EXHIBIT 10.31A
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN REDACTED PROVISIONS OF
THIS AGREEMENT. THE REDACTED PROVISIONS ARE IDENTIFIED BY THREE ASTERISKS
ENCLOSED BY BRACKETS AND UNDERLINED. THE CONFIDENTIAL PORTION HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
LICENSE AGREEMENT
THIS LICENSE AGREEMENT (this "Agreement"), effective as of March 15,
2000 (the "Effective Date"), is by and between the following parties:
Specialty Laboratories, having a principal place of business at 0000 Xxxxxxxx
Xxxxxx, Xxxxx Xxxxxx, Xxxxxxxxxx 00000 ("SPECIALTY"), and
Gen-Probe Incorporated, a Delaware corporation, having its principal place of
business at 00000 Xxxxxxx Xxxxxx Xxxxx, Xxx Xxxxx, Xxxxxxxxxx 00000-0000
("GEN-PROBE").
PREAMBLE
A. GEN-PROBE owns certain patents listed in Exhibit A covering
compositions and processes for detecting ribosomal nucleic acid subsequences
belonging to groups of non-viral organisms.
B. SPECIALTY and its Affiliates are engaged in the business of
running reference laboratories and conducting testing on patient samples
requested by third party customers of SPECIALTY.
C. SPECIALTY desires to obtain a license from GEN-PROBE to practice
certain aspects of the inventions described and claimed in the Patent Rights to
conduct testing on patient samples within SPECIALTY's and its Affiliates'
reference laboratories and to make, have made, use, and export for use by
SPECIALTY Licensed Products and Licensed Methods as defined below, and GEN-PROBE
is willing to grant such a license and provide to SPECIALTY GEN-PROBE's current
version of nucleic acid sequences pertinent to the Field as defined below on the
terms and subject to the conditions provided herein.
NOW, THEREFORE, in consideration of the mutual covenants set forth in
this Agreement, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
For purposes of this Agreement, the terms defined in this Article shall
have the meanings specified below:
1.1. "Affiliate" shall mean a corporation or other legal entity that
controls, is controlled by, or is under common control with such party. For
purposes of this definition, "control" means the ownership, directly or
indirectly, of more than fifty percent (50%) of the outstanding equity
securities of a corporation which are entitled to vote in the election of
directors of a more than fifty percent (50%) interest in the net assets or
profits of an entity which is not a corporation, but in any country where the
local law does not permit foreign equity participation of at least fifty percent
(50%), the "Affiliate" includes any company in which a party owns or controls or
is owned or controlled by, directly or indirectly, the maximum percentage of
outstanding stock or voting rights permitted by local law.
1.2. "Assay" shall mean any analytical process incorporating a
Licensed Product and/or a Licensed Method for determining the presence or amount
of at least one analyte in a human sample.
1.3. "Assay Series" shall mean a series of two or more analytical
processes used to test a sample from a single patient or samples from a
collection of patients wherein (i) at least one of such analytical processes
incorporates a Licensed Product and/or a Licensed Method to determine the
presence or amount of at least one analyte in the sample(s) and (ii) the result
obtained with the Licensed Product or Licensed Method is used to direct further
testing using other members of the Assay Series or the result obtained with the
Licensed Product or Licensed Method is used in combination with the results of
the other members of the Assay Series to generate a reportable result on the
specimen.
1.4. "Calendar Quarter" shall mean, for each calendar year, the
quarter beginning on each January 1, April 1, July 1 or October 1 of such year,
without regard to whether such dates are otherwise business days.
1.5. "Calendar Year" shall mean any calendar year commencing on
January 1 and ending on December 31; provided, however, that the 2000 Calendar
Year shall be the period commencing on the date hereof and ending on December
31, 2000.
1.6. "Confidential Information" shall mean all information and
materials, patentable or otherwise, of a Party which are not generally known or
available, are treated as private and confidential by the disclosing Party and
are disclosed by or on behalf of such Party to the other Party pursuant to this
Agreement, including, but not limited to, probe sequences and design
information, formulations, techniques, methodology, equipment, data, reports,
customer lists, pre-clinical and clinical trials and the results thereof,
sources of supply, patent applications and business plans, including any
negative developments, whether or not related to this Agreement.
1.7. "Dispute" shall mean any controversy or claim relating to,
arising out of or in any way connected to any provision of this Agreement.
1.8. "Effective Date" shall mean the date first set forth above.
1.9. "Exchange Rate" shall mean, with respect to any amount to be
converted from a foreign currency to U.S. dollars hereunder, the conversion rate
existing in the United States (as reported in the Wall Street Journal) on the
last business day of the Calendar Quarter preceding the applicable Calendar
Quarter. Such payments shall be without deduction of exchange, collection or
other charges.
1.10. "Field" shall mean the performance of human, clinical diagnostic
Assays and Assay Series using one or more nucleic acid probes, including [***]*
which are designed to detect [***]* in a human sample. "Field" shall NOT include
Assays and Assay Series only to detect, quantitate or identify any group of
organisms less than or different than that [***]*.
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CONFIDENTIAL TREATMENT AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.
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1.11. "First Commercial Sale" shall mean the first receipt of revenues
by SPECIALTY or an Affiliate of SPECIALTY for performance of an Assay or Assay
Series incorporating a Licensed Product and/or using a Licensed Method.
1.12. "Licensed Method" shall mean any method, the use or practice of
which would constitute, but for the license granted herein, an infringement of
one or more issued Valid Claims of the Patent Rights or one or more pending
Valid Claims of the Patent Rights (as if such pending Valid Claims were issued).
1.13. "Licensed Product" shall mean any product, the manufacture, use,
sale, offer to sell or importation of which would, in the absence of the license
granted herein, constitute an infringement of one or more issued Valid Claims of
the Patent Rights or one or more pending Valid Claims of the Patent Rights (as
if such Valid Claims were issued).
1.14. "Net Royalty Sales" shall have the meaning set forth in
Section 3.2.
1.15. "Party" or "Parties" means, in the singular, GEN-PROBE or
SPECIALTY and in the plural, GEN-PROBE and SPECIALTY.
1.16. "Patent Rights" shall mean all Valid Claims (defined below) of
(i) the patents listed on Exhibit A, including all reissues, reexaminations,
renewals and extensions thereof, and (ii) any patent issuing from a U.S. or
foreign application which is entitled to the benefit of the filing date of an
application leading to a patent listed on Exhibit A. Patent Rights granted
herein shall be limited to the Field defined in Paragraph 1.11.
1.17. "Royalty Period" shall mean the Calendar Quarter, or partial
Calendar Quarter, commencing with the date of the First Commercial Sale of any
Licensed Product in each country, and each Calendar Quarter thereafter.
1.18. "Royalty Termination Date" shall have the meaning set forth in
Section 8.1.
1.19. "Term" shall mean the term of this Agreement, consisting of the
period from the date hereof until termination of this Agreement in accordance
with Article VIII hereof.
1.20. "Territory" shall mean worldwide.
1.21. "United States" shall mean the United States of America, its
territories and possessions.
1.22. "U.S. Dollar" shall mean the United States dollar.
1.23. "Valid Claim" shall mean, any claim of the Patent Rights which
is (i) included in an issued patent that has not been held unenforceable or
invalid by any governmental agency or court of competent jurisdiction in any
unappealable or unappealed decision or (ii) is pending in a patent application
that has not been abandoned or finally rejected without the possibility of
appeal or refiling.
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ARTICLE II
GRANT OF RIGHTS
2.1. LICENSE GRANT. Subject to the terms and conditions of this
Agreement, GEN-PROBE hereby grants SPECIALTY and SPECIALTY hereby accepts a
non-exclusive, non-transferable, royalty-bearing license under Patent Rights (i)
to practice Licensed Methods in the Field within SPECIALTY's and is Affiliates'
reference laboratories and (ii) to make, have made, use, and export Licensed
Products solely for use by SPECIALTY and its Affiliates, if any, in the practice
of Licensed Methods in the Field. License grant shall not include the right to
sell Licensed Product and/or Licensed Method to third parties.
2.2. GEN-PROBE RETAINED RIGHTS. GEN-PROBE shall retain the
unrestricted right to make, have made, use, sell or offer for sale and/or to
license the same, for any purpose whatsoever, the property which is the subject
of this Agreement, inside or outside the Field. Except for the licenses
expressly granted under section 2.1, no right, title, or interest in any
discovery, invention or other technology, data or information (or any patent,
copyright, trademark, or other intellectual property rights therein) of
GEN-PROBE shall pass to SPECIALTY under this License. GEN-PROBE shall not be
under any obligation to grant to SPECIALTY any additional rights, other than
those granted by section 2.1, in any patent, copyright, trademark, or other
intellectual property, nor shall GEN-PROBE be restricted with respect thereto.
2.3. LIMITATION OF RIGHTS. SPECIALTY acknowledges that its rights
under Patent Rights are limited to those expressly granted herein and that
SPECIALTY is not granted the right to sell, transfer, or otherwise make
available to third parties Licensed Products and/or Licensed Methods for use
outside the Field. Nothing in this Agreement shall be interpreted as giving
SPECIALTY the right to analyze, dissect, or disassemble any instrument, reagent,
component, object, software or other property of GEN-PROBE provided under the
terms of this Agreement in order to circumvent the need for a license of the
technology reflected therein. The licenses granted hereunder do not include a
license for research and development activities which are intended to identify
means by which the need for the license can be avoided.
2.4. SUBLICENSING. The license rights granted by GEN-PROBE to
SPECIALTY under this Article 2 are without right to grant sublicenses, except
that SPECIALTY shall have the right to sublicense such rights to its Affiliates
(subject to all of the limitations and restrictions contained herein) in
connection with the development, design or supply of products, components or
materials to SPECIALTY or its Affiliates for or in connection with the
activities licensed under this Article II.
2.5. INVENTIONS, DISCOVERIES AND IMPROVEMENTS. SPECIALTY hereby
grants and GEN-PROBE hereby accepts a worldwide, non-exclusive, fully paid-up
license to make, have made, use, sell and offer to sell any product or process
embodying an invention, discovery or improvement made by SPECIALTY, or an
Affiliate of SPECIALTY, using or derived through the use of the Patent Rights
and/or GEN-PROBE's confidential Information. GEN-PROBE shall have the right to
grant sublicenses to third parties to make, have made, use, sell and offer to
sell products and processes embodying such inventions, discoveries and
improvements.
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2.6. PATENT MARKING. SPECIALTY agrees to xxxx all Licensed Products
made, used under the terms of this Agreement, or their containers, with the
patent number or numbers of any applicable patent practiced thereby.
ARTICLE III
FEES AND ROYALTIES
3.1. PERCENTAGE ROYALTIES. SPECIALTY agrees to pay GEN-PROBE
royalties with respect to each and every Assay or Assay Series performed by
SPECIALTY or an Affiliate of SPECIALTY. The amount of royalties payable under
this Section 3.1 shall be determined on a Calendar Quarter basis and, for any
Calendar Quarter, such amount shall be calculated by taking the product of (A)
the Net Royalty Sales for such Calendar Quarter, multiplied by (B) the
Applicable Royalty Rate.
3.2. NET ROYALTY SALES. In any Calendar Quarter Net Royalty Sales
shall mean the aggregate amount of revenue in U.S. Dollars (converted as
necessary for sales made in a currency other than U.S. Dollars into U.S. Dollars
at the applicable Exchange Rate on the last business day of such Calendar
Quarter in accordance with Section 1.10 above) received or receivable by
SPECIALTY and its Affiliates in consideration of performance of an Assay or
Assay Series (including revenues received for services and materials) during
such Calendar Quarter. In the event an Assay Series is performed, the Net
Royalty Sales shall be calculated on the consideration received for the Assay
Series and not limited to a single assay within the series. The applicable
royalty rate shall be [***]* of the Net Royalty Sales. For any Assay or Assay
Series performed for consideration other than cash, the Net Royalty Sales shall
be deemed to be the average price charged by SPECIALTY or its Affiliates for the
performance of an identical Assay or Assay Series in such country during such
Calendar Quarter in "arms-length" transactions and only the total amount of all
excise taxes, sales taxes, value added taxes, consumption taxes, customs duties
and other taxes or duties (excluding income taxes or franchise taxes) imposed
with respect to any such sales.
3.3. REPORTS AND PAYMENTS.
3.3.1. ROYALTY REPORTS. Commencing with the First Commercial
Sale of a Licensed Product in the Territory, within thirty (30) days after the
conclusion of each Royalty Period, SPECIALTY shall deliver to GEN-PROBE a report
containing the following information:
a. The total number of Assays and Assay Series
conducted;
x. Xxxxx revenues received for the performance of
Assays and Assay Series, in each country of sale, made by SPECIALTY and
its Affiliates during the applicable Royalty Period;
c. Calculation of Net Royalty Sales for the
applicable Royalty Period in each country of sale;
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COMMISSION.
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d. Total Net Royalty Sales in U.S. dollars for the
applicable Royalty Period, together with the exchange rates used for
conversion; and
e. Calculation of the royalty amount payable to
GEN-PROBE for the applicable Royalty Period.
All such reports shall be maintained in confidence by GEN-PROBE. If no royalties
or other payments are due to GEN-PROBE for any period, the report shall so
state.
3.3.2. ROYALTY PAYMENTS. Concurrent with these reports,
SPECIALTY shall remit to GEN-PROBE any payment due for the applicable Royalty
Period. The method of payment shall be by check or wire transfer as directed
from time to time by GEN-PROBE. All amounts payable to GEN-PROBE under this
Section will first be calculated in the currency of sale and then converted into
U.S. dollars in accordance with Section 1.10 and, to the extent permitted by
applicable law, such amounts shall be paid without any deduction for withholding
taxes, value-added taxes, or any other changes applicable to such payments.
3.4. PAYMENTS IN U.S. DOLLARS. All payments due under this Agreement
shall be payable in U.S. dollars. Conversion of foreign currency to U.S. dollars
shall be made in accordance with Section 1.10.
3.5. RECORDS. SPECIALTY shall keep, and shall require that its
Affiliates keep, for a period of not less than three (3) years after each
Calendar Year, complete, true and accurate books of account and other records
containing all information and data which may be necessary to ascertain and
verify the amount of royalties payable hereunder for such Calendar Year,
including, without limitation, detailed backup for the computations of Net
Royalty Sales which records shall contain sufficient information to permit
GEN-PROBE to confirm the accuracy of any reports delivered to GEN-PROBE in
accordance with Section 3.4. During the term of this agreement and for a period
of three (3) years thereafter, GEN-PROBE shall have the right from time to time
(not to exceed twice during each Calendar Year) to cause an independent
certified public accountant to inspect, in confidence, and audit all such books
and records at its expense, during normal business hours for the sole purpose of
verifying any reports and payments delivered under this Agreement and shall
provide SPECIALTY with a copy of any report given to GEN-PROBE. The parties
shall reconcile any underpayment or overpayment within thirty (30) days after
the accountant delivers the results of the audit. In the event that any audit
performed under this Section reveals an underpayment in excess of five percent
(5%) in any Royalty Period, SPECIALTY shall bear the full cost of such audit.
3.6. LATE PAYMENTS. Any payments by SPECIALTY that are not paid on or
before the date such payments are due under this Agreement shall bear interest,
to the extent permitted by law, at an annual rate of two percentage points above
the annual prime rate of interest most recently declared by Xxxxx Fargo Bank (or
its successor), calculated based on the number of days that payment is
delinquent.
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ARTICLE IV
DISCLOSURE, PATENT PROTECTION, INFRINGEMENT
4.1. DISCLOSURE OF CONFIDENTIAL AND PROPRIETARY INFORMATION. Subject
to the confidentiality requirement of Article VI, GEN-PROBE shall disclose to
SPECIALTY, from time to time such portions of GEN-PROBE's technology as may be
mutually agreed between the parties.
4.2. PROSECUTION OF PATENT FILINGS BY GEN-PROBE. GEN-PROBE shall, at
its own expense, secure and maintain patents on modifications made during the
Term, if, in GEN-PROBE's sole discretion, it is an appropriate business decision
to do so. If GEN-PROBE elects not to file or maintain a patent on any
modification, it shall notify SPECIALTY of its decision in sufficient time to
allow SPECIALTY, in its discretion, to assume responsibility for such filing or
maintenance. In such event, GEN-PROBE shall receive a non-exclusive license to
practice under any patent obtained by SPECIALTY.
4.3. COOPERATION. SPECIALTY shall make available to GEN-PROBE, or its
authorized attorneys, agents or representatives, reasonable access to such of
its employees as GEN-PROBE may consider reasonably necessary to render
assistance in connection with GEN-PROBE's preparation and submission of patent
filings, and shall use its best efforts, at its sole cost and expense, to cause
any such employees to execute and deliver any and all documents as may be
necessary to evidence the right of GEN-PROBE to make such Patent filings.
4.4. INFRINGEMENT BY THIRD PARTIES.
(a) If SPECIALTY becomes aware of any known or
suspected infringement by a third party on any patents or copyrights, or any
unauthorized use or misappropriation of know-how, Confidential Information or
other proprietary rights in any way pertaining to the Patent Rights, SPECIALTY
shall notify GEN-PROBE, in writing, within two (2) weeks of learning of such
infringement and shall provide all available supporting information known to
SPECIALTY regarding any such infringement, unauthorized use or misappropriation.
(b) If GEN-PROBE, at its own expense, commences a
suit under this Section 4.5, SPECIALTY shall provide reasonable cooperation and
assistance to GEN-PROBE in connection with any such suit, without any charge
therefor other that reasonable out-of-pocket expenses.
(c) In the event GEN-PROBE commences a suit under
Section 4.5, GEN-PROBE may require SPECIALTY to join in such suit as a party,
but SPECIALTY shall have no obligation to participate in the litigation except
to the extent action is required of a named party to the suit. If SPECIALTY is
required to join in any such suit, SPECIALTY shall have the right, at its sole
expense, to participate and be represented in any such suit by its own counsel,
which counsel shall be reasonably acceptable to GEN-PROBE.
4.5. ALLEGED INFRINGEMENT ON RIGHTS OF THIRD PARTIES. In the event
that any Third Party makes a written claim or demand, or brings an action, suit
or proceeding against either Party (or any of its Affiliates), alleging
infringement of such third party's patent rights or copyrights or unauthorized
use or misappropriation of its know-how, Confidential Information or
7
other proprietary rights, arising out of, in connection with or relating to any
Licensed Products or Patent Rights, such Party shall promptly notify (within two
(2) weeks of receiving notice of such claim) the other Party in writing, and
provide copies of all materials or papers received by or served on such Party
from or by such Third Party. Each Party agrees to make available to the other
Party, without charge, its advice and assessment with respect to the technical
merits of any matter which is the subject of any such claim, demand, action,
suit or proceeding.
ARTICLE V
REPRESENTATION AND WARRANTIES
5.1. AUTHORIZATION. Each Party represents and warrants to the other
that it has the legal right and power to enter into this Agreement, to extend
the rights and licenses granted to the other in this Agreement, and to fully
perform its obligations hereunder, and that the performance of such obligations
will not conflict with its charter documents or any agreements, contracts, or
other arrangements to which it is a party.
5.2. OWNERSHIP OF PATENT RIGHTS. GEN-PROBE represents and warrants
that it possesses the exclusive right, title, and interest in and to the Patent
Rights and that it has the full legal right and power to enter into obligations
and grant the rights and licenses set forth in this Agreement.
5.3. LIMITATION OF WARRANTIES. The license and rights provided herein
are provided WITHOUT WARRANTY OR MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE OR ANY OTHER WARRANTY, EXPRESS OR IMPLIED.
5.4. LIMITATION OF LIABILITY. IN NO EVENT WILL GEN-PROBE BE LIABLE
FOR ANY INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES RESULTING FROM SPECIALTY
EXERCISE OF THIS LICENSE OR ITS USE OF LICENSED PRODUCTS OR METHODS.
5.5. DISCLAIMER OF WARRANTIES. Nothing in this Agreement shall be
construed as:
5.5.1. A warranty or representation by GEN-PROBE as to the
validity or scope of any patent included within the Patent Rights;
5.5.2. A warranty or representation that the exploitation of
the Patent Rights or the manufacture, use or sale of a Licensed Product is or
will be free from infringement of patents of third parties;
5.5.3. An obligation of either Party to bring or prosecute
actions or suits against Third Parties for infringement;
5.5.4. An obligation of GEN-PROBE to maintain any patent or to
continue to prosecute any patent application included within the Patent Rights
in any country;
5.5.5. An obligation of either Party to furnish any
Confidential Information or know-how;
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5.5.6. Creating any agency, partnership, joint venture or
similar relationship between GEN-PROBE and specialty; or
5.5.7. Conferring by implication, estoppel or otherwise any
license, immunity or right under any patent of GEN-PROBE other than those
specified in Patent Rights.
ARTICLE VI
CONFIDENTIALITY
6.1. TREATMENT OF CONFIDENTIAL INFORMATION. SPECIALTY shall maintain
the Confidential Information of GEN-PROBE in confidence, and shall not disclose,
divulge or otherwise communicate such Confidential Information to others, or use
it for any purpose, except that SPECIALTY shall have the right to disclose
Confidential Information to its employees who have a need to know such
information in order to fulfill the objectives of this Agreement. SPECIALTY
hereby agrees to exercise its best efforts and precautions (at least the same
degree of care that SPECIALTY uses to protect its own Confidential Information)
to prevent and restrain the unauthorized disclosure of such Confidential
Information by any of its directors, officers, employees, consultants,
subcontractors, agents and Affiliates which shall include obtaining appropriate
secrecy or confidentiality undertakings from such persons. SPECIALTY shall be
responsible for any breach of any such undertakings by its employees, agents or
representative.
6.2. EXCEPTIONS TO CONFIDENTIALITY.
6.2.1. The restrictions on disclosure and use set forth in
Section 5.1 shall not apply:
a. To information which was generally available to
the public at the time of disclosure, or information which becomes
available to the public after disclosure by Disclosing Party other than
through fault of the Receiving Party.
b. To information which can be shown to have been
already known to the Receiving Party prior to its receipt from the
Disclosing Party.
c. To information which is obtained at any time
lawfully from a third party under circumstances permitting its use or
disclosure to others.
d. To information which is developed independently
by Receiving Party as evidenced by written records other than through
knowledge of the Confidential Information.
e. To information required to be disclosed by the
Receiving Party to comply with a court or administrative order provided
the Receiving Party furnishes prompt notice (in no event less than 3
days) to Disclosing Party to enable it to resist such disclosure.
6.2.2. The foregoing exceptions to Confidential Information
shall not operate to exclude from Confidential Information that which (i) is
merely embraced by more general information available on a nonconfidential basis
or, (ii) consists of a combination of features, each of which may be publicly
available, but wherein the combination itself and its principle of operation
constitute Confidential Information because they are not embraced by
corresponding information which is within one of the foregoing exceptions.
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ARTICLE VII
INDEMNIFICATION
7.1. INDEMNIFICATION BY SPECIALTY. SPECIALTY hereunder agrees to
indemnify, hold harmless and defend GEN-PROBE, its officers, employees and
agents against any and all claims, suits, losses, damages, costs, fees, and
expenses resulting from or arising out of SPECIALTY's exercise of the license
and rights granted herein including any sale, manufacture or use of a Licensed
Product or Licensed Method. This indemnification will include, but not be
limited to, any product liability.
7.2. INDEMNIFICATION BY GEN-PROBE. GEN-PROBE shall indemnify, defend,
and hold harmless SPECIALTY and its Affiliates and their directors, officers,
employees, and agents and their respective successors, heirs and assigns (the
"Indemnitees") against any liability, damage, loss, or expense (including
reasonable attorneys fees and expenses of litigation) incurred by or imposed
upon the Indemnitees or any one of them which results from a claim, suit,
action, or demand (or a judgment with respect thereto) initiated by a Third
Party alleging that the actions of GEN-PROBE under the Patent Rights constitute
negligence, willful malfeasance or misfeasance, patent infringement or product
liability except to the extent of SPECIALTY's contributory negligence, willful
malfeasance or misfeasance, patent infringement or product liability.
7.3. NOTIFICATION REQUIREMENT. SPECIALTY shall promptly notify
GEN-PROBE in writing of any claim which SPECIALTY believes it may have a right
of indemnification under this Agreement.
ARTICLE VIII
TERM AND TERMINATION
8.1. TERM. Unless sooner terminated as provided herein, this
Agreement shall commence on the Effective Date and shall remain in effect for
two (2) years unless earlier terminated as provided in this Article VIII. Prior
to the end of said term, Parties may mutually agree to renew this Agreement in
writing on the same terms and conditions for one (1) year periods using the
Renewal Agreement, an example of which is attached hereto in Exhibit B.
8.2. TERMINATION BY GEN-PROBE. In the event that SPECIALTY fails to
make timely payment of any amounts due to GEN-PROBE under this Agreement,
including amounts due under Article II hereof, GEN-PROBE may terminate this
Agreement upon thirty (30) days written notice to SPECIALTY unless SPECIALTY
pays all past-due amounts prior to the expiration of such thirty (30)-day notice
period.
8.3. OTHER MATERIAL BREACH.
8.3.1. In the event that either Party commits a material breach
of any of its obligations under this Agreement, other than that stated in
Section 8.3, and such Party fails to remedy that breach within ninety (90) days
after receiving written notice thereof from the other
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Party, that other Party may immediately terminate this Agreement upon written
notice to the breaching Party.
8.4. EFFECT OF TERMINATION.
8.4.1. Upon termination of this Agreement at the end of the
Term and any extensions or renewal thereof, SPECIALTY and/or Affiliates shall
not retain any right granted by GEN-PROBE nor owe any obligation to GEN-PROBE
except that SPECIALTY will remain obligated to make any required payments and
reports pursuant to Article III for the period immediately prior to termination.
8.4.2. Upon the termination of this Agreement by GEN-PROBE
pursuant to 8.3, SPECIALTY's rights under the Patent Rights shall terminate
immediately. The following provisions shall survive such termination of this
Agreement: Articles I, III, IV, V, VI, VII, VIII, IX and X as well as
SPECIALTY's obligations to make payments and reports pursuant to Article III
with respect to Licensed Products developed using the Patent Rights during the
term of this Agreement.
8.5. NOTICE OF TERMINATION. SPECIALTY agrees that, in the event that
this Agreement is terminated pursuant to the terms hereof, SPECIALTY shall so
notify each Affiliate within twenty (20) days of such termination and shall
enforce against each Affiliate the requirements of Section 8.4.
ARTICLE IX
EXPORT
9.1. ACKNOWLEDGMENT. The Parties acknowledge that the export of
technical data, materials or products is subject to the exporting Party
receiving all necessary export licenses and that the Parties cannot be
responsible for any delays attributable to export controls which are beyond the
reasonable control of either Party. Each Party covenants and agrees to comply
with all applicable treaties, laws, statutes, rules and regulations of any
federal, state, local or foreign governmental entity or instrumentality,
including, without limitation, the provisions of the United States Export
Administration Act of 1969, as amended, and all other applicable export laws,
restrictions and regulations of the department of commerce and the FDA. The
receiving Party shall provide the exporting Party with any information,
materials, certifications or other documents which may be reasonably required in
connection with such export laws, restrictions and regulations.
9.2. WRITTEN ASSURANCE. Without limitation of the foregoing, and in
support of maintaining a general license for the export of technical data under
this Agreement, a Party receiving an export agrees to not knowingly export or
re-export any technical data or materials furnished to such Party under this
Agreement, any part thereof or any direct product thereof, directly or
indirectly, without first obtaining permission to do so (if required) from the
United States Department of Commerce, the United States Food and Drug
Administration and/or other appropriate United States Governmental agencies,
into any country to which restrictions apply.
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ARTICLE X
ARBITRATION
Any controversy, claim or dispute existing out of or relating to this
Agreement, or the breach thereof, shall be resolved by binding arbitration in
San Diego County, State of California and any judgment upon the award rendered
by arbitration may be entered in any Court having jurisdiction. If arbitration
is necessary pursuant to this paragraph, the Parties shall agree upon a single
arbitrator. If the Parties are unable to agree on an arbitrator, then they will
obtain nominations of three potential arbitrators from Judicial Arbitration and
Mediation Services ("JAMS") and each party will have the right to strike one
candidate's name from the list. JAMS will then designate the arbitrator. Any
arbitration award shall also include, but shall not be limited to, any and all
court or arbitration costs, attorney fees and any other costs or charges
reasonably necessary to adjudicate the controversy, in addition to any and all
damages deemed fair by the Arbitrator(s). Nothing contained herein shall deprive
any party of his or her right to obtain injunctive or other equitable relief.
ARTICLE XI
MISCELLANEOUS
11.1. FORCE MAJEURE. Each of the parties hereto shall be excused from
the performance of its obligations hereunder in the event performance of this
Agreement is prevented by FORCE MAJEURE and such excuse shall continue as long
as the condition constituting such FORCE MAJEURE continues, plus thirty (30)
days after the termination of such condition. For purposes of this Agreement,
FORCE MAJEURE is defined as follows:
Causes beyond the control of GEN-PROBE or SPECIALTY including
acts of God; war; any regulations, acts, rules, orders, proclamations,
requirements or laws of any government; civil commotion; strike,
lockout or other industrial dispute; destruction of production
facilities or material by fire, water, earthquake or storm; plant
breakdown or failure of equipment; inability to obtain equipment and/or
supplies; epidemics; failure of public utilities or common carriers; or
by any circumstances whatsoever beyond a Party's reasonable control.
11.2. SPECIFIC PERFORMANCE AND INJUNCTION. The Parties agree that
irreparable damage will occur in the event that the provisions of Article VI are
not specifically enforced. In the event of a breach or threatened breach of any
such provisions, SPECIALTY agrees that GEN-PROBE shall, in addition to all other
remedies, be entitled to temporary or permanent injunction, without showing any
actual damage or that monetary damages would not provide an adequate remedy and
without the necessity of posting any bond, and/or a decree for specific
performance, in accordance with the provisions hereof.
11.3. GOVERNING LAW. This Agreement will be construed and governed by
the laws of the State of California, without giving effect to conflict of law
provisions and excluding the United Nations Convention of Contracts for the
International Sale of Goods, except that any arbitration hereunder shall be
governed by Article X herein.
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11.4. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which
together shall be deemed to be one and the same instrument.
11.5. NO THIRD PARTY BENEFITS. 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.
11.6. REGISTRATION. In the event that this Agreement is required to be
registered with any governmental authority in the Territory, SPECIALTY shall
cause such registration to be made and shall bear any expense or tax payable in
respect thereof.
11.7. HEADINGS. All headings in this Agreement are for convenience
only and shall not affect the meaning of any provision hereof.
11.8. BINDING EFFECT. This Agreement shall inure to the benefit of and
be binding upon the parties and their respective lawful successors and assigns.
11.9. ASSIGNMENT. SPECIALTY does not have the right to assign,
delegate, mortgage, pledge, hypothecate, sublicense or otherwise transfer any
rights or obligations under this Agreement without the prior written consent of
GEN-PROBE. Any such purported transfer without such consent shall be deemed void
and without effect. For purposes of this Agreement, "assignment" shall include
(I) the transfer of substantially all of the assets of a party, even if this
Agreement is specifically excluded from such transfer and (II) any change in the
ultimate beneficial control of a Party. Notwithstanding the foregoing, either
Party may assign and transfer this Agreement, including all its rights and
obligations hereunder, to any Affiliate of such Party, provided that such
assignment shall not relieve the assigning Party or its obligations hereunder.
GEN-PROBE may assign and transfer this Agreement, including all its rights and
obligations hereunder, to any Party succeeding to substantially all its
business, and GEN-PROBE may assign or transfer any right to receive payments
hereunder upon reasonable prior written notice to SPECIALTY.
11.10. COMPLIANCE WITH LAW. Nothing in this Agreement shall be
construed so as to require the commission of any act contrary to law, and
wherever there is any conflict between any provisions of this Agreement and any
statute, law, ordinance or treaty, the latter shall prevail, but in such event
the affected provisions of the Agreement shall be conformed and limited only to
the extent necessary to bring it within the applicable legal requirements.
11.11. NOTICES. All notices, requests, demands and other communications
required or permitted to be given pursuant to this Agreement shall be in writing
and shall be deemed to have been duly given upon the date of receipt if
delivered by hand, recognized international overnight courier, confirmed
facsimile transmission, or registered or certified mail, return receipt
requested, postage prepaid to the following addresses or facsimile numbers:
If to GEN-PROBE: If to SPECIALTY:
Gen-Probe Incorporated Specialty Laboratories
00000 Xxxxxxx Xxxxxx Xxxxx 0000 Xxxxxxxx Xxxxxx
00
Xxx Xxxxx, Xxxxxxxxxx 00000-0000 Santa Monica, California
Attn: Xxxxx X. Xxxxxxxx Attn: Xxxxx X. Xxxxx, M.D., Ph.D.
President & CEO Chairman
(000) 000-0000 (000) 000-0000
Facsimile: (000) 000-0000 Facsimile: (000) 000-0000
Either party may change its designated address and facsimile number by notice to
the other party in the manner provided in this section.
11.12. AMENDMENT AND WAIVER. This Agreement may be amended,
supplemented, or otherwise modified only by means of a written instrument signed
by both parties. Any waiver of any rights or failure to act in a specific
instance shall relate only to such instance and shall not be construed as an
agreement to waive any rights or fail to act in any other instance, whether or
not similar.
11.13. SEVERABILITY. In the event that any provision of this Agreement
shall, for any reason, be held to be invalid, or unenforceable in any respect,
such invalidity or unenforceability shall not affect any other provision hereof,
and the parties shall negotiate in good faith to modify the Agreement to
preserve (to the extent possible) their original intent.
11.14. ATTORNEYS' FEES. If either Party hereto commences an arbitration
or other action against the other Party to enforce any of the terms hereof or
because of the breach by such other Party of any of the terms hereof, the
prevailing Party shall be entitled, in addition to any other relief granted, to
all actual out-of-pocket costs and expenses incurred by such prevailing Party in
connection with such action, including, without limitation, all reasonable
attorneys' fees, and a right to such costs and expenses shall be deemed to have
accrued upon the commencement of such action and shall be enforceable whether or
not such action is prosecuted to judgment.
11.15. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior agreements or understandings between the parties relating
to the subject matter hereof.
IN WITNESS WHEREOF, the undersigned have duly executed and delivered
this Agreement as a sealed instrument effective as of the date first above
written.
GEN-PROBE INCORPORATED SPECIALTY LABORATORIES
By: /s/ XXXXX X. XXXXXXXX By: /s/ XXXXX X. XXXXX
----------------------------- ---------------------------------
Name: XXXXX X. XXXXXXXX Name: XXXXX X. XXXXX, M.D., PH.D.
---------------------------- --------------------------------
Title: PRESIDENT & CEO Title: CHAIRMAN
---------------------------- --------------------------------
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EXHIBIT A
GEN-PROBE INCORPORATED
U.S. AND FOREIGN PATENTS
[***]*
15
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* PORTIONS OF THIS PAGE HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.
EXHIBIT B
LICENSE AGREEMENT RENEWAL NUMBER ONE
This Renewal Agreement ("Renewal") is made and entered into as of [***]*
by and between (collectively referred to herein as "Parties"):
GEN-PROBE INCORPORATED, a Delaware corporation, having offices at 00000 Xxxxxxx
Xxxxxx Xxxxx, Xxx Xxxxx, Xxxxxxxxxx 00000-0000 ("GEN-PROBE"); and
SPECIALTY LABORATORIES, having offices at 0000 Xxxxxxxx Xxxxxx, Xxxxx Xxxxxx,
Xxxxxxxxxx 00000, ("SPECIALTY").
RECITALS
SPECIALTY and GEN-PROBE entered into that License Agreement having an
effective date of February 1, 2000, a copy of which is attached and incorporated
herein and made a part of this Renewal as if fully set forth herein ("License").
TERMS
NOW, THEREFORE, in consideration of the mutual promises contained herein
and other and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the Parties agree as follows:
1. That the term of the License attached hereto shall be extended for the
time period commencing [***]* and terminating [***]*
2. That the Renewal shall be on the same terms, covenants and conditions as
set forth on the attached License except as set forth below:
IN WITNESS WHEREOF, the Parties have entered into this Renewal Agreement
on the day and year written below.
GEN-PROBE INCORPORATED SPECIALTY LABORATORIES
By: By:
---------------------------- ----------------------------
Name: XXXXX X. XXXXXXXX Name:
-------------------------- --------------------------
Title: PRESIDENT & CEO Title:
------------------------- -------------------------
Date: Date:
-------------------------- --------------------------
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* PORTIONS OF THIS PAGE HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.
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