1
Certain confidential portions of this Exhibit were omitted by means of blackout
of the text (the "Xxxx"). This Exhibit has been filed separately with the
Secretary of the Commission without the Xxxx pursuant to the Company's
Application Requesting Confidential Treatment under Rule 406 under the
Securities Act.
EXHIBIT 10.17
Exclusive License Agreement
between
The Regents of the University of California
and
Aurora Biosciences, Corp.
for
Fluorescent Assay Technologies
U.C. Case Nos. 93-289, 95-110, 95-219, 96-044, 96-160, 96-161, 96-162, 96-191
2
Table of Contents
ARTICLE PAGE
------- ----
1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2. Grant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3. License Issue Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4. Royalties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
5. Due Diligence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6. Progress and Royalty Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
7. Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
8. Life of the Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
9. Termination by The Regents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
10. Termination by Licensee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
11. Supply of the Biological Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
12. Maintenance of the Biological Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
13. Disposition of the Biological Materials, Biological Products, . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
14. Use of Names and Trademarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
15. Limited Warranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
16. Patent Prosecution and Maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
17. Patent Marking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
18. Patent Infringement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
19. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
20. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
21. Assignability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
22. Late Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
23. Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
24. Failure to Perform . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
25. Governing Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
26. Government Approval or Registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
27. Export Control Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
28. Force Majeure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
29. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
30. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
3
U.C. Case Nos. 93-289, 95-110, 95-219, 96-044, 96-160, 96-161, 96-162, and
96-191
Exclusive License Agreement
for
Fluorescent Assay Technologies
This license agreement ("Agreement") is effective this ______ day of
____________, 1996, (the Effective Date") by and between The Regents of the
University of California ("The Regents"), a California corporation, having its
statewide administrative offices at 000 Xxxxxxxx Xxxxx, 00xx Xxxxx, Xxxxxxx,
Xxxxxxxxxx 00000-0000 and Aurora Biosciences Corporation ("Licensee"), a
Delaware corporation, having a principal place of business at 00000 Xxxxx
Xxxxxx Xxxxx Xxxx, Xx Xxxxx, XX 00000.
Recitals
Whereas, certain inventions, generally characterized as fluorescent
assay technologies, including DNA encoding a green fluorescent protein and
fluorogenic substrates for Beta-lactamase ("Inventions"), useful for cell
screening, were made at the University of California, San Diego ("UCSD") by Dr.
Xxxxx Xxxxx, et al., and are claimed in Patent Rights or within the Property
Rights as defined below;
Whereas, Licensee entered into secrecy agreements ("Secrecy
Agreements") with The Regents covering UC Case Nos. *** on August 10, 1994; ***
on January 1, 1995; *** on December 8 1995; and *** on February 22, 1996 for the
purpose of evaluating the Invention;
***CONFIDENTIAL TREATMENT REQUESTED
1
4
Whereas, Licensee entered into an option agreement ("Option
Agreement") with The Regents on June 1, 1995 and ending on December 1, 1995 in
order to evaluate its commercial interest in the Invention;
Whereas, Licensee entered into a letter agreement with The Regents on
March 6, 1996 covering certain negotiated provisions that are contained in this
Agreement and a letter agreement with The Regents on April 26, 1996, with
respect to the Biological Materials ("Letter Agreements");
Whereas, the Invention was made under research funding provided in
part by the Department of Health and Human Services (DHHS) and in part by the
Xxxxxx Xxxxxx Medical Institute (HHMI), and as a consequence, this Agreement is
subject to overriding obligations to the federal government and to HHMI;
Whereas, under 35 USC Section 200-212, The Regents may elect to retain
title to any invention (including the Invention) made by it under U.S.
Government funding;
Whereas, if The Regents elects to retain title to the Invention, then
the law requires that The Regents grant to the U.S. Government a
nontransferable, paid-up, nonexclusive, irrevocable license to use the
Invention by or on behalf of the U.S. Government throughout the world;
Whereas, The Regents elected to retain title to the Invention covered
by UC Case Nos. *** on November 19, 1993; *** on February 5, 1996; ***
on October 25, 1995; and *** and *** on January 8, 1996, and granted the
required licenses to the U.S. Government;
Whereas, The Regents has acquired the right to grant this license from
the Xxxxxx Xxxxxx Medical Institute (HHMI) under the terms of the
interinstitutional agreement ("Interinstitutional Agreement"), having UC
Control No. 86-18-0017;
*** CONFIDENTIAL TREATMENT REQUESTED
2
5
Whereas, The Regents is required under the terms of Interinstitutional
Agreement to grant to the HHMI a paid-up, non-exclusive, irrevocable license to
use the Invention for its non-commercial purposes, but with no right to
sublicense;
Whereas, the Licensee is a "small entity" as defined in 37 CFR Section
1.9 and a "small-business concern" defined in 15 U.S.C. Section 632;
Whereas, it is the intent of the parties to this Agreement to create a
bailment (as provided for in Sections 2.2, 2.3 and 2.4 herein), among other
things, for the Biological Materials as defined below subject to Licensee's
rights as set forth herein;
Whereas, both parties recognize that royalties due under this
Agreement will be paid on pending patent applications and issued patents;
Whereas, Licensee requested certain rights from The Regents to
commercialize the Invention; and
Whereas, The Regents responded to the request of Licensee by granting
the following rights to Licensee so that the products and other benefits
derived from the Invention can be enjoyed by the general public.
- - oo 0 oo - -
The parties agree as follows:
1. Definitions
As used in this Agreement, the following terms will have the meaning
set forth below:
3
6
1.1 "Patent Rights" means all U.S. patents and patent applications
and foreign patents and patent applications assigned to The Regents, and in the
case of foreign patents and patent applications, those requested under Section
16.4 herein, including any reissues, extensions, substitutions, continuations,
divisions, and continuation-in-part applications (only to the extent, however,
1) that such continuation-in-part applications are covered in Section 1.1.9
below; or 2) that claims in the continuation-in-part applications are entitled
to the priority filing date of one or more of the following patent
applications listed in Sections 1.1.1 through 1.1.8 below) based on and
including any subject matter claimed in or covered by the following:
1.1.1. Pending U.S. Patent Application Serial No. ***,
entitled *** filed ***, by Dr. Xxxxx Xxxxx, et al.
and assigned to The Regents ***;
1.1.2. Pending U.S. Patent Application Serial No. *** filed
***, by Dr. Xxxxx Xxxxx, et al. and assigned to The
Regents ***;
1.1.3. Pending U.S. Patent Application Serial No. *** filed
***, by Dr. Xxxxx Xxxxx, et al. and assigned to The
Regents ***.
1.1.4. Pending PCT Application Serial No. ***, filed *** by
Dr. Xxxxx Xxxxx, et al. and assigned to The Regents
***;
1.1.5. Pending U.S. Patent Application Serial No. *** filed
***, by Dr. Xxxxx Xxxxx, et al. and assigned to The
Regents ***;
1.1.6. Any U.S. Patent Application based on subject matter
described in UC Case Number ***
*** CONFIDENTIAL TREATMENT REQUESTED
4
7
*** disclosed by Dr. Xxxxx Xxxxx, et al. and assigned
to The Regents; and
1.1.7. Any U.S. Patent Application based on subject matter
described in *** disclosed by Dr. Xxxxx Xxxxx, et al.
and assigned to The Regents; and
1.1.8. Any U.S. Patent Application based on subject matter
described in ***************************************
*********************************," disclosed by Dr.
Xxxxx Xxxxx, et al. and assigned to The Regents.
1.1.9 Any continuation-in-part applications that are filed
by *** where such continuation-in-part applications
disclosed Inventions at UCSD and name Xxxxx Xxxxx or
an employee of The Regents in Xxxxx Xxxxx'x laboratory
at UCSD as an inventor, and are based on one or more
of the patent applications described in Sections
1.1.1 through 1.1.8 immediately above.
1.2. "Biological Materials" means ***
1.3. "Biological Product" means any product containing: (a) a
plasmid, a protein structure, a cDNA clone, a promoter, a gene or a chimeric
gene, antibodies, or fragments thereof and their sequences derived from or
containing the Biological Materials; (b) any protein structure produced or
encoded by the Biological Materials; or (c) a compound (substantially similar
or identical to a compound in (a) or (b) above), produced by chemical synthesis
or by any other method which could not have been produced but for the use of
the Biological Materials. Biological Products may either be Patent Products or
Proprietary Products.
1.4. "Identified Product" means any product, compound, biological
agent, or other material not claimed by the Patent Rights and not comprising a
Biological Product,
***CONFIDENTIAL TREATMENT REQUESTED
5
8
but identified by Licensee or a sublicensee using the Biological Materials or
Biological Products.
1.5. "Patent Products" means:
1.5.1. any kit, composition of matter, material, product, or
Biological Product;
1.5.2. any kit, composition of matter, material, product, or
Biological Product to be used in a manner requiring
the performance of the Patent Method; or
1.5.3. any kit, composition of matter, material, product, or
Biological Product produced by the Patent Method;
the extent that the manufacture, use, or sale of such kit, composition of
matter, material, product, or Biological Product, in a particular country,
would be covered by or infringe, but for the license granted to Licensee
pursuant to this Agreement, an unexpired claim of a patent or pending claim of
a patent application were it issued as a claim in a patent under Patent Rights
in that country in which such patent has issued or application is pending.
1.6. "Patent Method" means any process or method covered by the
claims of a patent application or patent within Patent Rights or the use or
practice of which would constitute in a particular country, but for the license
granted to Licensee pursuant to this Agreement, an infringement of an unexpired
claim of a patent or pending claim of a patent application were it issued as a
claim in a patent within Patent Rights in that country in which the Patent
Method is used or practiced.
1.7. "Proprietary Products" means any kit, composition of matter,
material, or product containing a Biological Product, the manufacture, use, or
sale of which in a particular country is not within an unexpired, valid claim
of a patent or a pending claim of a patent application under Patent Rights in
such country.
1.8. "Products" means Patent Products, Identified Product,
Proprietary Products, and Services.
6
9
1.9. "Property Rights" means all personal proprietary rights of The
Regents covering the tangible personal property in the Biological Materials.
In no case, however, will Property Rights include Patent Rights.
1.10. "Research Reagent" means the *** . A Research Reagent may be a
Patent Product or a Proprietary Product.
1.11. "Net Sales" means the *** . Where Licensee distributes
Products to an Affiliate, a Joint Venture, or a sublicensee for end use by such
Affiliate, Joint Venture, or sublicensee, then such distribution will be
considered a sale at list price normally charged to independent third parties,
and The Regents will be entitled to collect a royalty on such sale in accordance
with Article 4. (Royalties).
1.12. "Services" means services provided by Licensee or its
sublicensees to its customers when such services require the use of the Patent
Rights or Property Rights.
1.13. "Service Revenues" means revenues paid to Licensee or its
sublicensees for Services.
***CONFIDENTIAL TREATMENT REQUESTED
7
10
1.14. "Affiliate(s)" of Licensee means any entity which, directly or
indirectly, controls Licensee, is controlled by Licensee, or is under common
control with Licensee ("control" for these purposes being defined as the
actual, present capacity to elect a majority of the directors of such
affiliate, or if not, the capacity to elect the members that control forty
percent of the outstanding stock or other voting rights entitled to elect
directors) provided, however, that in any country where the local law will not
permit foreign equity participation of a majority, then an "Affiliate" will
include any company in which Licensee will own or control, directly or
indirectly, the maximum percentage of such outstanding stock or voting rights
permitted by local law. Each reference to Licensee herein will be meant to
include its Affiliates.
1.15. "Joint Venture" means any separate entity established pursuant
to an agreement between a third party and Licensee to constitute a vehicle for
a joint venture, in which the separate entity manufactures, uses, purchases,
sells, or acquires Products from Licensee. Each reference to Licensee herein
will be meant to include its Joint Venture(s).
2. Grant
2.1. Subject to the limitations set forth in this Agreement and
subject to the license granted to the U.S. Government and to HHMI as set forth
in the Recitals above, where Patent Rights exists, The Regents hereby grants to
the licensee an exclusive license under Patent Rights to (i) make, have made,
and use the Biological Materials and Biological Products; (ii) to make, have
made, use, import, offer for sale, and sell Patent Products; (iii) to practice
the Patent Methods; and (iv) to provide services to others.
2.2. Subject to the limitations set forth in this Agreement and
subject to the licenses granted to the U.S. Government and to HHMI as set forth
in the Recitals above, where The Regents may lawfully grant such a license, The
Regents hereby
8
11
grants to Licensee ***.
2.3. Licensee acknowledges that title to the tangible material
comprising the Biological Materials is owned by The Regents and is not
transferred to Licensee under this Agreement, except that Licensee may transfer
title of such Biological Materials as are sold as Biological Products or
Research Reagents under the terms of this Agreement.
2.4. The licenses granted under Property Rights set forth in
Section 2.2 above expressly limit the rights granted to Licensee to those
licenses expressly stated in this Agreement and for no other purpose.
2.5. The licenses granted hereunder will be subject to the
overriding obligations to the U.S. Government including those set forth in 35
U.S.C. Section 200-212 and applicable governmental implementing regulations.
2.6. The manufacture of Products and the practice of the Patent
Method will be subject to applicable government importation laws and
regulations.
2.7. The Regents also grants to Licensee the right to issue
sublicenses under the rights granted in Sections 2.1 and 2.2 above to third
parties, provided Licensee retains current exclusive rights thereto under this
Agreement. To the extent applicable, such sublicenses will include all of the
rights of and obligations due to The Regents (and, if applicable, the United
States Government) that are contained in this Agreement including payment of
fees and royalties at the rates provided for in Section 3.2 and Article 4.
(Royalties).
2.8. Licensee will notify The Regents of each sublicense granted
hereunder and provide The Regents with a copy of each sublicense, which shall
be treated as
***CONFIDENTIAL TREATMENT REQUESTED
9
12
Proprietary Information of Licensee as defined in Article 29.
(Confidentiality). Licensee will collect and pay all such fees and royalties
due The Regents from sublicensees as set forth in Sections 3.2 and 4.1 below
(and guarantee all such payments due from sublicensees). Licensee will require
sublicensees to provide it with progress and royalty reports in accordance with
the provisions herein, and Licensee will collect and deliver to The Regents all
such reports due from sublicensees.
2.9. Upon termination of this Agreement for any reason, all
sublicenses granted by Licensee in accordance with this Agreement will remain
subject to the terms of such sublicenses in effect, and shall be assigned to
and assumed by The Regents except that sublicenses which: (i) are in a state of
breach as yet uncured by the sublicensee; or (ii) sublicenses which conflict
with state, or federal law, or the previously established written policy of The
Regents, shall not be assigned to and assumed by The Regents. The Regents will
not be bound by any duties and obligations contained in the sublicenses that
extend beyond the duties and obligations assumed by The Regents in this
Agreement and shall have no right to receive any payment from such sublicensees
except the amounts due under this Agreement for the activities of such
sublicensees.
2.10. The Regents may, at its own discretion, disclose to Licensee
certain chemical and biological materials relating to the Patent Rights and
Property Rights that are developed in Dr. Xxxxx Xxxxx'x laboratory at UCSD.
The Regents hereby grants to Licensee the right to elect to include under this
Agreement any or all of such chemicals and biological materials.
2.11. In accordance with Section 2.10, Licensee will notify The
Regents in writing within 60 days of the disclosure by The Regents of any such
further chemicals and/or biological materials which Licensee elects to be
included under this Agreement, and such chemicals and biological materials
shall be Biological Materials for all purposes of this Agreement.
10
13
2.12. Because this Agreement grants the exclusive right to use or
sell the Products in the United States, Licensee acknowledges that any
component of a Product which embodies a patented Invention or is produced
through the use thereof for sale in the United States will be manufactured
substantially in the United States to the extent required by 35 U.S.C. Section
204.
2.13. Nothing in this Agreement will be deemed to limit the right of
The Regents to publish any and all technical data resulting from any research
performed by The Regents relating to the Invention, Biological Materials,
Biological Products, and Patent Methods and to make and use the Invention,
Biological Materials, Biological Products, and Patent Methods, and associated
technology owned by The Regents solely for educational and research purposes.
3. License Issue Fee
3.1. As partial consideration for all the rights and licenses
granted to Licensee, Licensee will pay to The Regents a license issue fee of
***, payable according to the following schedule:
3.1.1. *** will be sent by Licensee to The Regents together
with two copies of this Agreement executed by
Licensee;
3.1.2. *** will be sent by Licensee to The Regents on or
before ***;
3.1.3. *** will be sent by Licensee to The Regents on or
before ***;
3.1.4. *** will be sent by Licensee to The Regents on or
before ***;
***CONFIDENTIAL TREATMENT REQUESTED
11
14
3.1.5. *** will be sent by Licensee to The Regents on or
before ***;
3.1.6. *** will be sent by Licensee to The Regents on or
before ***;
3.1.7. *** will be sent by Licensee to The Regents on or
before ***; and
3.1.8. *** will be sent by Licensee to The Regents on or
before ***.
3.2. Licensee will also pay to The Regents fees equal to *** of
Service Revenues and *** of the Service Revenues *** received by Licensee from
each third party with which it enters into a corporate alliance for screening
services using Patent Rights and Property Rights. Notwithstanding the above,
Licensee shall have no obligation to pay to The Regents any amounts it receives
from a third party for the purchase of equity, research funding, debt financing,
reimbursement of patent filing, prosecution, and/or maintenance expenses or
other expenses.
3.3. ***
4. Royalties
4.1. As further consideration for all the rights and licenses
granted to Licensee, Licensee will also pay to The Regents an earned royalty
based on Net Sales according to the following:
4.1.1. (a) A royalty rate of *** of the Net Sales paid to
Licensee and its sublicensees with respect to each
Identified Product ***
***CONFIDENTIAL TREATMENT REQUESTED
12
15
*** for each Identified Product, and a royalty rate of
*** of the Net Sales paid to Licensee and its
sublicensees of each Identified Product *** for each
such Identified Product.
(b) Notwithstanding Section 4.1.1(a) above, if
Licensee and a particular sublicensee are unable to
agree on a royalty *** of Identified Products by such
sublicensee *** and a royalty rate *** of Identified
Products for ***, then the royalty due to The Regents
*** will be equal to ***, if any, agreed to between
Licensee and such sublicensee *** of such Identified
Product by such sublicensee.
(c) In the event Licensee is unable to negotiate
with a particular sublicensee any royalty on the Net
Sales of Identified Products, then in such case
Licensee will not be entitled to take, in lieu of
royalties on Net Sales by such sublicensee of
Identified Products, consideration in any form for:
(i) equity in Licensee above fair market value; (ii)
research funding for screening to identify Identified
Products in excess of fully burdened direct and
indirect costs therefore; or (iii) reimbursement of
patent filing, prosecution, and maintenance expenses;
and
(d) For the avoidance of doubt, it is understood
and agreed that, except as provided in Section
4.1.1(a) and (b) above, The Regents shall not be
entitled to any royalty on Net Sales of Identified
Products, and if Section 4.1.1(c) applies to a
particular sublicense, the consideration received by
Licensee from such sublicensee will be in the form of
Service Revenues, and the only amounts due The
Regents under this Agreement with respect thereto
shall be the amounts set forth in Section 3.2, and
not a royalty based on the Net Sales of Identified
Products.
4.1.2. (a) A royalty rate *** by Licensee and its
sublicensees of Research Reagents and any other
Product that is not an Identified Product or Services.
Licensee will be entitled to reduce the royalty due
The Regents
***CONFIDENTIAL TREATMENT REQUESTED
13
16
on the Net Sales of such Research Reagents and other
Products if Licensee must pay a royalty to The
Regents on Patent Rights and Property Rights and a
third party with respect to intellectual property
rights in which The Regents has no ownership
interest. In such event, if the combined royalties
due The Regents and the third party(s) ***, Licensee
may reduce the royalty due The Regents ***, provided,
however, that in no event will the royalty rate due
The Regents on the Research Reagent or such Product
be ***.
(b) For the avoidance of doubt, it is understood
and agreed that Licensee shall have no obligation to
sell or have sold any Research Reagents except those
listed on Appendix E hereto.
4.2. Licensee will not be entitled to apply the royalty reduction
specified in Section 4.1.2(a) of this section to royalties due The Regents
under Section 4.1.1 of this Article 4. (Royalties) or any other provisions of
this Agreement except the provisions set forth in Section 4.1.2(a).
4.3. Sections 1.1, 1.5, and 1.6 define Patent Rights, Patent
Products, and Patent Methods so that royalties will be payable on Patent
Products and Patent Methods covered by both pending patent applications and
issued patents. Earned royalties will accrue on Patent Products on a
Product-by-Product basis in each country for the duration of Patent Rights in
that country and will be payable to The Regents when Patent Products are
invoiced, or if not invoiced, when delivered to a third party or to itself, an
Affiliate, Joint Venture, or sublicensee in the case where such delivery of the
Patent Products to Licensee, an Affiliate, Joint Venture, or sublicensee is
intended for end use. If no Patent Rights exist in a country, earned royalties
will accrue on a Proprietary Product, on a Product-by-Product basis, until the
*** CONFIDENTIAL TREATMENT REQUESTED
14
17
tenth anniversary of the first commercial sale of a particular Proprietary
Product in such country. Earned royalties will accrue on Identified Products,
on a Product-by-Product basis, until the tenth anniversary of the first
commercial sale of a particular Identified Product in such country.
4.4. Royalties accruing to The Regents will be paid to The Regents
***:
# ***
# ***
# ***
# ***
Each such payment will be for royalties which accrued ***.
4.5. Beginning ***, and in each succeeding calendar year after ***,
Licensee will pay *** and thereafter for the life of this Agreement. This ***
will be paid to The Regents by *** of each year and will be credited against the
earned royalty due and owing for the calendar year in which the minimum payment
was made.
4.6. All monies due The Regents will be payable in United States
funds collectible at par in San Francisco, California. When Products are sold
for monies other than United States dollars, the earned royalties will first be
determined in the foreign currency of the country in which such Products were
sold and then converted into equivalent United States funds. The exchange rate
will be that rate quoted in the Wall Street Journal on the last business day of
the reporting period.
4.7. *** Notwithstanding the foregoing, if the Regents
*** CONFIDENTIAL TREATMENT REQUESTED
15
18
is required to pay taxes on its royalties under the laws of any country, then
Licensee will pay such amounts to the proper authorities, withhold such amounts
from royalties paid to The Regents, and provide The Regents with all documents
and assistance reasonably necessary to enable The Regents to recover all or
part of such amounts pursuant to any double taxation treaty or otherwise.
Licensee will also be responsible for all bank transfer charges.
4.8. Notwithstanding the provisions of Article 28. (Force Majeure),
if at any time legal restrictions prevent prompt remittance of part or all
royalties owed to The Regents by Licensee with respect to any country where a
Product is sold or distributed, Licensee will convert the amount owed to The
Regents into United States funds and will pay The Regents directly from another
source of funds for the amount impounded.
4.9. In the event that any patent or any claim thereof included
within the Patent Rights is held invalid or unenforceable in a final decision
by a court of competent jurisdiction and last resort and from which no appeal
has or can be taken, all obligation to pay royalties based on such patent or
claim or any claim patentably indistinct therefrom will cease as of the date of
such final decision. Licensee will not, however, be relieved from paying any
royalties that accrued before such decision or that are based on another patent
or claim that has not expired or that is not involved in such decision or that
are based on Property Rights.
4.10. No royalties will be collected or paid hereunder to The
Regents on Products sold to the account of the U.S. Government. Licensee and
its sublicensee will reduce the amount charged for Products distributed to the
United States Government by an amount equal to the royalty for such Products
otherwise due The Regents as provided herein.
4.11. ***
*** CONFIDENTIAL TREATMENT REQUESTED
16
19
************************. No royalty shall be payable under Section 4.1 above
with respect to sales of Products among Licensee and its sublicensees where such
sales are not for end use by such Licensee or its sublicensees, nor shall a
royalty be payable under this Article 4. (Royalties) with respect to Products
distributed for use in research and/or development in clinical trials, or as
promotional samples.
5. Due Diligence
5.1. Licensee, upon execution of this Agreement, will diligently
proceed to develop and provide Services, and to develop, manufacture, and sell
Research Reagents and will earnestly and diligently market the same after
execution of this Agreement and in quantities sufficient to meet the market
demands therefor.
5.2. Licensee will be entitled to exercise prudent and reasonable
business judgment in the manner in which it meets its due diligence obligations
hereunder. In no case, however, will Licensee be relieved of its obligations
to meet the due diligence provisions of this Article 5. (Due Diligence).
5.3. Licensee will obtain all necessary governmental approvals in
each country in which Licensee elects to manufacture or commercialize Research
Reagents and provide Services.
5.4. If Licensee is unable to perform any of the following:
5.4.1. Obtain at least Ten Million Dollars ($10m) in funding
by August 31, 1996; and
5.4.2. Complete at least one Corporate Alliance with a
pharmaceutical or biotechnology company for Services
to identify Identified Products using patent Rights
and Property Rights before April 1, 1997; and
5.4.3. Fill the market demand for Services and Identified
Products that are marketed by licensee following
commencement of marketing at any time during the
exclusive period of this Agreement.
*** Confidential Treatment Requested
17
20
then The Regents will have the right and option, subject to Section 5.7 below,
to terminate this Agreement or reduce the exclusive licenses granted to
Licensee to non-exclusive licenses in accordance with Section 5.6 hereof. The
exercise of this right and option by The Regents will supersede the rights
granted in Article 2 (Grant).
5.5. In addition to the provisions of Section 5.4 above, Licensee
shall also market each of the Research Reagents listed on Appendix E attached
hereto to nonprofit/academic institutions solely for their internal,
noncommercial research use either within: (i) two years following the Effective
Date of this Agreement; or (ii) six months following the publication of the
first paper describing the use of the Research Reagent, whichever is earlier.
This Section 5.5 may be satisified by Licensee or its sublicenseees.
5.6. If Licensee fails to market a particular Research Reagent in
accordance with Section 5.5 above, then The Regents will have the right and
option, subject to Section 5.7 below, to terminate all rights granted to
Licensee under this Agreement with respect to that particular Research Reagent.
This termination includes Licensee's right to use the particular Research
Reagent for its own internal use. The Regents will thereafter be free to
dispose of the particular Research Reagent as it wishes. The exercise of this
right and option by The Regents will supersede the rights granted in Article 2
(Grant).
5.7. To exercise either the right to terminate this Agreement in
whole or with respect to any portion of Patent Rights or Property Rights, or
reduce the exclusive licenses granted to Licensee to non-exclusive licenses for
lack of diligence required in this Article 5. (Due Diligence), The Regents will
give Licensee written notice of the deficiency stating its intent to terminate
this Agreement in whole or with respect to any portion of Patent Rights or
Property Rights, or to reduce the licenses to non-exclusive licenses. Licensee
thereafter shall have 60 days to cure the deficiency. If The Regents
18
21
has not received written tangible evidence satisfactory to The Regents that the
deficiency has been cured by the end of the 60-day period, then The Regents
may, at its option, terminate this Agreement in whole or with respect to any
portion of Patent Rights or Property Rights, or reduce the exclusive licenses
granted to Licensee to non-exclusive licenses by giving written notice to
Licensee. These notices will be subject to Article 20. (Notices).
6. Progress and Royalty Reports
6.1. Beginning August 31, 1996, and semi-annually thereafter,
Licensee will submit to The Regents a progress report covering activities by
Licensee and its sublicensees related to the development and testing of all
their Products and the obtaining of the governmental approvals necessary for
marketing them, but Licensee will not be required to report on Products for
which a royalty is not due The Regents. These progress reports will be
provided to The Regents to cover the progress of the research and development
of the Products until the first commercial sale of Products in the United
States.
6.2. The progress reports submitted under Section 6.1 will include,
but not be limited to, the following topics so that The Regents may be able to
determine the progress of the development of Products on which a royalty is due
The Regents and may also be able to determine whether or not Licensee has met
its diligence obligations set forth in Article 5. (Due Diligence) above:
# summary of work in progress in anticipation of providing
Services and Research Reagents
# summary of work completed in anticipation of providing
Services and Research Reagents
# summary of Services completed
# current schedule of anticipated events or milestones
specified in Section 5.4 and 5.5
19
22
# anticipated market introduction date of Products on which
a royalty is due The Regents
# sublicenses granted, if any
6.3. Licensee also will report to The Regents in its immediately
subsequent progress and royalty report the date of first commercial sale of
each Product for which a royalty is due to The Regents in each country.
6.4. After the first commercial sale of a Product on which a
royalty is due The Regents, Licensee will provide The Regents with quarterly
royalty reports to The Regents on or before each February 28, May 31, August
31, and November 30 of each year. Each such royalty report will cover the most
recently completed calendar quarter of Licensee (October through December,
January through March, April through June, and July through September) and will
show:
6.4.1. the gross sales and Net Sales of such Products sold
by Licensee and reported to Licensee as sold by its
sublicensees during the most recently completed
calendar quarter;
6.4.2. the number of such Products sold or distributed by
Licensee and reported to Licensee as sold or
distributed by its sublicensees;
6.4.3. the royalties, in U.S. dollars, payable hereunder
with respect to Net Sales; and
6.4.4. the exchange rates used, if any.
6.5. If no sales of Products for which a royalty is due to The
Regents have been made during any reporting period after the first commercial
sale of such Product, then a statement to this effect is required.
7. Books and Records
7.1. Licensee will keep books and records accurately showing all
Products manufactured, used, and/or sold with respect to which Licensee owes
royalties to The Regents under the terms of this Agreement. Such books and
records will be preserved
20
23
for at least five years after the date of the royalty payment to which they
pertain and will be open to inspection by representatives or agents of The
Regents during normal business hours at agreed upon times to determine the
accuracy of the books and records and to determine compliance by Licensee with
the terms of this Agreement. Such independent certified public accountant
shall be bound to hold all information in confidence except as necessary to
communicate Licensee's non-compliance with this Agreement to The Regents. The
only purpose of any inspection and audit pursuant to this Paragraph 7.1 shall
be to verify Licensee's royalty statement or payment under this Agreement and
to determine Licensee's compliance with the other provisions thereunder.
7.2. The fees and expenses of representatives of The Regents
performing such an examination will be borne by The Regents. However, if an
error in royalties of *** of the total royalties due for any year is
discovered, then the fees and expenses of these representatives will be borne
by Licensee.
8. Life of the Agreement
8.1. Unless otherwise terminated by operation of law or by acts of
the parties in accordance with the terms of this Agreement, this Agreement will
be in force from the Effective Date and will remain in effect for the life of
the last-to-expire patent licensed under this Agreement, or until the last
patent application licensed under this Agreement is abandoned, or in the event
no patent issues, for a period of fifteen (15) years from market introduction
for the last to be introduced Proprietary Product in the United States.
8.2. In the event this Agreement remains in effect for the entire
term specified in Paragraph 8.1 above, and is not otherwise terminated under
the provisions of Articles 5. (Due Diligence), 9. (Termination by The Regents),
or 10. (Termination by Licensee), Licensee is hereby granted an option for
renewal of this Agreement for a period of twenty (20) years from the date of
its termination. Said option for renewal shall be
*** CONFIDENTIAL TREATMENT REQUESTED
21
24
automatically exercised provided that the Licensee has not notified The Regents
to the contrary prior to the option renewal date. The renewal licenses will be
for the same terms and conditions as set forth in this Agreement, except that
***.
8.3. Any termination of this Agreement will not affect the rights
and obligations set forth in the following Articles:
Article 7 Books and Records
Article 13 Disposition of Products on Hand Upon Termination
Article 14 Use of Names and Trademarks
Article 19 Indemnification
Article 22 Late Payments
Article 24 Failure to Perform
Article 29 Confidentiality
8.4. Termination of this Agreement for any reason shall not release
any party hereto from any liability which, at the time of such termination, has
already accrued to the other party or which is attributable to a period prior
to such termination, or preclude either party from pursuing any rights and
remedies it may have hereunder or at law or in equity which accrued or are
based upon any event occurring prior to such termination.
9. Termination by The Regents
9.1. If Licensee should violate or fail to perform any term or
covenant of this Agreement, then The Regents may give written notice of such
default ("Notice of Default") to Licensee. If Licensee should fail to repair
such default within 60 days after the date of such notice takes effect, The
Regents will have the right to terminate this Agreement and the licenses herein
by a second written notice ("Notice of Termination") to Licensee. If a Notice
of Termination is sent to Licensee, this Agreement will
*** CONFIDENTIAL TREATMENT REQUESTED
22
25
automatically terminate on the date such notice takes effect. Such termination
will not relieve Licensee of its obligation to pay any royalty or license fees
owing at the time of such termination and will not impair any accrued right of
The Regents. These notices will be subject to Article 20. (Notices).
10. Termination by Licensee
10.1. Licensee will have the right at any time to terminate this
Agreement in whole or as to any portion of Patent Rights or Property Rights by
giving notice in writing to The Regents. Such Notice of Termination will be
subject to Article 20. (Notices) and termination of this Agreement in whole or
with respect to any portion of the Patent Rights or Property Rights will be
effective 60 days after the effective date thereof.
10.2. Any termination pursuant to the above paragraph will not
relieve Licensee of any obligation or liability accrued hereunder prior to such
termination or rescind anything done by Licensee or any payments made to The
Regents hereunder prior to the time such termination becomes effective, and
such termination will not affect in any manner any rights of The Regents
arising under this Agreement prior to such termination.
11. Supply of the Biological Materials
and Biological Products
11.1. The Regents will initially supply Licensee with viable samples
of the Biological Materials set forth in Appendix D within thirty (30) days of
the Effective Date or as soon as reasonably practicable, and additional
Biological Materials elected by Licensee pursuant to Section 2.11 promptly
after Licensee's notice to The Regents pursuant to such Section. To the extent
Licensee requires and requests additional samples from The Regents during the
term hereof (due to failure of the initial supply of Biological Material(s)),
and The Regents has such additional samples in its possession,
23
26
The Regents agrees to supply such additional samples. Licensee will pay the
actual handling and shipping costs for any additional samples provided.
12. Maintenance of the Biological Materials
12.1. The Regents shall instruct Dr. Xxxxx Xxxxx that if The Regents
circulates any of the Biological Materials to third parties for noncommercial
research purposes, it shall only do so under the terms and conditions set forth
in the biological material transmission letter attached hereto as Appendix A.
The Regents expressly reserves the right to transfer the Biological Materials
to non-profit entities strictly for noncommercial research purposes in the
manner set forth above. The Regents agrees that it will not otherwise transfer
the Biological Materials. The Licensee acknowledges that The Regents' right to
so transfer the Biological Materials could lead to the inadvertent loss or
diminution of the proprietary commercial value of the Biological Materials.
13. Disposition of the Biological Materials, Biological Products,
and Products on Hand Upon Termination
13.1. Upon termination of this Agreement prior to the expiration of
its full term, the Licensee shall have the privilege of disposing all
previously made or partially made Products, but no more, for a period of one
hundred and twenty (120) days following the effective date of termination,
provided, however, that the sale of such Products shall be subject to the terms
of this Agreement including, but not limited to, the payment of royalties at
the rate and at the time provided herein and the rendering of reports in
connection therewith.
13.2. Upon termination of this Agreement for any reason, Licensee,
at its sole discretion, shall destroy or transfer to The Regents any Biological
Materials in its possession within thirty (30) days following the effective
date of termination. Licensee
24
27
shall provide The Regents within sixty (60) days following said termination
date with written notice that the Biological Materials have been destroyed.
14. Use of Names and Trademarks
14.1. Nothing contained in this Agreement will be construed as
conferring any right to use in advertising, publicity, or other promotional
activities any name, trade name, trademark, or other designation of either
party hereto by the other (including contraction, abbreviation or simulation of
any of the foregoing). Unless required by law, the use by Licensee of the name
"The Regents of the University of California" or the name of any campus of the
University of California for use in advertising, publicity, or other
promotional activities is expressly prohibited.
14.2. It is understood that The Regents will be free to release to
the inventors, HHMI, and senior administrative officials employed by The
Regents the terms of this Agreement upon their request. If such release is
made, The Regents will request that such terms will be kept in confidence in
accordance with the provisions of Article 29. (Confidentiality) and not be
disclosed to others. It is further understood that should a third party
inquire whether a license to Patent Rights is available, The Regents may
disclose the existence of this Agreement and the extent of the grant in Article
2. (Grant) to such third party, but will not disclose the name of Licensee,
except where The Regents is required to release such information under either
the California Public Records Act or other applicable law.
15. Limited Warranty
15.1. The Regents warrants to Licensee that it has the lawful right
to grant these licenses and bailment.
15.2. This license and the associated Invention, Biological
Materials, Products, and Patent Method are provided WITHOUT WARRANTY OF
MERCHANTABILITY OR
25
28
FITNESS FOR A PARTICULAR PURPOSE OR ANY OTHER WARRANTY, EXPRESS OR IMPLIED.
THE REGENTS MAKES NO REPRESENTATION OR WARRANTY THAT THE INVENTION, BIOLOGICAL
MATERIALS, PRODUCTS, OR PATENT METHOD WILL NOT INFRINGE ANY PATENT OR OTHER
PROPRIETARY RIGHT.
15.3. IN NO EVENT WILL THE REGENTS BE LIABLE FOR ANY INCIDENTAL,
SPECIAL, OR CONSEQUENTIAL DAMAGES RESULTING FROM EXERCISE OF THIS LICENSE OR
THE USE OF THE INVENTION, BIOLOGICAL MATERIALS, PRODUCTS, OR PATENT METHOD.
15.4. Nothing in this Agreement will be construed as:
15.4.1. a warranty or representation by The Regents as to the
validity, enforceability, or scope of any Patent
Rights or Property Rights; or
15.4.2. a warranty or representation that anything made,
used, sold, or otherwise disposed of under any
license granted in this Agreement is or will be
free from infringement of patents of third parties;
or
15.4.3. an obligation to bring or prosecute actions or suits
against third parties for patent infringement
except as provided in Article 18. (Patent
Infringement); or
15.4.4. conferring by implication, estoppel, or otherwise any
license or rights under any patents of The Regents
other than Patent Rights as defined herein,
regardless of whether such patents are dominant or
subordinate to Patent Rights; or
15.4.5. an obligation to furnish any know-how not provided in
Patent Rights and Property Rights.
16. Patent Prosecution and Maintenance
16.1. The Regents will diligently prosecute and maintain the United
States and foreign patents comprising Patent Rights using counsel of its
choice. The Regents will promptly provide Licensee with copies of all relevant
documentation so that Licensee
26
29
may be currently and promptly informed and apprised of the continuing
prosecution, and may comment upon such documentation sufficiently in advance of
any initial deadline for filing a response, provided, however, that if Licensee
has not commented upon such documentation prior to the initial deadline for
filing a response with the relevant government patent office or The Regents
must act to preserve Patent Rights, The Regents will be free to respond
appropriately without consideration of comments by Licensee, if any. Both
parties hereto will keep this documentation in confidence in accordance with
the provisions of Article 29. (Confidentiality) herein. Counsel for The
Regents will take instructions only from The Regents.
16.2. The Regents will use all reasonable efforts to amend any
patent application to include claims requested by Licensee and required to
protect the Products contemplated to be sold or Patent Method to be practiced
under this Agreement.
16.3. The Regents and Licensee will cooperate in applying for an
extension of the term of any patent included within Patent Rights, if
appropriate, under the Drug Price Competition and Patent Term Restoration Act
of 1984. Licensee will prepare all such documents, and The Regents will
execute such documents and will take such additional action as Licensee may
reasonably request in connection therewith.
16.4. The Regents will, at the request of Licensee, file, prosecute,
and maintain patent applications and patents covered by Patent Rights in
foreign countries if available. Licensee must notify The Regents within seven
months of the filing of the corresponding United States application of its
decision to request The Regents to file foreign counterpart patent
applications. This notice concerning foreign filing must be in writing and must
identify the countries desired. The absence of such a notice from Licensee to
The
27
30
Regents within the seven-month period will be considered an election by
Licensee not to request The Regents to secure foreign patent rights on behalf
of Licensee; provided, however, that the absence of such notice from Licensee
to The Regents within the seven-month period with respect to United States
applications filed within eight months prior to the Effective Date of this
Agreement will not be considered an election by licensee not to request The
Regents not to secure foreign patent rights. In such event, Licensee must
notify The Regents of its decision to request The Regents to file foreign
counterpart patent applications within ninety (90) days of the conventional
filing date of such applications. The Regents will have the right to file
patent applications at its own expense in any country Licensee has not included
in its list of desired countries, and such applications and resultant patents,
if any, will not be included in the licenses granted under this Agreement.
16.5. All past, present and future costs of preparing, filing,
prosecuting and maintaining all United States and foreign patent applications
and all costs and fees relating to the preparation and filing of patents
covered by Patent Rights in Section 1.1 will be borne by Licensee. This
includes patent preparation and prosecution costs for this Invention incurred
by The Regents prior to the execution of this Agreement. Such costs will be
due upon execution of this Agreement and will be payable at the time that the
license issue fee is payable. The costs of all interferences and oppositions
will be considered prosecution expenses and also will be borne by Licensee.
Licensee will reimburse The Regents for all costs and charges within 30 days
following receipt of an itemized invoice from The Regents for same.
16.6. The obligation of Licensee to underwrite and to pay patent
preparation, filing, prosecution, maintenance, and related costs will continue
for costs incurred until three months after receipt by either party of a Notice
of Termination with respect to a particular patent application or patent within
the Patent Rights provided, however, that The Regents provides Licensee with
written notification, at least three months prior to the effective date of the
termination, that such costs are anticipated. Licensee will reimburse The
Regents for all patent costs incurred during the term of the Agreement and for
three months thereafter whether or not invoices for such costs are received
during the three-month period after receipt of a Notice of Termination.
Licensee may
28
31
with respect to any particular patent application or patent terminate its
obligations with the patent application or patent in any or all designated
countries upon three months written notice to The Regents. The Regents may
continue prosecution and/or maintenance of such application(s) or patent(s) at
its sole discretion and expense, provided, however, that Licensee will have no
further right or licenses thereunder.
16.7. Licensee will notify The Regents of any change of its status
as a small entity (as defined by the United States Patent and Trademark Office)
and of the first sublicense granted to an entity that does not qualify as a
small entity as defined therein.
16.8. The Regents acknowledges that Licensee will be conducting
independent research and development activities with respect to the Biological
Materials, Biological Products, and/or the Patent Rights, and recognizes that
such independent research and development may result in patentable inventions
and other intellectual property owned by Licensee. The Regents hereby consents
to the filing of any patent applications, even if any Biological Materials or
Biological Products are within the scope of one or more claims of any such
patent application.
17. Patent Marking
17.1. Licensee will xxxx all Products made, used, or sold under the
terms of this Agreement, or their containers, in accordance with the applicable
patent marking laws.
18. Patent Infringement
18.1. In the event that Licensee, or The Regents' licensing
associate responsible for administering this Agreement, or Resident Counsel of
the Regents' Office of Technology Transfer learns of the substantial
infringement of any patent licensed under this Agreement, to the extent
contractually able to, it will call the attention to the other party hereto in
writing and will provide reasonable evidence of
29
32
such infringement. Both parties to this Agreement acknowledge that during the
period and in a jurisdiction where Licensee has exclusive rights under this
Agreement, neither will notify a third party of the infringement of any of
Patent Rights without first obtaining consent of the other party, which consent
will not be unreasonably withheld. Both parties will use their best efforts in
cooperation with each other to terminate such infringement without litigation.
18.2. Licensee may request that The Regents take legal action
against the infringement of Patent Rights. Such request must be made in
writing and must include reasonable evidence of such infringement and damages
to Licensee. If the infringing activity has not been abated within 90 days
following the effective date of such request, The Regents will have the right
to elect to:
18.2.1. commence suit on its own account; or
18.2.2. refuse to participate in such suit.
18.3. The Regents will give notice of its election in writing to
Licensee by the end of the 100th day after receiving notice of such request
from Licensee. Licensee may thereafter bring suit for patent infringement if
and only if The Regents elects not to commence suit and if the infringement
occurred during the period and in a jurisdiction where Licensee had exclusive
rights under this Agreement. However, in the event Licensee elects to bring
suit in accordance with this paragraph, The Regents may thereafter join such
suit at its own expense.
18.4. Such legal action as is decided upon will be at the expense of
the party on account of whom suit is brought and all recoveries recovered
thereby will belong to such party, provided, however, that legal action brought
jointly by The Regents and Licensee and participated in by both will be at the
joint expense of the parties and all recoveries will be allocated in the
following order: ***
*** CONFIDENTIAL TREATMENT REQUESTED
30
33
***
18.5. Each party will cooperate with the other in litigation
proceedings instituted hereunder but at the expense of the party on account of
whom suit is brought. Such litigation will be controlled by the party bringing
the suit, except that The Regents may be represented by counsel of its choice
in any suit brought by Licensee.
19. Indemnification
19.1. Licensee will (and require its sublicensees to) indemnify,
hold harmless, and defend The Regents and HHMI, their officers, employees, and
agents; the sponsors of the research that led to the Invention; the inventors
of any invention covered by patents or patent applications in Patent Rights
(including the Products and Patent Method contemplated thereunder) and their
employers against any and all claims, suits, losses, damage, costs, fees, and
expenses resulting from or arising out of exercise of this license or any
sublicense. This indemnification will include, but will not be limited to, any
product liability.
19.2. Licensee, at its sole cost and expense, will insure its
activities in connection with the work under this Agreement and obtain, keep in
force, and maintain insurance as follows: (or an equivalent program of self
insurance)
Comprehensive or Commercial Form General Liability Insurance
(contractual liability included) with limits as follows:
# Each Occurrence $1,000,000
# Products/Completed Operations Aggregate $1,000,000
*** CONFIDENTIAL TREATMENT REQUESTED
31
34
# Personal and Advertising Injury $1,000,000
# General Aggregate (commercial form only) $1,000,000
19.3. As of and following the date of commencement of any clinical
trial with respect to a Product marketed by Licensee, Licensee shall increase
insurance coverage under Section 19.2 immediately above from $1,000,000 to an
aggregate of $3,000,000. As of and following the date of commencement of any
sales of such Products, Licensee shall increase insurance coverage under
Section 19.2 to an aggregate of $5,000,000. It should be expressly understood,
however, that the coverages and limits referred to under the above will not in
any way limit the liability of Licensee. Licensee will furnish The Regents
with certificates of insurance evidencing compliance with all requirements.
Such certificates will:
19.3.1. Provide for 30 day advance written notice to The
Regents of any modification;
19.3.2. Indicate that The Regents has been endorsed as an
additional Insured under the coverages referred
to under the above; and
19.3.3. Include a provision that the coverages will be
primary and will not participate with nor will be
excess over any valid and collectable insurance
or program of self-insurance carried or
maintained by The Regents.
19.4. The Regents will promptly notify Licensee in writing of any
claim or suit brought against The Regents in respect of which The Regents
intends to invoke the provisions of this Article 19. (Indemnification).
Licensee will keep The Regents informed on a current basis of its defense of
any claims pursuant to this Article 19. (Indemnification). It is understood
that Licensee shall have the right to control the defense and settlement of any
such claim or suit, except Licensee shall not enter into any settlement which
(i) makes any admission of wrongdoing on the part of The Regents, or (ii)
admits that any of the Patent Rights of The Regents are invalid, unenforceable,
or not infringed without prior written consent of The Regents.
32
35
20. Notices
20.1. Any notice or payment required to be given to either party
will be deemed to have been properly given and to be effective (a) on the date
of delivery if delivered in person or (b) five days after mailing if mailed by
first-class certified mail, postage paid, to the respective addresses given
below, or to another address as it may designate by written notice given to the
other party.
In the case of Licensee: AURORA BIOSCIENCES, CORP.
00000 Xxxxx Xxxxxx Xxxxx Xxxx
Xx Xxxxx, XX 00000
Attention: President
(000) 000-0000
In the case of The Regents: THE REGENTS OF THE UNIVERSITY
OF CALIFORNIA
0000 Xxxxxx Xxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
Attention: Executive Director;
Research Administration
and Office of Technology
Transfer
Referring to: U.C. Case Nos. 93-289,
95-110, 95-219, 96-044, 96-160, 96-161,
96-162, and 96-191
21. Assignability
21.1. This Agreement is binding upon and will inure to the benefit
of The Regents, its successors and assigns, but shall be personal to Licensee
and assignable by Licensee only with the written consent of The Regents, which
consent shall not be unreasonably withheld; provided, however, Licensee may
assign this Agreement to an Affiliate or Joint Venture or in connection with
the sale or transfer of substantially all the
33
36
assets of Licensee relating to the subject matter of this Agreement, without
written consent of The Regents.
22. Late Payments
22.1. In the event royalty payments or fees or patent prosecution
costs are not received by The Regents when due, Licensee will pay to The
Regents interest charges at a rate of ten percent (10%) simple interest per
annum. Such interest will be calculated from the date payment was due until
actually received by The Regents. Acceptance by The Regents of any late
payment interest from Licensee under this Section 22.1 will in no way affect
the provision of Article 23. (Waiver) herein.
23. Waiver
23.1. It is agreed that no waiver by either party hereto of any
breach or default of any of the covenants or agreements herein set forth will
be deemed a waiver as to any subsequent and/or similar breach or default.
24. Failure to Perform
24.1. In the event of a failure of performance due under the terms
of this Agreement and if it becomes necessary for either party to undertake
legal action against the other on account thereof, then the prevailing party
will be entitled to reasonable attorney's fees in addition to costs and
necessary disbursements.
25. Governing Laws
25.1. THIS AGREEMENT WILL BE INTERPRETED AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF CALIFORNIA, excluding any choice of law rules
that would direct the application of the laws of another jurisdiction,
34
37
but the scope and validity of any patent or patent application will be governed
by the applicable laws of the country of such patent or patent application.
26. Government Approval or Registration
26.1. If this Agreement or any associated transaction is required by
the law of any nation to be either approved or registered with any governmental
agency, Licensee will assume all legal obligations to do so. Licensee will
notify The Regents if it becomes aware that this Agreement is subject to a
United States or foreign government reporting or approval requirement.
Licensee will make all necessary filings and pay all costs including fees,
penalties, and all other out-of-pocket costs associated with such reporting or
approval process.
27. Export Control Laws
27.1. Licensee will observe all applicable United States and foreign
laws with respect to the transfer of Products and related technical data to
foreign countries, including, without limitation, the International Traffic in
Arms Regulations (ITAR) and the Export Administration Regulations.
28. Force Majeure
28.1. The parties to this Agreement will be excused from any
performance required hereunder if such performance is rendered impossible or
unfeasible due to any acts of God, catastrophes, or other major events beyond
their reasonable control, including, without limitation, war, riot, and
insurrection; laws, proclamations, edicts, ordinances, or regulations; strikes,
lock-outs, or other serious labor disputes; and floods, fires, explosions, or
other natural disasters. However, any party to this Agreement will have the
right to terminate this Agreement upon 30 days' prior written notice if either
party is unable to fulfill its obligations under this Agreement due to any of
35
38
the causes mentioned above and such inability continues for a period of one
year. Notices will be subject to Article 20. (Notices). When such events
have abated, the parties' respective obligations hereunder shall resume.
29. Confidentiality
29.1. Licensee and The Regents respectively will treat and maintain
the proprietary business, patent prosecution, software, engineering drawings,
process and technical information, and other proprietary information
("Proprietary Information") of the other party in confidence using at least the
same degree of care as that party uses to protect its own proprietary
information of a like nature for a period from the date of disclosure until
five years after the date of termination of this Agreement. This
confidentiality obligation will apply to the information defined as "Data"
under the Secrecy Agreement, and such Data will be treated as Proprietary
Information hereunder.
29.2. All Proprietary Information will be labeled or marked
confidential or as otherwise similarly appropriate by the disclosing party, or
if the Proprietary Information is orally disclosed, it will be reduced to
writing or some other physically tangible form, marked and labeled as set forth
above by the disclosing party, and delivered to the receiving party within 30
days after the oral disclosure as a record of the disclosure and the
confidential nature thereof. Notwithstanding the foregoing, Licensee and The
Regents may use and disclose Proprietary Information to its employees, agents,
consultants, contractors, and, in the case of Licensee, its sublicensees,
provided that any such parties are bound by a like duty of confidentiality.
29.3. Nothing contained herein will in any way restrict or impair
the right of Licensee or The Regents to use, disclose, or otherwise deal with
any Proprietary Information:
36
39
29.3.1. that recipient can demonstrate by written records was
previously known to it;
29.3.2. that is now, or becomes in the future, public
knowledge other than through acts or omissions of
recipient;
29.3.3. that is lawfully obtained without restrictions by
recipient from sources independent of the disclosing
party;
29.3.4. that is required to be disclosed to a governmental
entity or agency in connection with seeking any
governmental or regulatory approval, or pursuant
to the lawful requirement or request of a
governmental entity or agency;
29.3.5. that is furnished to a third party by the recipient
with similar confidentiality restrictions imposed
on such third party, as evidenced in writing; or
29.3.6. that The Regents is required to disclose pursuant to
the California Public Records Act or other applicable
law.
29.4. Upon termination of this Agreement, Licensee and The Regents
will destroy or return to the disclosing party proprietary information received
from the other in its possession within 15 days following the effective date of
termination. Licensee and The Regents will provide each other, within 30 days
following termination, with a written notice that Proprietary Information has
been returned or destroyed. Each party may, however, retain one copy of
Proprietary Information for archival purposes in nonworking files.
30. Miscellaneous
30.1. The headings of the several sections are inserted for
convenience of reference only and are not intended to be a part of or to affect
the meaning or interpretation of this Agreement.
30.2. This Agreement will not be binding upon the parties until it
has been signed below on behalf of each party, in which event, it will be
effective as of the date recited on page one.
37
40
30.3. No amendment or modification hereof will be valid or binding
upon the parties unless made in writing and signed on behalf of each party.
30.4. This Agreement embodies the entire understanding of the
parties and will supersede all previous communications, representations or
understandings, either oral or written, between the parties relating to the
subject matter hereof. The Letter Agreements, the Option Agreement, and the
Secrecy Agreements specified in the Recitals of this Agreement are hereby
terminated.
30.5. In case any of the provisions contained in this Agreement are
held to be invalid, illegal, or unenforceable in any respect, such invalidity,
illegality, or unenforceability will not affect any other provisions hereof,
but this Agreement will be construed as if such invalid or illegal or
unenforceable provisions had never been contained herein.
The Regents and Licensee execute this Agreement in duplicate originals
by their respective, authorized officers on the date indicated.
Aurora Biosciences Corporation The Regents of the University
of California
By__________________________________ By_________________________________
(Signature) (Signature)
Name________________________________ Name Xxxxxxx X. Xxxxxxxxx
(Please Print)
Title_______________________________ Title Executive Director
Research Administration
and Office of Technology
Transfer
Date________________________________ Date_______________________________
38
41
APPENDIX A - PAGE 1A
University of California/San Diego (UCSD)
Instructions for Standard Letter Transmitting
Biological Materials to Universities and
Non-Profit Institutions
The attached letter is authorized for use by University of California,
UCSD Principal Investigators and Administrators only with Scientists and other
universities and nonprofit research institutions when transmitting cell lines,
plasmids and the like for non-commercial research purposes.
1. Choose the appropriate form of university or nonprofit research
institution in paragraph 2.
2. Choose whether or not to include the phrase "our cooperative" in
paragraph 2.
3. Insert in paragraph 4 the amount of processing charge. If the
material is to be shipped at no charge, insert the words "no charge".
4. Send the letter in duplicate to the other scientists.
5. Do not send biological materials until you receive the duplicate copy
executed by both the scientist and the other institution.
6. Send a copy of the fully executed letter agreement to:
Xxxxxxx X. Xxxxxxxxx
Executive Director
Research Administration
and Technology Transfer
0000 Xxxxxx Xxx Xxxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
7. Any changes in the wording of this standard letter must be reviewed by
the Executive Director of the Office of Technology Transfer before
acceptance.
Note: Do not use this letter for the exchange of living plants. A separate
"Testing Agreement for the Plant Varieties" is available for that purpose.
39
42
APPENDIX A - PAGE 2A
SAMPLE LETTER FOR USE PRIOR TO TRANSMISSION OF BIOLOGICAL
MATERIALS TO INVESTIGATORS AT UNIVERSITIES OR NON-PROFIT
RESEARCH INSTITUTIONS
(date)
IN DUPLICATE
To:_____________________
This is to (acknowledge receipt of your letter) (confirm our telephone
conversation) in which you requested certain research materials developed in
this laboratory be sent to you for scientific research purposes. The materials
concerned, which belong to The Regents of the University of California/San
Diego Campus (UCSD) are _______________.
While I cannot transfer ownership of these materials to you, I will be
pleased to permit your use of these materials within your (university)
(Non-Profit Research Institution) laboratory for (our cooperative) scientific
research. However, before forwarding them to you, I require your agreement
that the materials will be received by you only for use in (our cooperative
work) (scientific research), that you will bear all risk to you or any others
resulting from your use, and that you will not pass these materials, their
progeny or derivatives, on to any other party or use them for commercial
purposes without the express written consent of The Regents of the University
of California. You understand that no other right or license to these
materials, their progeny or derivatives, is granted or implied as a result of
our transmission of these materials to you.
These materials are to be used with caution and prudence in any
experimental work, since all of their characteristics are not known.
As you recognize, there is a processing cost to us involved in
providing these materials to you. We will xxxx you for our processing costs,
which will amount to $_________________.
If you agree to accept these materials under the above conditions,
please sign the enclosed duplicate copy of this letter, then have it signed by
an authorized representative of your institution, and return it to me. Upon
receipt of that confirmation I will forward the material(s) to you.
40
43
APPENDIX A - PAGE 3A
(Note: other paragraphs discussing the relevant literature, the nature of the
work, hazards relating to materials to be sent etc. may be appropriate. These
will vary depending on the individual circumstances and the relationship
between the two parties previously established. Be sure to retain a signed
copy when received and send a photocopy of the completed agreement to the
University of California Patent Administrator, Office of Technology Transfer,
Systemwide Administration, 0000 Xxxxxx Xxx Xxxxxxx, Xxxxx 000, Xxxxxxx, XX
00000)
Sincerely yours,
ACCEPTED:
RESEARCH INVESTIGATOR
______________________
Printed Name
______________________
(Signature)
______________________
Date
RESEARCH UNIVERSITY OR
NON-PROFIT INSTITUTION
______________________
Printed Name
_______________________
(Signature)
_______________________
Date
41
00
XXXXXXXX X - PAGE 1B
The INVENTORS listed below understand and agree to abide by the terms
and conditions of Article 12 (MAINTENANCE OF THE BIOLOGICAL MATERIALS) of the
Exclusive License Agreement between The Regents of the University of California
and Aurora Biosciences, Corp. effective ______________________, 1996, and to
instruct all relevant personnel working within their laboratory to act
accordingly. Said paragraph reads, in part, as follows:
"12.1 The Regents shall instruct Xxxxx Xxxxx that if The Regents
circulates any of the Biological Materials to third parties for noncommercial
research purposes, it shall only do so under the terms and conditions set forth
in the biological material transmission letter attached hereto as Appendix A.
The Regents expressly reserves the right to transfer the Biological Materials
to non-profit entities strictly for noncommercial research purposes in the
manner set forth above. The Regents agrees that it will not otherwise transfer
the Biological Materials. The Licensee acknowledges that The Regents' right to
so transfer the Biological Materials could lead to the inadvertent loss or
diminution of the proprietary commercial value of the Biological Materials."
The Biological Materials is defined in said Agreement as follows:
"1.2 Biological Materials" means (i) the chemical reagents and
biological materials owned by The Regents and listed in Appendix D attached
hereto and provided to Licensee by The Regents pursuant to the April 26, 1996
Letter Agreement, and (ii) any other chemical reagents or biological materials
elected for inclusion under this Agreement by Licensee pursuant to Section 2.11
below."
By:
______________________________ _____________________________
(Inventor) Date
42
45
APPENDIX C - PAGE 1C
CHANCELLOR APPROVAL OF COMMERCIAL RESTRICTIONS OF TANGIBLE RESEARCH PRODUCTS
In May 1989, the University of California issued the Guidelines on
University-Industry Relations ("Guidelines"). Guideline 10 entitled "Tangible
Research Products" requires that when the commercial availability of tangible
research products resulting from the conduct of research are restricted by a
license, approval must be obtained from the Chancellor of the campus where the
research took place.
The License Agreement between THE REGENTS OF THE UNIVERSITY OF
CALIFORNIA ("The Regents") and AURORA BIOSCIENCES, CORP. ("Licensee") entitled
"Fluorescent Assay Technologies" contains provisions that restrict the transfer
of certain tangible research products to commercial competitors of the Aurora
Biosciences, Corp. and requires that tangible research products transferred for
educational and research purposes be conveyed under a biological material
transfer agreement that permits the University to retain the discretion to
publish any results of research at any time and to disseminate the tangible
materials for educational and research purposes.
Approval of the provisions of the License Agreement that restrict the
commercial availability of tangible research products is indicated below.
Approval:
______________________________ _____________________________
Xxxxxxx X. Xxxxxxx Date
Interim Chancellor
43
46
APPENDIX D - PAGE 1D
*** CONFIDENTIAL TREATMENT REQUESTED
44
47
APPENDIX D - PAGE 2D
*** CONFIDENTIAL TREATMENT REQUESTED
45
48
APPENDIX D - PAGE 3D
*** CONFIDENTIAL TREATMENT REQUESTED
46
49
APPENDIX D - PAGE 4D
***CONFIDENTIAL TREATMENT REQUESTED
47
50
APPENDIX D - PAGE 5D
***CONFIDENTIAL TREATMENT REQUESTED
48
51
APPENDIX D - PAGE 6D
***CONFIDENTIAL TREATMENT REQUESTED
49
52
APPENDIX D - PAGE 7D
***CONFIDENTIAL TREATMENT REQUESTED
50
53
APPENDIX D - PAGE 8D
***CONFIDENTIAL TREATMENT REQUESTED
51
54
APPENDIX D - PAGE 9D
***CONFIDENTIAL TREATMENT REQUESTED
52
55
APPENDIX D - PAGE 10D
***CONFIDENTIAL TREATMENT REQUESTED
53
56
APPENDIX D - PAGE 11D
***CONFIDENTIAL TREATMENT REQUESTED
54
57
APPENDIX D - PAGE 12D
***CONFIDENTIAL TREATMENT REQUESTED
55
58
APPENDIX D - PAGE 13D
***CONFIDENTIAL TREATMENT REQUESTED
56
59
APPENDIX D - PAGE 14D
***CONFIDENTIAL TREATMENT REQUESTED
57
60
APPENDIX D - PAGE 00X
XXXXX XXXXXXXXXXX PROTEINS
***
***CONFIDENTIAL TREATMENT REQUESTED
58
61
APPENDIX D - PAGE 16D
***CONFIDENTIAL TREATMENT REQUESTED
59
62
APPENDIX D - PAGE 17D
***CONFIDENTIAL TREATMENT REQUESTED
60
63
APPENDIX D - PAGE 18D
***CONFIDENTIAL TREATMENT REQUESTED
61
64
APPENDIX D - PAGE 19D
***CONFIDENTIAL TREATMENT REQUESTED
62
65
APPENDIX D - PAGE 20D
***CONFIDENTIAL TREATMENT REQUESTED
63
66
APPENDIX D - PAGE 21D
***CONFIDENTIAL TREATMENT REQUESTED
64
67
APPENDIX E - PAGE 1E
Research Reagents
***
060596
***CONFIDENTIAL TREATMENT REQUESTED
66
