PARTIALLY EXCLUSIVE LICENSE AGREEMENT
BETWEEN THE
UNITED STATES OF AMERICA
REPRESENTED BY THE
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
AND
CJAB Associates, L.P.
TABLE OF CONTENTS
-------------------
ARTICLE PAGE NO.
Preamble 4
I Definitions 5
II License Grant 8
III Sublicenses 9
IV Term of License 10
V Practical Application 10
VI United States Manufacture 10
VII Royalty and Payment 11
VIII Reports 13
IX Audit Rights 15
X Marking 15
XI Use of the NASA Name 16
XII Disclaimer of Warranties 16
XIII Risk Allocation and Indemnification 18
XIV Patent Validity 19
XV Points of Contact 21
XVI Notices 21
XVII Infringement 22
XVIII Dispute or Breach 23
XIX Termination or Modification 24
XX Assignment 26
XXI Governing Law 26
XXII Independent Entities 27
XXIII Effect of Partial Invalidity 27
XXIV Patent Prosecution and Maintenance 28
XXV Nonwaiver 28
XXVI Entire Agreement 28
XXVII Article Headings 29
XXVIII Counterparts 29
XXVIV Acceptance 29
Appendix I 30
Appendix II 32
Attachment 33
LICENSE AGREEMENT
PREAMBLE
--------
This License Agreement ("AGREEMENT") is entered into between the National
Aeronautics and Space Administration (NASA), an agency of the United States,
hereinafter referred to as LICENSOR, having its headquarters at Washington,
D.C., and CJAB Associates, L.P., a Limited Partnership of the State of Texas,
having its principal place of business at 2008 Isla, Pearland, Texas,
hereinafter referred to as LICENSEE, as of the date of execution of the last
PARTY hereto.
WITNESSETH:
WHEREAS, under the authority of 35 U.S.C. 200 et seq., the U.S. Department
of Commerce has issued Patent Licensing Regulations (37 CFR Part 404) specifying
the terms and conditions upon which licenses may be granted for inventions
assigned to LICENSOR; and
WHEREAS, LICENSOR is the assignee of the U.S. patents listed in APPENDIX
II; and,
WHEREAS, LICENSEE, in consideration of the grant of a license under the
U.S. patents listed in APPENDIX II, will pay royalties, make all necessary
capital investments, and achieve PRACTICAL APPLICATION of the invention; and,
WHEREAS, LICENSOR has determined that the granting of a license to LICENSEE
under the U.S. patents listed in APPENDIX II, will provide the necessary
incentive for LICENSEE to achieve the desired early PRACTICAL APPLICATION of the
invention and the granting of such license to LICENSEE will therefore be in the
public interest;
NOW, THEREFORE, in accordance with said Patent Licensing Regulations, and
in consideration of the foregoing and of the terms hereinafter contained in this
AGREEMENT, the LICENSOR and LICENSEE agree as set forth below:
ARTICLE I
Definitions
-----------
"ACCOUNTING PERIOD" shall mean the period for which royalties are calculated.
For this AGREEMENT, the period is every six (6) months.
"BREACH" shall mean (a) a violation or nonperformance by a PARTY of a MATERIAL
term, condition, covenant or warranty herein, or (b) a misrepresentation made
hereunder or (c) a misrepresentation by LICENSEE to induce LICENSOR to enter
into this AGREEMENT (also see "MATERIAL").
"BREACHING PARTY" shall mean the PARTY in BREACH, as used in Section 19.2.
"GROSS SALES" shall mean either the total amount invoiced by or for LICENSEE,
and, in the event that some or all of the amount invoiced by LICENSEE is in the
form of non-monetary remuneration, then the equivalent dollar value sum of such
remuneration, for all disposals i.e., (sales, uses, including uses by LICENSEE,
leases, transfers, etc.) of ROYALTY-BASE PRODUCTS for consideration determined
in, or as if in, an arm's length transaction.
"INSOLVENT" shall mean that LICENSEE has either ceased to pay its debts (which
may include failure to pay royalty payments under this AGREEMENT) in the
ordinary course of business or cannot pay its debts as they fall due or is
insolvent within the meaning of the Federal Bankruptcy Code (11 U.S.C. 101
(31)).
"LICENSE COMMENCEMENT DATE" shall mean the date that the last PARTY has executed
this AGREEMENT.
"LICENSE EXPIRATION DATE" shall mean the last day that this AGREEMENT is in
effect.
"LICENSE TERM" shall mean the period of time starting with the LICENSE
COMMENCEMENT DATE and ending with the LICENSE EXPIRATION DATE.
"LICENSED AREA" shall mean the United States of America and its territories and
possessions, including the District of Columbia, and the Commonwealth of Puerto
Rico, and any foreign countries in which an application for patent corresponding
to one of more of the LICENSED PATENTS has or shall in the future be filed
during the term of this AGREEMENT.
"LICENSED FIELD OR EMBODIMENT(S)" shall mean making, using, selling,
proliferating, transferring and/or making other disposition of bone marrow cells
and tissues, and bone-marrow derived peripheral blood cells and applications
thereof, including but not limited to growth and commercialization of bone
marrow blood cell cultures, growth and transplantation of blood cells and bone
marrow; and the use of blood cells and bone marrow for commercial growth of bone
marrow-derived biological products, including but not limited to red blood
cells, white blood cells, platelets, cellular growth factors, and intercellular
communication factors, and processes for making such products. The sources of
testing and commercialization materials shall be derived from sources such as
living donor biopsies, harvested from cadaver donors, or from peripheral blood
cells. Specifically excluded as a source of bone marrow are human embryonic,
fetal or neonatal cells and tissues.
"LICENSED INVENTION" shall mean the inventions defined by the claims of the
LICENSED PATENTS and as may be further limited by ARTICLE II.
"LICENSED PATENTS" shall mean the United States Patents listed in APPENDIX II,
and shall include any corresponding: reissue patents; modifications of said
LICENSED PATENT(S) by means of certificates of correction or reexamination
certificates; and continuation or divisional patent applications and patents
(specifically excluding patent applications and patents containing new matter)
derived from said LICENSED PATENT(S), and any foreign patents derived from the
listed patents which have issued or may issue in the future
"MATERIAL," with respect to a particular matter (e.g., a BREACH), shall mean
that the matter is shown to affect adversely (a) the rights and benefits of the
other PARTY under this AGREEMENT; or (b) the ability of the other PARTY to
perform its obligations hereunder; and, in either case, to such a degree that a
reasonable person in the management of his or her own affairs would be more
likely than not to decline to enter into this AGREEMENT in view of the matter in
question.
"NET SALES" shall mean GROSS SALES, less allowances for returns and less (to the
extent separately stated, and not charged to the customer or others, on the
invoices): (1) regular trade and quantity discounts; (2) insurance and shipping
charges from the point of origin; (3) duties, tariffs, and other customs
charges; and (4) sales, use, value added, and similar taxes. In addition,
LICENSEE shall be entitled to deduct from NET SALES any receivables which are
deemed to be uncollectible according to generally accepted accounting principles
consistently applied, following commercially reasonable efforts to collect
receivables. Such bad debt deduction shall be applied to NET SALES in the period
in which such receivables are written off.
"NONBREACHING PARTY" shall mean the PARTY not in BREACH, as used in Section
19.2.
"PARTY" shall mean a party to this AGREEMENT.
"PERSON" shall mean a natural person; a corporation (for profit or
not-for-profit); an association; a partnership (general or limited); a joint
venture; a trust; a government or political department, subdivision, or agency;
or any other entity.
"PRACTICAL APPLICATION" shall mean, with respect to the LICENSED INVENTION, to
reduce it to practice and to commercialize it, i.e., to manufacture it in the
case of a composition or product, to practice it in the case of a process or
method, or to operate it in the case of a machine or system; and, in each case,
under such conditions as to establish: i) that a market for the LICENSED
INVENTION has been created, and to the extent practicable, that a market has
been created in the United States; ii) that it is being utilized; iii) that its
benefits are, to the extent permitted by law or Government regulations,
available to the public on reasonable terms; and iv) that market demand, at
least in the United States, shall be reasonably met.
"ROYALTY-BASE PRODUCTS" shall include the components of an item sold, used,
leased, transferred, or otherwise disposed of by LICENSEE or its SUBLICENSEEs
that is covered by or included within the LICENSED INVENTION. For purposes of
this license, ROYALTY-BASE PRODUCTS include, but is not limited to, methods and
processes for proliferating bone marrow tissues, red and white blood cells, and
the resultant tissues and cells. ROYALTY-BASE PRODUCTS may include other
components of the item not covered by or within the LICENSED INVENTION that
LICENSEE or its SUBLICENSEEs would not have sold, used, leased, transferred, or
otherwise disposed of but for the sale, use, lease, transfer, or other
disposition of the LICENSED INVENTION. For purposes of this license, the
revenue-producing sale, use, lease, transfer or other disposition of bone marrow
tissues or cells, and red and white blood cells, and processes for making such
products, constitute sales of ROYALTY-BASE PRODUCTS.
"SUBLICENSEE" shall mean any PERSON who has the right, granted by LICENSEE, to
make, use, or sell the LICENSED INVENTION.
"THIRD PARTIES" shall mean PERSONS other than the LICENSOR and the LICENSEE.
ARTICLE II
License Grant
-------------
2.1 LICENSOR hereby grants to LICENSEE a terminable, royalty-bearing, exclusive
license to practice, i.e., to make, have made, use, offer to sell, sell,
transfer, or dispose of, the LICENSED INVENTION as limited to the LICENSED AREA
and as limited to a LICENSED FIELD OR EMBODIMENT(S), as defined in ARTICLE I.
2.2 LICENSOR, upon request, will use reasonable efforts to grant LICENSEE, in
accordance with 37 CFR 404, a license to practice any inventions assigned to
LICENSOR, without which license or licenses, the practice of the LICENSED
INVENTION would result in infringement. The grant of said license or licenses
shall be limited, however, to the extent necessary to practice the LICENSED
INVENTION. There will be no such grant where said inventions are licensed
exclusively.
2.3 Notwithstanding anything to the contrary in this AGREEMENT, LICENSEE shall
take the license granted in this ARTICLE II subject to any outstanding licenses
or other rights in THIRD PARTIES under agreements executed by LICENSOR prior to
the LICENSE COMMENCEMENT DATE. LICENSOR has not granted any licenses to third
parties in any of the LICENSED PATENTS other than the following: License No.
DE-199 to VivoRx, Inc.; License No. DE-200, which was terminated by LICENSOR, to
VivoRx Pharmaceuticals, Inc.; LICENSE No. DE-305, in which NASA is a co-licensor
with Tulane University, to ▇▇▇▇ Ventures, License No. DE-160 to Synthecon, Inc.,
as modified by NASA pursuant to the NASA letter dated February 15, 1996
addressed to ▇▇. ▇▇▇▇▇ ▇. Buskop, attorney, and License No. DE-322, to
Synthecon, Inc. LICENSEE acknowledges that it has copies of pertinent portions
of the above-listed licenses, including the respective licensed fields of use
and listings of the patents licensed under the respective licenses.
2.4 LICENSOR reserves an irrevocable, royalty-free right to practice and have
practiced the LICENSED INVENTION, and any other inventions as provided in
Section 2.2, throughout the world by or on behalf of the Government of the
United States and on behalf of any foreign government pursuant to any existing
or future treaty or agreement with the United States.
ARTICLE III
Sublicenses
-----------
3.1 Upon written approval by LICENSOR, LICENSEE may grant a written
royalty-bearing, sublicense under the license granted in ARTICLE II provided
that it submits to LICENSOR a written request, in advance, for permission to
grant the sublicense, including with said request a copy of the proposed
sublicense. The proposed sublicense shall refer to and be generally consistent
with this AGREEMENT and shall include the rights reserved by LICENSOR under
Section 2.4. The proposed sublicense shall include the condition that the
sublicense shall automatically terminate upon the revocation or termination of
this AGREEMENT. Approval by LICENSOR of such sublicense(s) will not be
unreasonably withheld. If a proposed sublicense is rejected, LICENSOR will
advise LICENSEE of its reason(s) therefor, and LICENSEE may remedy the proposed
sublicense. LICENSOR and LICENSEE acknowledge that achievement of PRACTICAL
APPLICATION pursuant to this AGREEMENT may require the granting of a sublicense
from LICENSEE to a joint venture or similar entity, and sublicenses from such
entity to underlying users or customers
3.2 LICENSEE shall furnish LICENSOR with a copy of the sublicense, consistent
with the proposed sublicense approved by LICENSOR and executed by both LICENSEE
and its SUBLICENSEE, within fifteen (15) days after the grant of the sublicense
by LICENSEE.
3.3 LICENSEE shall submit to LICENSOR, for advance approval, any proposed
modification of a sublicense. LICENSEE shall also submit to LICENSOR a copy of
the sublicense modification (either as an addendum or a new sublicense),
consistent with the proposed sublicense modification and executed by both
LICENSEE and its SUBLICENSEE, within fifteen (15) days after the effective date
of the sublicense modification.
3.4 The granting of a sublicense by LICENSEE shall not operate to relieve
LICENSEE from any of its obligations under this AGREEMENT.
3.5 LICENSEE shall be responsible for and remit royalties based upon its
SUBLICENSEE's activities as if said activities were its own.
ARTICLE IV
Term of License
---------------
4.1 The license granted in ARTICLE II will be in effect for a LICENSE TERM that
is equal to the unexpired term of the last patent to be in effect of the
patent(s) encompassed under the definition of LICENSED PATENTS. Except as may be
expressly provided otherwise herein or agreed to in writing by LICENSOR, the
license shall expire automatically at the end of the LICENSE TERM without notice
to LICENSEE.
ARTICLE V
Practical Application
----------------------
5.1 LICENSEE shall achieve PRACTICAL APPLICATION of the LICENSED INVENTION in
accordance with the schedule set forth in the APPENDIX to this AGREEMENT and
incorporated into this AGREEMENT. LICENSEE shall notify LICENSOR within 30 days
of achieving PRACTIAL APPLICATION that PRACTICAL APPLICATION has been achieved.
LICENSEE shall also provide evidence to verify the achievement.
5.2 LICENSEE, once PRACTICAL APPLICATION of the LICENSED INVENTION is achieved,
shall thereafter maintain it throughout the LICENSE TERM.
ARTICLE VI
United States Manufacture
---------------------------
6.1 In achieving PRACTICAL APPLICATION of the LICENSED INVENTION, LICENSEE
agrees that any products embodying the LICENSED INVENTION or produced through
the use of the LICENSED INVENTION shall be reduced to practice and manufactured
substantially in the United States, in accordance with 35 U.S.C. 209(b).
6.2 LICENSEE shall make a bona fide attempt to use or sell the LICENSED
INVENTION in the United States.
6.3 LICENSEE shall promptly report to LICENSOR its discontinuance of making the
benefits of the LICENSED INVENTION available to the public.
ARTICLE VII
Royalty and Payment
---------------------
7.1 In consideration of the license granted in ARTICLE II, LICENSEE shall remit
to LICENSOR a nonrefundable license fee in the amount of one hundred thousand
Dollars ($100,000), payable as follows:
(a) $15,000, payable upon execution of this AGREEMENT by LICENSEE;
(b) $40,000, payable four months following the LICENSE COMMENCEMENT DATE;
(c) $45,000, payable ten months following the LICENSE COMMENCEMENT DATE.
7.2 LICENSEE agrees to pay LICENSOR a running royalty of five percent (5%) of
the NET SALES of ROYALTY-BASE PRODUCTS, provided that the sum of the NET SALES
of ROYALTY-BASE PRODUCTS sold by LICENSEE does not exceed $1,000,000 in any
ACCOUNTING PERIOD. In the event that the NET SALES OF ROYALTY-BASED PRODUCTS
sold by LICENSEE within any ACCOUNTING PERIOD exceed $1,000,000, then LICENSEE
shall pay LICENSOR a running royalty of five percent (5%) of NET SALES of
ROYALTY-BASE PRODUCTS up to $1,000,000 and three percent (3.0%) of Net SALES of
ROYALTY-BASE PRODUCTS in excess of $1,000,000 during any ACCOUNTING PERIOD.
Running royalties shall be remitted to LICENSOR within 30 days of the end of
every ACCOUNTING PERIOD, i.e., within 30 days after the first day of each
January and July.
7.3 LICENSEE agrees to pay LICENSOR a minimum royalty of $10,000 at the end of
each of the four ACCOUNTING PERIODS occurring during the years 2004 and 2005,
and $15,000 at the end of each of the four ACCOUNTING PERIODS occurring during
the years 2006 and 2007, and $25,000 at the end of each ACCOUNTING PERIOD
thereafter. Such minimum royalty payments shall be remitted within 30 days of
the end of every ACCOUNTING PERIOD, subject to the provisions of Section 7.4.
Further, notwithstanding any other provision of this AGREEMENT, if, pursuant to
its performance of this AGREEMENT, LICENSEE diligently endeavors in good faith
to obtain one or more sublicenses from any third party to whom LICENSOR has
granted license rights which would otherwise be infringed, or which LICENSEE
reasonably apprehends might be alleged to be infringed pursuant to the
performance of this AGREEMENT, or to obtain a further license from LICENSOR with
respect to such license rights, and is unable to obtain such sublicense(s) from
a third party, or to obtain a further license from LICENSOR, and upon the
provision to LICENSOR of 30-days written notification of such an eventuality ,
then all dates set forth in Sections 7.1 and 7.3 hereof with respect to future
payments which become due under this AGREEMENT shall commence and be calculated
from the commencement date of the last such sublicense or further license from
LICENSOR.
7.4 The minimum royalties specified in Section 7.3 shall not be due for any
particular ACCOUNTING PERIOD if the running royalties specified in Section 7.2
are equal or greater than the minimum royalty.
7.5 LICENSEE agrees that in the event any ROYALTY-BASE PRODUCTS shall be sold,
transferred, or disposed of, to a third-party for purposes of resale in a
transaction that does not represent an arm's length transaction, then the
royalties to be paid under this AGREEMENT for the ROYALTY-BASE PRODUCTS shall be
based upon the NET SALES of the ROYALTY-BASE PRODUCTS by the third-party, rather
than upon the NET SALES of the LICENSEE. Examples of transactions that do not
reflect an arm's length transaction includes sales, transfers or disposals(1) to
any type of organization or individual who owns a controlling interest in
LICENSEE by stock ownership or otherwise, (2) to any type of organization in
which LICENSEE shall own, directly or indirectly, a controlling interest by
stock ownership or otherwise, or (3) to any type of organization with which, or
individual with whom, LICENSEE, its stockholders, or associated companies shall
have any agreement, understanding, or arrangement (such as, among other things,
an option to purchase stock, an arrangement involving a division of profits, or
special rebates or allowances) without which agreement, understanding, or
arrangement, prices paid by such organization or individual for the ROYALTY-BASE
PRODUCTS would be higher than the NET SALES reported by LICENSEE, or if such
agreement, understanding, or arrangement results in extending to such
organization or individual lower prices for ROYALTY-BASE PRODUCTS than those
charged to outside concerns buying similar merchandise in similar amounts and
under similar conditions.
7.6 Under this AGREEMENT, ROYALTY-BASE PRODUCTS will be considered sold when
invoiced, except that upon expiration of the LICENSED PATENTS, or upon
termination of the license, all shipments made on or prior to the day of such
expiration or termination which have not been invoiced prior thereto shall be
royalty-bearing.
7.7 Royalties shall be paid within thirty (30) days of the end of each
ACCOUNTING PERIOD. Royalties shall be paid by check, denominated in United
States dollars, and made payable to the National Aeronautics and Space
Administration. The check shall be mailed to LICENSOR at the address set forth
in ARTICLE XV of this AGREEMENT concurrently with the report required in ARTICLE
VIII of this AGREEMENT. LICENSOR's acceptance of any royalty payment does not
eliminate LICENSOR's right to contest the accuracy of such payment in the
future.
7.8 LICENSOR shall assess interest, penalties, and administrative costs in
accordance with the Federal Claims Collections Standards, 4 CFR 100-105, on all
payments due LICENSOR which are not timely paid by LICENSEE.
ARTICLE VIII
Reports
-------
8.1 LICENSEE shall submit to LICENSOR written reports within thirty (30) days of
the end of every ACCOUNTING PERIOD whether or not royalties are due. Each report
shall be submitted concurrently with the royalties required by ARTICLE VII. To
ensure that any proprietary information submitted by LICENSEE is protected to
the fullest extent of the law, LICENSEE should ▇▇▇▇ with a proprietary notice,
any portions of the report that is considered proprietary to LICENSEE.
8.2 Each report shall include the following information:
(a) With reference to the schedule set forth in the APPENDIX to this AGREEMENT,
a narrative description of the steps being taken to reduce the LICENSED
INVENTION to practice.
(b) With reference to the schedule set forth in the APPENDIX to this AGREEMENT,
a narrative description of the steps being taken to create a market demand for
the LICENSED INVENTION, to commercialize the LICENSED INVENTION, and to meet
market demand for the LICENSED INVENTION.
(c) A narrative description of the ROYALTY-BASE PRODUCTS currently being offered
for sale by LICENSEE and its SUBLICENSEEs. Copies of current sales brochures,
promotional materials, and price lists shall be included with this description.
(d) A list of the geographic locations at which the LICENSED INVENTION is being
manufactured.
(e) The number and type of ROYALTY-BASE PRODUCTS sold or disposed of by
LICENSEE.
(f) The number and type of ROYALTY-BASE PRODUCTS sold or disposed of by each
SUBLICENSEE (if any).
(g) The number and type of ROYALTY-BASE PRODUCTS sold or disposed of by each
reseller of ROYALTY-BASE PRODUCTS under Section 7.5.
(h) LICENSEE's GROSS SALES.
(i) GROSS SALES for each SUBLICENSEE (if any).
(j) GROSS SALES for each reseller of ROYALTY-BASE PRODUCTS under Section 7.5.
(k) LICENSEE's NET SALES.
(l) NET SALES for each SUBLICENSEE (if any).
(m) NET SALES for each reseller of ROYALTY BASED PRODUCTS under Section 7.5.
(n) The amount of royalties due LICENSOR.
8.3 Each report shall be accompanied by a certification by an officer of
LICENSEE that the LICENSEE is complying with the terms and conditions of this
AGREEMENT and that the responses to each part of Section 8.2 are accurate and
complete.
8.4 LICENSEE shall, on an annual basis, submit to LICENSOR an audited balance
sheet and an audited income statement. Internal audits are permissible, but
LICENSOR reserves the right to require an independent audit and additionally
reserves the right to approve of the auditor.
8.5 A final report shall be submitted to LICENSOR by LICENSEE within thirty (30)
days after the termination of this AGREEMENT.
ARTICLE IX
AUDIT RIGHTS
9.1 LICENSEE shall keep full, true, and accurate records for the purpose of
LICENSOR verifying LICENSEE's reports to LICENSOR under ARTICLE VIII, verifying
LICENSEE's royalty payments to LICENSOR under ARTICLE VII, and for determining
LICENSEE's activities in general under the AGREEMENT. These records shall
include, but are not limited to, ledgers and journals of account, customer
orders, invoices, shipping documents, inventory records, computer records,
purchase orders, and tax records. These records, as a whole, shall include
information which will allow, at a minimum, identification of suppliers,
customers, items sold or otherwise transferred, and/or services rendered, as
well as whether the LICENSEE is operating within the scope of its license.
9.2 The records described in Section 9.1 shall be available for audit by
LICENSOR, or by an authorized representative of LICENSOR, at all reasonable
times for the LICENSE TERM and for three (3) calendar years thereafter. In
addition, LICENSEE shall permit inspection by LICENSOR, or by an authorized
representative of LICENSOR, of LICENSEE's assembly facilities and of LICENSEE's
inventory of ROYALTY-BASE PRODUCTS, including parts, works-in-progress, and
finished goods, during any audit by LICENSOR.
9.3 If LICENSOR, as a result of an audit, discovers an underpayment of royalties
which exceeds $20,000.00, then LICENSEE shall reimburse LICENSOR for the
reasonable cost of the audit, including all related costs of performing the
audit (e.g., travel, food, lodging, cost of professional services, etc.), in
addition to any penalties assessed pursuant to Section 7.8.
ARTICLE X
Marking
-------
10.1 LICENSEE and all SUBLICENSEEs shall ▇▇▇▇ all ROYALTY-BASE PRODUCTS, or
products incorporating ROYALTY-BASE PRODUCTS, in accordance with the statutes of
the United States relating to the marking of patented articles (see 35 U.S.C.
287). Such marking shall be accomplished by fixing on the article or when, from
the character of the article, this cannot be done, by fixing to it, or to the
package wherein one or more of the articles is contained, a label including the
notation "Licensed from the National Aeronautics and Space Administration under
(insert license number)." Such marking shall also be included into all
literature and/or advertising materials describing the LICENSED INVENTION.
ARTICLE XI
Use of the NASA Name
------------------------
11.1 Except as required by Section 10.1, LICENSEE may use the name of LICENSOR,
or the acronym "NASA," only in truthful statements concerning its relationship
with LICENSOR. The letters 'NASA' may be used in such truthful statements only
if they are:
(a) used in their normal typed or printed form;
(b) the same size, color, and intensity as the rest of the words in a sentence;
(c) not used in their stylized version as they appear in the NASA logotype or
NASA insignia; and
(d) not used to indicate that NASA approves of the LICENSEE's products,
processes, etc.
11.2 Uses of the letters 'NASA', other than those required by Section 10.1 or
specified in Section 11.1, shall require the express written approval of
LICENSOR. Approval by LICENSOR shall be based on applicable law (i.e., 42 U.S.C.
2459(b), 2472(a), and 2473(c)(1); and 14 CFR 1221.100 et seq.) and
NASA policy governing the use of the letters 'NASA' and the words 'National
Aeronautics and Space Administration' and shall not be unreasonably withheld.
11.3 LICENSEE agrees to make copies of its marketing literature available to
LICENSOR so that LICENSOR can determine that such use is in accordance with the
terms of this ARTICLE.
ARTICLE XII
DISCLAIMER OF WARRANTIES
12.1 EXCEPT AS SPECIFICALLY STATED AT 2.3, LICENSOR MAKES NO REPRESENTATIONS OR
WARRANTIES, EXPRESS, IMPLIED, OR STATUTORY, AS TO ANY MATTER WHATSOEVER.
12.2 In particular, nothing in this AGREEMENT shall be construed as:
(a) A warranty or representation by LICENSOR as to the validity or scope of any
LICENSED PATENT; or
(b) 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 any type, including patent infringement, copyright infringement,
and trademark infringement; or
(c) A requirement that LICENSOR shall file any patent application, secure any
patent, or maintain any patent in force, other than maintaining the LICENSED
PATENTS as set forth in Article XXIV; or
(d) An obligation to bring or prosecute actions or suits against THIRD PARTIES
for infringement; or
(e) An obligation to furnish any manufacturing or technical information; or, if
any such information is supplied, a warranty or representation that such
information is accurate; or
(f) Conferring a right to use in advertising, publicity or otherwise the name of
any inventor of the LICENSED INVENTION or the NASA name, seal, insignia,
logotype or any other adaptation without the prior written consent of LICENSOR
(except as otherwise provided in ARTICLE XI); or
(g) Precluding the export from the United States of ROYALTY-BASE PRODUCTS on
which royalties shall have been paid as provided in ARTICLE VII, provided that
the item can be exported under the export control laws of the United States; or
(h) Granting by implication, estoppel, or otherwise, any licenses or other
rights under any patent of LICENSOR or any other PERSON in the United States or
any foreign country; or
(i) Granting by implication, estoppel, or otherwise, any licenses or rights
under patents or patent applications of LICENSOR other than the LICENSED
INVENTION, regardless of whether such other patents or patent applications are
dominant, subordinate, or an improvement to the invention or inventions as
claimed, of the LICENSED PATENTS or LICENSED PATENT APPLICATIONS, nor to other
applications that did not claim the invention.
(j) Conferring upon any PERSON (1) any immunity from or defenses under the
antitrust laws, (2) any immunity from a charge of patent misuse, or (3) any
immunity from the operation of Federal, State, or other law.
ARTICLE XIII
Risk Allocation and Indemnification
--------------------------------------
13.1 LICENSOR makes no representation, extends no warranties of any kind, either
express or implied, and assumes no responsibility whatever with respect to use,
sales, or other disposition by LICENSEE or its vendees or other transferees of
products incorporating or made by the use of (1) the LICENSED INVENTION or (2)
information, if any, furnished under this AGREEMENT.
13.2 LICENSEE shall indemnify LICENSOR, its officers and employees, and hold
them harmless against all liabilities, demands, damages, expenses, or losses
including, but not limited to, attorney's fees, court costs, and the like,
arising (1) out of the use by LICENSEE or its transferees of the LICENSED
INVENTION or information furnished under this AGREEMENT, or (2) out of any sale,
use, or other disposition by LICENSEE or its transferees of products, processes,
or compositions, made by use of such inventions or information.
13.3 It shall be the sole responsibility of the LICENSEE to ensure that any and
all embodiments of the LICENSED INVENTION are safe under all circumstances.
13.4 Independent of, severable from, and to be enforced independently of any
other enforceable or unenforceable provision of this AGREEMENT, other than as
provided in Sections 13.1 and 13.2, or other than for infringement of one
PARTY's intellectual property rights by another PARTY, (including any engagement
in licensable activities by licenses beyond the scope of the license provided by
this AGREEMENT), neither PARTY will be liable to the other PARTY (nor to any
THIRD PARTY claiming rights derived from the other PARTY's rights) for
incidental, consequential, special, punitive, or exemplary damages of any kind,
including lost profits, loss of business, or other economic damage, and further
including injury to property, as a result of breach of any warranty or other
term of this AGREEMENT, regardless of whether the PARTY liable or allegedly
liable was advised, had reason to know, or in fact knew of the possibility
thereof.
13.5 Prior to commencement of clinical trials involving human test subjects,
LICENSEE agrees to have implemented and maintained product liability insurance
naming LICENSOR as an additional insured with a reputable insurance company
approved by LICENSOR in an amount not less than five million dollars
($5,000,000) per person, and ten million dollars ($10,000,000) aggregate.
LICENSEE shall provide LICENSOR with certified copies of such policy or policies
within thirty (30) days of the purchase of each policy and will notify LICENSOR
of any cancellation or lapse in said coverage.
ARTICLE XIV
Patent Validity
----------------
14.1 If, in any proceeding in which the validity, infringement, or priority of
invention of any claim of any of the LICENSED PATENTS is in issue, a judgement
or decree is entered which becomes final (below referred to as an "final
judgement"), the construction placed upon any such claim by such final judgement
shall thereafter be followed, not only as to such claim but as to all claims to
which such construction applies, with respect to subsequently occurring acts. If
such final judgement holds any claim invalid, LICENSEE shall be relieved
prospectively (1) from including in its reports ROYALTY-BASE PRODUCTS sold or
otherwise disposed of covered only by such claim or any broader claim to which
such final judgement is applicable, and (2) from the performance of those other
acts which may be required by this AGREEMENT only because of any such claim.
However, if there are two or more conflicting final judgements with respect to
the same claim based on the same grounds or where the same issues were raised,
the decision of the higher tribunal shall be followed, but if the tribunals be
of equal dignity, then the decision more favorable to the claim shall be
followed.
14.2 In the event evidentiary material comes to the attention of the LICENSEE
subsequent to the LICENSEE's execution of this AGREEMENT which, in the judgement
of the LICENSEE, bears on the validity or scope of any LICENSED PATENT(S), the
LICENSOR will in good faith discuss with the LICENSEE whether such evidentiary
material so affects the validity or scope of the LICENSED PATENT(S) to which it
is asserted to apply that the terms of the license in respect to such LICENSED
PATENT(S) should be modified.
14.3 The LICENSEE, subsequent to the date of its execution of this AGREEMENT,
may assert the invalidity of any claim in any LICENSED PATENT(S), if coupled
with or followed by:
(a) Withholding, or notice of intention to withhold, or denial of obligation to
pay, royalties otherwise payable under this AGREEMENT in respect to the
LICENSEE's operations under such claim; or
(b) Initiation or participation in a suit challenging or denying the validity of
such claim in reference to LICENSEE's operations under this AGREEMENT, that may,
at the option of the LICENSOR, be conclusively presumed to constitute LICENSEE's
termination, as of the earliest provable date of such withholding, notice,
denial, initiation, or participation, of its AGREEMENT including its obligation
for payment of royalties due from the date of the termination.
ARTICLE XV
Points of Contact
-------------------
15.1 The following individuals are designated as the points of contact for their
respective PARTY. These points of contact are the principal representatives of
the PARTIES involved in the performance of this AGREEMENT.
LICENSOR LICENSEE
Name: ▇▇▇▇▇ ▇. ▇▇▇▇ Name: CJAB Associates, L.P.
Title: Patent Attorney Title: President of CJAB
Associates G.P., Inc.,
Address: its General Partner
NASA ▇▇▇▇▇▇▇ Space Center/HA
NASA One Road Address: ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tele. No.: 281 483-1001 Tele. No.: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: ▇▇▇ ▇▇▇-▇▇▇▇ Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇.▇.▇▇▇▇@▇▇▇.▇▇▇▇.▇▇▇ ▇▇▇▇▇▇▇▇▇@▇▇▇.▇▇▇
------------------------- -----------------
ARTICLE XVI
Notices
-------
16.1 Notices hereunder will be delivered and effective as follows:
(a) Every notice required or contemplated by this AGREEMENT to be given either
PARTY may be delivered in person or may be sent by courier, telecopy, express
mail, telex, telegraph or postage prepaid certified or registered air mail (or
its equivalent under the laws of the country where mailed), addressed to the
PARTY for whom it is intended, at the address specified in ARTICLE XV. Either
PARTY may change its address for notice by giving notice to the other PARTY of
the change.
(b) Any written notice will be effective no earlier than the date actually
received.
(c) Unless otherwise provided in this AGREEMENT, notice by courier, or by
express, certified, or registered mail, will be effective on the date it is
officially recorded as delivered by return receipt or the equivalent, and in the
absence of such record as to delivery, it will be rebuttably presumed to have
been delivered on the fifth business day after it was deposited, first-class
postage prepaid, in the mails.
(d) Notice by telex or telegraph will be deemed given at the time it is recorded
by the carrier in the ordinary course of business as having been delivered, but
in any event no later than one business day after dispatch.
(e) Notice not given in writing will be effective only if acknowledged in
writing by a duly authorized officer of the PARTY to whom it was given.
(f) As used in this ARTICLE, a reference to a particular date means the date
itself, if a business day, otherwise the first business day after the date.
ARTICLE XVII
Infringement
------------
17.1 If LICENSEE becomes aware of an infringement or has reasonable cause to
believe that there has been an infringement of any LICENSED PATENT, LICENSEE
shall notify LICENSOR in writing concerning LICENSEE's knowledge of any
infringement or of the reasonable cause for belief of infringement. Such notice
should include: an analysis of how the claims of any LICENSED PATENT(S) read-on
the allegedly infringing articles; the identity of the alleged infringers; a
statement as to whether the alleged infringers are making, using, or selling the
allegedly infringing articles; a statement describing the extent of the alleged
infringement; and a statement which describes and quantifies the harm being
suffered by the LICENSEE as a result of the alleged infringement. If such notice
and information are furnished, LICENSOR may volunteer its opinion as to whether
reasonable cause exists to believe that there has been an infringement. LICENSEE
is authorized under the provisions of Chapter 29 of Title 35, United States
Code, or other statutes, (a) to bring suit in its own name, at its own expense,
and on its own behalf, for infringement of the LICENSED PATENT(S), and (b) in
any such suit, to enjoin infringement and to collect for its use, damages,
profits and awards of whatever nature, recoverable from such infringement,
subject to payment of royalties due to NASA, and further, (c) to settle any
claim or suit for infringement of the LICENSED PATENT(S), as by granting a
sublicense under this AGREEMENT. With respect to the royalties due to NASA from
LICENSEE's successful infringement action, the parties agree to enter into good
faith negotiations to arrive at the appropriate amount of royalties due to NASA.
The authority to bring suit is subject to the continuing right of the United
States to bring suit itself or to intervene in LICENSEE's suit; and, in either
event, LICENSEE shall give LICENSOR reasonable notice and assistance.
ARTICLE XVIII
DISPUTE OR BREACH
18.1 All disputes concerning the interpretation or application of this AGREEMENT
shall be discussed mutually between the PARTIES. Any disputes which are not
disposed of by mutual agreement shall be decided by the NASA Associate General
Counsel (Intellectual Property), or designee, who shall reduce the decision to
writing and mail or otherwise furnish a copy thereof to LICENSEE. LICENSEE may
respond to an adverse decision in accordance with the procedures set forth in
Article 19.8.
18.2 In the event of a BREACH of any provision of this AGREEMENT, the
NONBREACHING PARTY shall give the BREACHING PARTY notice describing the BREACH
and stating that the BREACHING PARTY has thirty (30) days after receipt of the
notice of the BREACH to cure the BREACH or show cause why the AGREEMENT should
not be terminated in accordance with Article 19.8.
18.3 If a provision of this AGREEMENT sets forth a cure period for the BREACH in
question other than thirty (30) days, then that provision shall take precedence
over the cure period set forth in Article 18.2.
18.4 No cure period is required, except as may be otherwise provided in this
AGREEMENT, if:
(a) this AGREEMENT sets forth specific deadline dates for the obligation
allegedly breached; or
(b) this AGREEMENT otherwise states that no cure period is required in
connection with the termination in question.
18.5 The BREACHING PARTY will be deemed to have cured such BREACH if within the
cure period it takes steps reasonably adequate to alleviate any damage to the
NONBREACHING PARTY resulting from the BREACH and to prevent a similar future
BREACH.
ARTICLE XIX
Termination or Modification
-----------------------------
19.1 The PARTIES may terminate or modify this AGREEMENT by mutual consent upon
such terms as they may agree in writing.
19.2 Either PARTY may terminate this AGREEMENT by failing to extend the LICENSE
TERM, if an extension is provided for in Section 4.1.
19.3 Either PARTY may terminate this AGREEMENT upon the discovery by one PARTY
of any intentional MATERIAL false statement or misrepresentation made or
submitted by the other PARTY which BREACHES any obligation under the terms of
this AGREEMENT or upon the discovery by one PARTY that the other PARTY has
committed a MATERIAL breach of a provision of the AGREEMENT.
19.4 LICENSEE may prospectively terminate this AGREEMENT upon ninety (90) days
written notice to LICENSOR.
19.5 This AGREEMENT may be terminated by LICENSOR if:
(a) LICENSOR determines that LICENSEE has failed or will fail to achieve
and maintain PRACTICAL APPLICATION of the LICENSED INVENTION as provided by
Section 5.
(b) LICENSOR determines that LICENSEE has failed or will fail to both
reduce to practice and substantially manufacture the LICENSED INVENTION in the
United States as provided by Section 6.1
(c) LICENSOR determines that LICENSEE has failed or will fail to meet
market demand for the LICENSED INVENTION.
(d) LICENSEE fails to pay royalties and submit reports as provided by
ARTICLE VII and VIII.
(e) LICENSOR determines that such action is necessary to meet the
requirements for public use specified by Federal regulations issued after the
date of the license and such requirements are not reasonably satisfied by
LICENSEE.
19.6 LICENSOR may terminate this AGREEMENT if LICENSEE becomes "INSOLVENT."
LICENSEE must notify LICENSOR within thirty (30) days after becoming INSOLVENT.
LICENSEE's failure to conform to this requirement shall be deemed a material,
incurable breach.
19.7 LICENSEE must promptly inform LICENSOR of its intention to file a voluntary
petition in bankruptcy or of another's communicated intention to file an
involuntary petition in bankruptcy. LICENSOR may terminate this AGREEMENT upon
receiving notice of intention to file. LICENSEE's filing without conforming to
this requirement shall be deemed a material, pre-petition incurable breach.
19.8 Before LICENSOR unilaterally modifies, or terminates this AGREEMENT for any
cause, LICENSOR will furnish LICENSEE and all SUBLICENSEES of record a written
notice stating LICENSOR's intention to modify or terminate the AGREEMENT and the
reasons therefor. LICENSEE and SUBLICENSEES of record will be allowed thirty
(30) days after: (1) receipt of such notice to remedy any BREACH of the
AGREEMENT or show cause why the AGREEMENT should not be unilaterally modified or
terminated; or, (2) receipt of a decision regarding a dispute, rendered in
accordance with Article 18.1, to rebut such decision. A response to a notice of
modification or termination or to a notice of a dispute determination should be
addressed to the General Counsel, National Aeronautics and Space Administration,
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. The General Counsel will render a determination based on
the LICENSEE'S response within a reasonable time. Absent any response from
LICENSEE to the notice regarding the modification, termination and/or dispute
determination, the determination by the General Counsel will be final and/or the
AGREEMENT will be unilaterally modified or will terminate, effective thirty-one
(31) days from the receipt of the notice of modification, termination or dispute
determination, with no right to appeal under Section 20.9.
19.9 LICENSEE may appeal in writing to the NASA Administrator, any determination
rendered by the General Counsel in accordance with Section 20.8, within thirty
(30) days after receipt of such determination.,. The notice of appeal and all
supporting documentation should be addressed to the Administrator, National
Aeronautics and Space Administration, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. LICENSEE shall be
afforded an opportunity to be heard and to offer evidence in support of its
appeal. The decision on the appeal shall be made by the NASA Administrator or
designee, which shall be the final agency decision from which there will be no
further right of administrative appeal. Nothing in this Article shall be
interpreted as precluding actions at law.
19.10 If no action is taken under Section 19.9, then the decision to modify or
terminate this AGREEMENT shall become final within thirty-one (31) days after
receipt of the determination rendered by the General Counsel in accordance with
19.8.
19.11 All royalties and reports due up to and including the date of termination
of this AGREEMENT are due within thirty (30) days of the date of termination.
ARTICLE XX
ASSIGNMENT
20.1 Upon written approval by LICENSOR, LICENSEE may assign this AGREEMENT
provided that LICENSEE submits to LICENSOR, in advance, a written request for
permission to grant the assignment, information that NASA considers necessary to
evaluate the proposed assignment, and a copy of the proposed assignment. If
LICENSOR approves the assignment as being consistent with the Government's
interests, the PARTIES and the assignee will be required to execute a novation
agreement. At a minimum, the novation agreement will provide that LICENSEE
waives all rights under the license, the assignee assumes all obligations under
the AGREEMENT and that LICENSOR recognizes the assignee as the successor in
interest to the AGREEMENT.
ARTICLE XXI
GOVERNING LAW
21.1 This AGREEMENT will be interpreted and enforced in accordance with United
States federal law.
ARTICLE XXII
INDEPENDENT ENTITIES
22.1 The Parties are separate and independent entities. Except as may be
expressly and unambiguously provided in this AGREEMENT, no partnership or joint
venture is intended to be created by this AGREEMENT, nor any principal-agent or
employer-employee relationship.
22.2 Except to the extent expressly provided in this AGREEMENT, neither PARTY
has, and neither PARTY shall attempt to assert, the authority to make
commitments for or to bind the other PARTY to any obligation.
ARTICLE XXIII
EFFECT OF PARTIAL INVALIDITY
23.1 If any one of more of the provisions of this AGREEMENT should be ruled
wholly or partly invalid or unenforceable by a court or other government body of
competent jurisdiction, and as long as the fundamental objectives of the
AGREEMENT can be carried out, then:
(a) the validity and enforceability of all provisions of this AGREEMENT not
ruled to be invalid or unenforceable will be unaffected;
(b) the provision(s) held wholly or partly invalid or unenforceable will be
deemed to be amended, and the court or other government body is authorized to
reform the provision(s), to the minimum extent necessary to render them valid
and enforceable in conformity with the PARTIES' intent as manifested herein; and
(c) if the ruling, and/or the controlling principle of law or equity leading to
the ruling, is subsequently overruled, modified, or amended by legislative,
judicial, or administrative action, then the provision(s) in question, as
originally set forth in this AGREEMENT, will be deemed to be valid and
enforceable to the maximum extent permitted by the new controlling principle of
law or equity.
ARTICLE XXIV
Patent Prosecution and Maintenance
24.1 Domestic Prosecution: Subject to the provisions of Article XII, NASA shall
continue to maintain the LICENSED PATENTS, and any patents issuing from the
LICENSED PATENT APPLICATIONS, in the United States, utilizing a reasonable
standard of care in such prosecution not less than the standard taken with
respect to its other prosecution.
24.2 Foreign Prosecution: It is acknowledged by LICENSEE that the LICENSED
PATENTS under AGREEMENT are domestic patents, and that LICENSOR assumes no
obligations or responsibilities for the prosecution or maintenance of any
foreign patents or patent applications.
ARTICLE XXV
Nonwaiver
---------
25.1 The failure of either PARTY at any time to require performance by the other
PARTY of any provisions of this AGREEMENT shall in no way affect the right of
such PARTY to require future performance of that provision. Any waiver by either
PARTY of any BREACH of any provision of this AGREEMENT shall not be construed as
a waiver of any continuing or succeeding BREACH of such provision, a waiver of
the provision itself, or a waiver of any right under this AGREEMENT.
ARTICLE XXVI
Entire Agreement
-----------------
26.1 Except as may be expressly provided otherwise herein, this AGREEMENT
constitutes the entire agreement between the PARTIES concerning the subject
matter thereof. No prior or contemporaneous representations, inducements,
promises, or agreements, oral or otherwise, between the PARTIES with reference
thereto will be of any force or effect. This AGREEMENT may only be modified by
written agreement of the PARTIES.
ARTICLE XXVII
ARTICLE HEADINGS
27.1 The ARTICLE headings contained in this AGREEMENT are for reference purposes
only and shall not in any way control the meaning or interpretation of this
AGREEMENT.
ARTICLE XXVIII
COUNTERPARTS
28.1 This AGREEMENT may be executed in separate counterparts, each of which so
executed and delivered shall constitute an original, but all such counterparts
shall together constitute one and the same instrument. Any such counterpart may
comprise one or more duplicates or duplicate signature pages, any of which may
be executed by less than all of the PARTIES, provided that each PARTY executes
at least one such duplicate or duplicate signature page. The PARTIES stipulate
that a photostatic copy of an executed original will be admissible in evidence
for all purposes in any proceeding as between the PARTIES.
ARTICLE XXVIV
ACCEPTANCE
29.1 In witness whereof, each PARTY has caused this AGREEMENT to be executed by
its duly authorized representatives:
LICENSOR: LICENSEE:
National Aeronautics and CJAB Associates, L.P.
Space Administration
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ BY: CJAB Associates G.P., Inc.,
its general partner
Typed Name ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By: /s/ ▇.▇. ▇▇▇▇▇, ▇▇.
Title: General Counsel President
Date: March 8, 2001 Date: March 8, 2001
NOTICE: THIS APPENDIX I INCLUDES COMMERCIAL AND FINANCIAL INFORMATION RECEIVED
FROM LICENSEE WHICH IS CONSIDERED PRIVILEGED AND CONFIDENTIAL.
APPENDIX I
Practical Application: Development Plan and Milestone Events
------------------------------------------------------------------
PRACTICAL APPLICATION of the LICENSED INVENTIONS in accordance with
Articles I and V shall include the following milestone events, which are
accepted by the parties as criteria with respect to whether or not PRACTICAL
APPLICATION of the LICENSED INVENTIONS is being accomplished within the
respective LICENSED FIELD(S) OR EMBODMENT(S).
In the performance of LICENSEE'S development plan (incorporated into this
AGREEMENT as ATTACHMENT I) for achieving PRACTICAL APPLICATION of the LICENSED
INVENTIONS, LICENSEE commits to aggressively pursue the development and
commercialization of the LICENSED INVENTIONS. Such development and
commercialization will include proof of principle testing, scale-up, Government
approvals, and marketing necessary to achieve commercialization of the products
and processes of the LICENSED INVENTIONS for human therapeutic and clinical
applications.
It is acknowledged that PRACTICAL APPLICATION of the LICENSED INVENTIONS
encompasses medical and clinical applications of bone marrow tissues, produced
in accordance with the LICENSED INVENTIONS, for human therapeutic uses. Examples
of such applications include the proliferation of bone marrow tissues from
tissues derived from human patients, and the introduction or implantation of the
proliferated tissues into human patients for the treatment of leukemia and other
medical conditions. Whether performed by LICENSEE or by a SUBLICENSEE of
LICENSEE under this AGREEMENT, the accomplishment of such commercialization for
human therapeutic applications is the responsibility of LICENSEE.
In conjunction with the performance of the development phases listed below
and the development plan provided by LICENSEE, LICENSEE commits to the following
minimum levels of expenditures supporting the achievement of PRACTICAL
APPLICATION of the LICENSED INVENTIONS pursuant to the provisions of this
AGREEMENT: $500,000 shall have been invested within 12 months from the effective
date of this AGREEEMENT, and an aggregate of $2,000,000 shall have been invested
during the period extending for 30 months from the effective date of the
AGREEMENT. These minimum expenditures for the achievement of PRACTICAL
APPLICATION of the LICENSED INVENTIONS are exclusive of expenditures for
achieving development and/or commercialization of other technologies, or
development and/or commercialization in fields of use other than those set forth
in this AGREEMENT.
The product development benchmarks are as follows, in which the performance
dates indicate the period of time subsequent to the effective date of the
AGREEMENT in which the respective step will be accomplished, unless otherwise
indicated:
1) Proof-of Principle Experimentation: 24 months
Proof-of-principle experimentation, including proliferation of effecaceous
quantities of bone marrow tissues in the bioreactors, testing and evaluation of
such tissues. Begin pilot scale production and sales of tissues, for research
and/or veterinary purposes. Begin pre-clinical research; arrange research
program(s) with investigators; review and begin application process for any
Government approval procedures, such as FDA approvals, necessary for
commercialization of the tissues for human therapeutic applications.
2) Commercialization for Human Medical Applications: 36 Months
(A.) In the event an IND or Good Manufacturing Approval will be required for
commercialization of the tissues, proceed with the requisite approval process
and pursue commercialization of the LICENSED INVENTIONS for human therapeutic
application(s) in accordance with the schedule provided below.
In the event that: (1) LICENSEE determines that the scope of investment and
manpower necessary to proceed to full commercialization of the LICENSED
INVENTIONS will necessitate reliance upon one or more commercial partner(s),
then LICENSEE shall proceed to survey prospective commercial partner(s), and
pursue negotiations with such prospective commercial partners with respect to
entering into one or more sublicense(s), pursuant to Article III, for the
achievement of commercialization of the LICENSED INVENTIONS for such medical
applications; by the 36th-month anniversary, LICENSEE shall have identified and
negotiated SUBLICENSE(S) under this AGREEMENT, pursuant to Article III, with one
or more commercial partners. Such SUBLICENSES shall include, inter alia,
provisions under which the sublicensee(s) shall commit to the achievement of any
necessary FDA approval processes, and to levels of investments commensurate with
the achievement of commercialization of the
LICENSED INVENTIONS for human therapeutic applications.
3. Implement Commercialization and Marketing Proceedures 42 months
Formulate and provide report of marketing and commercialization programs and
procedures intended to be used for commercialization of the LICENSED INVENTIONS,
including such procedures to be implemented by any SUBLICENSEE(S).
4. Commercial Sales for Human Therapeutic Applications: 48 months
LICENSEE and/or its SUBLICENSEE(S) shall have begun sales of ROYALTY BASE
PRODUCTS for therapeutic applications in human patients no later than 48 months.
5. Notwithstanding any term in this AGREEMENT to the contrary, if it becomes
necessary for LICENSEE to obtain one or more sublicenses from any third party to
whom LICENSOR has granted rights, or to obtain such rights through a further
license from LICENSOR, and if LICENSEE'S performance hereunder is thereby
delayed, then all dates and corresponding time periods set forth in this
Appendix I shall commence and be calculated from the commencement date of the
last such sublicense.
APPENDIX II
PATENTS:
-------
A. ISSUED PATENTS:
CASE NUMBER TITLE PATENT STATUS
------------ ----- --------------
MSC-21560-1 "Three-Dimensional Co-Culture Process" U.S. ▇▇▇ No. 5,153,132
Issued October 6, 1992
MSC-21294-2 "Method for Culturing Mammalian Cells U.S. ▇▇▇ No. 5,153,133
in a Horizontally Rotated Bioreactor" Issued October 6, 1992
MSC-21559-1 "Three-Dimensional Cell to Tissue U.S. ▇▇▇ No. 5,155,034
Assembly Process" Issued October 13, 1992
MSC-21293-2 "Method for Culturing Mammalian Cells U.S. ▇▇▇ No. 5,155,035
in a Perfused Bioreactor Issued October 13, 1992
MSC-21560-2 "Multi-Cellular Three-Dimensional U.S. ▇▇▇ No. 5,308,764
Living Mammalian Tissue" Issued May 3, 1994
MSC-21984-1 "Cultured Normal mammalian Tissue U.S. ▇▇▇ No. 5,496,722
and Process" Issued March 5, 1996
MSC-21560-3 "Multi-Cellular, Three-Dimensional U.S. ▇▇▇ No. 5,627,021
Living Mammalian Tissue" Issued May 6, 1997
MSC-21984-2 "Media Compositions for Three- U.S. ▇▇▇ No. 5,846,807
Dimensional Mammalian Tissue Growth Issued December 8, 1998
Under"
MSC-21984-3 "Production of Normal Mammalian Organ U.S. ▇▇▇ No. 5,858,783
Culture Using a Medium Containing Issued January 12, 1999
Mem- Alpha, Leibovitz L-15, Glucose
Galactose Fructose"
MSC-22119-1 "Cultured High-Fidelity U.S. ▇▇▇ No. 5,851,816
Three Dimensional Human Urogenital Issued December 22, 1998
Tract Carcinomas and Process"
MSC-22122 "Horizontal Rotating-Wall Vessel U.S. ▇▇▇ No. 6,117,674
Propagation in Vitro Human Tissue Issued September 12, 2000
Models"