Exhibit 10.28
Confidential Treatment Requested
Under 17 C.F.R. Sections 200.80 (b)(4),
200.83 and 230.406
***Indicates omitted material that is the subject of a confidential treatment
request filed separately with the Commission.
LICENSE AGREEMENT
AGREEMENT effective on the date of the last signature hereon, by and
between YALE UNIVERSITY, a corporation organized and existing under and by
virtue of a charter granted by the general assembly of the Colony and State
of Connecticut and located in New Haven, Connecticut ("YALE"), and Gene
Logic, Inc. a corporation organized and existing under the laws of the State
of Delaware, and with principal offices located at Columbia, MD ("LICENSEE").
WITNESSETH:
WHEREAS, in the course of research conducted under YALE auspices,
Xxxxxxx Xxxxxxxx a faculty member of the YALE School of Medicine and Xx.
Xxxxxxxx Xxxxxxx, Xx. Xxxxxx X. Xxxxxx and Xx. Xxxxxxx Xxxxxxxx (the four
collectively the "INVENTORS"), have produced inventions entitled [***]; and
[***]; and [***]; and
WHEREAS, pursuant to an assignment by the INVENTORS to YALE of all the
right, title and interest in and to the INVENTIONS and any patents resulting
therefrom, YALE is the owner of the INVENTIONS, subject to rights reserved by
the U.S. government; and
WHEREAS, Licensee wishes to obtain a license to the INVENTIONS and any
patents resulting therefrom, and YALE is willing to grant such a license to
LICENSEE subject to the terms and conditions hereof;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained the parties agree as follows:
Article I Definitions
As used in this Agreement, the following terms shall be defined as set forth
below:
1.1 The "INVENTIONS" shall mean the inventions described in [***],
incorporated herein by reference.
1.2 "LICENSED PATENTS" shall mean any United States or foreign
patent(s) owned, in whole or in part, by YALE during the term of this
Agreement and containing
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CONFIDENTIAL TREATMENT REQUESTED
claims substantially the same as those of [***] covering the Inventions;
together with any continuations, continuations-in-part, divisional or
substitute patents, any reissues or re-examinations of any such applications
or patents, and any extension of any such patents.
1.3 "LICENSED PRODUCTS" shall mean any products whose manufacture, use
or sale, or any service provided to clients which would, in the absence of
this agreement, infringe a claim of the LICENSED PATENTS.
1.4 "NET SALES" shall mean gross sales of the LICENSED PRODUCTS
invoiced by LICENSEE less delivery or shipping costs if separately invoiced
and less credits or allowances, if any, on account of rejections or returns
of LICENSED PRODUCTS previously sold. LICENSED PRODUCTS shall be deemed to
have been sold when delivered or shipped, invoiced, or when paid for,
whichever is earliest. In the event that LICENSEE shall transfer LICENSED
PRODUCTS to a company owned or controlled by or affiliated with LICENSEE and
such company retransfers the LICENSED PRODUCTS to a third party within one
year of its receipt, then the price charged by the affiliated company to
third parties, shall be included in LICENSEE's gross sales. If such
affiliated company does not retransfer LICENSED PRODUCTS within one year,
then the higher of) the price charged by LICENSEE to such affiliate company
or ii) the average price charged by LICENSEE to third party customers during
such year or in the absence of sales to third party customers, the fair
market price for the LICENSED PRODUCTS, shall be included in LICENSEE's gross
sales. In the event that a LICENSED PRODUCT under the Agreement is sold in a
combination package or kit containing other active products, then NET SALES
or purposes of determining royalty payments on the combination package shall
be calculating by apportionment of the sales price of the package to each of
its components, royalty payments being due on that fraction which is a
LICENSED PRODUCT.
1.5 "EARNED ROYALTIES" means royalties paid or payable by LICENSEE to
YALE.
1.6 "ROYALTY YEAR" shall mean each twelve month period commencing
January 1 and ending December 31 during the term of this Agreement, as
defined in Article III, below. For the first year of this Agreement, the
ROYALTY YEAR shall be the period of time between the signing of the Agreement
and December 31, 1996.
1.7 "QUARTER YEAR" shall mean the three-month periods ending March 31,
June 30, September 30 and December 31 of each Royalty Year.
1.8 "LICENSEE" shall include Gene Logic, Inc. and;
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CONFIDENTIAL TREATMENT REQUESTED
(a) an organization of which fifty percent (50%) or more Of the
voting stock is controlled or owned directly or indirectly by Gene Logic,
Inc.;
(b) an organization which directly or indirectly owns or controls
fifty percent (50%) or more of the voting stock of Gene Logic, Inc.
(c) an organization, the majority ownership of which is directly
or indirectly common to the majority ownership of Gene Logic Inc.
1.9 SUBLICENSE ROYALTIES shall mean payments made to LICENSEE by any
company to which LICENSEE has given the right to exploit any technology for
the analysis of gene expression or transcription factor identification or to
sell products developed through the utilization of any such technology.
Article II Grant Of License
2.1 YALE hereby grants to LICENSEE, under the LICENSED PATENTS and other
intellectual property rights of YALE, subject to all the terms and conditions
of this Agreement, a non-transferable exclusive worldwide license, with the
right to sublicense, for the term defined by ARTICLE III to make, have made,
use, sell and practice the INVENTION, subject to rights required to be
granted to the U.S. Government.
2.2 YALE shall retain the right to make, use and practice the Invention for
its own non-commercial research purposes. In the event of an invention being
made during the course of research at Yale, exercising this right, Yale shall
promptly notify Licensee. Licensee shall be granted an exclusive option for
a period of ninety days from first notification, in which to negotiate
reasonable terms and conditions from Yale for an exclusive license to the new
invention.
Article III Term Of License
The term of the LICENSE granted hereunder shall commence upon the
signing hereof and shall continue for the life of any applicable patents, and
any license granted hereunder shall expire on a country by country basis when
the last to expire patent in such country expires.
Article IV Royalties
As consideration for the rights granted hereunder, LICENSEE shall make
the following payments to YALE:
4.1 LICENSEE shall pay to YALE:
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(a) an initial fixed royalty of Thirty five Thousand U.S. Dollars
($35,000), within thirty (30) days of the execution of this Agreement. Such
payment shall be separate from and not be credited against any future EARNED
ROYALTIES.
(b) [***] of all [***] paid to Gene Logic, Inc. by collaborators less
payments made to Gene Logic, Inc. to cover research costs related to the
collaboration, provided however that suitable documentation is made available
to YALE to justify the exclusion pursuant to Article VI below.
4.2 In addition, LICENSEE shall pay to YALE EARNED ROYALTIES of NET
SALES of LICENSED PRODUCTS, of [***] of NET SALES; and [***] of SUBLICENSE
ROYALTIES paid to Gene Logic, Inc.
4.3 EARNED ROYALTIES shall be payable by LICENSEE on any LICENSED
PRODUCTS during the period that any LICENSED PATENT remains pending or
effective in any applicable country. In the event that a LICENSED PATENT
lapses or if all of its claims are finally declared invalid by a
non-appealable decision of a court of competent jurisdiction through no fault
or cause of LICENSEE, the obligation to pay royalties under that LICENSED
PATENT shall terminate but this Agreement shall remain in effect as to the
remaining LICENSED PATENTS or claims thereunder.
4.4 Notwithstanding anything else in this Agreement, in the event that
the manufacture, sale or commercialization of a LICENSED PRODUCT requires
LICENSEE'S obtaining rights to or under any third party patents, then the
royalty rates set forth in this Article IV shall be reduced by an amount
equal to the LICENSEE'S payments to any such third parry provided that in no
event shall the royalties to be paid under this Article 1V be reduced to less
than [***] of what they would have been in the absence of the section 4.4.
Article V Payments And Report
5.1 (a) Within thirty (30) days after the end of each QUARTER
YEAR, LICENSEE shall furnish to YALE a written report setting forth the NET
SALES, and the EARNED ROYALTIES payable, accompanied by full payment of such
EARNED ROYALTIES due to Yale under 4.1(a) above.
(b) Within thirty (30) days after the end of each YEAR.
LICENSEE shall furnish to YALE a written report setting forth the NET
REVENUES, research expenditures, accompanied by full payment of such fees due
to Yale under 4.1 (b) above.
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CONFIDENTIAL TREATMENT REQUESTED
5.2 The reports required by this Article VI shall be certified by an
officer of LICENSEE to be correct to the best of LICENSEE's knowledge and
information. Each report shall be accompanied by LICENSEE's payment of the
full amount due, less any taxes required by a governmental agency to be
withheld therefrom; provided, however, that YALE shall have the right to
contest any such taxes and LICENSEE shall provide reasonable assistance with
respect thereto. All royalties shall be paid to YALE in U.S. dollars, and
in full. in the event that conversion from foreign currency is required in
calculating a royalty payment hereunder, the exchange rate used shall be the
rate in effect at the end of the last business day of the month just prior to
the date payment is required to be made hereunder as published in the Wall
Street Journal. If by law, regulation, or fiscal policy of a particular
country, conversion into United States dollars or transfer of funds of a
convertible currency to the United States is restricted or forbidden,
LICENSEE shall give YALE prompt notice in writing and shall pay the royalty
or other amounts due through such means or methods as are lawful in such
country as YALE may reasonably designate.
5.3 If this Agreement should be terminated at any time other than at
the end of a QUARTER YEAR or ROYALTY YEAR, the last report and payment shall
be made within sixty (60) days after the effective date of such termination,
and shall include any EARNED ROYALTIES prorated to the date of termination.
If the amount of LICENSEE's existing inventory of LICENSED PRODUCTS which had
been manufactured but not sold up to the date of termination exceeds a thirty
(30) day supply, LICENSEE shall provide YALE with a report setting forth the
amount of such inventory at the date of termination, and may elect to
continue to render QUARTER YEAR reports on the sales of such existing
inventory and to make payments as though the Agreement were still in effect;
provided, however, that in any event, LICENSEE shall complete payment of
EARNED ROYALTIES thereon within one year from the effective date of
termination.
Article VI Books And Records
LICENSEE, its affiliates and its Sublicensees shall keep and maintain
complete and accurate records and books of account in sufficient detail and
form so as to enable verification of Earned Royalties payable by LICENSEE
hereunder. Such records and books of account shall be maintained for a period
of no less than three (3) years following the HALF YEAR to which they
pertain. LICENSEE shall permit such records and books of account to be
examined by YALE or YALE's duly appointed agent, to the extent necessary for
Yale to verify the amount of royalties payable. Such examination shall be at
YALE's expense, during normal business hours, and upon ten (10) days' prior
written notice to LICENSEE.
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Article VII Patent Protection
7.1 It is understood as that of the date hereof no patent protection
exists in the United States or any foreign country but only the potential to
realize the same.
7.2 LICENSEE shall be responsible for all costs of prosecution and
maintenance of all U.S. patents and patent applications covering the
INVENTION incurred after the date of this Agreement, including without
limitation attorney's fees, taxes, annuities, working fees, maintenance fees,
and renewal and extension charges, and shall, at YALE's option, either
punctually pay such costs directly or punctually reimburse YALE for such
costs. Any and all such U.S. patent applications and patents resulting
therefrom shall remain the property of YALE.
7.3 LICENSEE at LICENSEE's expense, shall prepare and file foreign
patent applications covering the INVENTION in such foreign countries as are
determined by LICENSEE and agreed to by YALE. Any and all such foreign
patent applications and patents resulting therefrom shall remain the property
of YALE. LICENSEE shall be responsible for all costs of prosecution and
maintenance of all such foreign patents and patent applications, including
without limitation attorney's fees, taxes, annuities, working fees,
maintenance fees, and renewal and extension charges, and shall punctually pay
all such costs directly on behalf of both parties. If LICENSEE does not
agree to bear the expenses of filing patent applications or continuing
prosecution in any foreign countries in which YALE wishes to obtain or
maintain patent protection, then YALE may file and/or prosecute such
application at its own expense, and YALE may terminate LICENSEE's license to
the LICENSED PATENTS in such foreign country or countries.
7.4 All U.S. and foreign patent applications relating to the INVENTION
shall be prepared, prosecuted, filed and maintained by independent patent
counsel chosen and engaged by LICENSEE and approved by YALE. For U.S. patent
applications, LICENSEE shall retain substantive control of and responsibility
for direct prosecution, however no modifications to the original patent
applications may be made without written approval by YALE. For foreign
patent applications, LICENSEE shall have substantive control of and
responsibility for direct prosecution. In any case, YALE and LICENSEE shall
instruct patent counsel to keep both YALE and LICENSEE fully informed of the
progress of all U.S. and foreign patent applications and patents, and to give
the party that is not directing prosecution reasonable opportunity to comment
on the type and scope of useful claims and the nature of supporting
disclosure. YALE will not finally abandon any patent application for which
LICENSEE is bearing expenses without LICENSEE's consent. The party directing
prosecution shall have no liability to the other party for damages, whether
direct, indirect, incidental, consequential or otherwise, allegedly arising
from its good faith decisions, actions and omissions in connection with such
prosecution, except as provided in Article VII.
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7.5 LICENSEE shall apply, and shall require sublicensees to apply, the
patent marking notices required by the law of any country where LICENSED
PRODUCTS are made, sold or used, to the extent feasible and practical, and in
accordance with the applicable patent laws of that country.
Article VIII Due Diligence in Commercialization
LICENSEE shall conduct research, development, manufacturing or
sublicense programs, as appropriate, directed toward expeditious
commercialization of technology based on the Invention, and make annual
reports to YALE of progress in these programs, which reports to be held in
confidence by YALE. If in YALE's reasonable judgment taking into account the
normal course of such programs conducted with sound and reasonable business
practices, LICENSEE has failed to conduct such programs for any period of six
months after the Effective Date, YALE may request a plan from LICENSEE
indicating its schedule for reinstituting such a program. If LICENSEE fails
to provide a satisfactory plan to YALE within thirty (30) days, YALE shall
have the right to terminate this Agreement.
Article IX Infringement and Litigation
9.1 LICENSEE shall have the sole obligation to defend the LICENSED
PATENTS against infringement or interference by other parties in any country
in which a LICENSED PATENT is in effect hereunder, including by bringing any
legal action for infringement or defending any counterclaim of invalidity or
action of a third party for declaratory judgment of non-infringement or
interference. LICENSEE may settle any such actions solely at its own expense
and through counsel of its selection; provided, however, that YALE shall be
entitled in each instance to participate through counsel of its selection and
at its own expense. YALE shall have no obligation or responsibility with
respect to any such actions unless legally required to participate, except to
provide reasonable assistance to LICENSEE as requested, and LICENSEE shall
reimburse YALE for YALE's out-of-pocket expenses in connection with any such
requested assistance. LICENSEE shall bear the expenses of such actions and
shall obtain all benefits in the recoveries, if any, whether by judgment,
award, decree or settlement, the excess of such recoveries over such expenses
shall be included in LICENSEE's NET SALES. In the event LICENSEE fails to
initiate and pursue or participate in such legal action, YALE shall have the
right to initiate legal action to uphold the LICENSED PATENTS against third
parties in any country in which a LICENSED PATENT is in effect. LICENSEE
shall have no legal or contractual obligation to YALE for its failure to
initiate or participate in any such legal action, except that YALE may
terminate in such a country any then existing exclusive license granted to
LICENSEE hereunder.
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9.2 Each party shall promptly notify the other in writing in the event
that a third party shall bring a claim of infringement against YALE or
LICENSEE, either in the United States or in any foreign country in which
there is a LICENSED PATENT. If the alleged infringement is so substantial as
to threaten the competitive position of LICENSEE and/or LICENSEE is
temporarily enjoined from exercise of its license hereunder, and if YALE
elects not to defend against such claim and not to obtain a license to permit
LICENSEE to exercise its license free of such claim, then LICENSEE may in its
own name and at its sole expense defend such claim and may compromise, settle
or otherwise pursue such defense in such a manner and on such terms as
LICENSEE shall see fit. YALE, at its own expense and through counsel of its
selection may become a party to such defense and/or settlement and
compromise. In any event, YALE shall have the right to defend, at its own
expense, any such third party claim or action and to settle or compromise the
same in such manner as its shall see fit. LICENSEE may participate in such
litigation or claim on its behalf at its own expense.
9.3 In the event LICENSEE is permanently enjoined from exercising its
license rights granted hereunder pursuant to an infringement action brought
by a third party, or if both LICENSEE and YALE elect not to undertake the
defense or settlement of such a claim of alleged infringement for a period of
six months from notice of such claim or suit, then LICENSEE shall have the
right to terminate this Agreement with respect to the infringing patent
claims following thirty (30) days' written notice to YALE and in accordance
with the terms of Article XI hereof.
Article X Use of Yale's Name
LICENSEE shall not use the name "Yale" or "Yale University" for any
purpose without prior written consent obtained from YALE in each instance.
Article XI Termination
11.1 YALE may terminate this Agreement following thirty (30) days
written notice to LICENSEE in the event LICENSEE:
(i) fails to make, within the sixty (60) day period set by
the notice, any payment which is due and payable pursuant to this Agreement
and has been in arrears for more than one (1) month; or
(ii) commits a material breach of any other obligation of this
Agreement which is not cured (if capable of being cured) within the thirty
(30) day period set by the notice; or
(iii) becomes insolvent or, a petition in bankruptcy is
filed against LICENSEE and is consented to, acquiesced in or remains
undismissed for ninety (90)
8
days; or makes a general assignment for the benefit of creditors, or a
receiver is appointed for LICENSEE, and LICENSEE does not return to solvency
before the expiration of said thirty (30) day period set by the notice; or
(iv) fails to exercise due diligence in bringing the LICENSED
PRODUCTS to market in accordance with Article VIII.
11.2 LICENSEE shall be entitled to terminate this Agreement upon thirty
(30) days advance written notice to YALE, in the event of YALE's material
breach of any of the provisions of this Agreement, which breach is not cured
(if capable of being cured) within the thirty (30) day period set by the
notice, or if the conditions of Section 9.3 apply.
11.3 Upon termination of this Agreement and except as otherwise
expressly provided herein, all licenses granted to LICENSEE under the terms
of this Agreement and, at YALE's option, any Sublicenses granted by LICENSEE,
shall terminate and LICENSEE must return to YALE all materials containing the
INVENTION; provided, however, that LICENSEE shall have the right for one year
thereafter to dispose of all LICENSED PRODUCTS then in its inventory, and
shall pay EARNED ROYALTIES thereon, in accordance with the provisions of
Article IV, as though this Agreement had not terminated.
11.4 Termination of this Agreement shall not affect any rights or
obligations accrued prior to the effective date of such termination and
specifically LICENSEE's obligation to pay all EARNED ROYALTIES specified by
Article IV.
11.5 The rights provided in this Article XI shall be in addition and
without prejudice to any other rights which the parties may have with respect
to any breach or violations of the provisions of this Agreement.
11.6 Waiver by either party of a single default or breach or of a
succession of defaults or breaches shall not deprive such party of any right
to terminate this Agreement pursuant to the terms hereof upon the occasion of
any subsequent default or breach.
Article XII No Warranties; Indemnification; Insurance
12.1 YALE makes no representations or warranties that any LICENSED
PATENT is valid, or that the manufacture, use, sale or other disposal of the
LICENSED PRODUCTS does not infringe upon any patent or other rights not
vested in YALE.
12.2 YALE DISCLAIMS ALL WARRANTIES WHATSOEVER, WITH RESPECT TO THE
LICENSED PATENTS, THE INVENTION, AND THE LICENSED PRODUCTS, EITHER EXPRESS OR
IMPLIED, INCLUDING WARRANTIES AS TO
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THE MERCHANTABILITY OR FITNESS OF THE LICENSED PRODUCTS FOR A PARTICULAR
PURPOSE and LICENSEE shall make no statements, representations or warranties
whatsoever to any third parties which are inconsistent with such disclaimer
by YALE.
12.3 With the exception of infringement claims or actions covered by
ARTICLE IX, LICENSEE shall defend, indemnify and hold harmless YALE, its
fellows, officers, employees, and agents, from and against any and all
claims, demands, damages, losses and expenses of any nature (including
attorney's fees), including, but not limited to death, personal injury,
illness, property damage or products liability arising from or in connection
with any of the following:
(i) the use of LICENSEE of any method or process related to
the LICENSED PATENTS; or
(ii) any use, sale or other disposition on any of the LICENSED
PRODUCTS by LICENSEE and/or other transferees or any statement,
representation or warranty of LICENSEE or other transferees with respect
thereto; or
(iii) the use of the LICENSED PRODUCTS by any person.
YALE shall reasonably cooperate with LICENSEE in defending any such claim.
YALE shall be entitled to receive information regarding the status of any
such matter and shall be entitled to retain counsel on its own behalf and at
its sole expense, in addition to counsel retained by LICENSEE to defend YALE,
if YALE is named party and if YALE is not satisfied with the defense provided
by LICENSEE for any reason.
12.4 Prior to commencement of any human trials of a Licensed Product by
LICENSEE, or any Affiliate or Sublicensee, LICENSEE shall purchase and
maintain in effect or shall require its sublicensees to purchase and maintain
in effect a policy of products liability insurance covering all claims with
respect to any LICENSED PRODUCTS manufactured or sold within the term of any
license granted hereunder, which policy shall i) be in such form and amount
of coverage and written by such company as YALE shall reasonably approve, ii)
provide that such policy is primary and not excess or contributory with
regard to other insurance YALE may have, iii) provide at least 30 days notice
to YALE of cancellation-; and iv) include YALE and YALE's directors, officers
and employees, as additional named insureds. LICENSEE shall furnish a
certificate of such insurance to YALE on or before the date of first sale or
use of any LICENSED PRODUCTS.
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Article XIII Notices
Any notice required by this Agreement shall be sent by Registered or
Certified U.S. Mail, or by telex or cable and shall be deemed delivered if
sent to the following addresses of the respective parties or such other
address as is furnished by proper notice to the other party:
FOR YALE: FOR LICENSEE:
Yale University Dr. Xxxxxxx Xxxxxxx
Xx. Xxxxxxx Xxxxxxxx, Director Gene Logic Inc.
Office of Cooperative Research 00000 Xxx Xxxxxxxx Xx.
000 Xxxxxx Xx., Xxx 000 Xxxxxxxx, XX 00000
Xxx Xxxxx, XX 00000
Article XIV Laws and Regulations
LICENSEE shall comply with all foreign and United States federal, state,
and local laws, regulations, rules and orders applicable to the testing,
production, transportation, packaging, labeling, export, sale and use of the
LICENSED PRODUCTS. In particular, LICENSEE shall be responsible for assuring
compliance with all U.S. export laws and regulations applicable to this
license and LICENSEE's activities hereunder.
Article XV Miscellaneous
15.1 Any delays in or failure by either party in performance of any
obligations hereunder shall be excused if and to the extent caused by such
occurrences beyond such party's reasonable control, including but not limited
to such occurrences as acts of God, strikes or other labor disturbances, war,
and other causes which cannot reasonably be controlled by the party who
failed to perform.
15.2 This Agreement may not be amended except by written agreement
signed by both of the parties, and shall not be assigned by LICENSEE except
upon the advance written consent of YALE. This Agreement constitutes the
entire agreement of the parties relating to the subject matter hereof, and
all prior representations and understandings are merged into and superseded
hereby.
15.3 This Agreement shall be governed by and in accordance with the laws
of the state of Connecticut except where the federal laws of the United
States are applicable and have precedence.
15.4 The provisions of this Agreement shall be deemed separable. If any
part of this Agreement is rendered void, invalid, or unenforceable, such
shall not affect the
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validity or enforceability of the remainder of this Agreement unless the part
or parts which are void, invalid or unenforceable shall substantially impair
the value of the entire Agreement as to either party.
15.5 No rights or privileges provided in this Agreement except as
provided in the right to sublicense, may be assigned by LICENSEE to any third
party without the written permission of YALE.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate originals by their duly authorized representatives.
Yale University Gene Logic, Inc.
/s/ Xxxxxxx X. Xxxxxxxx /s/ Xxxxxxx Xxxxxxx
-------------------------------- --------------------------------
By: Xxxxxxx X. Xxxxxxxx By: Xxxxxxx Xxxxxxx
----------------------------- -----------------------------
Director of Cooperative Res. Chief Executive Officer
Date: 5/20/96 Date: 5/22/96
--------------------------- ---------------------------
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