This License Agreement ("AGREEMENT") is made by and between The Trustees of
the University of Pennsylvania, a Pennsylvania nonprofit corporation, with
offices located at 0000 Xxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxxxx, Xxxxxxxxxxxx
00000-0000 ("PENN") and Orthovita, Inc., a corporation organized and existing
under the laws of Pennsylvania ("LICENSEE"), having a place of business at
Haverford, PA.
This AGREEMENT is effective as of September 1, 1993 ("EFFECTIVE DATE").
RECITALS
WHEREAS, PENN owns and is a proprietor of certain intellectual property
developed by Xx. Xxxx Xxxxxxxx of PENN's School of Engineering relating to novel
materials and techniques for improving orthopaedic implants; and,
WHEREAS, PENN owns applications for United States letters patent listed in
Attachment 1 and attached hereto and foreign counterparts relating to the
foregoing intellectual property developed by Xx. Xxxxxxxx; and,
WHEREAS, LICENSEE desires to secure the exclusive right and license to use,
develop, manufacture, market and exploit the intellectual property developed by
Xx. Xxxxxxxx described in Attachment 1 hereto; and,
WHEREAS, PENN has determined that the exploitation of the intellectual
property of Xx. Xxxxxxxx is in the best interest of PENN and is consistent with
its educational and research missions and goals; and,
WHEREAS, PENN and LICENSEE have entered into a STOCK PURCHASE AGREEMENT
(Attachment 2) providing for the issuance to PENN of shares of LICENSEE's Common
Stock in partial consideration of the exclusive license granted hereunder;
NOW, THEREFORE, in consideration of the premises and of the promises and
covenants contained herein and intending to be legally bound hereby, the parties
agree as follows:
ARTICLE 1 - DEFINITIONS
1.1 AFFILIATE means, when used with reference to LICENSEE, any ENTITY
directly or indirectly controlling, controlled by or under common control with
LICENSEE. For purposes of this AGREEMENT "control" means the direct or indirect
ownership of over fifty percent (50%) of the outstanding voting securities of an
ENTITY or the right to receive over fifty percent (50%) of the profits or
earnings of an ENTITY, or the right to control the policy decisions of a ENTITY.
1.2 BANKRUPTCY EVENT means voluntary or involuntary proceedings by or
against such ENTITY are instituted in bankruptcy or under any insolvency law, or
a receiver or custodian
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is appointed for such ENTITY, or proceedings are instituted by or against such
ENTITY for corporate reorganization or the dissolution of such ENTITY, which
proceedings, if involuntary, shall not have been dismissed within sixty (60)
days after the date of filing, or such ENTITY makes an assignment for the
benefit of creditors, or substantially all of the assets of such ENTITY are
seized or attached and not released within sixty (60) days thereafter.
1.3 CALENDAR QUARTER means each three-month period, or any portion
thereof, beginning on January 1, April 1, July 1 and October 1.
1.4 CALENDAR YEAR means a period of twelve (12) months beginning on
January 1 and ending on December 31.
1.5 CONFIDENTIAL INFORMATION means and includes all technical information,
inventions, trade secrets, developments, discoveries, software, know-how,
methods, techniques; formulae, data, processes and other proprietary ideas,
whether or not patentable or copyrightable, that PENN identifies as confidential
or proprietary at the time it is delivered or communicated to LICENSEE.
1.6 ENTITY means a corporation, an association, a joint venture, a
partnership, a trust, a business, an individual, a government or political
subdivision thereof, including an agency, or any other organization that can
exercise independent legal standing.
1.7 FDA means the Food and Drug Administration of the United States.
1.8 FEDERAL GOVERNMENT INTEREST means the rights of the United States
Government under Public Laws 96-517, 97-256 and 98-620, codified at 33 U.S.C.
200-212, and any regulations issued thereunder, as statute or regulations may be
amended from time to time hereafter.
1.9 FAIR MARKET VALUE means the cash consideration which LICENSEE or its
sublicensee would realize from an unaffiliated, unrelated buyer in an arm's
length sale of an identical item sold in the same quantity and at the same time
and place of the transaction.
1.10 FIELD OF USE means the use of PENN TECHNICAL INFORMATION and/or PENN
PATENT RIGHTS for use in medical, dental and veterinary fields for growth of
bone cells, fixing human prosthetic devices, coating human prosthetic devices,
inducing bone growth onto or into modified human prosthetic devices, and/or
producing human prosthetic devices.
1.11 LICENSE shall include LICENSEE and its AFFILIATES.
1.12 NET SALES means the cash consideration or FAIR MARKET VALUE
attributable to the SALE of any PENN LICENSED PRODUCT(S), less qualifying costs
directly attributable to such SALE and borne by LICENSEE or its sublicense.
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1.12.1 Such qualifying costs which shall be documented by LICENSEE
at the time of their occurrence shall be limited to the following:
1.12.1.1 Discounts, in amounts customary in the trade, for
quantity purchases, prompt payments and for
wholesalers and distributors.
1.12.1.2 Credits or refunds, not exceeding the original
invoice amount, for claims or returns.
1.12.1.3 Prepaid transportation insurance premiums.
1.12.1.4 Prepaid outbound transportation expenses.
1.12.1.5 Sales and use taxes imposed by a governmental
agency.
1.13 PENN LICENSED PRODUCT(S) means products which in the absence of this
AGREEMENT would infringe at least one claim of PENN PATENT RIGHTS or products
which are made using a process or machine covered by a claim of PENN PATENT
RIGHTS or products made, at least in part, using PENN TECHNICAL INFORMATION.
1.14 PENN PATENTED PRODUCT(S) means products which are made, made for,
used or sold, which manufacture, use or sale is covered by any claim of the PENN
PATENT RIGHTS in any country.
1.15 PENN PATENT RIGHTS means those United States patent applications
listed in Attachment 1 hereto, and foreign counterparts including continuation,
divisional and re-issue applications thereof and continuation-in-part
applications thereof based upon intellectual property discovered by PENN through
Xx. Xxxxxxxx together with any and all patents issuing thereupon.
1.16 PENN TECHNICAL INFORMATION means research and development
information, unpatented inventions know-how, trade secrets, and technical data
in the possession of PENN on the EFFECTIVE DATE of this AGREEMENT which is
needed to produce PENN LICENSED PRODUCTS.
1.17 SALE means any bona fide transaction for which consideration is
received or expected for the sale, use, lease, transfer or other disposition of
PENN LICENSED PRODUCT(S). A SALE of PENN LICENSED PRODUCT(S) shall be deemed
completed at the time LICENSEE or its sublicense invoices, ships, or receives
payment for such PENN LICENSED PRODUCT(S), whichever occurs first.
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ARTICLE 2 - LICENSE AGREEMENT
2.1 PENN grants to LICENSEE for the term of this AGREEMENT an exclusive,
world-write right and license with the right to grant sublicenses to make, have
made, use and sell PENN LICENSED PRODUCT(S) in the FIELD OF USE. No other rights
or licenses are granted hereunder.
2.2 The license grant of this Article 2 is exclusive but for the
reserved right of PENN to use and permit other nonprofit organizations to use
the PENN PATENT RIGHTS, and the PENN TECHNICAL INFORMATION solely for
educational and research purposes.
2.3 LICENSEE acknowledges that in accordance with the FEDERAL GOVERNMENT
INTEREST, the United States government retains certain rights in intellectual
property funded in whole or part under any contract, grant or similar agreement
with a Federal agency. The license grant of this Article 2 is expressly subject
to all of such right.
2.4 The right to sublicense conferred upon LICENSEE under this AGREEMENT
is subject to the following conditions:
2.4.1 In each such sublicense, the sublicensee shall be prohibited
from further sublicensing and shall be subject to the terms and conditions of
the license granted to LICENSEE under this AGREEMENT.
2.4.2 LICENSEE shall forward to PENN, within thirty (30) days of
execution, a complete and accurate copy written in the English language of each
sublicense granted hereunder. PENN's receipt of such sublicense shall not
constitute an approval of such sublicense or a waiver of any of PENN's rights or
LICENSEE's obligations hereunder.
2.4.3 If LICENSEE becomes subject to a BANKRUPTCY EVENT, all
payments then or thereafter due and owing to LICENSEE from its sublicensees
shall upon notice from PENN to any such sublicense become payable directly to
PENN for the account of LICENSEE; provided however, that PENN shall remit to
LICENSE the amount by which such payments exceed the amounts owed by LICENSEE to
PENN.
2.4.4 Notwithstanding any such sublicense, LICENSEE shall remain
primarily liable to PENN for all of the LICENSEE'S duties and obligations
contained in this AGREEMENT, and any act or omission of a sublicensee which
would be a breach of this AGREEMENT if performed by LICENSEE shall be deemed to
be a breach by LICENSEE of this AGREEMENT.
ARTICLE 3 - FEES AND ROYALTIES
3.1 LICENSE INITIATION FEE AND ROYALTIES
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3.1.1 In partial consideration of the exclusive license granted
herein, LICENSEE shall pay to PENN on the EFFECTIVE DATE of this AGREEMENT, a
non-refundable license initiation fee of three and one-half percent (3.5 %) of
the currently issued and outstanding shares of LICENSEE's common stock via a
Stock Purchase Agreement (Appendix 2). The issuance of such stock shall be in
accordance with a Stock Agreement attached to this Agreement as Appendix 2.
3.1.2 In further consideration of the exclusive license granted
herein, LICENSEE shall pay to PENN a royalty of four percent (4%) of the NET
SALES of PENN LICENSED PRODUCTS made, made for, used or sold by LICENSEE and any
sublicensees or any other products, the rights of which were obtained through
sublicense of the PENN LICENSED PRODUCTS.
3.1.3 NET SALES of any PENN LICENSED PRODUCT shall not be subject to
more than one assessment of the scheduled royalty; such assessment shall be the
highest applicable royalty.
3.1.4 In the event that a PENN LICENSED PRODUCT is sold in the form
of a combination product containing one or more products which are themselves
not PENN LICENSED PRODUCTS, the NET SALES shall be calculated by multiplying the
sales price of such combination product by the fraction A/(A+B) where A is the
invoice price or FAIR MARKET VALUE of the PENN LICENSED PRODUCT and B is the
total invoice price or FAIR MARKET VALUE of the other products. In the case of a
combination product which includes one or more PENN LICENSED PRODUCTS, the NET
SALES upon which the royalty due PENN is based shall not be less than the normal
aggregate NET SALES for such PENN LICENSED PRODUCTS.
3.2 MILESTONES AND MAINTENANCE FEES
3.2.1 LICENSEE shall use its best efforts to develop for commercial
use and to market PENN LICENSED PRODUCTS as soon as practical, consistent with
sound and reasonable business practices.
3.2.2 LICENSEE shall provide PENN on each June 1 and December 1 with
written reports, setting forth in such detail as PENN may reasonably request,
the progress of the development, evaluation, testing and commercialization of
the PENN LICENSED PRODUCTS. LICENSEE shall also notify PENN within thirty (30)
days of the first commercial sale of any PENN LICENSED PRODUCT.
3.2.3 LICENSEE and PENN shall meet at least once each year this
Agreement is extant, on or about the anniversary of this Agreement, to discuss
LICENSEE's progress with respect to the development and regulatory status of
each of the PENN LICENSED PRODUCTS and the anticipated date of commercialization
or sublicense of such products.
3.3 REPORTS AND RECORDS
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3.3.1 LICENSEE shall deliver to PENN within forty-five (45) days
after the end of each CALENDAR QUARTER a report, certified by the chief
financial officer of LICENSEE setting forth in reasonable detail the calculation
of the royalties due to PENN for such CALENDAR QUARTER, including, without
limitation:
3.3.1.1 Number of PENN LICENSED PRODUCTS involved in
SALES, listed by country.
3.3.1.2 Gross consideration for SALES of PENN LICENSED
PRODUCTS, including all amounts invoiced, billed,
or received.
3.3.1.3 Qualifying costs, as defined in Section 1.12,
listed by category of cost.
3.3.1.4 NET SALES of PENN LICENSED PRODUCTS listed by
country.
3.3.1.5 Royalties owed to PENN, listed by category,
including without limitation earned and
sublicensee-derived.
3.3.2 Royalties payable under Sections 3.1 and 3.3 hereof shall be
paid within forty-five (45) days following the last day of the CALENDAR QUARTER
in which the royalties accrue and shall accompany the report of Section 3.4.1.
3.3.3 LICENSEE will maintain and cause its sublicensees to maintain,
complete and accurate books and records which enable the royalties payable
hereunder to be verified. The records for each CALENDAR QUARTER shall be
maintained for three years after the submission of each report under Article 3
hereof. Upon reasonable prior notice to LICENSEE, PENN and its accountants shall
have access to all books and records relating to the SALES of PENN LICENSED
PRODUCTS by LICENSEE and its sublicensees to conduct a review or audit thereof.
Such access shall be available not more than once each CALENDAR YEAR, during
normal business hours, and for each of the three years after the expiration or
termination of this AGREEMENT. If PENN determines that LICENSEE has underpaid
royalties by 5% or more, LICENSEE will pay the costs and expenses of PENN and
its accountants in connection with their review or audit.
3.4 CURRENCY, PLACE OF PAYMENT, INTEREST
3.4.1 All dollar amounts referred to in this AGREEMENT are expressed
in United States dollars. All payments to PENN under this AGREEMENT shall be
made in United States dollars by check payable to "The Trustees of the
University of Pennsylvania."
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3.4.2 If LICENSEE receives revenues from SALES of PENN LICENSED
PRODUCTS in currency other than United States dollars, revenues shall be
converted into United States dollars at the conversion rate for the foreign
currency as published in the eastern edition of The Wall Street Journal as of
the last business day of the applicable CALENDAR QUARTER.
3.4.3 Amounts that are not paid when due shall accrue interest from
the due date until paid, at an annual rate equal to the prime rate as designated
by LICENSEE'S principal lender plus two percent (2%) (or the maximum allowed by
law, if less).
ARTICLE 4 - CONFIDENTIALITY
4.1 CONFIDENTIALITY
4.1.1 LICENSEE agrees to maintain in confidence and not to disclose
to any third party any CONFIDENTIAL INFORMATION of PENN received pursuant to
this AGREEMENT. LICENSEE agrees to ensure that its employees have access to
CONFIDENTIAL INFORMATION only on a need-to-know basis and are obligated in
writing to abide by LICENSEE'S obligations hereunder. The foregoing obligation
shall not apply to:
4.1.1.1 information that is known to LICENSEE or
independently developed by LICENSEE prior to the
time of disclosure, in each case, to the extent
evidenced by written records promptly disclosed to
PENN upon receipt of the CONFIDENTIAL INFORMATION.
4.1.1.2 information disclosed to LICENSEE by a third party
that has a right to make such disclosure;
4.1.1.3 information that becomes patented, published or
otherwise part of the public domain as a result of
lawful acts by PENN or a third person obtaining
such information, as a matter of right; or
4.1.1.4 information that is required to be disclosed by
order of United States government authority,
including the U.S. Food and Drug Administration
and the U.S. Securities and Exchange Commission,
or a court of competent jurisdiction; provided
that LICENSEE, shall use its best efforts to
obtain confidential treatment of such information
by the agency or court.
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4.2 PENN shall not be obligated to accept any confidential information
from LICENSEE. PENN bears no institutional responsibility for maintaining the
confidentiality of any confidential information of LICENSEE.
4.3 The placement of a copyright notice on any CONFIDENTIAL INFORMATION
shall not be construed to mean that such information has been published and will
not release LICENSEE from its obligation of confidence hereunder.
ARTICLE 5 - TERM AND TERMINATION
5.1 This AGREEMENT, unless sooner terminated as provided herein, shall
terminate upon the expiration of the last to expire or become abandoned of the
PENN PATENT RIGHTS.
5.2 LICENSEE may, at its option, terminate this AGREEMENT at any time by
doing all of the following:
5.2.1 By ceasing to make, have made, use and sell all PENN LICENSED
PRODUCTS; and
5.2.2 By terminating all sublicenses, and causing all sublicensees to
cease making, having made, using and selling all PENN LICENSED PRODUCTS; and
5.2.3 By giving sixty (60) days notice to PENN of such cessation and
of LICENSEE's intent to terminate; and
5.2.4 By tendering payment of all accrued royalties.
5.3 PENN may terminate this AGREEMENT if any of the following occur:
5.3.1 LICENSEE becomes more than ninety (90) days in arrears in
payment of royalties or expenses due pursuant to this AGREEMENT and LICENSEE
does not provide full payment immediately upon demand; or
5.3.2 LICENSEE becomes subject to a BANKRUPTCY EVENT; or
5.3.3 LICENSEE breaches this AGREEMENT and does not cure such breach
within ninety (90) days written notice thereof.
5.4 PENN may also terminate this AGREEMENT individually as to a PENN
LICENSED PRODUCT and PENN PATENT RIGHTS related thereto if:
5.4.1 five years have elapsed from the EFFECTIVE DATE of this
AGREEMENT; and
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5.4.2 LICENSEE has not submitted such PENN LICENSED PRODUCT for FDA
regulatory approval; or
5.4.3 LICENSEE has not made a SALE within one (1) year after FDA
Regulatory Approval of such PENN LICENSED PRODUCT or has no sublicensees doing
so; or
5.4.4 LICENSEE has not met milestones specified in Section 3.2; and
5.4.5 PENN has given LICENSEE ninety (90) days notice of intent to
terminate.
5.4.6 Notwithstanding the foregoing, PENN agrees that it shall not
terminate this Agreement individually as to a PENN LICENSED PRODUCT without
giving LICENSEE the opportunity to extend the term of this AGREEMENT as to such
PENN LICENSED PRODUCT upon the payment to PENN of such reasonable consideration
as is mutually agreed to by each of the parties.
In the event LICENSEE terminates this AGREEMENT individually as
to a PENN LICENSED PRODUCT and PENN PATENT RIGHTS related thereto as provided
herein, Penn shall be free to license to any other party the rights to make,
have made, use and sell such PENN LICENSED PRODUCT and to use such PENN PATENT
RIGHTS upon such terms as PENN deems appropriate, without any further obligation
to LICENSEE.
5.5 If LICENSEE becomes subject to a BANKRUPTCY EVENT, all duties of PENN
and all rights (but not duties) of LICENSEE under this AGREEMENT shall
immediately terminate without the necessity of any action being taken either by
PENN or by LICENSEE. To secure the complete and timely payment and satisfaction
of all LICENSEE's royalty obligations under this AGREEMENT, LICENSEE hereby
grants to PENN a security interest, effective immediately, in LICENSEE's entire
right, title and interest in and to this AGREEMENT and to all inventories of
PENN LICENSED PRODUCTS now or hereafter owned by LICENSEE. In addition to any
rights or remedies provided for under this AGREEMENT, PENN shall have all of the
rights and remedies of secured party under the Uniform Commercial Code. Upon
the request and at the sole expense of PENN, LICENSEE shall execute any and all
instruments or documents as shall be reasonably necessary to evidence and
perfect such security interest in any jurisdiction.
5.6 Upon termination of this AGREEMENT, LICENSEE shall, at PENN's request,
return to PENN all CONFIDENTIAL INFORMATION fixed in any tangible medium of
expression as well as any data generated by LICENSEE during the term of this
AGREEMENT which will facilitate the development of the technology licensed
hereunder.
5.7 LICENSEE's obligation to pay royalties accrued under Article 3 hereof
shall survive termination of this AGREEMENT. In addition, the provisions of
Articles 4 (for a three
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(3) year period), and 8.1, 8.2, 8.3, 9 (for the applicable statute of
limitations) shall survive such termination
ARTICLE 6 - PATENT MAINTENANCE AND REIMBURSEMENT
6.1 PENN shall control and diligently prosecute and maintain PENN PATENT
RIGHTS provide LICENSEE shall promptly reimburse PENN for all the attorneys
fees, expenses, official fees and other charges incident to the preparation,
prosecution and maintenance of PENN PATENT RIGHTS, as documented in the
memorandum of October 15, 1993 from Xxxxxxx Xxxxxx to Xxxxx Xxxxxx, attached
hereto as Exhibit 1. PENN shall provide LICENSEE with itemized statements
reflecting these expenses LICENSEE shall reimburse PENN for such past expenses
according to the following schedule:
Date of Payment Amount of Payment
--------------- -----------------
Within 90 Days of the EFFECTIVE DATE One-quarter (1/4) of accrued expenses;
Upon the 1st Anniversary of This One-quarter (1/4) of accrued expenses;
Agreement
Upon the 2nd Anniversary of This One-half (1/2) of accrued expenses.
Anniversary
LICENSEE shall also promptly reimburse PENN for all documented attorneys
fees, expenses, official fees and other charges incident to the preparation,
prosecution and maintenance of PENN PATENT RIGHTS incurred subsequent to the
EFFECTIVE DATE of this Agreement; provided, however, that PENN will file patent
applications on technology only after receipt of notice from LICENSEE that such
technology should become should become part of the PENN PATENT RIGHTS.
6.2 LICENSEE and its sublicensees shall comply with all United States and
foreign laws with respect to patent marking of PENN LICENSED PRODUCTS.
ARTICLE 7 - INFRINGEMENT AND LITIGATION
7.1 PENN and LICENSEE are responsible for notifying each other promptly of
any infringement of PENN PATENT RIGHTS which may come to their attention. PENN
and LICENSEE shall consult one another in a timely manner concerning any
appropriate response thereto.
7.2 LICENSE shall have the right, but not the obligation to prosecute such
infringement at its own expense. LICENSE shall not settle or compromise any
such suit in a manner that imposes any obligations or restrictions on PENN or
grants any rights to the PENN TECHNICAL
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INFORMATION or the PENN PATENT RIGHTS, without PENN'S written permission.
Financial recoveries from any such litigation will first be applied to reimburse
LICENSEE for its litigation expenditures with additional recoveries being paid
to LICENSEE, subject to a royalty due PENN based on the provisions of Article 3
hereof.
7.3 Such rights of Section 7.2 shall be subject to the continuing right of
PENN to intervene at PENN's own expense and join LICENSEE in any claim or suit
for infringement of the PENN PATENT RIGHTS. Any considerations received by
LICENSEE in settlement of any claim or suit shall be shared between PENN and
LICENSEE in proportion with their share of the litigation expenses in such
infringement action. If counsel chosen by LICENSEE is reasonably acceptable to
PENN, for these purposes, PENN's litigation expenses shall not be deemed to
include counsel fees.
7.4 If LICENSEE fails to prosecute such infringement, PENN shall have the
right, but not the obligation, to prosecute such infringement at its own
expense. In such event, financial recoveries will be entirely retained by PENN.
7.5 In any action to enforce any of the PENN PATENT RIGHTS either party,
at the request and expense of the other party shall cooperate to the fullest
extent reasonably possible. This provision shall not be construed to require
either party to undertake any activities, including legal discovery, at the
request of any third party except as may be required by lawful process of a
court of competent jurisdiction.
7.6 In the event an infringement action is brought by a third party
claiming that the PENN TECHNICAL INFORMATION or PENN PATENT RIGHTS or any PENN
LICENSED PRODUCT infringes or violates any patent, copyright, trademark or other
intellectual property rights of such third party, LICENSEE's first obligation
shall be to defend, indemnify and hold harmless the Indemnified Parties at the
extent provided in Article 8 of this AGREEMENT. While such a third party
infringement action is pending, all royalties and other payments required to
made any LICENSEE under Article 3 shall be held in an interest-bearing escrow
account established as a joint account in the names of LICENSEE and PENN
(hereinafter referred to as the "Account").
7.6.1 Upon determination by a court of competent jurisdiction from
which no appeal has been or can be taken that no infringement occurred, and
following satisfaction of LICENSEE's obligation under Article 8, the payments
held in the Account shall be used as follows: (a) LICENSEE shall be entitled to
deduct from the Account an amount equal to fifty percent (50%) of LICENSEE's
costs and expenses incurred in defending such infringement action; and (b) any
amount remaining the Account after such deduction shall be paid to PENN.
7.6.2 Upon a determination by a court of competent jurisdiction from
which no appeal has been or can be taken than an infringement occurred, LICENSEE
and PENN shall meet to agree upon a schedule and terms for the resumption of the
payment to PENN of royalties and other payments consistent with the court's
determination and the effect of such determination on rights licensed under this
AGREEMENT, and PENN shall take whatever action is necessary to
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remedy the infringement, if practical, and consistent with sound and reasonable
business practices. Following satisfaction of LICENSEE's obligations under
Article 8, the payments held in the Account shall be used as follows: (a)
LICENSEE shall be entitled to deduct from the Account an amount equal to one
hundred percent (100%) of LICENSEE's costs and expenses incurred in defending
such infringement action; and (b) any amount remaining in the Account after such
deduction shall be paid to PENN.
7.6.3 In no event shall the provisions of this Article 7; (a) in any
way limit LICENSEE's obligations to defend, indemnify and hold harmless the
Indemnified Parties as required in Article 8; and (b) require PENN to refund any
royalties or other payments received by PENN prior to the commencement of an
infringement action.
ARTICLE 8 - DISCLAIMER OF WARRANTY; INDEMNIFICATION
8.1 THE PENN PATENT RIGHTS, JOINT PATENT RIGHTS, PENN TECHNICAL
INFORMATION, PENN LICENSED PRODUCTS AND ALL OTHER TECHNOLOGY LICENSED UNDER THIS
AGREEMENT ARE PROVIDED ON AN "AS IS" BASIS AND PENN MAKES NO REPRESENTATIONS OR
WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT THERETO. BY WAY OF EXAMPLE BUT NOT
OF LIMITATION, PENN MAKES NO REPRESENTATION OR WARRANTIES (i) OF COMMERCIAL
UTILITY; (ii) OF MERCHANTABILITY OF FITNESS FOR A PARTICULAR PURPOSE; OR (iii)
THAT THE USE OF THE PENN PATENT RIGHTS, PENN TECHNICAL INFORMATION, PENN
LICENSED PRODUCTS AND ALL TECHNOLOGY LICENSED UNDER THIS AGREEMENT WILL NOT
INFRINGE ANY PATENT, COPYRIGHT OR TRADEMARK OR OTHER PROPRIETARY OR PROPERTY
RIGHTS OF OTHERS. PENN SHALL NOT BE LIABLE TO LICENSEE, LICENSEE'S SUCCESSORS
OR ASSIGNS OR ANY THIRD PARTY WITH RESPECT TO: ANY CLAIM ARISING FROM THE USE OF
THE PENN PATENT RIGHTS, PENN TECHNICAL INFORMATION, PENN LICENSED PRODUCTS AND
ALL TECHNOLOGY LICENCED UNDER THIS AGREEMENT OR FROM THE MANUFACTURE, USE OR
SALE OF PENN LICENSED PRODUCTS; OR ANY CLAIM FOR LOSS OF PROFITS, LOSS OR
INTERRUPTION OF BUSINESS, OR FOR INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES OF
ANY KIND.
8.2 LICENSEE will defend, indemnify and hold harmless PENN, its trustees,
officers, agents and employees (individually, an "Indemnified Party", and
collectively, the "Indemnified Parties"), from and against any and all
liability, loss, damage, action, claim or expense suffered or incurred by the
Indemnified Parties (including attorney's fees) (individually, a "Liability",
and collectively, the "Liabilities") that results from or arises out of: (a) the
development, use, manufacture, promotion, sale or other disposition, of any PENN
TECHNICAL INFORMATION, PENN PATENT RIGHTS or PENN LICENSED PRODUCTS by LICENSEE,
its assignees, sublicensees, vendors or other third parties; (b) breach by
LICENSEE of any covenant or agreement contained in this AGREEMENT; and (c) the
enforcement by an Indemnified Party of its rights under
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this Section. Without the foregoing, LICENSEE will defend, indemnify and hold
harmless the Indemnified Parties from and against any Liabilities resulting
from:
8.2.1 any product liability or other claim of any kind related to the
use by a third party of a PENN LICENSED PRODUCT that was manufactured, sold or
otherwise disposed by LICENSEE, its assignees, sublicensees, vendors or other
third parties; and
8.2.2 clinical trials or studies conducted by or on behalf of
LICENSEE relating to the PENN TECHNICAL INFORMATION, PENN PATENT RIGHTS or PENN
LICENSED PRODUCTS, including, without limitation, any claim by or on behalf of a
human subject of any such clinical trial or study, any claim arising from the
procedures specified in any protocol used in any such clinical trial or study,
any claim of deviation, authorized or unauthorized, from the protocols of any
such clinical trial or study, and any claim resulting from or arising out of the
manufacture or quality control by a third party of any substance administered in
any clinical trial or study.
8.3 The Indemnified Party shall promptly notify LICENSEE of any claim or
action giving rise to Liabilities subject to the provisions of the foregoing
Section. LICENSEE shall have the right to defend any such claim or action, at
its cost and expense. LICENSEE shall not settle or compromise any such claim or
action in a manner that imposes any restrictions or obligations on PENN or
grants any rights to PENN TECHNICAL INFORMATION, PENN PATENT RIGHTS or PENN
PATENTED PRODUCTS without PENN's prior written consent. If LICENSEE fails or
declines to assume the defense of any such claim or action within thirty (30)
days after notice thereof, PENN may assume the defense of such claim or action
for the account and at the risk of LICENSEE, and any Liabilities related thereto
shall be conclusively deemed a liability of LICENSEE. LICENSEE shall pay
promptly to the Indemnified Party any Liabilities to which the foregoing
indemnify relates, as incurred. The indemnification rights of PENN or other
Indemnified Party contained herein are in addition to all other rights which
such Indemnified Party may have at law or in equity or otherwise.
8.4 INSURANCE
8.4.1 LICENSEE shall procure and maintain a policy or policies of
comprehensive general liability insurance, including broad form and contractual
liability, and, if commercial reasonable at standard rates, such coverage in a
minimum amount of $1,000,000 combined single limit per occurrence and in the
aggregate as respects personal injury, bodily injury and property damage arising
out of LICENSEE'S performance of this AGREEMENT.
8.4.2 LICENSEE shall, upon commencement of clinical trials involving
PENN LICENSED PRODUCTS, procure and maintain a policy or policies of product
liability insurance and, if commercially reasonable at standard rates, such
coverage in a minimum amount of $3,000,000 combined single limit per occurrence
and in the aggregate as respects bodily injury and property damage arising out
of LICENSEE's performance of this AGREEMENT.
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8.4.3 The policy or policies of insurance specified herein shall be
issued by an insurance carrier with an A.M. Best rating of "A" or better and
shall name PENN as an additional insured with respect to LICENSEE's performance
of this AGREEMENT. LICENSEE shall provide PENN with certificates evidencing the
insurance coverage required herein and all subsequent renewals thereof. Such
certificates shall provide that LICENSEE's insurance carrier(s) notify PENN in
writing at least 30 days prior to cancellation or material change in coverage.
8.4.4 PENN shall periodically review the adequacy of the minimum
limits of liability specified herein. The specified minimum insurance amounts
shall not constitute a limitation of LICENSEE's obligation to indemnify PENN
under this AGREEMENT.
ARTICLE 9 - USE OF PENN'S NAME; INDEPENDENT CONTRACTOR
9.1 LICENSEE and its employees and agents shall not use and LICENSEE
shall not permit its sublicensees to use PENN's name, any adaptation thereof,
any PENN logotype, trademark, service xxxx or slogan or the name xxxx or
logotype of any PENN representative or organization in any way without the
prior, written consent of PENN.
9.2 Nothing herein shall be deemed to establish a relationship of
principal and agent between PENN and LICENSEE, nor any of their agents or
employees for any purpose whatsoever. The AGREEMENT shall not be construed as
constituting PENN and LICENSEE as partners, or as creating any other form of
legal association or arrangement which would impose liability upon one party for
the act or failure to act of the other party.
ARTICLE 10 - ADDITIONAL PROVISIONS
10.1 LICENSEE shall comply with all prevailing laws, rules and regulations
pertaining to the development, testing, manufacture, marketing, sales, use,
import or export of products. Without limiting the foregoing, it is understood
that this AGREEMENT may be subject to United States laws and regulations
controlling the export of technical data, computer software, laboratory
prototypes and other commodities, articles and information, including the Arms
Export Control Act as amended in the Export Administration Act of 1979, and that
the parties obligations hereunder are contingent upon compliance with applicable
United States export laws and regulations. The transfer of certain technical
data and commodities may require a license from the cognizant agency of the
United States Government and/or written assurances by LICENSEE that LICENSEE
shall not export data or commodities to certain foreign countries without prior
approval of such agency. PENN neither represents that a license is not required
nor that, if required, it will issue.
10.2 This AGREEMENT and the rights and duties appertaining thereto may not
be assigned by LICENSEE without first obtaining the express written consent of
PENN which consent shall not be unreasonably withheld. Any such purported
assignment, without the written consent of PENN, shall be null and of no effect.
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10.3 Notices, payments, statements, reports and other communications under
this AGREEMENT shall be in writing and shall be deemed to have been received as
of the date dispatched if sent by public overnight courier (e.g. Federal
Express) and addressed as follows:
If for PENN:
University of Pennsylvania
Center for Technology Transfer
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxxxx, XX 00000-0000
Attention: Managing Director
with a copy to:
Office of General Counsel
University of Pennsylvania
000 Xxxxxxx Xxxx
Xxxxxxxxxxxx, XX 00000-0000
Attention: General Counsel
If for LICENSEE:
with a copy to:
Xxxxxxx X. Xxxxxxx
Wolf, Block, Xxxxxx & Xxxxx-Xxxxx
00xx & Xxxxxxxx Xxxxxxx
Xxxxxxxxxxxx, XX 00000
Either party may change its official address upon written notice to the other
party.
10.4 This AGREEMENT shall be construed and governed in accordance with the
laws of the Commonwealth of Pennsylvania, without giving effect to conflict of
law provisions.
10.5 This AGREEMENT and the STOCK PURCHASE AGREEMENT (Attachment 2 hereto)
are being entered into simultaneously and each is related to the other in
setting forth the entire agreement of the parties. Any modification of this
AGREEMENT shall be in writing and signed by an authorized representative of each
party.
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10.6 In the event that a party to this AGREEMENT perceives the existence
of a dispute with the other party concerning any right or duty provided for
herein, the parties shall, as soon as practicable, confer in an attempt to
resolve the dispute. If the parties are unable to resolve such dispute amicably,
then the parties hereby submit to the exclusive jurisdiction of and venue in the
courts located in the Eastern District of the Commonwealth of Pennsylvania with
respect to any and all disputes concerning the subject of this AGREEMENT.
10.7 A waiver by either party of a breach or violation of any provision
of this AGREEMENT will not constitute or be construed as a waiver of any
subsequent breach or violation of that provision or as a waiver of any breach or
violation of any other provision of this AGREEMENT.
10.8 Any of the provisions of this AGREEMENT which are determined to be
invalid or unenforceable in any jurisdiction shall be ineffective to the extent
of such invalidity or unenforceability in such jurisdiction, without rendering
invalid or unenforceable the remaining provisions hereof or affecting the
validity or unenforceability of any of the terms of this AGREEMENT in any other
jurisdiction.
10.9 The headings and captions used in this AGREEMENT are for convenience
of reference only and shall not affect its construction or interpretation.
10.10 Nothing in this AGREEMENT, express or implied, is intended to confer
on any person, other than the parties hereto or their permitted assigns, any
benefits, rights or remedies.
10.11 PENN and LICENSEE shall not discriminate against any employee or
applicant for employment because of race, color, sex, sexual or affectional
preference, age, religion, national or ethnic origin, or handicap.
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IN WITNESS WHEREOF the parties, intending to be legally bound, have caused
this AGREEMENT to be executed by their duly authorized representatives.
THE TRUSTEES OF THE UNIVERSITY OF PENNSYLVANIA
______________________________________
DATE: November 29, 1993
--------------------------------
SIGNATURE: /s/ Xxxxxxx X. Xxxxxx
----------------------------
TYPED NAME: Xxxxxxx X. Xxxxxx
---------------------------
TITLE: Managing Director, Center for Technology Transfer
---------------------------------------------------
LICENSEE
______________________________________
DATE: 11-21-93
---------------------------------
SIGNATURE: /s/ Xxxxx X. Xxxxxx
----------------------------
TYPED NAME:___________________________
TITLE: President
--------------------------------
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