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EXHIBIT 10.47
BASE MEDIA LICENSE AGREEMENT
AGREEMENT (this "Agreement") dated as of March 3, 1997, between
AccuMed International, Incorporated a Delaware corporation (AccuMed"), and
Difco Laboratories Incorporated, a Michigan corporation ("Difco").
WITNESSETH:
WHEREAS, AccuMed and Difco Microbiology Systems, Inc., a Michigan
corporation, have entered into an Asset Purchase Agreement dated as of the date
hereof (the "Asset Purchase Agreement") and the execution and delivery of this
Agreement by the parties hereto is an express condition precedent to AccuMed's
obligations under the Asset Purchase Agreement and the parties are executing
and delivering this Agreement in satisfaction of such condition precedent.
NOW THEREFORE, in consideration of the foregoing and of the mutual
agreements hereinafter contained, the parties hereto, intending to be legally
bound, do hereby agree as follows:
1.1 Definitions.
(a) "Affiliates" shall have the same meaning as that ascribed to
it in the Asset Purchase Agreement.
(b) "Base Media" shall mean Seller's proprietary formulae as
defined in the Asset Purchase Agreement, Sec. 1.1.
(c) The terms "Component A," "Component B," "Component C,"
"Component D" and "Component E" shall have the same meaning as that ascribed to
each, respectively, in the Asset Purchase Agreement, Sec. 1.1. Collectively,
these components are designated "Base Media Components."
(d) "DCM" means Dehydrated Culture Media which is a product(s)
required in the proprietary formulae of the Base Media. DCM contains one or
more of the proprietary Base Media Components A through E;
(e) "Base Media Know-How" shall mean information (including trade
secret information) with respect to the formulae and specifications for
manufacturing Base Media and/or DCM, known to Difco at the effective date of
this Agreement, exclusive of the formulae and specifications for manufacturing
Base Media Components. Notwithstanding the above definition of Base Media
Know-How, confidential information belonging to a third party shall not be
considered Base Media Know-How.
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(f) "Base Media Intellectual Property Rights" shall mean
proprietary rights to know-how and/or trade secrets, including Base Media
Know-How, relating to Base Media or any of the components thereof, held in
confidence by Difco, its Affiliates, sublicensees, and assigns, and not
otherwise in the public domain.
(g) "Clinical Market" shall mean the worldwide market relating to
all uses and applications of the ESP Product Line related to (i) human
diagnostic testing, including detection of septicemia, fungemia or
mycobacteria, including related testing such as for mycobacterial
susceptibility or sterile body fluids, (ii) veterinary diagnostic testing and
(iii) pharmaceutical research through the end of clinical trials intended for
the human or veterinary clinical market.
(h) "Clinical Purpose" shall have the same meaning ascribed to it
in the Non-Clinical License and Non-Competition Agreement, Sec. 1.1(f).
(i) "Base Media Licensed Products" as used herein shall mean Base
Media and/or DCM manufactured in accordance with the Base Media Know-How.
(j) "ESP Product Line" shall have the same meaning ascribed to it
in the Asset Purchase Agreement, Sec. 1.1, and shall additionally include
modifications thereto, as made by or under the authority of AccuMed, or its
permitted successors or assigns, from time to time.
(k) "Ancillary Agreements" means the Manufacturing Agreement,
Non-Clinical License and Non-Competition Agreement, Transition Services and
Facilities Agreement, the Escrow Agreement, the Escrow (Base Media Components)
Agreement, the Base Media Components License, the Closing Agreement, and the
Instrument of Assumption and Instruments of Assignment, as those terms are
defined in the Asset Purchase Agreement.
(l ) Other capitalized terms used herein, but not specifically
defined in this Agreement, such as "Person," shall have the same meaning
ascribed to them as in the Asset Purchase Agreement or in any relevant
Ancillary Agreement(s), to the extent not inconsistent herewith.
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1.2 Usage.
(i) References to a Person who is not a party hereto are also
references to its permitted assigns and permitted successors in interest (by
means of merger, consolidation or sale of all or substantially all the assets
of such Person or otherwise, as the case may be), and references to a Person,
in the case of the parties hereto, are also references to its assigns and
successors in interest as provided in Sec. 2 hereof.
(ii) References to a document are to it as amended, waived and
otherwise modified as of the time in question and references to a statute or
other governmental rule are to it as amended and otherwise modified as of the
time in question (and references to any provision thereof shall include
references to any successor provision in effect as of the time in question).
(iii) References to Sections or to Schedules or Exhibits are to
sections hereof or schedules or exhibits hereto, unless the context otherwise
requires.
(iv) The definitions set forth herein are equally applicable both
to the singular and plural forms and the feminine, masculine and neuter forms
of the terms defined.
(v) The term "including" and correlative terms shall be deemed to
be followed by "without limitation" whether or not followed by such words or
words of like import.
(vi) The term "hereof" and similar terms refer to this Agreement as
a whole.
(vii) References to the "parties" are to AccuMed and Difco, unless
the context otherwise requires.
(viii) The date on which any notice or other writing is deemed given
shall be determined pursuant to Sec.13.
2. License to Manufacture the Base Media and/or DCM.
(a) Difco grants to AccuMed a non-exclusive, worldwide,
royalty-free, fully paid-up license to use the Base Media Know-How to make and
further develop Base Media Licensed Products exclusively for use, distribution,
and sale in connection with the ESP Product Line in the Clinical Market subject
to the terms, conditions and restrictions set forth herein.
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(b) Difco expressly reserves all other rights in and to
the Base Media Intellectual Property Rights.
(c) The rights granted in this license are not
sublicenseable unless the sublicensee enters into a written sublicense
agreement substantially in the form attached as Schedule 1.
(d) The rights granted in this license may be assigned by
each party to any of its respective Affiliates or to any Person acquiring all
or substantially all of its respective assets, or that portion of the business
relating to the use of the ESP Product Line for the respective purpose provided
that any such party shall first deliver to the other party an executed written
agreement in which the assignee agrees in writing to assume all of the
assignor's obligations under this Agreement and agrees to be bound by all of
the terms and conditions of this Agreement.
(e) The parties acknowledge that all formulae, processes,
procedures, specifications, inventions (whether patentable or not), trade
secrets and other intellectual property of whatever kind or character related
to the Base Media Know-How is, and shall remain, the sole and exclusive
property of Difco. The only interest AccuMed shall have in the Base Media
Know-How is that of licensee.
(f) AccuMed hereby grants and agrees to grant to Difco a
non-exclusive, fully paid-up, worldwide license to make, use, sell, or offer to
sell, products under any patent rights which AccuMed has or may come to have in
improvements related to the Base Media Know- How.
(g) Difco hereby grants and agrees to grant to AccuMed a
non-exclusive, fully paid-up, worldwide license to make, use, sell, or offer to
sell, products in the Clinical Market under any patent rights which Difco has
or may come to have in improvements related to the Base Media Know-How.
3. Relationship of the Parties.
The relationship of the parties hereto shall be that of licensor and
licensee. Nothing in this Agreement shall be construed to imply a joint
venture or other principal and agent relationship between the parties, and
neither party shall have any right, power, or authority to create any
obligation, express or implied, on behalf of the other.
4. Indemnification.
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(a) AccuMed shall defend, indemnify, and hold harmless
Difco from and against any Actual Loss arising out of any legal action or suit
brought against Difco insofar as such suit or proceeding shall be based on a
claim arising from the manufacture, distribution, use, or sale of any Base
Media Component Licensed Product by AccuMed provided that:
(i) Difco gives AccuMed prompt written notice of any such
claim;
(ii) AccuMed shall have sole control of the defense of any
action against such claim and all negotiations toward settlement or compromise;
and
(iii) Difco shall cooperate fully with AccuMed in any
reasonable way requested and shall make available to AccuMed all information
under its control relating thereto.
For purposes hereof, the term "Actual Loss" means the actual amount of
the judgment or settlement payments and costs and expenses (including
reasonable legal fees) paid or payable by Difco in connection with a legal
action or suit indemnified hereunder.
(b) Compliance with all governmental regulations,
specifically including FDA regulations, shall be the sole responsibility of
AccuMed for all Base Media Licensed Products manufactured by, or on behalf of,
AccuMed or its Affiliates under this Agreement.
5. Warranty.
DIFCO MAKES NO WARRANTY, EXPRESS OR IMPLIED, STATUTORY OR
OTHERWISE, WITH RESPECT TO THE BASE MEDIA KNOW-HOW OR BASE MEDIA LICENSED
PRODUCTS, INCLUDING ANY WARRANTY OF MANUFACTURABILITY, MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE. DIFCO NEITHER ASSUMES NOR AUTHORIZES ACCUMED
OR ANY OTHER PERSON TO ASSUME OR CREATE FOR IT ANY LIABILITY IN CONNECTION WITH
THE SALE OR USE OF THE BASE MEDIA KNOW-HOW OR BASE MEDIA LICENSED PRODUCTS.
DIFCO SHALL NOT BE LIABLE FOR ANY INJURY OR DAMAGE TO ACCUMED, OR ANY
OF ACCUMED'S CUSTOMERS OR TO ANY OTHER PERSON CAUSED DIRECTLY OR INDIRECTLY BY
THE MANUFACTURE OR USE OF THE BASE MEDIA KNOW-HOW OR BASE MEDIA LICENSED
PRODUCTS OR BY THE USE, SALE, LEASE OR OTHER DISPOSITION OF ANY OF THE BASE
MEDIA
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LICENSED PRODUCTS BY ACCUMED OR ITS CUSTOMERS OCCURRING EITHER BEFORE, DURING
OR AFTER THE TERM OF THIS AGREEMENT, AND ACCUMED AGREES TO INDEMNIFY AND HOLD
DIFCO HARMLESS WITH RESPECT TO THE SAME.
6. Limitation of Liability and Exclusion of Damages.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN AND EXCEPT
FOR ACTUAL LOSS, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR ANY
CONSEQUENTIAL, INCIDENTAL, PUNITIVE, OR SPECIAL DAMAGES, NOR FOR CLAIMS FOR ANY
LOSS OR INJURY TO EARNINGS, PROFITS, OR GOOD WILL, WHATSOEVER, EVEN IF THE
PARTY HAS BEEN APPRISED OF THE LIKELIHOOD OF SUCH DAMAGES OCCURRING.
DIFCO SHALL NOT BE LIABLE FOR ANY INJURY OR DAMAGE TO ACCUMED OR TO
ANY OTHER PERSON CAUSED DIRECTLY OR INDIRECTLY AS A RESULT OF THE EXERCISE OF
THE LICENSE OR ANY RIGHT HEREUNDER, OR THE MANUFACTURE, SALE, OR USE OF ANY
PRODUCT DERIVED FROM AN EXERCISE OF THE LICENSE OR ANY RIGHT HEREUNDER.
7. Confidentiality.
(a) AccuMed acknowledges that the Base Media Know-How is
confidential information and a trade secret of Difco and that disclosure of the
Base Media Know-How would result in irreparable harm to Difco and loss of
valuable Base Media Intellectual Property Rights.
(b) At all times during the term of this Agreement, AccuMed shall
refrain from disclosing the Base Media Know-How to any third person without
prior written consent from Difco, except as required by law, and shall take all
necessary and reasonable steps to preserve the secrecy and prevent disclosure
of the Base Media Know-How. The obligation to hold such information in
confidence shall be satisfied if AccuMed exercises the same care with respect
to such information as it would take to preserve the confidentiality of its own
confidential and trade secret information. AccuMed warrants and represents
that it has security procedures for preserving the confidentiality of its own
information.
(c) AccuMed shall only disclose Base Media Know-How to its
employees on a need-to-know basis and only to the extent necessary to obtain
the benefits of the license granted herein. In furtherance of the foregoing,
AccuMed shall use the same security procedures to prevent unauthorized access
and/or use of the Base Media Know-How as it
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uses for its own confidential and trade secret information. AccuMed shall use
reasonable commercial efforts to maintain a permanent list identifying all
persons having access to the Base Media Know-How, which list shall be available
for inspection by Difco upon reasonable notice. All AccuMed personnel having
access to the Base Media Know-How shall be advised of the terms of this
Agreement and the requirements of confidentiality, and shall acknowledge in
writing his/her agreement to be bound by these requirements both individually
and as an employee of AccuMed.
(d) AccuMed shall appropriately identify, to the extent possible,
all reproductions, copies, extracts or the like of any document in any form
whatsoever, including electronic media, containing the Base Media Know-How as
the "Property of Difco" and "Confidential" or "Confidential - Trade Secret"
before disseminating same to its officers, employees, or if permitted
hereunder, to others. Upon termination of this Agreement, AccuMed shall return
all such reproductions, copies, extracts or the like to Difco, or an officer of
AccuMed shall certify as to their destruction. AccuMed shall not be permitted
to retain any copies of such information except as required by law; Difco will
provide AccuMed access to any documents required by law in the future to the
extent it continues to maintain the same.
(e) AccuMed shall notify Difco promptly upon receipt of any demand
or request by a court or other governmental body for access to or disclosure of
any Base Media Know-How, and shall, at Difco's expense, take all steps and
actions as reasonably and lawfully requested by Difco as necessary to prevent
such disclosure and shall reasonably and lawfully cooperate with and support
the actions of Difco to appear and object to such request or demand for access
or disclosure.
(f) During the term of this Agreement, AccuMed shall not use Base
Media Know-How for any purpose except in the manufacture of Base Media and/or
DCM for the sole and exclusive use by AccuMed or its Affiliates for the
Clinical Purpose. After termination of this Agreement pursuant to Sec. 8(b) or
Sec. 8(c) herein, AccuMed, its Affiliates, and any sublicensee or assignee,
shall cease using all Base Media Know-How received or learned by AccuMed under
this Agreement, and not in the public domain.
(g) The obligations imposed by this Section to receive, keep and
maintain the Base Media Know-How in confidence shall be binding on AccuMed, its
Affiliates, sublicensees, and assignees, continue during the term of this
Agreement and shall survive the termination of this Agreement.
(h) AccuMed shall be relieved of its obligations of
confidentiality to the extent that information can be shown (i) to have been in
the public domain at the time of AccuMed's receipt from Difco; (ii) to have
come into the public domain through no fault of AccuMed;
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(iii) to have been lawfully acquired by AccuMed from a third party in rightful
possession of such information; or (iv) to be the subject of a valid subpoena
or otherwise required by law to be disclosed, provided that advance notice is
given to Difco of the requirement of such disclosure, and AccuMed takes all
reasonable steps to obtain a protective order that will maintain the
confidentiality of the Base Media Components Know-How.
8. Term and Termination.
(a) This Agreement shall be effective on the date written in the
preamble, and unless earlier terminated in accordance with Sec. 8(b) or Sec.
8(c), the license shall be in full force and effect until the day that Difco,
its successors and assigns shall cease to have Base Media Intellectual Property
Rights in any of: the Base Media, DCM, or Base Media Components.
(b) Difco may, at its option, immediately terminate this Agreement
and any rights of AccuMed hereunder by giving AccuMed written notice thereof in
the event that:
(i) AccuMed shall terminate or suspend its business as a
result of bankruptcy or insolvency, become subject to any bankruptcy or
insolvency proceeding if such proceeding remains undismissed for sixty (60)
days, or becomes insolvent or subject to control by a trustee, receiver or
similar authority; or
(ii) AccuMed shall have failed to perform or to observe any of
its material obligations or covenants to Difco hereunder, including
specifically compliance with any requirement set forth in Sec. 7; provided that
Difco shall have first notified AccuMed in writing of any such breach and, if
such breach is capable of cure, AccuMed shall have failed to:
(A) cure such breach within 30 days;
(B) take reasonable steps to cure such breach within 30
days of the date such Notice from Difco is deemed given under
Sec. 13 of this Agreement, and to continue to take reasonable
steps to cure such breach until such breach is cured; and to
promptly notify Difco of all steps being taken to cure the
breach.
If such breach is incapable of cure, termination pursuant to this Sec.
8(b)(ii) shall be effective immediately upon the date on which notice of breach
is deemed to be given.
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(c) This Agreement shall automatically and immediately terminate
in the event that AccuMed or its Affiliates willfully disclose, contrary to the
terms of this Agreement, Base Media Know-How not otherwise in the public domain
to a third party, and such disclosure has, or is likely to have, a material
adverse effect on Difco.
(d) In the event of the termination of this Agreement, under Sec.
8(b) and Sec. 8(c), AccuMed shall thereafter cease and desist from in any way
exercising the license granted under this Agreement, except that AccuMed may
sell any Base Media Licensed Products in its inventory at that time that could
otherwise have lawfully been sold under the license herein.
9. Successors and Assigns.
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns. Except
as otherwise provided herein, AccuMed may not assign rights hereunder without
the written consent of Difco.
10. Severability.
Wherever possible, each provision hereof shall be interpreted in such
manner as to be effective and valid under applicable law, but in case any one
or more of the provisions contained herein shall, for any reason, be held
unenforceable, in any respect, such provision shall be ineffective to the
extent, but only to the extent, of such invalidity, illegality, or
unenforceability without invalidating the remainder of such invalid, illegal,
or unenforceable provisions, or any other provisions hereof.
11. Injunctive Relief.
Each of the parties hereto acknowledges that in the event of a breach
by any of them of any material provision of this Agreement relating to the
transfer and protection of intellectual properties, the aggrieved party may be
without an adequate remedy at law. Each of the parties therefore agrees that
in the event of such a breach hereof the aggrieved party may elect to institute
and prosecute proceedings in any court of competent jurisdiction to enforce
specific performance or to enjoin the continuing breach hereof. By seeking or
obtaining any such relief, the aggrieved party will not be precluded from
seeking or obtaining any other relief to which it may be entitled.
Notwithstanding Sec. 12 below, if either party seeks specific performance or
any other extraordinary or provisional relief including, but not limited to,
injunctive relief under this Agreement, then any such action shall not be
subject to arbitration, and each party agrees to submit to the non-exclusive
jurisdiction of the Federal and/or state courts located in the State of
Michigan, and waives
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any and all objections to jurisdiction or venue that it may have under the laws
or court rules of any state or United States or any court.
12. Arbitration.
Except as otherwise provided in this Agreement, AccuMed and Difco
agree that any claim, controversy or dispute arising out of or relating to this
Agreement, the interpretation of any of the provisions hereof, shall be
submitted to neutral, binding arbitration in accordance with the Commercial
Arbitration Rules of the American Arbitration Association (or any successor
thereto) and the Federal Arbitration Act, 9 U.S.C.A. sections 1-14 shall apply.
Any award or decision obtained from any parties, and judgment upon any award
thus obtained may be entered in any court having jurisdiction thereof. Any
such arbitration shall be conducted in Michigan.
13. Notices.
All notices, consents, waivers and other communications under this
Agreement must be in writing and will be deemed to have been duly given when
(a) delivered by hand (with written confirmation receipt), (b) sent by
telecopier (with written confirmation of receipt) provided that a copy is
mailed by registered mail, return receipt requested, or (c) received by the
addressee. Notice may be sent to the parties as follows:
If to AccuMed, to:
AccuMed International, Inc.
000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxxxx X. Xxxxxx
Chief Financial Officer
Telecopy No.: (000) 000-0000
Confirmation No.: (000) 000-0000
with a copy to:
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AccuMed International, Inc.
0000 - 0xx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxx
Attention: Xx. Xxxxx Xxxxxxx
General Counsel
Telecopy No.: (000) 000-0000
Confirmation No.: (000) 000-0000
if to Difco, to:
Difco Laboratories Incorporated
00000 Xxxxx Xxxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Executive Vice President Finance and Operation
Telecopy No.: (000) 000-0000
Confirmation No.: (000) 000-0000
with a copy to:
Miller, Canfield, Paddock and Stone, P.L.C.
0000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxxxxx Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxx, Esq.
Telecopy No.: (000) 000-0000
Confirmation No.: (000) 000-0000
or to such other address as such party may indicate by a notice delivered to
the other party hereto.
14. Jurisdiction.
Any action or proceeding seeking to enforce any provision of, or based
in any right arising out of, this Agreement may be brought against either party
in any court located in the State of Michigan and each of the parties hereby
submits to the respective jurisdiction of
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such courts in any such action or proceeding and waives any objection to venue
in such courts.
15. Counterparts.
This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original, and all of which, when taken together,
will be deemed to constitute one and the same.
16. Governing Law.
This Agreement shall be governed by and construed in accordance with
the laws of the State of Michigan, without regard to the conflicts of law
provisions thereof.
17. Entire Agreement; Amendments.
This Agreement supersedes any prior oral or written agreements and
understandings relating to the subject matter of this Agreement, and contains
the entire agreement of the parties relating to the subject matter hereof. No
amendment or modification of this Agreement shall be binding or enforceable
unless in writing and signed by the parties hereto.
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IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto on the date first above written:
ACCUMED INTERNATIONAL, INC.
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------
Xxxxxxx X. Xxxxx
President, Microbiology Division
DIFCO LABORATORIES INCORPORATED
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxx
President
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