Exhibit 10.18(a)
PATENT LICENSE AGREEMENT
THIS Agreement is between the Board of Regents ("Board") of The University of
Texas System ("System"), an agency of the State of Texas, whose address is 000
Xxxx 0xx Xxxxxx, Xxxxxx, Xxxxx 00000, and NOMOS CORPORATION, a Delaware
corporation having a principal place of business located at 0000 Xxxxxxx Xxxxx
Xxxx, Xxxxxxxxx, XX 00000 ("Licensee"). Board and Licensee shall be hereinafter
referred to collectively as the "Parties" and individually as the "Party."
TABLE OF CONTENTS
RECITALS 2
1. EFFECTIVE DATE 2
2. DEFINITIONS 2
3. WARRANTY, SUPERIOR RIGHTS 3
4. LICENSE 4
5. PAYMENTS AND REPORTS 5
6. TERM AND TERMINATION 7
7. INFRINGEMENT BY THIRD PARTIES 9
8. ASSIGNMENT 9
9. PATENT MARKING 9
10. INDEMNIFICATION 9
11. USE OF BOARD AND COMPONENT'S NAME 10
12. CONFIDENTIAL INFORMATION 10
13. PATENTS AND INVENTORS 11
14. ALTERNATE DISPUTE RESOLUTION 11
15. GENERAL 12
SIGNATURES 14
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RECITALS
A. Board owns certain Patent Rights and Technology Rights related to Licensed
Subject Matter, which were developed at The University of Texas Health Science
Center at San Antonio ("University"), a component institution of System.
B. Board desires to have the Licensed Subject Matter developed and used for the
benefit of Licensee, Inventor, Board, and the public as outlined in Board's
Intellectual Property Policy.
C. Licensee wishes to obtain a license from Board to practice Licensed Subject
Matter.
NOW, THEREFORE, in consideration of the mutual covenants and premises
herein contained, the parties agree as follows:
1. EFFECTIVE DATE
This Agreement is effective October 21, 1998 ("Effective Date").
2. DEFINITIONS
As used in this Agreement, the following terms have the meanings indicated:
2.1 "Affiliate" means any business entity more than 50% owned by
Licensee, any business entity which owns more than 50% of Licensee, or any
business entity that is more than 50% owned by a business entity that owns more
than 50% of Licensee.
2.2 "Licensed Field" means all radiation therapy applications deriving
from the Patent Rights or Technology Rights.
2.3 "Licensed Product" means any product Sold by Licensee comprising
Licensed Subject Matter pursuant to this Agreement.
2.4 "Licensed Subject Matter" means inventions and discoveries covered
by Patent Rights or Technology Rights within Licensed Field.
2.5 "Licensed Territory" means world-wide.
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2.6 "Net Sales" means the gross revenues received by Licensee from the
Sale of Licensed Products less sales and/or use taxes actually paid, import
and/or export duties actually paid, outbound transportation prepaid or allowed,
and amounts allowed or credited due to returns (not to exceed the original
billing or invoice amount).
2.7 "Patent Rights" means Board's rights in information or discoveries
covered by United States Patent Application filed on October 21, 1998 entitled
"Couch Mounted Tomotherapy Treatment Device and Methods of Using the Same" by
Xxxx X. Xxxxxx ("Inventor") and all divisions, continuations,
continuations-in-part, reissues, reexaminations or extensions thereof, and any
letters patent that issue thereon, whether domestic or foreign.
2.8 "Peacock(R) System" means a system for the delivery of intensity
modulated radiation therapy comprising the CORVUS Inverse Treatment Planning
System (or its functional equivalent) and/or the MIMiC Multileaf Collimator (or
its functional equivalent), as they may be modified from time to time.
2.9 "Sale or Sold" means the transfer or disposition of a Licensed
Product for value to a party other than Licensee.
2.10 "Technology Rights" means Board's rights in technical information,
know-how, processes, procedures, compositions, devices, methods, formulas,
protocols, techniques, software, designs, drawings or data created by Inventor
at University before or after the Effective Date relating to apparatus and
methods for delivering radiation therapy which are not covered by Patent Rights,
but which are necessary for practicing the invention covered by Patent Rights.
3. WARRANTY: SUPERIOR-RIGHTS
3.1 Except for the rights, if any, of the Government of the United
States, as set forth below, Board represents and warrants its belief to the best
of its knowledge, after due inquiry, that (i) it is the owner of the entire
right, title, and interest in and to Licensed Subject Matter, (ii) it has the
sole right to grant licenses thereunder, and (iii) it has not knowingly granted
licenses thereunder to any other entity that would restrict rights granted to
Licensee except as stated herein.
3.2 Licensee understands that the Licensed Subject Matter may have been
developed under a funding agreement with the Government of the United States of
America (the "Government") and, if so, that the Government may have certain
rights relative thereto. This Agreement is explicitly made subject to the
Government's rights under any agreement and any applicable law or regulation. If
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there is a conflict between an agreement, applicable law or regulation and this
Agreement, the terms of the Government agreement, applicable law or regulation
shall prevail. The Board shall be responsible for any payments or fees of any
kind payable to the Government of the United States under any such agreement,
law or regulation. To the best of Board's knowledge, this Agreement does not
conflict with or require the approval of the Government.
3.3 Licensee understands and acknowledges that Board, by this
Agreement, makes no representation as to the operability or fitness for any use,
safety, efficacy, ability to obtain regulatory approval, patentability, and/or
breadth of the Licensed Subject Matter. Board, by this Agreement, also makes no
representation as to whether there are any patents now held, or which will be
held, by others or by Board in the Licensed Field, nor does Board make any
representation that the inventions contained in Patent Rights do not infringe
any other patents now held or that will be held by others or by Board.
3.4 Licensee, by execution hereof, acknowledges, covenants, and agrees
that it has not been induced in any way by Board, System, University or its
employees to enter into this Agreement, and further warrants and represents
that: (i) it has conducted sufficient due diligence with respect to all items
and issues pertaining to this Article 3 and all other matters pertaining to this
Agreement; and (ii) Licensee has adequate knowledge and expertise, or has
utilized knowledgeable and expert consultants, to adequately conduct the due
diligence, and agrees to accept all risks inherent herein.
4. LICENSE
4.1 Board hereby grants to Licensee a royalty-bearing, exclusive
license under Licensed Subject Matter to manufacture, have manufactured, import,
offer to sell, and/or sell Licensed Products within the Licensed Territory for
use within Licensed Field. This grant is subject to the payment by Licensee to
Board of all consideration as provided herein, and is further subject to rights
retained by Board to:
a. Publish the general scientific findings from research related to
Licensed Subject Matter subject to the terms of Article 12,
Confidential Information; and
b. Use Licensed Subject Matter for research, teaching, and other
educationally-related purposes.
4.2 Licensee may extend the license granted herein to any Affiliate if
the Affiliate consents to be bound by this Agreement to the same extent as
Licensee.
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4.3 Licensee may grant sublicenses consistent with this Agreement if
Licensee is responsible for the operations of its sublicensees relevant to this
Agreement as if the operations were carried out by Licensee, including the
payment of royalties whether or not paid to Licensee by a sublicensee. Licensee
must deliver to Board a true and correct copy of each sublicense granted by
Licensee, and any modification or termination thereof, within 30 days after
execution, modification, or termination. When this Agreement is terminated, all
existing sublicenses granted by Licensee must terminate as well. This
termination right does not apply to products previously sold to third parties
for use in the Peacock(R) System.
5. PAYMENTS AND REPORTS
5.1 In consideration of rights granted by Board to Licensee under this
Agreement, Licensee will pay Board the following:
(a.) a non-refundable license documentation fee in the amount of
$25,000 due and payable when this Agreement is executed by
Licensee;
(b.) a royalty of $4,000 for the Sale, in conjunction with the
Sale of a Peacock(R) System, of a Licensed Product capable of
translating a radiation therapy treatment couch solely via manual
operation (i.e., the motive force for translation is supplied via
direct physical manipulation of the Licensed Product by an
operator thereof) ("Manual Licensed Product");
(c.) a royalty of $5,000 for the Sale, in conjunction with the
Sale of a Peacock(R) System, of a Licensed Product capable of
translating a radiation therapy treatment couch by means other
than or in addition to manual operation ("Self-motive Licensed
Product");
(d.) a running royalty equal to 20% of Net Sales or a royalty of
$4,000, whichever is greater, for each Manual Licensed Products
Sold independently from the Sale of a Peacock(R) System and
covered by Patent Rights or Technology Rights;
(e.) a running royalty equal to 15% of Net Sales or a royalty of
$5,000, whichever is greater, for each Self-motive Licensed
Product Sold independently from the Sale of a Peacock(R) System
and covered by Patent Rights or Technology Rights; and
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(f.) minimum yearly royalties of $100,000 due within 30 days of
the first anniversary, $125,000 due within 30 days of the second
anniversary, and $125,000 due within 30 days of the third
anniversary of the first Sale of a Licensed Product.
5.2 During the Term of this Agreement and for 1 year thereafter,
Licensee agrees to keep complete and accurate records of its and its
sublicensees' Sales and Net Sales of Licensed Products under the license granted
in this Agreement in sufficient detail to enable the royalties payable hereunder
to be determined. Licensee agrees to permit Board or its representatives, at
Board's expense, to periodically examine its books, ledgers, and records during
regular business hours for the purpose of and to the extent necessary to verify
any report required under this Agreement, but not more than twice in any
calendar year. If the amounts due to Board are determined to have been underpaid
by more than five (5%) percent of the correct amount due, Licensee will pay the
cost of the examination and accrued interest at the rate of twelve (12%) percent
per annum.
5.3 Within 30 days after March 31, June 30, September 30, and December
31, beginning immediately after the Effective Date, Licensee must deliver to
Board a true and accurate written report, even if no payments are due Board,
giving the particulars of the business conducted by Licensee and its
sublicensee(s), if any exist, during the preceding 3 calendar months under this
Agreement as are pertinent to calculating payments hereunder. This report will
include at least:
a. the quantities of Licensed Subject Matter that it has
produced;
b. the total Sales;
c. the calculation of royalties thereon; and
d. the total royalties computed and due Board.
Simultaneously with the delivery of each report, Licensee must pay to Board the
amount, if any, due for the period of each report.
5.4 On or before each anniversary of the Effective Date, irrespective
of having a first Sale or offer for Sale, Licensee must deliver to Board a
written progress report as to Licensee's (and any sublicensee's) efforts and
accomplishments during the preceding year in diligently commercializing Licensed
Subject Matter in the Licensed Territory and Licensee's (and, if applicable,
sublicensee's) commercialization plans for the upcoming year.
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5.5 All amounts payable here by Licensee must be paid in United States
funds without deductions for taxes, assessments, fees, or charges of any kind,
except as required by applicable law. Checks must be payable to Board of
Regents, The University of Texas System, and shall be delivered to:
X. X. Xxxxx
Executive Vice President for
Administration and Business Affairs
The University of Texas
Health Science Center at Xxx Xxxxxxx
Xxx Xxxxxxx, Xxxxx 00000-0000
5.6 Upon receiving a first notice of allowance for a patent application
covered under Paragraph 2.7 (Patent Rights), Licensee must reimburse Board for
all its out-of-pocket expenses thus far incurred in filing, prosecuting,
enforcing and maintaining exclusively licensed Patent Rights , up to a maximum
reimbursement of $10,000 during the Term. Notwithstanding the $10,000 maximum
reimbursement during the Term, if the Term is extended pursuant to Paragraph
6.1, Licensee agrees to reimburse Board for all its Patent Costs incurred prior
to the effective date of the extension, up to a maximum reimbursement of
$15,000.
6. TERM AND TERMINATION
6.1 The term of this Agreement is from the Effective Date until the
third anniversary thereof ("Term"). The Term may be extended for additional
periods of 2 years by mutual agreement of the Parties. However, the Term shall
not exceed the term or terms of any patents covered by Patent Rights.
6.2 Any time after 1 year from the Effective Date, Board and University
have the right to terminate the exclusivity of this license in any national
political jurisdiction in the Licensed Territory if Licensee, within 90 days
after receiving written notice from University of intended termination of
exclusivity, fails to provide written evidence reasonably satisfactory to
University that Licensee or its sublicensee has commercialized or is actively
attempting to commercialize a licensed invention in such jurisdiction(s).
6.3 Any time after 2 years from the Effective Date, Board and
University have the right to terminate this license in any national political
jurisdiction in the Licensed Territory if Licensee, within 90 days after
receiving written notice from University of intended termination, fails to
provide written evidence reasonably satisfactory to University that Licensee or
its sublicensee has commercialized or is actively attempting to commercialize a
licensed invention in such jurisdiction(s).
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6.4 The following definitions apply to Article 6: (i) "Commercialize"
means having Sales of Licensed Products in such jurisdiction; and (ii) "Active
attempts to commercialize" means having Sales of Licensed Products or an
effective, ongoing and active research, development, manufacturing, marketing or
sales program as commercially appropriate, directed toward obtaining regulatory
approval, production or Sales of Licensed Products in any jurisdiction, and
plans acceptable to University, in its sole discretion, to commercialize
licensed inventions in the jurisdiction(s) that University intends to terminate.
6.5. Licensee agrees to develop a vigorous sublicensing program to
effect commercialization of Licensed Subject Matter in any portion of the
Licensed Field that Licensee does not exploit.
6.6. This Agreement will earlier terminate:
a. automatically if Licensee becomes bankrupt or insolvent and/or
if the business of Licensee is placed in the hands of a receiver,
assignee, or trustee, whether by voluntary act of Licensee or
otherwise; or
b. upon 30 days written notice from Board if Licensee breaches or
defaults on its obligation to make payments (if any are due) or
reports, in accordance with the terms of Article 5, unless,
before the end of the 30 day period, Licensee has cured the
default or breach and so notifies Board, stating the manner of
the cure; or
c. upon 90 days written notice if Licensee breaches or defaults
on any other obligation under this Agreement, unless, before the
end of the 90 day period, Licensee has cured the default or
breach or is acting diligently to make such cure, and so notifies
Board, stating the manner of the cure; or
d. at any time by mutual written agreement between Licensee,
University, and Board, upon 180 days written notice to all
parties listed in Paragraph 15.2 and subject to any terms herein
which survive termination; or
e. under the provisions of Paragraphs 6.2 and 6.3 if invoked.
6.7. If this Agreement is terminated for any cause:
a. nothing herein will be construed to release either Party of
any obligation matured prior to the effective date of the
termination;
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b. after the effective date of the termination, Licensee may sell
all Licensed Products and parts therefor it has on hand at the
date of termination, if it pays earned royalties thereon
according to the terms of Article 5; and
c. Licensee will be bound by the provisions of Articles 10
(Indemnification), 11 (Use of Board and Component's Name), and 12
(Confidential Information) of this Agreement.
7. INFRINGEMENT BY THIRD PARTIES
7.1 Licensee, at its expense, must enforce any patent exclusively
licensed hereunder against infringement by third parties and it is entitled to
retain recovery from such enforcement. Licensee must pay Board a royalty on any
monetary recovery if the monetary recovery is for damages or a reasonable
royalty in lieu thereof. If Licensee does not file suit against a substantial
infringer of a patent within 6 months of knowledge thereof, then Board may
enforce any patent licensed hereunder on behalf of itself and Licensee, Board
retaining all recoveries from such enforcement and/or reducing the license
granted hereunder to non-exclusive.
7.2 In any infringement suit or dispute, the Parties agree to cooperate
fully with each other. At the request and expense of the Party bringing suit,
the other Party will permit access to all relevant personnel, records, papers,
information, samples, specimens, etc., during regular business hours.
8. ASSIGNMENT
Except in connection with the sale of substantially all of Licensee's
assets to a third party, this Agreement may not be assigned by Licensee without
the prior written consent of Board, which will not be unreasonably withheld.
9. PATENT MARKING
Licensee must permanently and legibly xxxx all products and
documentation manufactured or sold by it under this Agreement with a patent
notice as may be permitted or required under Xxxxx 00, Xxxxxx Xxxxxx Code.
10. INDEMNIFICATION
Subject to the terms of this Agreement, Licensee agrees to hold
harmless and indemnify Board, System, University, its Regents, officers,
employees and agents from and against any claims, demands, or causes of action
whatsoever, including without limitation those arising on account of any injury
or death of persons or
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damage to property caused by, or arising out of, or resulting from, the exercise
or practice of the license granted hereunder by Licensee, its Affiliates, or
their officers, employees, agents, or representatives, except for liabilities
resulting from the indemnified parties' gross negligence or willful acts or
omissions.
Subject to the terms of this Agreement, the Board and System agree, to
the extent authorized under the Constitution and laws of the State of Texas, to
hold harmless and indemnify Licensee, its officers, employees and agents from
liability resulting from the negligent acts or omissions of Board, System,
University, its Regents, officers, employees and agents pertaining to the
activities to be carried out pursuant to the obligations of this Agreement,
except for liabilities resulting from the indemnified parties' negligence or
willful acts or omissions.
11. USE OF BOARD AND COMPONENT'S NAME
Licensee may not use the name of University, System, or Board without
express written consent.
12. CONFIDENTIAL INFORMATION AND PUBLICATION
12.1 Board and Licensee each agree that all information contained in
documents marked "confidential" and forwarded to one by the other are to (i) be
received in strict confidence, (ii) be used only for the purposes of this
Agreement, and (iii) not be disclosed by the recipient Party, its agents or
employees without the prior written consent of the other Party, except to the
extent that the recipient Party can establish competent written proof that such
information:
(a.) was in the public domain at the time of disclosure;
(b.) later became part of the public domain through no act or
omission of the recipient Party, its employees, agents,
successors or assigns;
(c.) was lawfully disclosed to the recipient Party by a third
party having the right to disclose it;
(d.) was already known by the recipient Party at the time of
disclosure;
(e.) was independently developed by the recipient Party; or
(f.) is required by law or regulation to be disclosed.
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12.2 Each Party's obligation of confidence hereunder shall be fulfilled
by using at least the same degree of care with the other Party's confidential
information as it uses to protect its own confidential information. This
obligation shall exist while this Agreement is in force and for a period of 3
years thereafter.
12.3 University will submit its manuscript for any proposed publication
of research related to Licensed Subject Matter to Licensee at least 30 days
before publication, and Licensee shall have the right to review and comment upon
the publication in order to protect Licensee's confidential information. Upon
Licensee's request, publication will be delayed up to 60 additional days to
enable Licensee to secure adequate intellectual property protection of
Licensee's property that would be affected by the publication.
13. PATENTS AND INVENTIONS
13.1 If after consultation with Licensee, both Parties agree that a
patent application should be filed for Licensed Subject Matter, Board will
prepare and, after consultation with Licensee, file the appropriate patent
applications, and Licensee will pay the reasonable cost of searching, preparing,
filing, prosecuting, and maintaining same. If Licensee notifies Board that it
does not intend to pay the cost of an application, or if Licensee does not
respond or make an effort to agree with Board on the disposition of rights in
the subject invention, then Board may file an application at its own expense and
Licensee will have no rights to the invention. Board will provide Licensee a
copy of any patent application for which Licensee has paid the cost of filing,
as well as copies of any documents received or filed with the respective patent
office during the prosecution thereof.
14. ALTERNATE DISPUTE RESOLUTION
14.1 The Parties agree that any dispute or controversy arising out of
or relating to this Agreement, its construction, or its actual or alleged breach
will be decided by mediation, in accordance with the provisions of TEX. CIV.
PRAC. & REM. Codess.ss.154.001- 154.073 (Xxxxxx 1997) and TEX. GOV'T
Codess.ss.2008.001- 2008.055 (Xxxxxx 1997 & Supp. 1998). If the mediation does
not result in a resolution of such dispute or controversy, it will be decided by
another method of alternate dispute resolution in accordance with the provisions
of TEX. CIV. PRAC. & REM. Codess.ss.154.001- 154.073 (Xxxxxx 1997) and TEX.
GOV'T Codess.ss.2008.001- 2008.055 (Xxxxxx 1997 & Supp. 1998), including without
limitation, arbitration, conducted in the city of San Antonio, Texas in
accordance with the License Agreement Arbitration Rules of the American
Arbitration Association. The arbitration panel will include members
knowledgeable in the commercialization and licensing of medical devices, and
intellectual property law. The decision of the arbitration must be
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sanctioned by a court of law having jurisdiction to be binding upon and
enforceable by the Parties. Judgment upon the award rendered may be entered in
the highest court or forum having jurisdiction, state or federal. The provisions
of this Article 14 will not apply to decisions on the validity or enforceability
of patent claims or to any dispute or controversy as to which any treaty or law
prohibits such arbitration.
15. GENERAL
15.1 This Agreement constitutes the entire and only agreement between
the Parties for Licensed Subject Matter and all other prior negotiations,
representations, agreements, and understandings are superseded hereby. No
agreements altering or supplementing the terms hereof may be made except by a
written document signed by both Parties.
15.2 Any notice required by this Agreement must be given by prepaid,
first class, certified mail, return receipt requested, addressed in the case of
Board to:
Board of Regents
The University of Texas System
000 Xxxx 0xx Xxxxxx
Xxxxxx, Xxxxx 00000
ATTENTION: Office of General Counsel
FAX: (000) 000-0000
PHONE: (000) 000-0000
with copies to:
The University of Texas Health Science Center at San Antonio
0000 Xxxxx Xxxx Xxxxx
Xxx Xxxxxxx, Xxxxx 00000-0000
ATTENTION: Xxxx X. Park, Esq.
Executive Director of Legal Affairs and Technology Licensing
FAX: (000) 000-0000
PHONE: (000) 000-0000
or in the case of Licensee to:
NOMOS CORPORATION
0000 Xxxxxxx Xxxxx Xxxx
Xxxxxxxxx, XX 00000
ATTENTION: Xxxx Xxxxxxx, President and CEO
FAX: (000) 000-0000
PHONE: (000) 000-0000
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or other addresses as may be given from time to time under the terms of this
notice provision.
15.3 Licensee must comply with all applicable federal, state and local
laws and regulations in connection with its activities pursuant to this
Agreement.
15.4 This Agreement will be construed and enforced in accordance with
the laws of the United States of America and of the State of Texas.
15.5 Failure of Board to enforce a right under this Agreement will not
act as a waiver of that right or the ability to later assert that right relative
to the particular situation involved.
15.6 Headings are included herein for convenience only and shall not be
used to construe this Agreement.
15.7 If any part of this Agreement is for any reason found to be
unenforceable, all other parts nevertheless remain enforceable.
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IN WITNESS WHEREOF, the Parties hereto have caused their duly authorized
representatives to execute this Agreement.
BOARD OF REGENTS OF THE NOMOS CORPORATION
UNIVERSITY OF TEXAS SYSTEM
By /s/ Xxxx X. Xxxx By /s/ Xxxx Xxxxxxx
------------------------------ ----------------------------------
Xxxx X. Xxxx, III, M.D. Xxxx Xxxxxxx
President President and CEO
University of Texas
Health Science Center at San Antonio
Approved as to Form:
By /s/ Xxxxxxxx Xxxxxxx 21 Oct. '98
-----------------------------------------
XxxxXxxx Xxxxxxx
Office of General Counsel
Approved as to Content:
By /s/ X.X. Xxxxx
------------------------------------------
X.X. Xxxxx
Executive Vice President for
Administration and Business Affairs
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