faculty members or students, as evidenced
by written records. Exhibit A is hereby acknowledged
to consist of Duke University Office of Science and
Technology File #1538 describing technology invented
by Xx. Xxxxxxxx X. Xxxxx.
ARTICLE 2 - LICENSE
2.01 The LICENSOR hereby grants to the LICENSEE and LICENSEE hereby
accepts from LICENSOR, upon the terms and conditions herein specified, an
exclusive, world-wide license to make, have made, use, offer to sell and sell
LICENSED PRODUCTS, with the right to sublicense under the conditions specified
in Article 5 herein.
ARTICLE 3 - RESEARCH PROGRAM
3.01 As partial consideration for the rights granted in Article 2
herein, LICENSEE shall provide to LICENSOR support for the RESEARCH PROGRAM in
the FIELD.
3.02 WORK. LICENSOR agrees to use its best effort to perform the
RESEARCH PROGRAM described in the "Statement of Work" ("STATEMENT"), a copy of
which is attached to this Agreement as Exhibit B.
3.03 PRINCIPAL INVESTIGATOR. The research will be supervised by Xx.
Xxxxxxxx X. Xxxxx ("INVESTIGATOR"). If for any reason INVESTIGATOR is unable to
continue to serve as Principal Investigator and a successor acceptable to both
LICENSOR and LICENSEE is not available, the Agreement may be terminated in
accordance with Article 13 below.
3.04 BUDGET. In consideration of the foregoing, and as more
specifically provided in the budget included as Exhibit B, LICENSEE will pay
LICENSOR for all direct and indirect costs incurred in the performance of the
research as set forth in the STATEMENT, a total not to exceed [***]. Payment
will be made to LICENSOR by LICENSEE, in advance, in the form of twelve (12)
payments on the schedule set forth in Exhibit B.
3.05 TERM. The RESEARCH PROGRAM will be conducted during a one year
period commencing October 1, 1998 and concluding on or before September 30,
1999. This RESEARCH PROGRAM will be renewable for additional periods upon the
mutual consent of the parties by a new agreement or by amendment hereto
expressed in writing and signed by both parties.
3.06 TERMINATION COSTS. In the event that this Agreement is terminated
under the provisions of Article 13, other than 13.5 or due to breach by
LICENSOR, LICENSOR will proceed in an orderly fashion to terminate any
outstanding commitments and to stop the work as soon as it is practicable to do
so. All reasonable costs to LICENSOR associated with termination will be
considered reimbursable costs, including costs incurred prior to the notice of
termination but which have not yet been reimbursed, and commitments existing at
the time the notice of termination is received which cannot be canceled. This
shall include all noncancelable contracts and fellowships or postdoctoral
associate appointments incurred prior to the effective date of termination.
After termination, any obligation of LICENSEE for fellowships or postdoctoral
associates shall end no later than the end of LICENSEE's academic year following
termination. In no case will reimbursement under this Agreement exceed the total
estimated project costs specified in Exhibit B.
[***] represents certain information on this page that has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
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3.07 REPORTS. LICENSOR will provide LICENSEE with quarterly progress
reports on the RESEARCH PROGRAM. In addition, LICENSOR will provide LICENSEE
with a final report on THE RESEARCH PROGRAM within sixty (60) days of
termination of the research supported under the RESEARCH PROGRAM. All reports
provided under this Article 3.07 will be treated as confidential INFORMATION as
defined in Article 8 herein.
3.08 PUBLICATION. LICENSOR shall be free to use the results of the
subject research for its own teaching, research, educational, clinical and
publication purposes without the payment of royalties or other fees. LICENSOR
agrees to submit to LICENSEE for its review, a copy of any proposed publication
resulting from the subject research at least sixty (60) days prior to the
estimated date of publication, and if no response is received within thirty (30)
days of the date submitted to LICENSEE, it will be conclusively presumed that
the publication may proceed without delay. If LICENSEE determines that the
proposed publication contains patentable subject matters which require
protection, LICENSEE may require the delay of the publication for a period of
time not to exceed sixty (60) days for the purpose of allowing the pursuit of
such protection. LICENSEE shall treat all materials submitted for review under
this Article 3.08 as confidential INFORMATION as defined in Article 8 herein.
3.09 OPTION TO INVENTIONS.
a. Any new invention, development, or discovery
resulting from the subject research ("INVENTION")
shall be promptly disclosed in writing to LICENSEE.
LICENSEE is hereby granted, without option fee other
than the consideration of the research sponsored
herein and the reimbursement of DUKE for patent
expenses as discussed in the following paragraph, an
option to acquire an exclusive, worldwide,
royalty-bearing license of DUKE'S rights to any
INVENTION, which option shall extend for ninety (90)
days after LICENSEE'S receipt of an INVENTION
disclosure [the OPTION PERIOD]. If LICENSEE notifies
DUKE in writing of its exercise of the option within
the OPTION PERIOD, then the parties will proceed in
good faith to negotiate a license agreement within
ninety days on terms mutually agreed upon.
b. During the OPTION PERIOD, LICENSOR shall have
responsibility for filing, prosecuting and
maintaining appropriate patent protection for any new
INVENTIONS. All of the expenses of pursuing such
patent protection shall be paid by LICENSOR. LICENSOR
shall invoice LICENSEE for reimbursement of such
patent expenses during the OPTION PERIOD, and
LICENSEE shall reimburse LICENSOR within thirty [30]
days of receipt of such invoices. Failure by LICENSEE
to reimburse LICENSOR within said thirty [30] day
period will cancel the option granted to LICENSEE
under Section 3.09.a, and LICENSOR shall be free to
dispose of the INVENTION in any way LICENSEE shall
see fit.
3.10 COMPLIANCE WITH LAWS. The RESEARCH PROGRAM will be conducted in
accordance with, and the INVESTIGATOR and LICENSOR will comply with all federal,
state, and local laws and regulations applicable to the RESEARCH PROJECT.
ARTICLE 4 - CONSIDERATION
4.01 LICENSOR shall receive from LICENSEE consideration for the rights
granted to LICENSEE herein as follows:
a. LICENSEE shall sponsor the RESEARCH PROGRAM specified
in Article 2 herein.
b. LICENSEE shall pay to LICENSOR a running royalty of
[***] of all PROCEEDS, such royalty to be paid as
specified in Article 6 herein. In the event that
LICENSEE must pay to a third party additional
royalties on NET SALES in order to commercialize a
LICENSED PRODUCT, royalty stacking will be capped so
that the total royalty due to LICENSOR and any other
third parties will not exceed [***] of NET SALES,
provided, first, that the royalty due to all parties
receiving royalties is diluted to the same degree,
and second, that the royalty due to LICENSOR shall
not be less than [***] on NET SALES.
[***] represents certain information on this page that has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
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c. Upon execution of this Agreement, LICENSEE shall
transfer to LICENSOR [***] shares of the original
pool of founders' common stock in MicroIslet, Inc.
issued prior to financing, an amount equal to [***]
of such stock.
d. Upon issuance of the first patent application
protecting commercially significant claims involving
the SUBJECT TECHNOLOGY or matter disclosed in the
PROVISIONAL APPLICATION, LICENSEE shall transfer to
LICENSOR an additional amount of common stock in
MicroIslet, Inc., such stock being equivalent to an
additional [***] of the pre-financing founders'
shares.
e. Upon APPROVAL of a LICENSED PRODUCT, LICENSEE shall
transfer to LICENSOR an additional amount of common
stock in MicroIslet, Inc., such stock being
equivalent to an additional [***] of the
pre-financing founders' shares.
4.02 All stock transferred by LICENSEE to LICENSOR as consideration
shall be diluted during subsequent financing to the same degree as the stock
held by other founders.
ARTICLE 5 - SUBLICENSES
5.01 LICENSEE shall have the right to grant sublicenses without
LICENSOR approval. Any such sublicenses shall be subject to terms of this
Agreement. LICENSEE agrees to be responsible for the performance hereunder by
its sublicensees. If, for any reason, this license agreement is terminated,
LICENSEE agrees to assign all sublicenses directly to LICENSOR.
ARTICLE 6 - REPORTING & RECORDS
6.01 LICENSEE shall render to LICENSOR prior to February 28th and
August 31st of each year a written account of all PROCEEDS received by the
LICENSEE during the prior six month periods ending December 31st and June 30th,
respectively, and shall simultaneously pay to LICENSOR the royalties due on such
PROCEEDS in United States Dollars. The royalty on NET SALES made in currencies
other than US Dollars shall be calculated using the appropriate foreign exchange
rate for such currency quoted by the Bank of America (San Francisco) foreign
exchange desk on the close of the last banking day of each calendar quarter. All
non-US taxes related to royalty payments shall be paid by LICENSEE and are not
deductible from the payments due to LICENSOR.
6.02 LICENSEE shall keep full, true and accurate books of accounts and
other records containing all particulars which may be necessary to properly
ascertain and verify the royalties payable by them hereunder. Upon LICENSOR's
request, LICENSEE shall permit an independent Certified Public Accountant
selected by LICENSOR (except one to whom LICENSEE has some reasonable objection)
to examine during ordinary business hours to such of LICENSEE's records as may
be necessary to determine, in respect of any quarter ending not more than two
(2) years prior to the date of such request, the correctness of any report
and/or payment made under this Agreement.
6.03 During the term of this Agreement, LICENSEE will submit annual
progress reports to LICENSOR by February 28 of each year which discuss the
progress and results, as well as ongoing plans, with respect to the plan for the
development of LICENSED PRODUCTS negotiated under Article 7. LICENSOR shall have
the right to request one meeting per year to discuss such information. Should it
be necessary for LICENSOR's personnel to meet with LICENSEE outside of Durham,
North Carolina, LICENSEE will reimburse reasonable travel and living expenses
incident thereto.
6.04 All reports made under this Article 7 shall be treated as
confidential INFORMATION as defined in Article 8 herein.
[***] represents certain information on this page that has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
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ARTICLE 7 - DUE DILIGENCE REQUIREMENTS
7.01 LICENSEE shall use its best efforts to bring LICENSED PRODUCTS to
market through a thorough, vigorous and diligent program for exploitation of the
PATENT RIGHTS, to develop manufacturing capabilities itself or through third
parties, and to continue active, diligent marketing efforts for LICENSED
PRODUCTS, including a vigorous sublicensing program to effect commercialization
of LICENSED PRODUCTS in any field that the LICENSEE decides not to exploit on
its own, throughout the life of this Agreement.
7.02 LICENSEE and LICENSOR agree to negotiate in good faith a mutually
acceptable and commercially reasonable schedule for developing LICENSED
PRODUCTS. Such negotiations shall begin no later than three [3] months following
the termination of the RESEARCH PROGRAM. This schedule will be used to determine
if LICENSOR is showing due diligence in developing LICENSED PRODUCTS.
7.03 LICENSOR may or convert this Agreement to a non-exclusive
Agreement in a particular field of interest if LICENSEE fails materially to meet
any of the mutually agreed commercialization milestones with respect to such
field of interest established through the negotiations specified in Articles
7.02 herein.
ARTICLE 8 - CONFIDENTIAL INFORMATION
8.01 "Confidential Information" ("INFORMATION") shall mean all
information provided by one party to the other and clearly identified as
confidential by the transmitting party at the time of disclosure. Specifically
excepted from this definition is all information: (a) known by the receiving
party at the time of disclosure; (b) publicly disclosed except by breach of this
Agreement; (c) rightfully received by the receiving party from a third party
without an express obligation of confidence; (d) independently developed by the
employees or agents of either party without any knowledge of the confidential
information provided by the other party; or (e) is disclosed pursuant to any
judicial or government request, requirement or order, provided that the
disclosing party takes reasonable steps to provide the other party with
sufficient prior notice in order to allow the other party to contest such
request, requirement or order. The party receiving the INFORMATION agrees to
hold that INFORMATION in trust and confidence for the transmitting party, using
the same care and discretion that the receiving party uses with similar
INFORMATION which it considers confidential. The receiving party will not use
INFORMATION other than for the benefit of the two parties and relating to the
Agreement and except as may be provided for in Article 3.08 regarding
publication herein, neither party will disclose such information without
authorization from the other party. This provision shall remain in effect during
the term of this Agreement and for three (3) years thereafter.
ARTICLE 9 - PATENTS
9.01 LICENSOR shall have responsibility for the filing, prosecuting and
maintaining the appropriate United States patent protection for PATENT RIGHTS
and for any new INVENTIONS. All of the expenses of such protection shall be paid
by LICENSOR, and LICENSEE shall reimburse LICENSOR for all such expenses within
thirty [30] days of receiving invoices for such expenses from LICENSOR. LICENSOR
shall keep LICENSEE advised as to prosecution of such applications by forwarding
to LICENSEE copies of all official correspondence relating thereto and shall
take into account LICENSEE's reasonable comments thereto. The parties agree to
cooperate in the prosecution of all patent applications to insure that the
applications reflect, to the best of each party's knowledge, all items of
commercial and technical interest and importance. LICENSOR agrees to provide
LICENSEE with copies of all correspondence and information related to PATENT
RIGHTS, to consult with LICENSEE on all decisions related to PATENT RIGHTS, and
to consider all recommendations made by LICENSEE with regard to PATENT RIGHTS.
9.02 Article 9.01 not withstanding, the parties agree that LICENSEE
shall reimburse LICENSOR no more than [***] for expenses incurred by LICENSOR in
connection with the initial filing of the PROVISIONAL APPLICATION.
9.03 LICENSEE shall designate the foreign countries, if any, in which
LICENSEE desires patent protection, and LICENSOR shall proceed to obtain such
protection. LICENSOR shall diligently pursue patent protection in the countries
so designated by LICENSEE. LICENSEE shall reimburse LICENSOR for all expenses
incurred by LICENSOR with regard to such foreign patent protection. LICENSOR may
[***] represents certain information on this page that has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
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elect to seek patent protection in countries not so designated by LICENSEE, in
which case LICENSOR shall be responsible for all expenses attendant thereto;
however, in such instances LICENSEE shall forfeit its rights under this license
agreement as to those countries unless LICENSEE shall agree to pursue such
protection within thirty (30) days after receiving written notice.
9.04 Each party shall give the other party prompt notice of each claim
or allegation received by it that the manufacture, use or sale of LICENSED
PRODUCTS constitutes a significant infringement of a third party patent or
patents. LICENSEE shall have the primary right and responsibility at its own
expense to defend and control the defense of any such claim against LICENSEE, by
counsel of its choosing. The settlement of any such actions must be approved by
LICENSOR, which approval may not be unreasonably withheld. LICENSOR agrees to
cooperate with LICENSEE in any reasonable manner deemed by LICENSEE to be
necessary in defending or prosecuting such action. LICENSEE shall reimburse
LICENSOR for all expenses incurred in providing such assistance. In the event
LICENSEE recovers any proceeds in excess of its costs incurred through such
actions, all remaining proceeds shall be considered PROCEEDS to be retained by
LICENSEE except for the royalty due to LICENSOR under section 4.01.b of this
Agreement. Notwithstanding the foregoing, LICENSOR shall, in its sole
discretion, be entitled to participate through counsel of its own choosing in
any such action.
ARTICLE 10 - INFRINGEMENT BY THIRD PARTIES
10.01 Upon learning of the infringement of PATENT RIGHTS by a third
party, the party learning of such infringement shall promptly inform the other
party in writing of that fact along with any evidence available pertaining to
the infringement. LICENSEE may at its own expense take whatever steps are
necessary to stop the infringement and recover damages. In such case, LICENSEE
will keep LICENSOR informed of the steps taken and the progress of any legal
actions taken. LICENSEE agrees to pay LICENSOR one half of any such damages
recovered. If LICENSEE does not undertake, within sixty (60) days of notice, to
enforce the PATENT RIGHTS against the infringing party, the LICENSOR shall have
the right, at its own expense to take whatever steps are necessary to stop the
infringement and recover damages, and shall be entitled to retain damages so
recovered.
ARTICLE 11 - GOVERNMENT CLEARANCE,
PUBLICATION, OTHER USE, EXPORT
11.01 LICENSEE agrees to use its best efforts to have the SUBJECT
TECHNOLOGY cleared for marketing in those countries in which LICENSEE intends to
sell LICENSED PRODUCTS by the responsible government agencies requiring such
clearance. To accomplish said clearances at the earliest possible date, LICENSEE
agrees to file, according to the usual practice of LICENSEE, any necessary data
with said government agencies. Should LICENSEE cancel this Agreement, LICENSEE
agrees to assign its full interest and title in such market clearance
application to LICENSOR at no cost to LICENSOR and to negotiate in good faith a
non-exclusive license to all data relating thereto.
11.02 This license agreement is subject to all of the United States
laws and regulations controlling the export of technical data, computer
software, laboratory prototypes and other commodities and technology.
ARTICLE 12 -- RELATIONSHIP
12.01 LICENSOR's relationship to LICENSEE under this agreement will be
that of an independent contractor and not an agent, joint venturer or partner of
LICENSEE.
ARTICLE 13 - DURATION AND TERMINATION
13.01 This Agreement shall become effective upon the EFFECTIVE DATE,
and unless sooner terminated in accordance with any of the provisions herein,
shall remain in full force and effect in each country for the life of the
last-to-expire of the patents in such country included in the PATENT RIGHTS, or,
until such PATENT RIGHTS may be extended in such country by in terms of
Regulatory Market Exclusivity, e.g. Waxman Hatch ruling, European Community
regulatory exclusivity or if later, until the Market Exclusivity Position of the
LICENSED PRODUCT(S) ends through a generic entrant either into the US, Japan, or
a European country.
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13.02 LICENSEE may terminate the license granted herein and Articles 2,
4, 5, 6.01, 6.03, 6.04, 7, and 11 of this Agreement by giving LICENSOR written
notice at least three (3) months prior to such termination, and thereupon
terminate the manufacture, use or sale of LICENSED PRODUCTS.
13.03 LICENSEE shall transfer to LICENSOR at LICENSEE'S cost all
product licenses, product regulatory approvals, and sublicenses based on SUBJECT
TECHNOLOGY and PATENT RIGHTS licensed under this Agreement if the license
granted herein is terminated under Article 13.02.
13.04 LICENSEE's obligation to support the RESEARCH PROGRAM under the
terms and conditions specified in all subsections of Article 3 and Exhibit B and
also Articles 1, 6.02, 8, 9, 10, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22,
shall survive termination of the license and related terms of this Agreement
under Article 13.02. In the event that LICENSEE elects to terminate the license
under Article 13.02, all obligations, terms, and conditions listed in the
previous sentence shall remain in force until the termination of the RESEARCH
PROGRAM. Upon termination of the license as specified herein, LICENSEE may, upon
written notice to LICENSOR, terminate the RESEARCH PROGRAM prior to the date
specified in Article 3.05, said early termination to be subject to the
conditions specified in Article 3.06. When all obligations under the RESEARCH
PROGRAM have been met, this Agreement shall terminate in its entirety, except as
specified in Articles 13.06 and 13.08.
13.05 Either party may immediately terminate this Agreement for fraud,
willful misconduct, or illegal conduct of the other party upon written notice of
same to that other party. Except as provided above, if either party fails to
fulfill any of its obligations under this Agreement, the non-breaching party may
terminate this Agreement, upon written notice to the breaching party, as
provided below. Such notice must contain a full description of the event or
occurrence constituting a breach of the Agreement. The party receiving notice of
the breach will have the opportunity to cure that breach within thirty (30) days
of receipt of notice. If the breach is not cured within that time, the
termination will be effective as of the thirtieth (30th) day after receipt of
notice. A party's ability to cure a breach will apply only to the first two
breaches properly noticed under the terms of this Agreement, regardless of the
nature of those breaches. Any subsequent breach by that party will entitle the
other party to terminate this Agreement upon proper notice.
13.06 Upon the termination of this Agreement, LICENSEE may notify
LICENSOR of the amount of LICENSED PRODUCT LICENSEE then has on hand, and
LICENSEE shall then have a license to sell that amount of LICENSED PRODUCT, but
no more, provided LICENSEE shall pay the royalty thereon at the rate and at the
time provided for.
13.07 If during the term of this Agreement, LICENSEE shall become
bankrupt or insolvent or if the business of LICENSEE shall be placed in the
hands of a receiver or trustee, whether by the voluntary act of LICENSEE or
otherwise, LICENSEE will be allowed one year to reorganize itself out of
bankruptcy. If LICENSEE shall cease to exist as an active business or fails to
reorganize itself from bankruptcy within this one year period, this Agreement
shall immediately terminate.
13.08 Articles 6.02, 8 and 17 shall survive termination of this
Agreement.
ARTICLE 14 - LAW TO GOVERN
14.01 This Agreement shall be construed and enforced in accordance with
the laws of the State of North Carolina.
ARTICLE 15 - NOTICES
15.01 Notice hereunder shall be deemed sufficient if given by
registered mail, postage prepaid, and addressed to the party to receive such
notice at the address given below, or such other address as may hereafter be
designated by notice in writing.
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LICENSOR LICENSEE
Office of Science and Technology Mr. Xxxx Xxxxx
Xxxx University President
Xxxx 000, Xxxxx Xxxxxxxx XxxxxXxxxx Xxxxxxxxxxxxxxx, Xxx.
Xxx 00000 0000 Xxxxxxxx Xxxxxx, Xxxxx 000,
Xxxxxx, XX 00000 Xx Xxxxx, XX 00000
cc: Office of the University Counsel
Duke University/DUMC Box 3024.
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
ARTICLE 16 - ASSIGNMENT
16.01 This Agreement shall be binding upon and inure to the benefit of
the respective successors and assigns of the parties hereto. However, LICENSEE
may not assign its rights in this Agreement without approval by LICENSOR, such
approval not to be unreasonably withheld, provided that LICENSEE may assign this
Agreement or any portion hereof to an AFFILIATE or to a successor of all or
substantially all of its business relating to the PATENT RIGHTS without the
approval of LICENSOR and shall provide LICENSOR with written notice within
thirty [30] days of such assignment.
ARTICLE 17 - INDEMNITY, INSURANCE, AND STATUS
17.01 LICENSEE agrees to indemnify, hold harmless and defend LICENSOR,
its officers, employees, and agents, against any and all claims, suits, losses,
damages, costs, fees, and expenses asserted by third parties, both government
and non-government, resulting from or arising out of (a) product liability with
respect to a LICENSED PRODUCT or (b) any obligation or activity of the LICENSEE
under this Agreement provided that LICENSEE shall have the right to control the
defense and settlement of any such claims or suit except that LICENSEE shall not
enter into any settlement which makes any admission of wrongdoing on the part of
LICENSOR without prior written consent of LICENSOR. The LICENSEE shall not be
responsible for the negligence or intentional wrongdoing of the LICENSOR.
17.02 LICENSEE shall maintain in force at its sole cost and expense,
with reputable insurance companies, general liability insurance and products
liability insurance coverage in an amount reasonably sufficient to protect
against liability under paragraph 17.01 above upon initiation of clinical
studies wherein a LICENSED PRODUCT is administered to or used with human
subjects. LICENSOR shall have the right to ascertain from time to time that such
coverage exists, such right to be exercised in a reasonable manner.
17.03 NOTHING IN THIS AGREEMENT SHALL BE DEEMED TO BE A REPRESENTATION
OR WARRANTY BY LICENSOR OF THE VALIDITY OF ANY OF THE PATENTS OR THE ACCURACY,
SAFETY, EFFICACY, OR USEFULNESS, FOR ANY PURPOSE, OF ANY SUBJECT TECHNOLOGY.
LICENSOR SHALL HAVE NO OBLIGATION, EXPRESS OR IMPLIED, TO SUPERVISE, MONITOR,
REVIEW OR OTHERWISE ASSUME RESPONSIBILITY FOR THE PRODUCTION, MANUFACTURE,
TESTING, MARKETING OR SALE OF ANY LICENSED PRODUCT, AND LICENSOR SHALL HAVE NO
LIABILITY WHATSOEVER TO LICENSEE OR ANY THIRD PARTIES FOR OR ON ACCOUNT OF ANY
INJURY, LOSS, OR DAMAGE, OF ANY KIND OR NATURE, SUSTAINED BY, OR ANY DAMAGE
ASSESSED OR ASSERTED AGAINST, OR ANY OTHER LIABILITY INCURRED BY OR IMPOSED UPON
LICENSEE OR ANY OTHER PERSON OR ENTITY, ARISING OUT OF OR IN CONNECTION WITH OR
RESULTING FROM:
a. the production, use, or sale of any LICENSED PRODUCT;
b. the use of any SUBJECT TECHNOLOGY; or
c. any advertising or other promotional activities with
respect to any of the foregoing.
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ARTICLE 18 - REPRESENTATIONS
18.01 LICENSOR represents to LICENSEE that,
a. LICENSOR has the full power and authority to enter
into this Agreement and to carry out the transactions
contemplated hereby;
b. to the best of LICENSOR'S knowledge, LICENSOR is not
aware that LICENSOR has any existing patents or other
intellectual property rights necessary to practice
PATENT RIGHTS.
18.02 LICENSEE represents to LICENSEE that, to the best of LICENSEE'S
knowledge, LICENSEE has the full power and authority to enter into this
Agreement and to carry out the transactions contemplated hereby.
ARTICLE 19 - USE OF A PARTY'S NAME
19.01 Neither party will, without the prior written consent of the
other party:
a. use in advertising, publicity or otherwise, any
trade-name, personal name, trademark, trade device,
service xxxx, symbol, or any abbreviation,
contraction or simulation thereof owned by the other
party; or
b. represent, either directly or indirectly, that any
product or service of the other party is a product or
service of the representing party or that it is made
in accordance with or utilizes the information or
documents of the other party.
ARTICLE 20 - SEVERANCE, WAIVER AND ALTERATION
20.01 Each clause of this Agreement is a distinct and severable clause
and if any clause is deemed illegal, void or unenforceable, the validity,
legality or enforceability of any other clause or portion of this Agreement will
not be affected thereby.
20.02 The failure of a party in any instance to insist upon the strict
performance of the terms of this Agreement will not be construed to be a waiver
or relinquishment of any of the terms of this Agreement, either at the time of
the party's failure to insist upon strict performance or at any time in the
future, and such terms will continue in full force and effect.
20.03 Any alteration, modification, or amendment to this Agreement must
be in writing and signed by both parties.
ARTICLE 21 - ARBITRATION
21.01 Disputes relating to the terms and conditions of this Agreement
shall be settled by final and binding arbitration in the City of Durham in the
State of North Carolina pursuant to commercial arbitration rules of the American
Arbitration Association, in accordance with the following procedures:
a. The arbitration tribunal shall consist of three
arbitrators. Each party shall nominate in the request
for arbitration and the answer thereto one arbitrator
and the two arbitrators so named will then jointly
appoint a third arbitrator as chairman of the
arbitration tribunal.
b. The decision of the arbitration tribunal shall be
final and binding upon the parties hereto.
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ARTICLE 22 - TITLES
22.01 All titles and article headings contained in this Agreement are
inserted only as a matter of convenience and reference. They do not define,
limit, extend or describe the scope of this Agreement or the intent of any of
its provisions.
ARTICLE 23 - ENTIRE UNDERSTANDING
23.01 This Agreement represents the entire understanding between the
parties, and supersedes all other agreements, express or implied, between the
parties concerning the SUBJECT TECHNOLOGY.
IN WITNESS WHEREOF, the parties have caused these presents to be
executed in duplicate as of the date and year first above written.
SEAL LICENSOR
By: /S/ XXXXX XXXXXXXXX
-------------------
Xxxxx Xxxxxxxxx, MD
Chancellor, Duke University Medical Center
Date: 9/9/98
/S/ XXXXXX XXXXX
----------------
Xxxxxx Xxxxx, Ph.D., Director,
Office of Science & Technology
Date: 9/1/98
[LICENSEE]
By: /S/ XXXX X. STEEL IV
--------------------
Name: Xxxx X. Steel IV
Title: President
Date: 9/18/98
SEAL
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