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EXHIBIT 10.9
CIRCE BIOMEDICAL, INC. HAS OMITTED FROM THIS EXHIBIT 10.9 PORTIONS OF THE
AGREEMENT FOR WHICH CIRCE BIOMEDICAL, INC. HAS REQUESTED CONFIDENTIAL TREATMENT
FROM THE SECURITIES AND EXCHANGE COMMISSION. THE PORTIONS OF THE AGREEMENT FOR
WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED ARE MARKED WITH AN ASTERISK AND
SUCH CONFIDENTIAL PORTIONS HAVE BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
SETTLEMENT AGREEMENT, MUTUAL RELEASE
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AND RESTATEMENT OF RIGHTS AND OBLIGATIONS
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This Settlement Agreement, Mutual Release and Restatement of Rights and
Obligations ("the Agreement") is entered into this 12th day of June, 1997 by and
among BioHybrid Technologies Incorporated, a Massachusetts corporation having a
principal place of business at 000 Xxxxxx Xxxxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxxx
00000, BioHybrid Technologies Limited Partnership, a Massachusetts limited
partnership having a principal place of business at 000 Xxxxxx Xxxxxxxx,
Xxxxxxxxxx, Xxxxxxxxxxxxx 00000, BioHybrid Technologies Development Company, a
joint venture organized as a Massachusetts general partnership having a
principal place of business at 000 Xxxxxx Xxxxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxxx
00000, X.X. Xxxxx & Co. - Conn., a Connecticut corporation having a principal
executive office at Xxx Xxxx Xxxxxx Xxxx, Xxxx Xxxxx, Xxxxxxx 00000 and Circe
Biomedical, Inc., a Delaware corporation having a principal place of business at
One Ledgemont Center, 000 Xxxxxx Xxxxxx, Xxxxxxxxx, XX 00000.
WHEREAS, BioHybrid Technologies Limited Partnership, BioHybrid
Technologies, Inc. and X.X. Xxxxx & Co. - Conn. were parties to an agreement
dated June 4, 1991 entitled "Stage Five Royalty and Development Agreement
between BioHybrid Technologies Limited Partnership,
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BioHybrid Technologies Inc. and X.X. Xxxxx & Co. - Conn." ("the Stage Five
Agreement") and to a Settlement Agreement and Mutual Release dated April 14,
1993 ("the Earlier Settlement Agreement");
WHEREAS, Circe Biomedical, Inc. is a wholly-owned subsidiary of X.X.
Xxxxx & Co. - Conn. and is the assignee of the rights, interests and
obligations of X.X. Xxxxx & Co. - Conn. under the Stage Five Agreement and
the Earlier Settlement Agreement pursuant to Paragraph 12.06 of the Stage
Five Agreement;
WHEREAS, under the Earlier Settlement Agreement, BioHybrid Technologies
Incorporated and BioHybrid Technologies Limited Partnership have certain rights
and interests relating to BHT Background Technology and New Technology;
WHEREAS, BioHybrid Technologies Incorporated has assigned its rights,
interests and obligations relating to the BHT Background Technology and New
Technology to its Affiliate, BioHybrid Technologies Development Company;
WHEREAS, BioHybrid Technologies Incorporated is the Managing Venturer of
BioHybrid Technologies Development Company, duly authorized to bind such venture
and each of the other venturers (specifically, Synergy Research Corporation and
JDR Corp.) to the terms of this Agreement;
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WHEREAS, certain issues have arisen between the parties under the Earlier
Settlement Agreement and otherwise, as a result of which certain claims,
counterclaims, and amended claims have been filed in the case entitled X.X.
XXXXX & CO. - CONN. V. BIOHYBRID TECHNOLOGIES INCORPORATED, et al., United
States District Court for the District of Massachusetts (Worcester Division),
civil action number 96-40048 ("the Litigation");
WHEREAS, X.X. Xxxxx & Co. - Conn. and Circe Biomedical, Inc. currently
intend to proceed with an initial public offering ("the IPO") of certain stock
of Circe Biomedical, Inc.; and
WHEREAS, the parties desire to settle certain of their differences
unconditionally, to settle certain of their disputes conditioned on the timely
completion of the IPO or on the occurrence of certain other events, and
otherwise to alter and restate their respective rights and obligations in
accordance with the terms and conditions set forth below;
NOW, THEREFORE, in consideration of the mutual promises and other
obligations contained herein, the parties have agreed as follows:
SECTION 1. DEFINITIONS: As used in this Agreement the following terms shall
have the following meanings:
1.1 "Affiliate" shall mean any and all corporations or other business
entities in which a party hereto owns or controls, directly or indirectly, fifty
percent (50%) or more of either (i) the shares entitled to vote for the election
of the board of directors, or (ii) equivalent equity interest if
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such business entity is not incorporated. Affiliates shall also mean any parent
company to a party or companies of which fifty percent (50%) or more is owned by
such parent company.
1.2 "BHT Background Technology" shall mean all United States and foreign
patent rights, technical information, data, know-how, inventions and the like
owned or controlled (in the sense of being able to license others) by BioHybrid
Technologies Limited Partnership as of March 1, 1986 (the effective date of the
Assignment, Royalty and Development Agreement dated February 21, 1986 between
BHT and Grace) relating to Hybrid Artificial Organs.
1.3 "BHT" shall mean, collectively, BioHybrid Technologies Incorporated
and BioHybrid Technologies Limited Partnership, and BioHybrid Technologies
Development Company, and their respective Affiliates, successors and assigns.
1.4 "Circe" shall mean Circe Biomedical, Inc., and its Affiliates (other
than X.X. Xxxxx & Co. Xxxx. or its Affiliates), successors and assigns.
1.5 "Grace" shall mean X.X. Xxxxx & Co. - Conn., and its Affiliates,
successors and assigns, excluding Circe.
1.6 "Grace Proprietary Information" shall mean all information in whatever
form now or previously in the possession or control of Grace that BHT learned
of, directly or indirectly, as a result of BHT's participation with Grace in a
joint program up to and including February 28, 1993.
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1.7 "Hybrid Artificial Organ" shall mean a device which simulates or
substitutes for functions performed by a natural body organ and which is
comprised of a combination of living cells with a membrane.
1.8 "Hybrid Artificial Pancreas" shall mean a device which simulates or
substitutes for functions performed by an endocrine pancreas and which is
composed of a combination of living pancreatic islet cells with a membrane.
1.9 "Net Sales" shall mean the actual invoice price of a product sold,
leased or otherwise disposed of by a party (or any Affiliate, licensee or
sublicensee thereof) calculated at the time of sale, lease or other disposition
of such product, less the following deductions attributable to such transaction:
(a) customer discounts and rebates;
(b) actual credits to customers for returned goods;
(c) any of the following when separately charged to customers:
(i) transportation and insurance costs;
(ii) excise, sales, value-added, property and use taxes; and
(iii) import and export duties.
1.10 "New Technology" shall mean all United States and foreign patent
rights, technical information, data, know-how, inventions and the like developed
(i) either solely by BioHybrid Technologies, Inc., or jointly by BioHybrid
Technologies, Inc. and Grace, in the course of the
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development work which was the subject of the Stage Five Agreement or earlier
agreements between such parties, or (ii) jointly by BioHybrid Technologies, Inc.
and personnel of an institution at which Grace and BHT agreed to conduct
pre-clinical research in the course of a sponsored research program between
Grace and such institution relating to Hybrid Artificial Organs.
1.11 "Perfusion Device" shall mean a Hybrid Artificial Organ which
incorporates means by which blood or other biological fluids flow through one or
more tubular membranes of the Hybrid Artificial Organ, or a Hybrid Artificial
Organ which is connected to the circulatory system directly or through a
plasmapheresis device.
1.12 "Similar Transaction" shall mean (1) the sale or other
disposition by Circe (other than to an Affiliate) of substantially all of the
assets and properties associated with the Hybrid Artificial Pancreas program or
(2) a transaction by which Circe ceases to be an "Affiliate" of Grace.
SECTION 2. NO ADMISSION OF LIABILITY. Nothing in this Agreement
constitutes an admission or concession on the part of any party of any liability
or wrongdoing of any kind or an admission or concession on the part of any party
concerning the merit or lack of merit of any claim that was asserted or could
have been asserted in the Litigation.
SECTION 3. INITIAL PAYMENT TO BHT. Within seven days of the execution of
this Agreement, Grace shall pay to BHT, by check or wire transfer, the
non-refundable sum of $50,000.
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SECTION 4. Dismissal and stay of claims and counterclaims in the
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litigation.
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4.1 Promptly following the execution of this Agreement, Grace shall
notify the Court that it is withdrawing with prejudice the claims it sought to
add in the Litigation through Counts II, III and IV of its proposed Second
Amended Complaint, or, if Grace's motion to add such claims has at that point
been allowed, then Grace will file a Notice of Dismissal with prejudice and
without costs of the claims in Counts II, III and IV of its Second Amended
Complaint. By withdrawing or dismissing such claims with prejudice, Grace and
Circe irrevocably waive any claim for damages or equitable relief in any court
in connection with the matters that are addressed in said Counts II, III and IV
of the Second Amended Complaint, subject only to the reservation of the rights
specified in subsection 5.13 below. Such dismissal is not intended to and shall
not constitute or support a determination, one way or the other, as to whether
BHT is or will be using BHT Background Technology or New Technology to make, use
or sell any particular product, such as potentially to trigger royalty
obligations payable to Circe under the licenses contained in this Agreement.
4.2 Promptly following the execution of this Agreement, BHT and
Grace, by their counsel, shall execute, and BHT shall cause to be filed, a
stipulation of dismissal with prejudice of Counts III through VIII of its
counterclaims in the Litigation. By dismissing such claims with prejudice, BHT
irrevocably waives any claim in any court for damages or compensation (other
than such compensation as is specifically set forth in this Agreement) in
connection with any of the matters that are or were the subject of the
Litigation.
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4.3 The parties acknowledge that prior to the execution of this
Agreement the parties secured the approval of the Court to stay through November
30, 1997 the Counts of the Litigation that are not being dismissed or withdrawn
with prejudice, namely, Grace's claim for equitable and declaratory relief as
set forth in the First Amended Complaint (and as incorporated in Count I of the
proposed Second Amended Complaint), and BHT's Answer and Counterclaim for
declaratory relief and specific performance as set forth in Counts I and II
thereof (collectively "the Stayed Claims"). If the conditions of subsection 6.2
below are met, or if the conditions of subsection 6.4 below are met, then, upon
BHT's receipt of the proceeds described therein, the parties shall promptly file
a stipulation of dismissal with prejudice and without costs of the Stayed
Claims, thereby terminating the Litigation in its entirety. If the conditions of
subsection 6.2 are not met, and the conditions of subsection 6.4 are likewise
not met, then promptly following the expiration of the Deadline, as defined in
subsection 6.1 (or earlier if the provisions of subsection 6.5 become
applicable), the parties will jointly notify the Court that they wish to lift
the stay as to the Stayed Claims.
4.4 In the event the stay as to the Stayed Claims is lifted pursuant
to subsection 4.3 or pursuant to subsection 6.5, the parties will proceed with
the Litigation concerning their rights under the Earlier Settlement Agreement,
as limited by the provisions of subsections 4.1 and 4.2 of this Agreement, and
subject, however, to the agreements of the parties set forth in Section 5 of
this Agreement. The parties waive any right to trial by jury in connection with
the Litigation and agree that if the stay is lifted all issues will be tried to
the Court, sitting without jury. The parties further agree that they will not
add any new or additional claims to the Litigation, by amended or
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supplemental complaint, or otherwise, except that Circe may be added or
substituted for Grace as a party to the extent necessary or desirable to secure
the relief sought in connection with the Stayed Claims. This Agreement shall not
be admissible in evidence in connection with the Stayed Claims, except that the
parties may, to the extent necessary, and without disclosing the other terms of
the Agreement, bring to the Court's attention the limitations on claims, issues
and remedies agreed to by the parties in subsections 4.1, and 4.2 and Section 5
hereof. In addition, the parties covenant and agree that they will not seek,
obtain or enforce any judgment with respect to the Stayed Claims to the extent
that such judgment is or would be inconsistent with any of the provisions of
Section 5 of this Agreement.
SECTION 5. TERMS CONCERNING CERTAIN TECHNOLOGY RIGHTS. Notwithstanding
anything to the contrary in any prior agreement between the parties, the parties
agree as follows:
5.1 Circe is the owner of and has the right to use and license BHT
Background Technology in the field of Hybrid Artificial Organs. In addition to
any other royalties payable hereunder, Circe, as the assignee of Grace's
obligations under Paragraph 7.02 of the Stage Five Agreement, shall pay
BioHybrid Technologies Limited Partnership a running royalty of [*] of Net Sales
of any Hybrid Artificial Pancreas sold by Circe (or its licensees or
sublicensees), whether or not such Hybrid Artificial Pancreas incorporates the
BHT Background Technology, in whole or in part, through March 1, 2001 (subject
to the Prepaid Royalty Credit provided for in subsection 6.3, if applicable).
BHT is the owner of and has the right to use and license BHT Background
Technology in all fields other than Hybrid Artificial Organs.
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5.2 BHT has a non-exclusive license as of February 28, 1993 (with
the right to grant sublicenses) to use the BHT Background Technology in the
field of Hybrid Artificial Organs, which license the parties hereby agree
excludes Perfusion Devices. If the conditions set forth in subsection 6.2 are
met, or if the conditions set forth in subsection 6.4 are met, then in addition
to any other royalties payable to Circe by BHT, BHT will pay Circe a running
royalty at the rate of [*] of the Net Sales of any Hybrid Artificial Organ which
incorporates BHT Background Technology, sold by BHT (or its sublicensees)
through March 1, 2001. The procedural provisions of Article VIII of the Fifth
Stage Agreement, a copy of which is attached as Appendix A, shall be deemed
applicable to such payments. If the conditions of subsection 6.2 are not met and
the conditions of subsection 6.4 likewise are not met, then whether BHT's
license to the BHT Background Technology in the field of Hybrid Artificial
Organs bears such royalties will depend upon the outcome of the litigation of
the Stayed Claims.
5.3 Circe, as Grace's assignee, is the sole and complete owner of
any and all rights in and to New Technology, and has the right to use the New
Technology in all fields. If Circe (or its licensees) use New Technology to
make, use or sell a Hybrid Artificial Pancreas, then Circe shall pay BioHybrid
Technologies Limited Partnership a running royalty on the Net Sales of any such
Hybrid Artificial Pancreas in accordance with the provisions and limitations of
Article VIII of the Stage Five Agreement (subject to the Prepaid Royalty Credit
provided for in subsection 6.3, if applicable).
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5.4 BHT has a license as of February 28, 1993 (with the right to
sublicense) to use the New Technology on a royalty bearing basis in the field of
Hybrid Artificial Organs, which license the parties hereby agree excludes
Perfusion Devices. If BHT, or its sublicensees use New Technology to make, use
or sell a product in the field of Hybrid Artificial Organs, then BHT shall pay a
running royalty to Circe on Net Sales of any such product or products in
accordance with the provisions and limitations of Article VIII of the Stage Five
Agreement. Such royalties will be paid in accordance with the royalty schedule
contained in Paragraph 8.05 of the Stage Five Agreement, which will be deemed to
be the negotiated rates between the parties.
5.5 If the provisions of subsection 6.2 are met or if the provisions
set forth in subsection 6.4 are met, BHT's royalty-bearing license to the New
Technology in the field of Hybrid Artificial Organs, excluding Perfusion
Devices, shall be non-exclusive (with the right to grant sublicenses), BHT shall
not be subject to any minimum royalty requirement, Grace and Circe shall not be
required to use reasonable efforts to sell to BHT membrane devices for BHT
practice of the BHT Background Technology, and Circe shall have the right to
license and sublicense the New Technology in the field of Hybrid Artificial
Organs. If the provisions of subsection 6.2 are not met and the provisions of
subsection 6.4 are likewise not met, then whether BHT's license to the New
Technology in the field of Hybrid Artificial Organs, excluding Perfusion
Devices, is exclusive (other than as to Circe) or non-exclusive, whether Circe
has the right to license and sublicense the New Technology in the field of
Hybrid Artificial Organs, whether Grace or Circe shall be required to use
reasonable efforts to sell to BHT membrane devices for BHT practice of the BHT
Background Technology (other than for Perfusion Devices), and whether BHT is
obligated to pay minimum royalties pursuant to the Earlier Settlement
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Agreement and Paragraph 11.05(b)(iv) of the Stage Five Agreement, will be
determined based on the outcome of the Litigation of the Stayed Claims conducted
in accordance with the provisions of subsection 4.4.
5.6 Circe hereby grants BHT a non-exclusive license (with the right
to sublicense) to use the New Technology on a royalty bearing basis in fields
outside the field of Hybrid Artificial Organs. If BHT or its sublicensees uses
New Technology to make, use or sell a product outside the field of Hybrid
Artificial Organs, then BHT shall pay Circe royalties on Net Sales of any such
products in accordance with and subject to the provisions and limitations of
Article VIII of the Stage Five Agreement, in accordance with the royalty
schedule contained in Paragraph 8.05 thereof, which will be deemed to be the
negotiated rates between the parties. The non-exclusive license granted herein
shall apply as of February 28, 1993.
5.7 If Circe (or its licensees) uses New Technology developed solely
by BHT to make, use or sell a product other than a Hybrid Artificial Pancreas,
then Circe shall pay BioHybrid Technologies Limited Partnership a running
royalty on the cumulative Net Sales of all sales of such Product in accordance
with the provisions and limitations of Article VIII of the Stage Five Agreement.
Such royalties will be paid in accordance with the royalty schedule contained in
Paragraph 8.06 of the Stage Five Agreement, which will be deemed to be the
negotiated rates between the parties. BHT acknowledges, however, that BHT is not
entitled, nor will it be entitled in the future, to any royalties or other
payments with respect to the commercialization of an
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artificial liver device, system or product by Grace, Circe or their licensees or
sublicensees, and BHT waives any and all present and future claims to any such
royalty. BHT further acknowledges and agrees that the commercialization of an
artificial liver device, system or product by Grace, Circe or their licensees or
sublicensees will not violate any of the proprietary rights of BHT.
5.8 BHT acknowledges that Grace previously assigned its rights and
obligations under the Earlier Settlement Agreement and under the Stage Five
Agreement to Circe in accordance with Paragraph 12.06 of the Stage Five
Agreement. BHT, agrees that Grace and Circe may assign or transfer their rights
and obligations set forth or restated in this Agreement, including without
limitation Circe's rights with respect to BHT Background Technology in the field
of Hybrid Artificial Organs and its rights with respect to New Technology and
patents and patent applications relating thereto.
5.9 Grace and Circe acknowledge that BioHybrid Technologies
Incorporated previously assigned its rights and obligations relating to New
Technology and BHT Background Technology to its Affiliate, BioHybrid
Technologies Development Company. Grace and Circe agree that BHT may assign or
transfer its rights and obligations set forth or restated in this Agreement,
including without limitation, BHT's license rights with respect to BHT
Background Technology and New Technology.
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5.10 BHT represents and warrants that as of the date hereof it has
not assigned or licensed rights to the BHT Background Technology in the field of
Hybrid Artificial Organs or rights to the New Technology to anyone.
5.11 Notwithstanding anything to the contrary in this Agreement or
any prior Agreement between Grace and BHT (including but not limited to the
Earlier Settlement Agreement and the Stage Five Agreement), BHT understands and
agrees that it does not have a license to use, and that no license rights will
be granted to it to use, the BHT Background Technology or the New Technology in
connection with a Perfusion Device in the field of Hybrid Artificial Organs. BHT
further agrees that any license, sublicense or assignment they may grant with
respect to the BHT Background Technology or the New Technology shall expressly
exclude the right to use the BHT Background Technology or the New Technology in
connection with a Perfusion Device in the field of Hybrid Artificial Organs. It
is the intent of this provision to confirm (as between BHT and Circe) the
exclusive right of Circe (and, if applicable, its licensees and sublicensees) to
use the BHT Background Technology and the New Technology in connection with a
Perfusion Device in the field of Hybrid Artificial Organs.
5.12 BHT agrees and covenants that it will not seek to enforce
against Grace or Circe (or, if applicable, any licensees or sublicensees of
Grace or Circe), nor will it grant a license to anyone else that would include a
right to enforce, against Grace or Circe (or, if applicable, their licensees or
sublicensees), any rights under existing patents or under patents that have been
applied for, or other claimed technology rights, that would in any way restrict
Grace, Circe, or, if
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applicable, their licensees or sublicensees in connection with their development
and commercialization of Perfusion Devices in the field of Hybrid Artificial
Organs.
5.13 To the extent BHT or its licensees or sublicensees seek to
enforce any patent or technology rights against Grace, Circe or, if applicable,
their licensees or sublicensees, nothing in this Agreement shall be construed as
preventing Grace, Circe or their licensees or sublicensees from defending
themselves on the basis of any and all defenses that were open to them before
the execution of this Agreement, including, but not limited to, defenses based
upon the alleged facts underlying Counts II, III and IV of the proposed Second
Amended Complaint.
5.14. In the event that Circe grants a license to any third party to
utilize BHT Background Technology to sell or lease any product or application
(other than a Perfusion Device) in the field of Hybrid Artificial Organs upon
financial terms that are more favorable than the terms of the license granted to
BHT to utilize BHT Background Technology for such product or application, Circe
shall notify BHT of such third-party license and shall give BHT the opportunity
to obtain the benefit of the more favorable financial terms for such product or
application (excluding any Perfusion Device), upon the same terms and
conditions, in their entirety (including any minimum royalty provisions or the
like), as contained in such third-party license. If, as a result of either (i)
the satisfaction of the provisions of either subsection 6.2 or subsection 6.4 or
(ii) the outcome of the litigation of the Stayed Claims, Circe has the right to
license and sublicense the New Technology in the field of Hybrid Artificial
Organs, then in such case, in the event that Circe grants a license to any third
party to utilize New Technology to sell or lease any product or application
(other than a Perfusion Device) in the field of Hybrid Artificial
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Organs upon financial terms that are more favorable than the terms of the
license granted to BHT to utilize New Technology for such product or
application, Circe shall notify BHT of such third-party license and shall give
BHT the opportunity to obtain the benefit of the more favorable financial terms
for such product or application (excluding any Perfusion Device), upon the same
terms and conditions, in their entirety (including any minimum royalty
provisions or the like), as contained in such third-party license. Nothing in
this subsection shall be construed as granting to BHT any license to use BHT
Background Technology or New Technology in connection with a Perfusion Device in
the field of Hybrid Artificial Organs.
SECTION 6. Additional Terms Conditioned Upon Timely Completion of IPO or
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Certain Other Events.
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6.1 The Deadline shall mean September 30, 1997 unless Grace by
written notice to BHT sent on or before September 30, 1997 extends the Deadline,
in which case the Deadline shall be November 30, 1997.
6.2 If the closing of the IPO, or the closing of a Similar
Transaction, occurs on or before the Deadline, time being of the essence, then
within ten (10) days of such closing Circe (or Grace, as the case may be) shall
pay to BHT by check or wire transfer the sum of $450,000. Upon the making of
this payment, Circe shall have, in addition to any other rights it has under
this Agreement, the right to license and sublicense the New Technology in the
field of Hybrid Artificial Organs (subject to the royalty provisions of
subsection 5.3) and the right to receive
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royalties for BHT's use of the BHT Background Technology in the field of Hybrid
Artificial Organs as set forth in subsection 5.2.
6.3 In consideration of the payment to BHT set forth in subsection
6.2 (or 6.4), BHT will be deemed to have received prepaid royalties from Circe
in the principal amount of $300,000, for which Circe shall receive a Prepaid
Royalty Credit against any future royalty obligations otherwise payable to BHT,
[*], as set forth below. On January 1, 1998, the Prepaid Royalty Credit will be
an amount equal to $300,000,[*]. As of January 1, 1999, and as of each
successive January 1 thereafter, the amount of the Prepaid Royalty Credit shall
be re-calculated by subtracting from the amount of the Prepaid Royalty Credit
the royalties, if any, that accrued to BHT during the calendar year just ended,
[*]. If, during the course of any calendar year, there are sufficient Net Sales
such that accrued royalties during that year equal or exceed the Prepaid
Royalty Credit as of the beginning of such year, then the Prepaid Royalty
Credit will be exhausted, and Circe will resume paying to BHT, in accordance
with and subject to the provisions and limitations of Appendix A, any royalties
that accrue to BHT in excess of the amount of the Prepaid Royalty Credit. Grace
shall not be liable for the payment by Circe of any royalty that accrues after
the receipt by BHT of the payment described in subsection 6.2 or 6.4.
6.4 Even if no IPO or Similar Transaction has occurred, Grace or
Circe, in their sole discretion, may elect to invoke the provisions of
subsections 6.2 and 6.3 by notice to BHT on or before the Deadline together with
a payment to BHT in the amount of $450,000.
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6.5 Nothing in this Agreement shall be construed as imposing upon
Grace or Circe any obligation to proceed with the IPO or a Similar Transaction
or to complete the IPO or a Similar Transaction either before the Deadline or
otherwise. In the event Grace or Circe abandons any attempt to complete an IPO
or Similar Transaction prior to the Deadline, the parties agree to jointly
notify the Court that they wish to lift the stay as to the Stayed Claims, in
which case the provisions of subsection 4.4 shall apply.
SECTION 7. INCORPORATION OF CERTAIN PROVISIONS OF STAGE FIVE AGREEMENT
The parties hereby incorporate by reference Paragraphs 1.12, 6.09, and 6.11 of
the Stage Five Agreement, and Article IX of the Stage Five Agreement in its
entirety, (to the extent the foregoing provisions are applicable by their terms
after February 28, 1993), as well as Paragraph 6.3 of the Earlier Settlement
Agreement, with the understanding that references therein to Grace shall refer,
where applicable, to Circe as Grace's assignee. Copies of these incorporated
provisions are set forth in Appendix B. If there is any inconsistency between
the provisions hereby incorporated, and the other terms of this Agreement, then
the terms of this Agreement shall control.
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SECTION 8. CONFIDENTIALITY
8.1 The parties incorporate by reference Article X of the Stage Five
Agreement, in its entirety, a copy of which is set forth in Appendix C, with the
understanding that the ten year period referred to therein shall expire on
February 28, 2003, and that references to Grace shall mean Grace and/or Circe,
as Grace's assignee, as the context requires, and with the further understanding
that the provisions of such Article X do not preclude the disclosure of
confidential information to any licensee or sublicensee of BHT Background
Technology or New Technology provided such licensee or sublicensee agrees to be
bound by the provisions of this subsection.
8.2 The parties shall hold the terms of this Agreement in strict
confidence and shall not disclose the terms contained herein except as required
by law; provided, however, that any party may disclose the existence and terms
of this Agreement to such extent as may be required for a proper business
purpose, including for the purpose of implementing the IPO or a Similar
Transaction, any proposed license or sublicense or obtaining financing. In
particular, the parties agree that Grace and Circe may refer to this Agreement
or any part of it in, and/or file this Agreement or any part of it as an exhibit
to, any registration statement filed with the Securities and Exchange Commission
or other governmental agencies. In no event shall the parties directly or
indirectly publicize through the media the fact of or terms of this Agreement. A
party may respond to any inquiry addressed to the parties for information
concerning the parties' dispute by stating, without further elaboration, that
the matter has been amicably resolved.
8.3 BHT agrees that it and each of its partners, officers,
directors, stockholders, employees and agents shall maintain in strict
confidence their knowledge concerning the potential
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IPO until such time as the IPO becomes public knowledge through the filing of a
registration statement with the Securities and Exchange Commission.
8.4 BHT, on the one hand, and Grace and Circe on the other, each
agree to refrain from any disparagement of, interference with or negative
comments (oral or written) with respect to the other party, or any licensee or
employee of the other party (other than as may be necessary in connection with
the conduct of the Litigation, if required, of the Stayed Claims).
SECTION 9. MUTUAL RELEASE OF CLAIMS. Except with respect to the
continuing obligations specifically set forth in this Agreement, and except for
the rights specifically set forth or reserved in this Agreement, BHT on behalf
of itself and its venturers (including, without limitation, JDR Corp. and
Synergy Research Corp.)and each of their respective employees, officers,
representatives and agents, on the one hand, and Grace and Circe, on behalf of
themselves and their respective employees, officers, representatives and agents,
on the other hand, hereby release and forever discharge one another from any and
all liens, claims, contracts, demands, causes of action, obligations, damages
(including both direct and consequential damages) and liabilities, costs and
expenses, of any nature whatsoever, known or unknown, in tort or contract, under
federal, state or local laws or regulations (including, without limitation,
attorneys' fees) as of the date hereof. The parties hereto acknowledge that they
may have sustained injuries, damages or claims which are presently unknown or
unsuspected or which may be different in magnitude, type, causative agent or
latency from injuries, damages or claims that are presently known or suspected,
and that such injuries, damages or claims may give rise to additional losses or
expenses in the future which are not now anticipated. Nevertheless, the
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parties intend herein to release and forever discharge each other from any and
all such unknown or unsuspected claims or different injuries, damages or claims,
except with respect to the rights and obligations expressly stated in this
Agreement.
Except for the continuing rights and obligations set forth in this
Agreement, this release includes any and all claims that were asserted or could
have been asserted in the Litigation, except for the Stayed Claims. In the event
the conditions of subsection 6.2 are met or in the event the conditions of
subsection 6.4 are met, then this Release shall apply to the Stayed Claims as
well. If the conditions of subsection 6.2 are not met and the conditions of
subsection 6.4 are likewise not met, then the litigation of the Stayed Claims
shall be entirely unaffected by this section 9, but shall proceed as limited by
and in accordance with subsection 4.4 above.
SECTION 10. INTEGRATION. This Agreement and the provisions of earlier
agreements specifically incorporated herein by reference and set forth in
Appendices A, B and C constitute the entire agreement and understanding of the
parties with respect to the transactions contemplated hereby and relating to the
specific subject matter hereof and supersede all prior agreements and
understandings between the parties.
SECTION 11. NOTICES. All notices and other communications required or
permitted to be given under this Agreement shall be deemed to have been duly
given when received if in writing and delivered by hand or courier or mailed
(first class, postage prepaid, registered or certified mail) or sent by
confirmed facsimile to the appropriate address as follows:
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If to BHT BioHybrid Technologies
Incorporated
000 Xxxxxx Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attn.: President
Fax# (000)000-0000
with a copy to: Xxxx X. Xxxxx, Esq.
Xxx Xxxxxx Xxxxxxxxx Xxxx
Xxxxxx, XX 00000
Fax# (000)000-0000
If to Grace: X.X. Xxxxx & Co.-Xxxx.
Xxx Xxxx Xxxxxx Xxxx
Xxxx Xxxxx, Xxx. 00000-0000
Attn: Secretary
Fax# (000)000-0000
with a copy to: Chief Patent Counsel
X.X. Xxxxx & Co.-Conn.
Xxx Xxxx Xxxxxx Xxxx
Xxxx Xxxxx, Xxx. 00000-0000
Fax# (000)000-0000
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If to Circe: Circe Biomedical, Inc.
One Ledgemont Center
000 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: President
Fax# (000)000-0000
SECTION 12. GOVERNING LAW. This Agreement and the performance of the
transactions contemplated herein shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts, excluding its
conflict of laws provisions.
SECTION 13. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument.
SECTION 14. AMENDMENT. This Agreement may be amended or any of the terms
hereof may be waived only be a writing specifically referring to this Agreement
and executed by duly authorized representatives of the parties affected by the
amendment, or, in the case of a waiver, by the party waiving compliance. The
failure of any party at any time or times to require performance of any
provision hereof shall in no manner affect the right at a later time to enforce
the same. No waiver by any party of any breach of any term contained in this
Agreement, in any one or more instances, shall be deemed to be or construed as a
further or continuing waiver of any such breach or a waiver of any breach of any
other term.
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SECTION 15. INTERPRETATION. The parties hereto acknowledge and agree
that: (i) each party and its counsel reviewed and negotiated the terms and
provisions of this Agreement and have contributed to its revision; (ii) the rule
of construction to the effect that any ambiguities are resolved against the
drafting party shall not be employed in the interpretation of this Agreement;
and (iii) the terms and provisions of this Agreement shall be construed fairly
as to all parties hereto and not in favor of or against any party, regardless of
which party was generally responsible for the preparation of this Agreement.
SECTION 16. OTHER INSTRUMENTS. From time to time, as and when requested
by either party to this Agreement, the other party shall execute and deliver, or
cause to be executed and delivered, any other instrument which may be deemed
reasonably necessary or desirable to vest in and confirm to the parties the
rights, obligations and agreements referred to herein, including, but not
limited to:
(i) any estoppel certificate or other instrument necessary or
desirable to effect the IPO or a Similar Transaction;
(ii) the grant of the licenses referred to herein; or
(iii) the release of the claims made by the parties against each other
as described in subsections 4.1 and 4.2 hereof.
IN WITNESS WHEREOF, the parties by their duly authorized representations
have caused this Agreement to be executed as of the date first above written.
BIOHYBRID TECHNOLOGIES INCORPORATED
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By /s/ Xxxxxxx X. Chick
-------------------------------------------
Xxxxxxx X.Chick, President
BIOHYBRID TECHNOLOGIES LIMITED
PARTNERSHIP
By /s/ Xxxxxxx X. Chick
-------------------------------------------
Xxxxxxx X. Chick, General Partner
BIOHYBRID TECHNOLOGIES DEVELOPMENT
COMPANY
By: BioHybrid Technologies
Incorporated, Managing Venturer
By /s/ Xxxxxxx X. Chick
-------------------------------------------
Xxxxxxx X. Chick, President
X.X. XXXXX & CO. - CONN.
By /s/ Xxxxx X. Xxxxxxx
-------------------------------------------
Xxxxx X. Xxxxxxx, Vice President
CIRCE BIOMEDICAL, INC.
By /s/ Xxxxxx Xxxx
-------------------------------------------
Xxxxxx Xxxx, President
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APPENDIX A
----------
ARTICLE VIII - RIGHTS AND ROYALTIES AS TO NEW TECHNOLOGY
--------------------------------------------------------
(8.01) GRACE shall be the sole and exclusive owner of any and all rights in and
to New Technology. In the case of inventions made jointly by BHT INC. and GRACE,
or jointly by BHT INC. and personnel of that institution referred to in
Paragraph 1.11 acting pursuant to the program described in Paragraph 1.04, BHT
INC. shall, pursuant to Paragraph 6.09 herein, promptly assign to GRACE all
rights in such invention which it holds or derives from its employees, and BHT
INC. shall not seek to exploit such invention except as permitted by the terms
of this Agreement.
(8.02) If GRACE uses New Technology to make, use, or sell a Hybrid Artificial
Pancreas and the use of such New Technology is covered by Patentable Claims or
results, in a Hybrid Artificial Pancreas which is covered by Patentably Claims,
then Grace shall pay BHT PARTNERSHIP a running royalty on the cumulative Net
Sales of all sales of such Hybrid Artificial Pancreas by GRACE and its
Affiliates according to the following schedule:
CUMULATIVE NET SALES ROYALTY RATE
-------------------- ------------
[*]
(8.03) Royalties payable by GRACE to BHT PARTNERSHIP under Paragraph 8.02 on the
sale of a Hybrid Artificial Pancreas shall be in addition to any royalties
payable by GRACE to BHT PARTNERSHIP pursuant to Paragraph 7.02 herein.
(8.04) In no event shall BHT have the right to use any of the New Technology for
any purpose related to a Hybrid Artificial Pancreas except in connection with
the joint program or pursuant to Article XI subsequent to termination of this
Agreement. However, Grace hereby grants BHT a non-exclusive right (including the
right to grant sub-licenses) to use the New Technology pursuant to the terms of
Paragraph 8.05 in the fields listed in Appendix E hereto. In the event that BHT
wishes to use the New Technology in fields in addition to those listed in
Appendix E, then BHT shall so indicate by written notice to GRACE. GRACE shall
thereafter advise BHT within sixty (60) days whether it is willing to enter into
negotiations with BHT for rights to such additional fields on terms which shall
be satisfactory to GRACE but which shall not exceed the royalty rates set forth
in Paragraph 8.05.
(8.05) If BHT, its affiliates or sub-licensees use New Technology to make, use
or sell a product pursuant to the rights granted to BHT in Paragraph 8.04
herein, the BHT shall pay a running royalty to GRACE on terms to be negotiated
but which shall not exceed the following:
(a) If the use of such New Technology is neither covered by
Patentable Claims nor results in a product which is covered by
Patentable Claims, then BHT shall pay GRACE a running royalty which
shall not exceed [*] of the cumulative Net Sales of such product.
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(b) If the use of such New Technology is either covered by
Patentable Claims or results in a product which is covered by Patentable
Claims, then BHT shall pay GRACE a running royalty (in addition to the
royalty provided in Paragraph 8.05(a) above) on the cumulative Net Sales
of such product, the royalty rate not to exceed the following schedule:
CUMULATIVE NET SALES ROYALTY RATE
-------------------- ------------
[*]
(8.06) If GRACE or its Affiliates use New Technology developed solely by BHT to
make, use, or sell a product other than a Hybrid Artificial Pancreas, then GRACE
shall pay a running royalty to BHT PARTNERSHIP on terms to be negotiated but
which shall not exceed the following:
(a) If the use of such New Technology is neither covered by
Patentable Claims nor results in a product which is covered by
Patentable Claims, then GRACE shall pay BHT PARTNERSHIP a running
royalty which shall not exceed [*] of the cumulative Net Sales of such
product.
(b) If the use of such New Technology is either covered by
Patentable Claims or results in a product which is covered by Patentable
Claims, then GRACE shall pay BHT PARTNERSHIP a running royalty (in
addition to the royalty provided in Paragraph 8.06(a) above) on the
cumulative Net Sales of such product, the royalty rate not to exceed the
following schedule:
CUMULATIVE NET SALES ROYALTY RATE
-------------------- ------------
[*]
(8.07) The obligation of GRACE to pay royalties to BHT PARTNERSHIP pursuant to
Paragraph 8.02 or Paragraph 8.06 herein, and the obligation of BHT to pay
royalties to GRACE pursuant to Paragraph 8.05 herein shall exist for whichever
of the following periods is appropriate:
(a) If the relevant Patentable Claims appear in an issued U.S.
patent, then such obligation shall commence with the date of issuance of
the patent and shall continue for the life of such patent.
(b) If the relevant Patentable Claims do not appear in an issued
U.S. patent, but are deemed Patentable Claims pursuant to either
Paragraph 6.06 or Paragraph 6.07 herein, then such obligation shall have
commenced with the date on which either party first submitted to the
other pursuant to Paragraph 6.04 herein, a writing describing the
invention to which such Patentable Claims are directed, and such
obligation shall continue thereafter for a period of twenty (20) years.
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(c) If the New Technology is neither covered by Patentable Claims
nor results in a product which is covered by Patentable Claims, then
such obligation shall have commenced with the date on which either party
first advised the other, pursuant to Paragraph 4.04 herein, of the
existence of such New Technology, and such obligation shall continue
thereafter for a period of ten (10) days.
(8.08) (a) The payment of royalties based on cumulative Net Sales by either
party to the other under Paragraphs 7.02, 8.02, 8.05, or 8.06 herein
shall refer only to sales of products at a price in excess of the direct
manufacturing cost (i.e., cost of goods sold) of such product, and shall
not include any sales at cost or transfers of products at cost for
experimental or development purposes in connection with obtaining Food
and Drug Administration approval of such product.
(b) In the event that GRACE has filed an application for a U.S.
patent directed to some portion of New Technology and no claims
resulting from such application have been allowed by the U.S. Patent and
Trademark Office within a period of three years from the date of filing,
then BHT and GRACE shall meet promptly thereafter to discuss terms and
conditions on which all or part of the royalties payable under this
Article VIII may be commenced.
(8.09) Each calendar year in which one party to this Agreement has a royalty
obligation to the other party shall be divided into two (2) royalty periods
ending upon the last day of June and December. The party having the royalty
obligation shall, within forty-five (45) days of the close of each such royalty
period, remit to the other party the running royalties accrued during such
royalty period as well as a written royalty report showing the basis on which
such royalties were computed.
(8.10) Each party shall keep, and require its Affiliates and licensees to keep,
accurate and complete records in accord with general accepted accounting
practices which provide all information (including without limitation, all sales
records and xxxxxxxx) necessary for the accurate determination of the amounts
payable to the other party pursuant to Article VII and VIII of this Agreement.
Each party shall further permit such records to be inspected and audited by
independent auditors retained by and at the expense of the party seeking such
audit at reasonable intervals and during regular business hours so as to
determine the completeness or accuracy of the royalty reports made pursuant to
Paragraph 8.09 herein. Records in support of each such royalty report made by a
party shall be kept intact for a period of two (2) years from the date on which
such royalty report was submitted to the other party to this Agreement.
(8.11) (a) Pancreatic islets isolated by BHT INC. using New Technology
shall be subject to GRACE rights as defined in the Article for New
Technology, whether or not the islets themselves can be considered as
New Technology. Pancreatic islets isolated by BHT INC. without using New
Technology shall belong to BHT INC. and GRACE shall have no rights
therein under this Agreement.
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(b) In the event that BHT INC. considers that sampling of the
pancreatic islets of Paragraph 8.11(a) to third parties is advisable, it
shall discuss such sampling with GRACE and GRACE shall determine whether
the proposed sampling is appropriate. GRACE shall advise BHT INC. in
writing of that determination. If GRACE agrees that BHT INC. shall
proceed with the proposed sampling and GRACE considers that a written
agreement is required to protect GRACE and BHT INC. proprietary
interests, then BHT INC. shall first secure a written agreement with the
third party, corresponding to one of the following subparagraphs, to be
selected by GRACE:
(i) written agreement to receive and maintain the islets in
confidence, without disclosure or transfer to any third party,
or
(ii) written agreement to receive and maintain the islets in
confidence, without disclosure or transfer to any third party,
and also to assign or license (non-exclusively or exclusively)
to BHT INC. inventions which are made or developed with the
pancreatic islets, with said agreement including such terms and
provisions as to allow BHT INC. to fulfill its obligations to
GRACE under this Article.
BHT INC. shall keep GRACE advised of all such agreement and shall keep
GRACE apprised, in at least a general manner, of the progress of the third party
research.
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APPENDIX B
----------
(1.12) "Patentable Claims" shall mean any one of the following:
(a) claims in an issued United States Patent which are directed to
some portion of New Technology; or
(b) patent claims directed to some portion of New Technology which
in the opinions of GRACE and BHT INC. would be allowed by the United
States Patent and Trademark Office; or
(c) patent claims directed to some portion of New Technology which
in the opinion of competent, independent patent counsel, acting pursuant
to the provisions of Article 6.07 herein, would be allowed by the United
States Patent and Trademark Office.
(6.09) Except as otherwise provided herein, all patent applications in any
country which are based on technical advances made, solely or jointly, by BHT
INC. pursuant to this Agreement shall be promptly assigned by BHT INC. to GRACE,
and GRACE shall have sole control of the selection of patent counsel and the
filing, prosecution, and maintenance of such patent applications. BHT shall
fully cooperate with GRACE in the filing and prosecution of all such
applications, including without limitation signing required documents and
providing documentation or testimony in support of the application.
(a) In the event that GRACE decides that it no longer wishes to
prosecute or maintain any patent application or patent arising from the
New Technology, then it shall give notice to BHT INC. If BHT INC.
desires that such patent property be further prosecuted or maintained,
then it shall so advise GRACE and GRACE shall instruct its patent
counsel accordingly, with the cost of all such further prosecution or
maintenance to be charged to BHT INC.
(6.11) GRACE shall have the exclusive right, but not the obligation, to initiate
and prosecute legal action for infringement or misappropriation by a third party
of any of the New Technology. BHT shall render all necessary cooperation and
shall promptly execute all documents as may be required during the course of
such legal action. All expenses of any such action shall be borne by GRACE. Any
damages or other compensation recovered by GRACE as a result of such action
shall belong solely to GRACE, subject to royalties payable to BHT in accord with
the provisions of Articles VII and VIII (that is, considering the amount of
damages or other compensation to be cumulative Net Sales), provided that all
expenses borne by GRACE in the course of such litigation (including, without
limitation, all attorneys' fees) shall first be deducted from the amount subject
to royalties.
(a) In the event that GRACE declines to initiate or prosecute any
legal action for infringement or misappropriation of New Technology in a
field in which BHT INC. is
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permitted to use such New Technology pursuant to Paragraph 8.04 or
Paragraph 11.05 herein, then BHT INC. shall be entitled to initiate and
prosecute such legal action and all expenses of such action shall be
borne by BHT. Any damages or other compensation recovered by BHT INC. as
a result of such action shall belong solely to BHT INC., subject to
royalties payable to GRACE in accord with the provisions of Paragraph
VIII (that is, considering the amount of damages or other compensation
to be cumulative Net Sales), provided that all expenses borne by BHT
INC. in the course of such litigation (including, without limitation,
all attorneys' fees) shall first be deducted from the amount subject to
royalties.
(b) Regardless of any actions or failures to act by GRACE with
regard to the New Technology, BHT INC. shall have no right to initiate
or prosecute any legal action for infringement or misappropriation of
New Technology in any field where BHT INC. has not been granted the
right to use such New Technology pursuant to Paragraph 8.04 or Paragraph
11.05 herein.
ARTICLE IX - THIRD PARTY PATENTS AND TECHNOLOGY
-----------------------------------------------
(9.01) In the event that GRACE (including any GRACE Affiliate or licensee) or
BHT (including any BHT Affiliate or licensee) receives a notice of a claim,
threat, or suit by a third party alleging that the manufacture, use, or sale of
Hybrid Artificial Organs for which royalties are payable under this Agreement
infringes or is dominated by intellectual property rights (including valid
patents) owned or controlled by such third party, then the party receiving the
notice shall promptly notify the other party to this Agreement of such claim,
threat, or suit.
(9.02) If notice of a claim, threat, or suit of the type described in Paragraph
9.01 herein is received by either party, GRACE shall have full control of the
resolution of such claim, threat, or suit. Such control shall include
negotiation with the third party, selection and supervision of counsel, filing
of lawsuits or other proceedings, and settlement of the claim, threat, or suit.
All costs and expenses, including attorneys' fees, incurred in the course of
resolving such claim, threat, or suit shall be charged to GRACE. BHT shall fully
cooperate with GRACE in the defense and resolution of any such claim, threat, or
suit.
(9.03) Except as otherwise provided in Paragraph 9.04 herein, in the event that
resolution of a claim, threat, or suit of the type described in Paragraph 9.01
herein results in the payment of any royalties or other compensation by GRACE to
a third party, then GRACE shall thereafter be permitted to deduct one-half the
amount of such payment from the running royalties paid or payable by GRACE to
BHT PARTNERSHIP under Article VIII (but not Article VII) of this Agreement. The
total amount to be deducted under this Paragraph 9.03 shall not exceed one-half
of the total royalties paid or payable to BHT PARTNERSHIP under Article VIII of
this Agreement.
(9.04) The royalty deduction permitted GRACE pursuant to Paragraph 9.03 herein
shall not be applicable in the event that GRACE pays royalties or other
compensation to a third party for rights under one or more of the items of
intellectual property listed in Appendix D hereto.
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6.3 If Grace successfully commercializes a Hybrid Artificial Pancreas utilizing
BHT Background Technology or New Technology, in whole or in part, then Grace
shall give appropriate credit or recognition to Xx. Xxxxxxx X. Chick and to BHT
for their contributions to the project in any announcement or publication made
by Grace.
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APPENDIX C
----------
ARTICLE X - CONFIDENTIALITY
---------------------------
(10.01) Subject to the provisions of Paragraph XI herein, for the term of this
Agreement and for an additional period of ten (10) years from the date of
expiration or termination of this Agreement, BHT and GRACE shall hold in
confidence all information relating to BHT Background Technology, New Technology
and GRACE Proprietary Information and shall use such information only for
purposes permitted by this Agreement.
(10.02) The obligation of BHT and GRACE under Paragraph 10.01 herein upon
receipt of information from the other shall not extend to any information which:
(a) is known as of the date of this Agreement to the receiving party:
(b) is disclosed to the receiving party by a third party not under an
obligation of confidentiality to the disclosing party:
(c) is known to the public as of the Effective Date of this Agreement;
(d) becomes known to the public subsequent to the Effective Date of
this Agreement through no fault or omission of the receiving
party; or
(e) is required to be disclosed to a governmental authority or by
process of law.
Notwithstanding the provisions of this Paragraph, it is understood and agreed
that all obligations under the Prior Agreement and Stage Three Agreement with
respect to information disclosed under those agreements shall be continued under
this Agreement.
(10.03) For the period set forth in Paragraph 10.01, should BHT wish to disclose
to the public or to any third party any document or information (of whatever
type and by whatever means, including without limitation speeches, articles,
brochures and the like relating to: (i) the existence of the joint program or
the activities or plans of the parties with respect thereto, or (ii) the BHT
Background Technology or the New Technology, then BHT shall give ample notice of
such proposed disclosure to GRACE and BHT shall not make the proposed disclosure
without the prior written consent of GRACE. GRACE shall advise BHT within thirty
(30) days of receiving such notice of proposed disclosure as to whether GRACE
consents to a proposed disclosure.
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