Exhibit 10.17
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS
([**]), HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED
CO-DEVELOPMENT AND
LICENSE AGREEMENT
between
VIACELL, INC.
and
GAMETE TECHNOLOGY, INC.
Dated as of July 15, 2003
CO-DEVELOPMENT AND
LICENSE AGREEMENT
This CO-DEVELOPMENT AND LICENSE AGREEMENT (this "Agreement"), dated as of
July 15, 2003, is between Gamete Technology, Inc., a company duly organized and
existing under the laws of Rhode Island and having offices at ▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇, North Kingston, Rhode Island, USA for and on behalf of itself and
its Affiliates (together with its Affiliates, "GAMETE"), and ViaCell, Inc., a
company duly organized and existing under the laws of Delaware and having
offices at 131 Clarendon Street, Boston, Massachusetts, USA, for and on behalf
of itself and its Affiliates (together with its Affiliates, "VIACELL").
PRELIMINARY STATEMENTS
A. GAMETE has entered into that certain License Agreement with The
General Hospital Corporation dba Massachusetts General Hospital ("MGH") dated
April 29, 2003, pursuant to which GAMETE has been granted a license, with the
right to sublicense, to certain patent rights and other know-how and technology
owned by MGH.
B. GAMETE wishes to grant a sublicense to VIACELL, and VIACELL wishes to
take a sublicense from GAMETE, under certain rights granted to GAMETE under the
MGH License Agreement upon the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing preliminary statements
and the mutual covenants and agreements of the Parties contained in this
Agreement, the Parties hereby agree as follows:
1. DEFINITIONS
As used in this Agreement, the following terms shall have those meanings
set forth in this Section 1 unless the context dictates otherwise.
1.1. "Affiliate" with respect to either Party, shall mean any Person
controlling, controlled by, or under common control with, such Party. For the
purpose of this Section 1.1, "control" shall refer to (i) the possession,
directly or indirectly, of the power to direct the management or policies of
such Party, whether through the ownership of voting securities, by contract or
otherwise, or (ii) the beneficial ownership (as such term is defined in the
Securities Exchange Act of 1934, as amended) of at least fifty percent (50%) of
the voting securities or other ownership interest of such Party.
1.2. "Confidential Information" shall have the meaning assigned to
such term in Section 10.1.
1.3. "Covered Products" shall mean any product or service related to the
collection, processing and cryopreservation of human oocytes in any country in
the Territory that meets any of the following criteria:
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(i) the development, manufacture or sale of any such product or any
process undertaken in the provision of such services is covered by a Valid Claim
of any Patent in such country included in the MGH Patent Rights or any Patent in
such country covering any portion of the GAMETE Development Technology or Joint
Development Technology (a "Patented Covered Product");
(ii) the development, manufacture or sale of any such product or any
process undertaken in the provision of such services has, at any time, been
covered by a Valid Claim of any Patent in such country included in the MGH
Patent Rights or any Patent in such country covering any portion of the GAMETE
Development Technology or Joint Development Technology, and all such Valid
Claims have expired or been invalidated (an "Expired Covered Product"); or
(iii) such product or service (a) is not described in clauses (i) or (ii)
above and (b) is developed, manufactured, sold or provided using Gamete
Development Technology or Joint Development Technology that is not described in
or dominated by a Valid Claim of any Patent included in the MGH Patent Rights or
any Patent covering any portion of the GAMETE Development Technology or Joint
Development Technology (a "Development Technology Covered Product").
For purposes of this Section 1.3, "services" shall include any initial
set-up, training, provider agreements, or other arrangements to allow a Customer
to sell or distribute Covered Product; provided, however, that if VIACELL is
obligated pursuant to Section 3.3(a)(ii) hereof to make payments to MGH based on
any of the activities, fees or other arrangements described in this sentence,
such activities, fees or other arrangements shall not constitute "services" and
GAMETE shall not be entitled to any royalty therefor.
1.4. "Effective Date" shall mean the date first set forth above.
1.5. "FDA" shall mean the United States Food and Drug Administration,
or any successor thereto.
1.6. "Field" shall mean the field of human oocyte cryopreservation.
1.7. "First Commercial Sale" shall mean, with respect to any Covered
Product, the first sale to the general public of such Covered Product in a
country in the Territory after all required marketing and pricing approvals have
been granted, or otherwise permitted, by the governing health authority of such
country. "First Commercial Sale" shall not include the provision of any Covered
Product for use in clinical trials or for compassionate use prior to the receipt
of necessary marketing approvals.
1.8. "GAMETE Development Technology" shall mean all Inventions and
Know-How first (i) conceived, (ii) developed, (iii) reduced to practice or (iv)
shown to have utility during the term of this Agreement by one or more employees
or Third Parties working on behalf of GAMETE (including ▇▇▇▇▇▇ ▇▇▇▇ M.D. or
▇▇▇▇▇▇ ▇▇▇▇▇ Ph.D. ("Drs. ▇▇▇▇ and Toner") pursuant to any consulting agreement
between either of ▇▇. ▇▇▇▇ or Dr. Toner and GAMETE or VIACELL) without the
involvement of one or more employees of VIACELL, as well as any and all Patents
covering the same.
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1.9. "GAMETE Field" shall mean the field of cryopreservation of
mammalian cells other than human oocytes.
1.10. "GAMETE Product" shall mean any service or product related to the
collection, processing and cryopreservation of mammalian cells other than human
oocytes in any country in the Territory for which the development, manufacture
or sale of any such product or any process undertaken in the provision of such
services is covered by a Valid Claim of any Patent covering VIACELL Development
Technology or Joint Development Technology.
1.11. "GAMETE Royalty Term" shall mean the period beginning on the
Effective Date and ending, on a country by country basis on the date of the
expiration of the last to expire Valid Claim included in any Patent covering
VIACELL Development Technology that covers a GAMETE Product.
1.12. "Invention" shall mean any new or useful method, process,
manufacture, compound or composition of matter, whether or not patentable or
copyrightable, or any improvement thereof.
1.13. "Joint Development Committee" shall mean the entity organized and
acting pursuant to Section 4.
1.14. "Joint Development Technology" shall mean all Inventions and
Know-How first (i) conceived, (ii) developed, (iii) reduced to practice or (iv)
shown to have utility by one or more employees or Third Parties working on
behalf of VIACELL, on the one hand, with one or more employees or Third Parties
working on behalf of GAMETE or by either of Drs. ▇▇▇▇ or Toner in their capacity
as consultants to VIACELL, on the other hand, in connection with the development
of Covered Products, as well as any and all Patents covering the same.
1.15. "Know-How" shall mean unpatented technical and other information
which is not in the public domain including information comprising or relating
to discoveries, inventions, data, designs, formulae, methods, models, assays,
research plans, procedures, designs for experiments and tests and results of
experimentation and testing (including results of research or development),
processes (including manufacturing processes, specifications and techniques),
laboratory records, chemical, pharmacological, toxicological, clinical,
analytical and quality control data, trial data, case report forms, data
analyses, reports or summaries and information contained in submissions to and
information from ethical committees and regulatory authorities. Know-How
includes rights protecting Know-How. The fact that an item is known to the
public shall not be taken to exclude the possibility that a compilation
including the item, and/or a development relating to the item, is (and remains)
not known to the public.
1.16. "MGH License Agreement" shall mean that certain License Agreement
dated April 29, 2003, by and between GAMETE and MGH, as amended from time to
time. A copy of such Agreement, including all amendments executed prior to the
execution of this Agreement, is attached hereto as Exhibit A.
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1.17. "MGH Patent Rights" shall mean the PATENT RIGHTS, as such term is
defined in the MGH License Agreement. A list of all such MGH Patent Rights in
existence on the Effective Date is included in Exhibit B attached hereto.
1.18. "MGH Royalty Term" shall mean the period beginning on the Effective
Date and ending on the earlier of (i) the termination of the MGH License
Agreement, as amended from time to time, or (ii) the date on which GAMETE is no
longer required to make royalty payments to MGH pursuant to the MGH License
Agreement.
1.19. "NDA" shall mean a New Drug Application to be filed with the FDA,
or the equivalent thereof in other countries or regulatory jurisdictions.
1.20. "Net Sales" shall mean the Gross Sales Price, as defined in (b) and
(c) below, received by VIACELL or any of its Affiliates or Sublicensees
("Sellers") for the sale or distribution of any Covered Product to a final
customer (who will be the service provider delivering services or Covered
Product rather than the recipient of such services) and is not an Affiliate or
Sublicensee ("Customer"), less (to the extent appropriately documented) the
following amounts actually paid out by VIACELL, its Affiliate or Sublicensee, or
credited against the amounts received by them from the sale or distribution of
any Covered Product:
(i) credits and allowances for price adjustment, rejection, or return of
Covered Products previously sold;
(ii) rebates and cash discounts to purchasers allowed and taken;
(iii) amounts for transportation, insurance, handling or shipping charges
to purchasers;
(iv) taxes, duties and other governmental charges levied on or measured by
the sale of Covered Products, whether absorbed by VIACELL or paid by the
purchaser so long as VIACELL's price is reduced thereby, but not franchise or
income taxes of any kind whatsoever; and
(v) for any sale in which the United States government on the basis of its
royalty-free license pursuant to 35 USC Sec. 202(c) to any MGH Patent Rights
requires that the Gross Sales Price of any Covered Product subject to such MGH
Patent Rights be reduced by the amount of such royalty owed GAMETE hereunder,
the amount of such royalty; provided that the aggregate of the amounts deducted
from the Gross Sales Price pursuant to clauses (i) through (iv) above shall not
exceed [**] of the Gross Sales Price to which such deductions relate.
Notwithstanding anything to the contrary in this Agreement, "Net Sales" shall
not include any revenue derived by VIACELL and/or its Affiliates and/or
Sublicensees from the storage of Covered Products.
(b) For any bona fide sale to a bona fide customer by VIACELL or any of
its Affiliates or Sublicensees, the Gross Sales Price shall be the gross billing
price of the
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Covered Product arrived at using the standard accounting procedures of VIACELL,
which procedures will be in accord with generally accepted accounting practices.
(c) If VIACELL or any of its Affiliates or Sublicensees sell any Covered
Product in a bona fide sale as a component of a combination of active functional
elements, the Gross Sales Price of the Covered Product shall be determined by
multiplying the Gross Sales Price of the combination by the fraction A over A +
B, in which "A" is the Gross Sales Price of the Covered Product portion of the
combination when sold separately during the applicable accounting period in the
country in which the sale was made, and "B" is the Gross Sales Price of the
other active elements of the combination sold separately during said accounting
period in said country. In the event that no separate sale of either such
Covered Product or active elements of the combination is made during said
accounting period in said country, the Gross Sales Price of the Covered Product
shall be determined by multiplying the Gross Sales Price of such combination by
the fraction C over C + D, in which "C" is the standard fully-absorbed cost of
the Covered Product portion of such combination, and "D" is the sum of the
standard fully-absorbed costs of the other active elements component(s), such
costs being arrived at using the standard accounting procedures of VIACELL which
will be in accord with generally accepted accounting practices.
(d) Transfer of a Covered Product within VIACELL or between VIACELL and an
Affiliate or Sublicensee for sale by the transferee shall not be considered a
sale, commercial use or disposition for the purpose of the foregoing paragraphs;
in the case of such transfer the Gross Sales Price shall be based on sale of the
Covered Product by the transferee.
1.21. "Net Storage Revenues" shall mean shall mean the gross revenue
derived by VIACELL and/or its Affiliates and/or Sublicensees from the storage of
oocytes cryopreserved through the use of Covered Products, less the following
items but only insofar as they are actually taken (as can be demonstrated by
VIACELL's records) and actually pertain to the storage of oocytes by VIACELL or
its Affiliates or Sublicensees, and are included in such gross revenue:
(a) Import, export, excise and sales taxes, and custom duties;
(b) Costs of insurance, packing, and transportation from the place of
preparation to the point of storage; and
(c) Credit for rebates, returns, allowances, or trades;
provided that the aggregate of the amounts deducted from the gross revenue
pursuant to clauses (a) through (c) above shall not exceed [**] of the gross
revenue to which such deductions relate.
1.22. "Party" shall mean GAMETE or VIACELL and, when used in the plural,
shall mean GAMETE and VIACELL.
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1.23. "Patents" shall mean all letters patent and patent applications
throughout the Territory, as well as any and all substitutions, extensions,
renewals, continuations, continuations-in-part, divisions, patents-of-addition
and/or reissues thereof.
1.24. "Person" shall mean any natural person, corporation, firm, business
trust, joint venture, association, organization, company, partnership or other
business entity, or any government or any agency or political subdivision
thereof.
1.25. "Royalty Term" shall mean the period beginning on the Effective
Date and ending, on a country by country and Covered Product by Covered Product
basis, on the later of (i) the date of the expiration of the last to expire
Valid Claim included in the MGH Patent Rights or GAMETE Development Technology
covering any aspect of a Covered Product and (ii) ten (10) years from the First
Commercial Sale of such Covered Product.
1.26. "Sublicensee" shall mean a Third Party to which VIACELL has
sublicensed rights under the MGH Patent Rights or the GAMETE Development
Technology.
1.27. "Territory" shall mean worldwide.
1.28. "Third Party" shall mean any Person who or which is neither a Party
nor an Affiliate of a Party.
1.29. "Valid Claim" shall mean (i) a pending claim in any patent
application that has not been pending for more than five (5) years, which shall
be treated as if such pending claim were issued in then-current form, or (ii) a
claim of any issued letters patent that, in each case, has not been held invalid
or unenforceable by final decision of a court or other governmental agency of
competent jurisdiction, unappealable or unappealed within the time allowed for
appeal, and that is not admitted to be invalid or unenforceable through reissue,
disclaimer or otherwise.
1.30. "VIACELL Development Technology" shall mean all Inventions and
Know-How first (i) conceived, (ii) developed, (iii) reduced to practice or (iv)
shown to have utility during the term of the Agreement by one or more employees
or Third Parties working on behalf of VIACELL without the involvement of one or
more employees of GAMETE or either or both of Drs. ▇▇▇▇ or Toner, as well as any
and all Patents covering the same.
2. REPRESENTATIONS AND WARRANTIES
2.1. REPRESENTATIONS AND WARRANTIES OF BOTH PARTIES. Each Party
represents and warrants to the other Party that, as of the Effective Date:
(a) Such Party is duly organized and validly existing under the laws of
the jurisdiction of its incorporation and has full corporate power and authority
to enter into this Agreement and to carry out the provisions hereof;
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(b) Such Party has taken all corporate action necessary to authorize the
execution and delivery of this Agreement and the performance of its obligations
under this Agreement; and
(c) This Agreement is a legal and valid obligation of such Party, binding
upon such Party and enforceable against such Party in accordance with the terms
of this Agreement, except as such enforceability may be affected by laws
affecting creditors' rights generally and general equitable principles. The
execution, delivery and performance of this Agreement by such Party do not
conflict with any agreement, instrument or understanding, oral or written, to
which such Party is a party or by which such Party may be bound, or violate any
law or regulation of any court, governmental body or administrative or other
agency having authority over such Party. All consents, approvals and
authorizations from all governmental authorities or other Third Parties required
to be obtained by such Party in connection with the execution, delivery and
performance of this Agreement have been obtained.
2.2. ADDITIONAL REPRESENTATIONS AND WARRANTIES OF GAMETE. GAMETE
represents and warrants to VIACELL that, as of the Effective Date:
(a) GAMETE and/or its Affiliates are the owner of, or have exclusive
rights to, all of the Patents included in the MGH Patent Rights (except as
expressly provided in the copy of the MGH License Agreement attached as Exhibit
A) in existence on the Effective Date in the field of oocyte cryopreservation,
and have the exclusive right to grant the licenses or sublicenses, as the case
may be, therefor granted under this Agreement;
(b) All such Patents consist of either patent applications that have been
filed and are pending and actively being prosecuted as of the Effective Date, or
issued letters patent that are in full force and effect and have been maintained
through the Effective Date;
(c) GAMETE is not aware of any asserted or unasserted claim or demand
which it believes can be enforced by a Third Party against any such Patents;
(d) To the best of GAMETE's knowledge and belief, without investigation,
the practice of such Patents and the exercise of the rights granted to VIACELL
in Section 6 do not infringe upon or conflict with any patent, copyright or
other proprietary right of any Third Party;
(e) The Know-How and Inventions subject to this Agreement were not
obtained by GAMETE, and to the best of GAMETE's knowledge and belief, without
investigation, were not obtained by MGH, in violation of any contractual or
fiduciary obligation to which GAMETE, MGH or any of their respective employees
or staff members are or were bound, or by the misappropriation of the trade
secrets of any Third Party;
(f) GAMETE has not entered into any agreement with any Third Party which
is in conflict with the rights granted to VIACELL under to this Agreement, and
the
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execution and performance of this Agreement by GAMETE do not and shall not
violate any agreement or undertaking to which GAMETE is a party; and
(g) To the best of GAMETE's knowledge and belief, all of the data and
information that GAMETE has provided to VIACELL prior to the Effective Date
relating to Patents, Know-How and Inventions, and to Covered Products in
general, are reasonably accurate, and GAMETE has not omitted therefrom any
material data or material information in GAMETE's possession or control
reasonably in advance of the Effective Date concerning the same.
3. MGH LICENSE AGREEMENT
3.1. REPRESENTATIONS AND WARRANTIES OF GAMETE. GAMETE represents and
warrants to VIACELL that, as of the Effective Date:
(a) The MGH License Agreement is in full force and effect and has not
been modified or amended, except that no representation or warranty is made with
respect to MGH or matters solely within the control or direction of MGH that are
not known to GAMETE;
(b) To the best of GAMETE's knowledge and belief, neither MGH nor GAMETE
is in default with respect to a material obligation under, and neither such
party has claimed or has grounds upon which to claim that the other party is in
default with respect to a material obligation under, the MGH License Agreement;
(c) To the best of GAMETE's knowledge and belief, the rights that MGH has
licensed to GAMETE pursuant to the MGH License Agreement were not and are not
subject to any restrictions or limitations except as set forth in the copy of
the MGH License Agreement attached as Exhibit A; and
(d) GAMETE has not waived or allowed to lapse any of its rights under the
MGH License Agreement, and no such rights have lapsed or otherwise expired or
been terminated.
3.2. GAMETE OBLIGATIONS. GAMETE agrees that during the term of this
Agreement:
(a) GAMETE will use commercially reasonable efforts to fulfill its
obligations under the MGH License Agreement to the extent such obligations have
not been delegated to VIACELL and to the extent that failure to do so would
adversely affect VIACELL or its rights hereunder;
(b) GAMETE shall not enter into any subsequent agreement with MGH that
modifies or amends the MGH License Agreement in any way that could potentially
adversely affect VIACELL's rights or economic interest under this Agreement
without VIACELL's prior written consent, and shall provide VIACELL with a copy
of all modifications to or amendments of the MGH License Agreement, regardless
of whether VIACELL's consent was required with respect thereto; provided that,
GAMETE may
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redact confidential portions of any such modifications and amendments, but only
to the extent that any such redactions do not impair VIACELL's ability to take
full advantage of its rights and benefits under this Agreement;
(c) GAMETE shall not terminate the MGH License Agreement in whole or in
part, directly or indirectly, without VIACELL's prior written consent;
(d) GAMETE shall promptly furnish VIACELL with copies of all reports and
other communications GAMETE receives from MGH that relate to the MGH License
Agreement; provided that GAMETE may redact confidential portions of any such
reports and other communications, but only to the extent that any such
redactions do not impair VIACELL's ability to take full advantage of its rights
and benefits under this Agreement;
(e) GAMETE shall promptly furnish VIACELL with copies of all reports and
other communications that GAMETE furnishes to MGH that relate to the MGH License
Agreement, and to the extent any such reports or communications relate to the
efforts of VIACELL under this Agreement, GAMETE shall give VIACELL a reasonable
opportunity to review and comment upon such reports or communications before
they are transmitted to MGH;
(f) GAMETE shall furnish VIACELL with copies of all notices received by
GAMETE relating to any alleged breach or default by GAMETE under the MGH License
Agreement within three (3) business days after GAMETE's receipt thereof and, if
GAMETE cannot or chooses not to cure or otherwise resolve any such alleged
breach or default, GAMETE shall so notify VIACELL within five (5) days
thereafter and allow VIACELL, in VIACELL's sole discretion, to cure or otherwise
resolve any such alleged breach or default; and
(g) GAMETE, acting as an intermediary between MGH and VIACELL, shall
allow VIACELL to enjoy the direct benefit of all of GAMETE's affirmative rights,
to the extent they relate to the MGH Patent Rights.
3.3. VIACELL OBLIGATIONS. VIACELL agrees that during the term of this
Agreement:
(a) With respect to any sublicensing by VIACELL of the licenses granted
by GAMETE to VIACELL in Section 6.1 hereof:
(i) VIACELL will comply with the first sentence of Section 2.2 and
Section 2.3 in its entirety of the MGH License Agreement as if VIACELL
were the "COMPANY" for purposes of those provisions; provided, however,
that VIACELL may, without obtaining MGH's prior written consent, grant a
sublicense of the licenses granted by GAMETE to VIACELL in Section 6.1
hereof to any party using a form of sublicensing agreement in
substantially the same form as an agreement that has at any time been
approved in writing by MGH, and agrees to notify MGH thereof; and
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(ii) VIACELL will comply with the first two sentences of Section 5.4
of the MGH License Agreement as if VIACELL were the "COMPANY" for purposes
of that provision.
(b) VIACELL will insure and indemnify MGH to the full extent that MGH is
entitled to be insured and indemnified under Sections 8.1 and 8.2 of the MGH
License Agreement as if VIACELL were the "COMPANY" for purposes of those
provisions.
4. JOINT DEVELOPMENT COMMITTEE; CONSULTING ARRANGEMENTS
4.1. MEMBERS. The Parties shall establish a Joint Development Committee
(the "Joint Development Committee"), which shall comprise three (3)
representatives designated by each Party (or such other number as the Parties
may agree in writing) with GAMETE choosing three from among its four designees
to attend each meeting of the Joint Development Committee in its sole
discretion. The initial members of the Joint Development Committee are set forth
on Exhibit C. Any member of the Joint Development Committee may be represented
at any meeting by a designee who is appointed by the Party designating such
member for such meeting and who has authority to act on behalf of such member,
as evidenced by written notice from the Party designating such member to the
chairperson of the Joint Development Committee. The chairperson of the Joint
Development Committee shall be one of the representatives designated by VIACELL.
The initial chairperson is designated on Exhibit C. Each Party shall be free to
replace its representative members with new appointees who have authority to act
on behalf of such Party on the Joint Development Committee, on written notice to
the other Party.
4.2. RESPONSIBILITIES. The Joint Development Committee shall be
responsible for planning, overseeing and directing the development and
commercialization of, and regulatory filings relating to, Covered Products,
including, without limitation, overseeing all clinical trial activities,
protocol cross-training, coordination of activities among in vitro fertilization
centers and overseeing project budgets. In addition, the Joint Development
Committee shall be responsible for directing prototype device investigation and
device design.
4.3. MEETINGS. The Joint Development Committee shall meet as frequently
as the Parties deem appropriate during the first three-year period following the
Effective Date and quarterly (or more frequently, as agreed upon by the Parties)
during the next two-year period, on such dates and at such times as the Parties
shall agree, on ten (10) days' written notice to the other Party unless such
notice is waived by the other Party. The Joint Development Committee may convene
or be polled or consulted from time to time by means of telecommunications,
video conferences or correspondence, as deemed necessary or appropriate by the
Parties. To the extent that meetings are held in person, they shall alternate
between the offices of the Parties unless the Parties otherwise agree. The
chairperson shall be responsible for sending notices of meetings to all members.
4.4. DECISIONS.
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(a) A quorum for a meeting of the Joint Development Committee shall
require the presence of at least one GAMETE member (or designee) and at least
one VIACELL member (or designee) in person or by telephone. All decisions made
or actions taken by the Joint Development Committee shall be made unanimously by
its members, with the GAMETE members present at a meeting cumulatively having
one vote and the VIACELL members present at a meeting cumulatively having one
vote.
(b) In the event that unanimity cannot be reached by the Joint
Development Committee with respect to a matter that is a subject of its
decision-making authority within thirty (30) days after the matter is first
brought before the Joint Development Committee, then (i) if, and to the extent
that, the matter regards the scientific development of Covered Products and/or
clinical trials of Covered Products (including, without limitation, the matters
described in Section 7.4 hereof), the matter shall be decided by ▇▇. ▇▇▇▇ in
good faith and (ii) for all other matters, the matter shall be decided by the
chairperson of the Joint Development Committee in good faith; provided that,
with respect to matters described in clause (i) above, without VIACELL's
consent, no such decision by ▇▇. ▇▇▇▇ shall require any expenditure by VIACELL
greater than the expenditure that would be required if the matter were decided
as VIACELL proposed in good faith.
4.5. MINUTES. Within fifteen (15) days after each Joint Development
Committee meeting, VIACELL shall prepare and distribute minutes of the meeting,
which shall provide a description in reasonable detail of the discussions had at
the meeting and a list of any actions, decisions or determinations approved by
the Joint Development Committee at such meeting. VIACELL shall be responsible
for circulation of all draft and final minutes. Draft minutes shall be
circulated to all members of the Joint Development Committee sufficiently in
advance of the next meeting to allow review and comment prior to the meeting.
Minutes shall be approved or disapproved, and revised as necessary, at the next
meeting. Final minutes shall be distributed to the members of the Joint
Development Committee.
4.6. TERM. The Joint Development Committee shall exist until the
expiration of the Royalty Term for all Covered Products.
4.7. EXPENSES. Each Party shall be responsible for all travel and
related costs for its representatives to attend meetings of, and otherwise
participate on, the Joint Development Committee.
4.8. CONSULTING. GAMETE will provide the consulting services to VIACELL
described in Exhibit D hereto, providing the personnel identified in such
Exhibit D in rendering such services. Exhibit D may be amended from time to time
by mutual agreement of the Parties. In consideration of such consulting
services, VIACELL shall make the payments described in Section 8.8 of this
Agreement. If requested, VIACELL will enter into consulting agreements directly
with the individuals identified in Exhibit D, rather than engaging GAMETE to
provide the services described in Exhibit D. In connection with the execution of
this Agreement, each of Drs. ▇▇▇▇ and Toner shall enter into a consulting
agreement with VIACELL on terms mutually satisfactory to each of
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them and VIACELL, which terms shall include quarterly payments to each of Drs.
▇▇▇▇ and Toner of not less than $[**] per quarter. Unless earlier terminated by
GAMETE or Drs. ▇▇▇▇ or Toner, as applicable, the consulting arrangements
described in this Section shall continue at least until the time that the
aggregate royalty payments made by VIACELL to GAMETE under this Agreement exceed
$[**] in any 12 month period, net of any payments obligated to be made by GAMETE
to MGH under the MGH License Agreement (the "Termination Condition"), and may
thereafter be terminated by VIACELL in its sole discretion.
5. OWNERSHIP; PATENT PROTECTION
5.1. OWNERSHIP OF VIACELL DEVELOPMENT TECHNOLOGY. Except as otherwise
provided in this Agreement, the entire right, title and interest in and to all
VIACELL Development Technology shall be owned solely by VIACELL, and all
decisions regarding the protection of VIACELL Development Technology shall
remain with VIACELL.
5.2. OWNERSHIP OF MGH PATENT RIGHTS AND GAMETE DEVELOPMENT TECHNOLOGY.
Except as otherwise provided in this Agreement, the entire right, title and
interest in and to all GAMETE Development Technology and, as between the
Parties, MGH Patent Rights shall be owned solely by GAMETE, and, except as
otherwise set forth in this Agreement or the MGH License Agreement, all
decisions regarding the protection of MGH Patent Rights and GAMETE Development
Technology shall remain with GAMETE. GAMETE shall provide to VIACELL, within
ninety (90) days of the Effective Date, evidence reasonably satisfactory to
VIACELL that, subject only to the rights of MGH, all Inventions and Know-How
first (i) conceived, (ii) developed, (iii) reduced to practice or (iv) shown to
have utility in the Field by either or both of Drs. ▇▇▇▇ and Toner during the
term of this Agreement, as well as any patents covering the same, will be
assigned to GAMETE, except in the case of Joint Development Technology.
5.3. OWNERSHIP OF JOINT DEVELOPMENT TECHNOLOGY. Except as otherwise
set forth in the MGH License Agreement, VIACELL and GAMETE shall jointly own
all rights, title and interests in Joint Development Technology.
5.4. PATENT FILING, PROSECUTION AND MAINTENANCE.
(a) Reasonably promptly after the Effective Date the Joint Development
Committee, in consultation with the Parties' respective patent counsel, shall
agree upon a patent filing policy with respect to the Joint Development
Technology and the GAMETE Development Technology. In addition, from time to
time, the Joint Development Committee shall determine, in accordance with such
policy, whether and in what jurisdictions patent applications should be filed
with respect to any Know-How or Inventions included in the Joint Development
Technology and the GAMETE Development Technology. GAMETE shall have the right to
file and prosecute patent applications with respect to any Know-How or
Inventions included in any GAMETE Development Technology or Joint Development
Technology in any jurisdiction in which it is determined in accordance with such
policy not to file such applications. Unless
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otherwise agreed by the Parties, all expenses incurred in connection with the
prosecution and maintenance of Patents covering Joint Development Technology
shall be borne equally by the Parties.
(b) The preparation, filing, prosecuting and maintenance of Patents
included in the MGH Patent Rights shall be accomplished as provided in the MGH
License Agreement, subject to the provisions of this Agreement and the right of
VIACELL to direct the prosecution and maintenance of patent applications and
patents included in the MGH Patent Rights to the extent GAMETE has such rights
under the MGH License Agreement and to direct the substance of any comments
which GAMETE may have the right to provide regarding such Patents. Furthermore,
the Parties' respective rights and obligations under this Section shall be
subject, in all events, to any superior rights of MGH under the MGH License
Agreement regarding the MGH Patent Rights.
(c) If GAMETE elects to abandon the prosecution or maintenance of any MGH
Patent Right in any country pursuant to Section 4.5 of the MGH License
Agreement, and MGH elects not to assume the prosecution or maintenance of such
MGH Patent Right, GAMETE shall so notify VIACELL. If VIACELL notifies GAMETE
that VIACELL wishes to assume the prosecution or maintenance of such MGH Patent
Right, GAMETE shall take all actions in connection with the MGH License
Agreement and shall otherwise assist VIACELL in assuming the prosecution and
maintenance of such abandoned patents.
6. GRANT OF LICENSES
6.1. EXCLUSIVE SUBLICENSE GRANT BY GAMETE. GAMETE hereby grants VIACELL
an exclusive royalty-bearing right and sublicense in the Field throughout the
Territory, with the right to grant further sublicenses in accordance with the
terms of this Agreement, under the MGH Patent Rights to research, develop, have
developed, use, manufacture, have manufactured, sell, offer for sale and have
sold Covered Products.
6.2. EXCLUSIVE LICENSE GRANT BY GAMETE. GAMETE hereby grants to VIACELL
an exclusive royalty-bearing right and license in the Field throughout the
Territory, with the right to grant sublicenses in accordance with the terms of
this Agreement, under GAMETE's interest in the GAMETE Development Technology and
the Joint Development Technology to research, develop, have developed, use,
manufacture, have manufactured, sell, offer for sale and have sold Covered
Products.
6.3. NON-EXCLUSIVE SUBLICENSE GRANT BY GAMETE. In the event that, during
the term of this Agreement, GAMETE licenses from any Third Party rights in the
Field to any Valid Claim of any issued patent or patent application issued to a
Third Party that may be necessary for VIACELL's exercise of its rights hereunder
to research, develop, make, have made, use, sell, offer for sale, have sold,
import or export any Covered Product (a "GAMETE Third Party License"), GAMETE
shall promptly so notify VIACELL of the terms of such GAMETE Third Party License
and the rights covered by such license. Upon request by VIACELL, and to the
extent not prohibited by such GAMETE Third Party License, GAMETE shall grant to
VIACELL, and does
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hereby grant to VIACELL, a non-exclusive right and sublicense in the Field
throughout the Territory, with the right to grant further sublicenses in
accordance with the terms of this Agreement, under the rights granted to GAMETE
under the GAMETE Third Party License to research, develop, have developed, use,
manufacture, have manufactured, sell, offer for sale and have sold Covered
Products. GAMETE shall use reasonable efforts to secure the right to grant the
sublicense under this Section in any GAMETE Third Party License.
6.4. EXCLUSIVE LICENSE GRANT BY VIACELL. VIACELL hereby grants to GAMETE
an exclusive royalty-bearing right and license in the GAMETE Field throughout
the Territory, with the right to grant sublicenses in accordance with the terms
of this Agreement, under VIACELL's interest in the VIACELL Development
Technology and the Joint Development Technology to research, develop, have
developed, use, manufacture, have manufactured, sell, offer for sale and have
sold GAMETE Products.
6.5. NON-EXCLUSIVE SUBLICENSE GRANT BY VIACELL. In the event that, during
the term of this Agreement, VIACELL licenses from any Third Party rights in the
GAMETE Field to any Valid Claim of any issued patent or patent application
issued to a Third Party that may be necessary for GAMETE's exercise of its
rights hereunder to research, develop, make, have made, use, sell, offer for
sale, have sold, import or export any GAMETE Product (a "VIACELL Third Party
License"), VIACELL shall promptly so notify GAMETE of the terms of such VIACELL
Third Party License and the rights covered by such license. Upon request by
GAMETE, and to the extent not prohibited by such VIACELL Third Party License,
VIACELL shall grant to GAMETE, and does hereby grant to GAMETE, a non-exclusive
right and sublicense in the GAMETE Field throughout the Territory, with the
right to grant further sublicenses in accordance with the terms of this
Agreement, under the rights granted to VIACELL under the VIACELL Third Party
License to research, develop, have developed, use, manufacture, have
manufactured, sell, offer for sale and have sold GAMETE Products. VIACELL shall
use reasonable efforts to secure the right to grant the sublicense under this
Section in any VIACELL Third Party License.
6.6. SCOPE OF EXCLUSIVITY. The licenses granted Pursuant to Sections 6.1,
6.2 and 6.4 shall be exclusive even as to the Party granting such license,
except to the extent necessary for the granting Party to perform its obligations
under this Agreement.
6.7. PROVISIONS REGARDING SUBLICENSES. Subject to the provisions of the
MGH License Agreement, any sublicense by either Party of the rights granted to
such Party hereunder shall be consistent with the terms of this Agreement and
shall include an obligation for the Sublicensee to comply with the applicable
obligations of the sublicensing Party set forth in this Agreement, including
without limitation Section 3.3. VIACELL shall not, without GAMETE's prior
consent, grant any sublicense hereunder that would, upon the application of
Section 12.7 hereof, impose obligations on GAMETE greater than those obligations
of GAMETE contained in this Agreement. VIACELL shall provide to GAMETE a copy of
each sublicense hereunder, which may be redacted
14
by VIACELL to prevent the disclosure of confidential information, but which
shall permit verification by GAMETE of compliance with the provisions of this
Agreement.
6.8. TRANSFER OF INFORMATION. Promptly following the Effective Date,
GAMETE shall coordinate with the Joint Development Committee and provide copies
of and access to all information relating to the MGH Patent Rights in its
possession. Thereafter, each of GAMETE and VIACELL will provide copies of and
access to all information relating to the MGH Patent Rights, GAMETE Development
Technology or VIACELL Development Technology to the other Party as soon as
practicable after it becomes available or is conceived.
7. DEVELOPMENT AND COMMERCIALIZATION
7.1. DEVELOPMENT EFFORTS BY VIACELL. VIACELL shall, either itself or
through its Affiliates or Sublicensees, at its own expense, or at the expense of
its Affiliates or Sublicensees, diligently conduct the development of Covered
Products within the Territory. VIACELL shall exercise in the performance of such
development commercially reasonable technical skill and competence. Such
diligent efforts shall include, without limitation, the expenditure by VIACELL
of not less than $2,500,000 during the first eighteen (18) months following the
Effective Date (of which not less than $1,500,000 shall be expended before April
29, 2004) relating to the development and commercialization of Covered Products
(which amount shall include all amounts required to be paid by VIACELL during
such 18-month period pursuant to Section 8 hereof). In addition, without
limiting the foregoing, VIACELL shall use diligent efforts to achieve the
following objectives ("MILESTONES"):
(a) within [**] of the effective date of the MGH License Agreement (April
29, 2003) (the "MGH Effective Date"), VIACELL and GAMETE shall furnish MGH with
a written research and development plan describing the major tasks to be
achieved in order to bring to market Covered Products and specifying the number
of staff and other resources to be devoted to such commercialization effort;
(b) within [**] of the MGH Effective Date, VIACELL, either on its own
behalf or through any Sublicensees in the United States, shall initiate clinical
trial evaluations for Covered Products in a minimum of five patients;
thereafter, COMPANY shall pursue diligently such clinical trial evaluations and
in connection therewith take all actions necessary, if any, under the Food, Drug
and Cosmetic Act (21 USC 301-391) or the equivalent federal regulatory agency
required for U.S. market approval;
(c) within [**] of the MGH Effective Date, VIACELL either on its own
behalf or through any Sublicensee, shall develop systems or procedures which
standardize the delivery of cryoprotectants to oocytes by clinicians;
(d) within the period ending on the later to occur of (i) the date [**]
of the MGH Effective Date; or (ii) the date [**] after receipt of approval for
the U.S. market (to the extent necessary), VIACELL shall introduce the first
Covered Product to market in the U.S;
15
(e) within [**] of the MGH Effective Date, VIACELL, either on its own
behalf or through any Sublicensee, shall announce and market for general
commercial sale a Covered Product outside the United States;
provided, however, that, upon request by VIACELL or GAMETE, GAMETE and VIACELL
shall jointly present to MGH, pursuant to the MGH License Agreement, revisions
to the milestones described in clauses (a) through (e) above, or in the
designated time periods, with supporting evidence of technical difficulties or
delays in financing, clinical studies, technical difficulties, or regulatory
processes that VIACELL or GAMETE shall deem appropriate; and provided further,
that VIACELL may, after consultation with GAMETE, on behalf of GAMETE and
pursuant to Section 3.2 of the MGH License Agreement, pay to MGH [**] in
exchange for a [**] to any of the milestones described in clauses (a) through
(e) above.
7.2. REGULATORY FILINGS. The Joint Development Committee shall determine
all regulatory strategy and direct the content of all regulatory filings
relating to Covered Products. All INDs, NDAs and other regulatory filings made
or filed with respect to any Covered Products shall be in the name of, and be
owned solely by, VIACELL. VIACELL shall promptly provide to GAMETE copies of all
correspondence related to Covered Products delivered to or received from the
FDA. In addition to the foregoing, GAMETE hereby grants to VIACELL an
irrevocable right to reference all regulatory submissions, approvals,
clearances, data and other documents and information related to the Covered
Products existing on the Effective Date.
7.3. COMMERCIALIZATION EFFORTS BY VIACELL. VIACELL shall, either itself
or through its Affiliates or Sublicensees, at its own expense, or at the expense
of its Affiliates or Sublicensees, diligently commercialize Covered Products
within the Territory. Such diligence shall include commencement of sales of
Covered Products in each of the United States, England, France, Germany, Spain
and Italy within the time periods described in Sections 7.1(d) and 7.1(e).
Following commencement of sales of Covered Products, VIACELL shall maintain
active sales of Covered Products in each of the countries listed in the
preceding sentence and shall, no later than sixty (60) days prior to the end of
each calendar year following the commencement of sales of Covered Product,
provide the Joint Development Committee with a good faith estimate of the amount
of Net Sales anticipated for each Covered Product for the succeeding year, which
estimate shall be the same estimate of sales of Covered Products provided by
management of VIACELL to its Board of Directors as a part of VIACELL'S annual
budgeting process (with respect to each such year, the "Sales Estimate"). In
addition, at least sixty (60) days prior to commencement of sales of Covered
Products in a new territory, VIACELL shall provide the Joint Development
Committee with a Sales Estimate for such new territory covering the first twelve
months following such commencement of sales. VIACELL's obligations under this
Section shall include the obligation to achieve the worldwide Net Sales of
Covered Products for each year of not less than [**] of the Net Sales set forth
in the applicable Sales Estimate or, if VIACELL fails to achieve such [**] level
of Net Sales, it shall nonetheless pay to GAMETE the amount of royalties
calculated pursuant to Section 8.2 hereof based on such level of Net Sales.
Notwithstanding anything else contained herein, VIACELL may suspend active
16
sales in any jurisdiction in which such suspension is required by applicable
regulatory authorities, there is any adverse event with respect to the Covered
Products or any other condition arises or exists which, in the reasonable
judgment of VIACELL, requires or makes commercially appropriate the suspension
of sales of Covered Products, in which event such sales shall be suspended for
as short a duration as is necessary or appropriate.
7.4. ADDITIONAL IN VITRO FERTILIZATION CENTERS. Except as otherwise set
forth in this Agreement, all clinical trial activities regarding Covered
Products before commercialization of Covered Products shall take place at Boston
IVF, except that VIACELL may expand the clinical study to multiple in vitro
fertilization centers at its own cost with the approval of the Joint Development
Committee which approval shall not be unreasonably withheld. The approval of the
Joint Development Committee shall be based on the assessment of the sites
proposed and the VIACELL/GAMETE scientific team's ability to transfer technology
and teach protocol without negatively impacting performance at Boston IVF.
7.5. REPORTING. (a) VIACELL shall promptly notify GAMETE concerning
any happening or circumstance that VIACELL reasonably believes may jeopardize
GAMETE's rights under the MGH License Agreement, and VIACELL shall reasonably
cooperate with GAMETE to prevent any such loss.
(b) Following any acquisition of or by GAMETE (whether through merger,
consolidation, acquisition (directly or indirectly) of stock representing thirty
percent (30%) or more of the outstanding voting stock or other of its equity
securities, sale of all or substantially all of its assets, or otherwise) by or
of any Third Party that is a competitor of VIACELL (the determination of whether
such Third Party is a competitor of VIACELL shall include, but not be limited
to, a determination as to whether such Third Party is developing or marketing a
product or service competitive with a Covered Product or whether such Third
Party is developing or marketing a product or service competitive with any
product or service under development or being marketing by VIACELL), VIACELL
shall not be required to include in any report furnished by VIACELL pursuant to
this Agreement, or provide to any representative of GAMETE (or any successor
thereto), any information that VIACELL, acting in good faith, determines to be
competitively sensitive or enabling information, unless such information is
required for compliance with the obligations to MGH under the MGH License
Agreement, in which event GAMETE or its successor, as the case may be, and MGH
(if it shall receive such information) shall execute a nondisclosure and nonuse
agreement, reasonably satisfactory to VIACELL in form and substance, concerning
all such information.
(c) VIACELL shall submit to GAMETE, no less frequently than once per
calendar quarter, a report detailing VIACELL's progress toward meeting the
development and commercialization objectives described in this Section 7,
including without limitation an accounting of funds expended in such efforts.
7.6. TRADEMARKS. VIACELL shall market the Covered Products throughout
the Territory under trademarks (collectively, the "Trademarks") selected by
VIACELL.
17
VIACELL shall own all right, title and interest in and to such Trademarks and
shall bear all costs and expenses of registering, and maintaining the
registration of, same.
8. MONETARY OBLIGATIONS
8.1. FUNDING OF DEVELOPMENT. VIACELL shall pay the following amounts
related to the development of Covered Products:
(a) TECHNOLOGY TRANSFER AND CLINICAL DEVELOPMENT COSTS. VIACELL shall
reimburse GAMETE for costs incurred by Boston IVF to fund clinical development
of Covered Products, up to a maximum amount of [**], separate and apart from the
reimbursement described in Section 8.1(b). Such amounts shall be paid within 30
days of receipt by VIACELL of the accounting described in Section 8.1(d) below.
(b) LABORATORY EQUIPMENT. VIACELL shall reimburse GAMETE and/or Boston
IVF up to an aggregate of [**] solely to fund the purchase of laboratory
equipment at a single in vitro fertilization center for the development or sale
of Covered Products, separate and apart from the reimbursement described in
Section 8.1(a). The timing, amount and selection of such equipment shall be
determined by the Parties. Such amounts shall be paid within 30 days of receipt
by VIACELL of the accounting described in Section 8.1(d) below.
(c) GAMETE EMBRYOLOGIST. VIACELL shall reimburse up to [**] to cover the
fully loaded employment costs of an embryologist hired by GAMETE. Such amounts
shall be paid within 30 days of receipt by VIACELL of the accounting described
in Section 8.1(d) below. GAMETE acknowledges that $100,000 of such amount has
been advanced by VIACELL to GAMETE pursuant to a letter agreement dated February
13, 2003 and that, as a result, VIACELL has an additional obligation of only
$[**] pursuant to this Section.
(d) PERIODIC ACCOUNTING. During the period that VIACELL is required to
make any payments pursuant to this Section 8.1, for each of the expenditures
described in Sections (a) through (c) above, GAMETE shall provide to VIACELL on
a periodic basis (no less frequently than quarterly) a detailed accounting of
GAMETE's expenditures in such period.
8.2. ROYALTIES. (a) Subject to Section 8.2(b), 8.2(e), 8.4 and 8.8, in
partial consideration of the rights and licenses granted to VIACELL under this
Agreement, VIACELL shall pay GAMETE a royalty on Net Sales of each Covered
Product, on a country by country basis, commencing on the First Commercial Sale
of each Covered Product by VIACELL or its Affiliates in each country in the
Territory, in an amount equal to the percentage of the world-wide Net Sales of
such Covered Product by VIACELL and its Affiliates throughout the Territory
during each calendar year (or portion thereof) during the term of this Agreement
as set forth below.
1. Patented Covered Products. [**]
18
2. Expired Covered Products or [**]
Development Technology Covered
Products.
3. Expired Covered Products with [**]
Generic Competition or Development
Technology Covered Products with
Generic Competition.
"Generic Competition" shall exist:
(i) with respect to Expired Covered Products, when (A) one or more
products or services which would have infringed the expired or invalidated
Valid Claims included in the MGH Patent Rights or covering the GAMETE
Development Technology that had covered the development, manufacture or
sale, or any process undertaken in the provision, of such Expired Covered
Product is being sold in the country in the Field and (B) the sale of such
other products or services constitutes at least [**] Expired Covered
Products are being sold in such country; or
(ii) with respect to Development Technology Covered Products, when
(A) one or more products or services that competes directly with such
Development Technology Covered Product is being sold in the country in the
Field and (B) the sale of such other products or services constitutes at
least [**] Development Technology Covered Products are being sold in such
country.
(b) Notwithstanding the foregoing, VIACELL's obligation to make payments
with respect to each Covered Product in each country in the Territory under
Sections 8.2(a) shall expire upon the expiration of the Royalty Term with
respect to such Covered Product in such country.
(c) The obligation to pay royalties to GAMETE under Section 8.2(a) is
imposed only once with respect to the same unit of a Covered Product, regardless
of the number of Patents pertaining thereto, and shall not be in lieu of any
payment obligation that may be imposed pursuant to Section 8.2(d).
(d) VIACELL shall pay GAMETE a royalty on Net Storage Revenues,
commencing on the initial receipt ("First Storage Payment Date") by VIACELL or
its Affiliates of payment for the storage of cryopreserved human oocytes, in an
amount equal to [**] of worldwide Net Storage Revenues by VIACELL and its
Affiliates throughout the Territory during each calendar year (or portion
thereof) during the term of this Agreement. Notwithstanding the foregoing,
VIACELL's obligation to make payments with respect to Net Storage Revenues under
this Section 8.2(d) shall expire on the expiration of the Royalty Term
applicable to the Covered Product to which such Net Storage Revenues apply.
19
(e) Notwithstanding the foregoing, the amount of any royalties owed under
Section 8.2(a) with respect to Covered Products based solely on Joint
Development Technology shall be equal to [**] of the amount indicated in the
table in Section 8.2(a).
8.3. PAYMENT OF MILESTONES. VIACELL shall pay to GAMETE the following
amounts within fifteen (15) days following the occurrence of each of the
following events:
(a) $[**] upon the First Commercial Sale of a Covered Product in the
United States;
(b) $[**] upon the First Commercial Sale of a Covered Product outside of
the United States; and
(c) $25,000 upon the execution of this Agreement.
VIACELL shall be entitled to credit [**] of the amounts paid by it to
GAMETE pursuant to this Section against royalty obligations of VIACELL to GAMETE
pursuant to Section 8.2(a) hereof. Such credit shall be applied, to the extent
possible, ratably over the first four quarterly royalty payments made by
VIACELL.
8.4. THIRD PARTY PAYMENTS. (a) VIACELL, at its sole expense, shall pay
all amounts owing to any Third Party to obtain rights to any Valid Claims of any
issued patent or patent application issued to Third Parties determined by the
Joint Development Committee to be necessary for VIACELL's exercise of its rights
hereunder to research, develop, make, have made, use, sell, offer for sale, have
sold, import or export any Covered Product (collectively, "Third Party
Payments"). Except as provided in Section 8.4(b), VIACELL shall not be entitled
to any credit under this Agreement on account of any Third Party Payments paid
by VIACELL.
(b) VIACELL shall be entitled, on a country by country basis, to credit
against payments due to GAMETE under this Agreement an amount equal to [**] of
the Third Party Payments paid by VIACELL; provided, however, that the
application of such credit shall not reduce the amounts payable by VIACELL under
this Agreement with respect to any given calendar quarter by more than [**].
Notwithstanding the foregoing, if VIACELL is required to pay an award of damages
or a settlement amount in the form of a reasonable royalty based on sales during
any period of previous infringement (as opposed to the on-going payment of a
running royalty), then such payment shall be allocated to the several calendar
quarters during such period of infringement, and the limits set forth in the
previous sentence shall apply to each portion of such payment allocated to a
specific quarter and not to such payment as a whole.
8.5. PAYMENTS UNDER MGH LICENSE. Except as otherwise explicitly provided
herein, GAMETE shall remain solely responsible to MGH for all payments due to
MGH under the MGH License.
20
8.6. PAYMENTS UNDER GAMETE THIRD PARTY LICENSES AND VIACELL THIRD PARTY
LICENSES. In the event that either VIACELL or GAMETE elects to receive a
sublicense under a GAMETE Third Party License or VIACELL Third Party License
pursuant to Section 6.3 or 6.5, respectively, the Party receiving such
sublicense shall pay to the Party granting such sublicense all amounts required
to be paid by the Party granting such sublicense to the Third Party licensor
solely in respect of the sublicense granted hereunder. GAMETE and VIACELL each
agree that they shall negotiate in good faith the terms of any GAMETE Third
Party License or VIACELL Third Party License so as to not unduly shift the
economic burden of such license to the Party receiving a sublicense pursuant to
Section 6.3 or 6.5 hereof.
8.7. PATENT EXPENSES. Within thirty (30) days of receipt of invoices from
GAMETE, VIACELL shall reimburse GAMETE for all reasonable attorneys fees and
expenses incurred by GAMETE in the prosecution and maintenance of the MGH Patent
Rights. VIACELL's reimbursement obligation under this Section 8.7 shall be
limited to One Hundred Thousand Dollars ($100,000) for fees and expenses
incurred in the first 18 months following the Effective Date. Following such
period, VIACELL shall assume all reasonable attorneys fees and expenses incurred
in the prosecution and maintenance of the MGH Patent Rights. In the event that
VIACELL gives written notice to GAMETE of its decision to discontinue
reimbursement of such fees and expenses with respect to one or more of the MGH
Patent Rights in a particular jurisdiction, VIACELL's sublicense under Section
6.1 to the specified MGH Patent Rights in the specified jurisdiction shall
terminate; provided, however, that VIACELL's sublicense to the MGH Patent Rights
in all other jurisdictions and (to the extent VIACELL elects to continue such
reimbursement in the specified jurisdiction with respect to some, but not all,
of the MGH Patent Rights) all other MGH Patent Rights in the specified
jurisdiction shall continue.
8.8. CONSULTING FEES. In consideration of the consulting services
provided by GAMETE pursuant to Section 4.8, VIACELL shall pay to GAMETE an
aggregate of $[**] per year, payable in [**] each, with the first such payment
due within five (5) days of the Effective Date hereof, pro rated for the portion
of the calendar quarter remaining after the Effective Date, and each successive
payment due by the first day of each successive calendar quarter. The payments
described in this Section shall be due whether or not VIACELL uses the
consulting services of GAMETE described in this Agreement. Unless earlier
terminated by GAMETE, the consulting arrangements described in this Section
shall continue at least until the first date (the "Cross-Over Date") that the
aggregate royalty payments made by VIACELL to GAMETE under this Agreement
exceeded $[**] in the immediately preceding 12-month period, net of any payments
obligated to be made by GAMETE to MGH under the MGH License Agreement (as so
calculated, the "Net Royalties"), and may thereafter be terminated by VIACELL in
its sole discretion. VIACELL shall be entitled to credit against future royalty
payments which it is obligated to pay hereunder, commencing with the first
quarterly royalty payment to be made after the first [**] in which the aggregate
royalty payments made by VIACELL to GAMETE under this Agreement exceed $[**] of
the aggregate royalty payments made by VIACELL to GAMETE with respect to any
periods prior to the Cross-Over Date; provided, however, that VIACELL may not
credit more than $[**] against royalty payments per calendar quarter.
21
8.9. ROYALTY PAYMENTS BY GAMETE. In consideration of the grant of rights
under Section 6.4 hereof, GAMETE shall pay to VIACELL, until the expiration of
the applicable GAMETE Royalty Term, a royalty equal to[**] of Net Sales of
GAMETE Products; provided, however, that the definition of "Net Sales" in
Section 1.20 and the provisions of Sections 8.2(b) and (c), and Article 9 of
this Agreement shall apply to GAMETE with respect to Net Sales of GAMETE
Products, substituting "GAMETE" for "VIACELL," "VIACELL" for "GAMETE" and
"GAMETE Product" for "Covered Product" in those Sections and that Article.
9. PAYMENTS AND REPORTS
9.1. PAYMENT. Except as otherwise provided in this Agreement, all royalty
and other payments due hereunder shall be paid quarterly within forty five (45)
days after the end of each calendar quarter. Each such payment shall be
accompanied by a statement listing: (i) on a Covered Product-by-Covered Product
and country-by-country basis, the quantity of Covered Products sold, the Gross
Sales Price for Covered Products sold, the amount of Net Sales and an itemized
list of deductions made to arrive at Net Sales during such quarter and the
amount and manner of calculation of royalties due on such Net Sales; and (ii)
the corresponding information with respect to Net Storage Revenues during such
quarter.
9.2. MODE OF PAYMENT. VIACELL shall make all payments required under this
Agreement as directed by GAMETE from time to time, in U.S. Dollars (except as
provided in Section 9.6). All royalties due hereunder shall first be determined
in the currency of the country in which the Covered Products in question were
sold and then converted into equivalent U.S. funds. The exchange rate for such
conversion shall be that rate quoted in The Wall Street Journal on the last
business day of the applicable reporting period.
9.3. RECORDS RETENTION. VIACELL and its Affiliates shall keep
complete and accurate records pertaining to the sale of Covered Products in
the Territory in accordance with the obligations therefor set forth in the
MGH License Agreement.
9.4. AUDIT REQUEST. At the request and expense (except as provided below)
of GAMETE, VIACELL and its Affiliates shall permit an independent, certified
public accountant appointed by GAMETE and reasonably acceptable to VIACELL, at
reasonable times and upon reasonable notice, to examine no more than once per
year those records and all other material documents relating to or relevant to
Net Sales and Net Storage Revenues in the possession or control of VIACELL and
its Affiliates, for a period of three years after such royalties have accrued.
The results of any such examination shall be made available to both Parties. If,
as a result of any inspection of the books and records of VIACELL or its
Affiliates, it is shown that VIACELL's royalty payments under this Agreement
were less than the amount which should have been paid, then VIACELL shall make
all payments required to eliminate any discrepancy revealed by said inspection
within forty-five (45) days after GAMETE's demand therefor. Furthermore, if the
aggregate royalty payments VIACELL made were less than ninety five (95%) of the
amount which should have been paid made during the period in
22
question, VIACELL shall also reimburse GAMETE for the reasonable out-of-pocket
cost of such inspection.
9.5. TAXES. In the event that VIACELL is required to withhold and make
payment of any tax to the tax or revenue authorities in any country in the
Territory in connection with any payment to GAMETE due to the laws of such
country which payment is credited to GAMETE's tax liability, such amount paid
and so credited shall be deducted from the royalty or other payment to be made
by VIACELL, and VIACELL shall notify GAMETE and promptly furnish GAMETE with
copies of any tax certificate or other documentation evidencing such withholding
and payment. Each Party agrees to cooperate with the other Party in claiming
exemptions from such deductions or withholdings under any agreement or treaty
from time to time in effect.
9.6. BLOCKED CURRENCY. If at any time legal restrictions prevent
VIACELL's prompt remittance of part or all of the royalties due with respect
to any country where a Covered Product is sold, VIACELL shall convert the
amount owed to GAMETE into U.S. funds and shall pay GAMETE directly from
VIACELL's U.S. source of funds for the amount impounded. VIACELL shall then
pay all future royalties due to GAMETE from VIACELL's U.S. source of funds so
long as the legal restrictions of this Section 9.6 still apply.
(a) LATE PAYMENTS. In the event that any payment VIACELL is required to
make hereunder is not made within thirty (30) days after such payment was
originally due, VIACELL shall pay interest on the past due amount at the rate of
eight percent (8%) per annum.
10. CONFIDENTIALITY
10.1. CONFIDENTIALITY; EXCEPTIONS. Except to the extent expressly
authorized by this Agreement or otherwise agreed in writing and subject to the
MGH License Agreement, the Parties agree that, during the term of this Agreement
and for five years thereafter, each Party, its Affiliates and its Sublicensees,
if any (collectively, a "receiving Party"), shall use their best efforts to keep
completely confidential, shall not publish or otherwise disclose to any Third
Party and shall not use for any purpose other than the performance of this
Agreement both the financial terms of this Agreement and any information
furnished to it by the other Party, its Affiliates or its Sublicensees, if any
(collectively, a "disclosing Party") (and shall ensure that its and its
Affiliates' and its Sublicensees' respective directors, officers, employees or
agents do likewise), except to the extent that it can be established by the
receiving Party by competent proof that such information: (i) is, or hereafter
becomes, generally available to the public other than by reason of any default
by the receiving Party with respect to its confidentiality obligations
hereunder; (ii) was already known to the receiving Party at the time of
disclosure by the disclosing Party; (iii) was lawfully disclosed to the
receiving Party by a Third Party not in default of any confidentiality
obligation to the disclosing Party; or (iv) is independently developed by or for
the receiving Party without reference to or reliance upon the information
furnished by the disclosing Party (all such information to which none of the
foregoing exceptions applies, "Confidential Information"). The GAMETE
Development
23
Technology shall be the Confidential Information of GAMETE and the VIACELL
Development Technology shall be the Confidential Information of VIACELL. The
Joint Development Technology shall be the Confidential Information of both
Parties.
10.2. EXCLUSIONS TO CONFIDENTIALITY. The restrictions contained in
Section 10.1 shall not apply to any Confidential Information in the hands of a
receiving Party that (i) is submitted by the receiving Party to governmental
authorities to facilitate the issuance of marketing approvals for a Covered
Product, provided that reasonable measures shall be taken to assure confidential
treatment of such information, if practicable; (ii) is provided by VIACELL or
GAMETE to any Third Party under appropriate terms and conditions, including
confidentiality provisions equivalent to those in this Agreement, for
consulting, manufacturing development, manufacturing, external testing,
marketing trials and sublicensing or potential sublicensing; or (iii) is
otherwise required to be disclosed in compliance with applicable laws or
regulations (including, without limitation, to comply with any governmental or
stock exchange disclosure requirements) or an order by a court or other
regulatory body having competent jurisdiction; provided, however, that if a
receiving Party is required to make any such disclosure of the disclosing
Party's Confidential Information such receiving Party shall, except where
impracticable for necessary disclosures (for example to physicians conducting
studies or to health authorities), give reasonable advance notice to the other
Party of such disclosure requirement and, except to the extent inappropriate in
the case of patent applications or otherwise, will use its best efforts to
secure confidential treatment of such Confidential Information required to be
disclosed. In addition, any press release or other public announcement permitted
by the terms of Section 14.8 hereof shall be excluded from the provisions of
Section 10.2.
10.3. INJUNCTIVE RELIEF. The Parties acknowledge that monetary damages
alone would not adequately compensate the disclosing Party in the event of a
material breach by the receiving Party of this Section 10, and that, in addition
to all other remedies available to the disclosing Party under this Agreement, at
law or in equity, it shall be entitled to injunctive relief for the enforcement
of its rights under this Section 10, without the posting of a bond or other
security.
11. INTELLECTUAL PROPERTY
11.1. PATENT ENFORCEMENT. (a) Each Party shall notify the other promptly
after such Party becomes aware of any alleged infringement of any Patent
licensed to VIACELL under this Agreement in any country in the Territory. Except
as provided in Section 11.3, VIACELL shall have the first right, but not the
duty, to institute patent infringement actions against Third Parties with
respect to any such alleged infringement. VIACELL shall take all such actions
under this Section 11.1(a) (other than with respect to a Patent included solely
in the VIACELL Development Technology) in reasonable consultation with GAMETE
and shall keep GAMETE apprised as to the status of any such infringement action
VIACELL institutes. GAMETE shall execute all reasonable, necessary and proper
documents and take such actions as shall be appropriate to allow VIACELL to
institute and prosecute infringement actions under this Section 11.1(a).
24
(b) The costs and expenses of bringing and maintaining any infringement
action under Section 11.1(a) shall be borne solely by VIACELL.
(c) Any award or compensation (including the fair market value of
non-monetary compensation) paid by Third Parties as a result of any infringement
action brought by VIACELL under Section 11.1(a) (whether by way of settlement or
otherwise) shall be allocated first to reimbursement of VIACELL and GAMETE for
all expenses incurred by it in connection with such action. VIACELL shall then
pay GAMETE the royalty it would have been entitled to receive had the balance of
such recovery or damages, to the extent attributable to sales of such infringing
products, been attributable to sales of Covered Products by VIACELL hereunder.
VIACELL shall be entitled to retain the remainder of any such recovery or
damages.
(d) Except as provided in Section 11.3, in the event VIACELL elects not
to, or fails to, exercise its rights under Section 11.1(a) with respect to any
alleged infringement of a Patent licensed to VIACELL under this Agreement
(excluding any Patent included solely in the VIACELL Development Technology)
within one hundred twenty (120) days after receiving notice thereof, GAMETE
shall have the right, but not the duty, to institute patent infringement actions
against Third Parties with respect to any such alleged infringement. GAMETE
shall take all such actions under this Section 11.1(d) in reasonable
consultation with VIACELL and shall keep VIACELL apprised as to the status of
any such infringement action GAMETE institutes. VIACELL shall execute all
reasonable, necessary and proper documents and take such actions as shall be
appropriate to allow GAMETE to institute and prosecute infringement actions
under this Section 12.1(d). Any award or compensation (including the fair market
value of non-monetary compensation) paid by Third Parties as a result of any
infringement action brought by GAMETE under this Section 11.1(d) (whether by way
of settlement or otherwise) shall be allocated first to reimbursement of GAMETE
and VIACELL for all expenses incurred by them in connection with such action.
Any remaining award or compensation shall be retained by GAMETE.
11.2. INFRINGEMENT ACTIONS BY THIRD PARTIES. (a) Each Party shall notify
the other Party promptly in writing of any claim of, or action for, infringement
of any Patents owned or licensed by Third Parties which is threatened, made or
brought against either Party by reason of either Party's performance of its
obligations under this Agreement or manufacture, use or sale of any Covered
Products in the Territory in the Field.
(b) Except as provided in Section 11.3, in the event that such an action
for infringement is commenced solely against a Party or both Parties jointly
and/or any of their respective Affiliates or Sublicensees, as the case may be,
with respect to any Covered Product developed and commercialized by VIACELL, its
Affiliates and/or Sublicensees, VIACELL shall defend such action at its own
expense, and GAMETE hereby agrees to assist and cooperate with VIACELL to the
extent necessary in the defense of such suit, in accordance with Section
11.2(c). VIACELL shall have the right to settle any such action or consent to an
adverse judgment thereto, and GAMETE's consent shall not be required unless such
settlement or consent: (i) imposes any material obligation on GAMETE or limits
VIACELL's obligations to GAMETE under this
25
Agreement (including under Sections 8.4(b) or 11.2(d)), or (ii) materially
impairs GAMETE's rights in or to any MGH Patent Rights, GAMETE Development
Technology and/or Joint Development Technology, in which event GAMETE's consent
shall not be unreasonably withheld or delayed.
(c) The costs of defending any infringement action with respect to a
Covered Product developed and commercialized by VIACELL, its Affiliates and/or
Sublicensees shall be borne solely by VIACELL.
(d) During the pendency of any such action, VIACELL shall continue to
pay all royalties due hereunder. Subject to Section 8.4(b), VIACELL shall be
fully liable for the payment of any award for damages, or any amount due
pursuant to any settlement entered into by VIACELL, to the extent that any such
action pertains to a Covered Product developed and commercialized by VIACELL
and/or its Affiliates or Sublicensees.
(e) Except to the extent that the provisions of Section 11.1 shall apply
to any portion thereof, VIACELL shall retain any award or compensation
(including the fair market value of non-monetary compensation) received by
VIACELL as a result of any such action (i.e., as a result of a counterclaim).
11.3. SUPERIOR RIGHTS OF MGH. Notwithstanding any other provision of this
Agreement, the Parties' respective rights and obligations under this Section 11
shall be subject, in all events, to any superior rights of MGH under the MGH
License Agreement regarding the MGH Patent Rights; provided that, to the extent
that VIACELL's exercise of any of its rights under this Section 11 requires
GAMETE to exercise any rights or make any election or request under the MGH
License Agreement, GAMETE shall exercise all such rights and make any such
election or request all in a timely manner under the MGH License Agreement.
12. TERM; TERMINATION
12.1. TERM. This Agreement shall commence as of the Effective Date and,
unless sooner terminated as provided hereunder, shall expire as follows:
(a) As to each Covered Product in each country in the Territory, this
Agreement shall expire upon the expiration of the Royalty Term with respect to
such Covered Product in such country.
(b) This Agreement shall expire in its entirety upon the termination of
the respective Royalty Terms with respect to all Covered Products in all
countries in the Territory.
12.2. EFFECT OF EXPIRATION. Following the expiration of this Agreement
with respect to a Covered Product in a country in the Territory pursuant to
Section 12.1(a), VIACELL shall have the royalty-free, perpetual right to
continue to make, have made, use, sell, offer for sale, have sold and export
such Covered Product in such country.
26
Following the expiration of the term of this Agreement in its entirety pursuant
to Section 12.1(b), VIACELL shall have the royalty-free, perpetual right to
continue to make, have made, use, sell, offer for sale, have sold and export all
Covered Products in all countries in the Territory.
12.3. TERMINATION BY EITHER PARTY. Each Party shall have the right to
terminate this Agreement, upon notice to the other Party, in the event that:
(a) Such other Party materially defaults with respect to any of its
material obligations under this Agreement and does not cure such default within
sixty (60) days after the receipt of a notice from the non-breaching Party
specifying the nature of, and requiring the remedy of, such default (or, if such
default cannot be cured within such sixty (60)-day period, if the breaching
Party does not commence and diligently continue actions to cure same during such
sixty (60)-day period); provided that, (x) if GAMETE is the Party claiming a
default by VIACELL, VIACELL shall promptly following receipt of such notice of
default notify GAMETE if it intends to seek to cure such default, (y) if the
default relates to the payment of any amounts owed under this Agreement, the
cure period described above shall be fifteen (15) days from receipt of notice of
such default, and (z) if any such default is limited to the breaching Party's
obligations with respect to a particular Covered Product and/or a particular
country in the Territory, then any termination of this Agreement under this
clause (a) due to such default shall be limited to the breaching Party's rights
under this Agreement with respect to such Covered Product and/or country. Any
termination pursuant to this clause (a) shall be without prejudice to any of the
non-breaching Party's other rights under this Agreement, and in addition to any
other remedies available to it by law or in equity;
(b) The other Party shall have: (i) voluntarily commenced any proceeding
or filed any petition seeking relief under the bankruptcy, insolvency or other
similar laws of any jurisdiction, (ii) applied for, or consented to, the
appointment of a receiver, trustee, custodian, sequestrator, conciliator,
administrator or similar official for it or for all or substantially all of its
property, (iii) filed an answer admitting the material allegations of a petition
filed against or in respect of it in any such proceeding, (iv) made a general
assignment for the benefit of creditors of all or substantially all of its
assets, (v) admitted in writing its inability to pay all or substantially all of
its debts as they become due, or (vi) taken corporate action for the purpose of
effecting any of the foregoing; or
(c) An involuntary proceeding shall have been commenced, or any
involuntary petition shall have been filed, in a court of competent jurisdiction
seeking: (i) relief in respect of the other Party, or of its property, under the
bankruptcy, insolvency or similar laws of any jurisdiction, (ii) the appointment
of a receiver, trustee, custodian, sequestrator, conciliator, administrator or
similar official for such other Party or for all or substantially all of its
property, or (iii) the winding-up or liquidation of such other Party; and, in
each case, such proceeding or petition shall have continued undismissed for
sixty (60) days, or an order or decree approving or ordering any of the
foregoing shall have continued unstayed, unappealed and in effect for thirty
(30) days.
27
12.4. TERMINATION BY VIACELL. Notwithstanding any other provision of this
Agreement, VIACELL shall have the right to terminate this Agreement, in its
entirety or with respect to any particular Covered Product and/or country in the
Territory, at any time upon six (6) months' notice (or less, at GAMETE's
discretion) to GAMETE.
12.5. EFFECT OF EXPIRATION OR TERMINATION. (a) Subject to Section
12.5(b), upon any termination of this Agreement by GAMETE pursuant to Section
12.3 or by VIACELL pursuant to Section 12.4, VIACELL shall (i) transfer and
assign to GAMETE all of VIACELL's right, title and interest in and to any
VIACELL Development Technology and all data, reports, records, materials and
other intellectual property owned or controlled by VIACELL that relates
exclusively to the development, manufacture, use or sale of Covered Products in
the Field or of GAMETE Products in the GAMETE Field; (ii) grant GAMETE an
exclusive license, solely for the purpose of GAMETE's developing, making, having
made, using, marketing and selling Covered Products in the Field and GAMETE
Products in the GAMETE Field, under VIACELL's interest in any Joint Development
Technology and VIACELL Development Technology that does not exclusively relate
to the Covered Products; (iii) grant GAMETE an exclusive license, solely for the
purpose of GAMETE's sale of Covered Products in the Field, under VIACELL's
interest in any trademarks that have been used by VIACELL in connection with the
sale of Covered Products during the twelve months preceding termination of this
Agreement; and (iv) transfer and assign to GAMETE ownership of all INDs, NDAs
and other regulatory filings made or filed with respect to any Covered Product
or GAMETE Product (or, if such transfer and assignment is not permitted under
the laws of any applicable jurisdiction, VIACELL shall take such other permitted
actions with respect to such filings as may be reasonably requested by GAMETE).
If this Agreement is terminated by GAMETE pursuant to Section 12.3, then the
assignments and licenses of rights pursuant to clauses (i) - (iv) of the
preceding sentence shall be upon commercially reasonable, arms length financial
terms and conditions that the Parties shall negotiate in good faith and agree
upon as soon as practicable after such termination of this Agreement. In the
event the Parties, despite the mutual use of good faith efforts, are unable to
agree upon such terms and conditions, the Parties shall appoint an independent
valuation expert who shall determine such terms and conditions, which
determination shall be binding upon the Parties. If the Parties are unable to
agree upon the appointment of such an expert, then each Party shall nominate an
expert (the cost of whom shall be borne by such Party), and both experts
appointed by the Parties shall jointly appoint the expert who shall make such
determination. Any expert appointed pursuant to this Section 12.5(a) shall have
at least fifteen (15) years' experience in the business of pharmaceutical
development and commercialization. Except as provided above, the costs and
expenses of any expert acting under this Section 12.5(a) shall be borne equally
by the Parties. If this Agreement is terminated by VIACELL pursuant to Section
12.4, then, in consideration of the assignments and licenses of rights pursuant
to clauses (i) - (iv) of the first sentence of this Section, GAMETE shall pay to
VIACELL a royalty equal to [**] of Net Sales of Covered Product, which payment
obligation shall continue until the earlier of (a) the time that the aggregate
payments made by GAMETE under this Section equal the aggregate documented
expenditures made by VIACELL in performance of this Agreement until the date of
termination of this Agreement or (b) the expiration of the Royalty Term. If
GAMETE is obligated to make royalty payments pursuant to the
28
previous sentence of this Section, the provisions of Section 8.2(a), 8.2(b),
8.2(c), 8.2(e) and Article 9 shall apply with respect to such obligation, with
each such Section appropriately adjusted to reflect the obligation of GAMETE to
VIACELL under the terms of this Section, and the parties will negotiate in good
faith all other necessary terms regarding the sale of Covered Products by
GAMETE.
(b) Notwithstanding the foregoing,
(i) In the event of any termination of this Agreement by GAMETE
pursuant to Section 12.3 or by VIACELL pursuant to Section 12.4 with
respect to fewer than all of the Covered Products and/or fewer than all of
the countries in the Territory, the rights, licenses and other benefits to
be transferred, granted and otherwise assigned to GAMETE under Section
12.5(a) shall be expressly limited to those pertaining to the Covered
Products and/or the countries in the Territory to which such termination
applies; and
(ii) at any time prior to any transfer, granting and assignment of
rights, licenses and benefits to GAMETE pursuant to Section 12.5(a),
GAMETE may elect, upon notice to VIACELL, to waive the application of
Section 12.5(a) with respect to such rights, licenses and benefits.
Following any such waiver neither Party shall have any obligation or
liability to the other with respect to such rights, licenses and benefits.
12.6. RIGHT TO SELL STOCK ON HAND. Provided that VIACELL is not in
material breach of any obligation under this Agreement at the time of any
termination of this Agreement, in whole or in part, VIACELL shall have the right
for one year thereafter to dispose of all Covered Product then in its inventory
and to complete manufacture of and dispose of any work-in-progress then being
manufactured, as though this Agreement had not terminated. VIACELL shall pay
royalties thereon, in accordance with the provisions of this Agreement, as
though this Agreement had not terminated.
12.7. SURVIVAL OF SUBLICENSES. Upon any termination of this Agreement,
all sublicenses granted by VIACELL under this Agreement shall be automatically
assigned to GAMETE, which shall thereafter receive all benefits and have all
obligations under the sublicenses as in the place and stead of VIACELL.
12.8. EFFECT OF TERMINATION OF MGH LICENSE AGREEMENT. Upon any
termination of the MGH License Agreement (other than a termination by GAMETE
made with the consent of VIACELL), all sublicenses of the MGH Patent Rights
contained in this Agreement shall continue in full force and effect, with MGH in
place of GAMETE for the limited purposes of such sublicenses and the rights and
obligations relating thereto, pursuant to the terms of Section 9.3 of the MGH
License Agreement.
12.9. ACCRUED RIGHTS, SURVIVING OBLIGATIONS. (a) Termination,
relinquishment or expiration of this Agreement for any reason shall be without
prejudice to any rights which shall have accrued to the benefit of either Party
prior to such termination, relinquishment or expiration. Such termination,
relinquishment or expiration
29
shall not relieve either Party from obligations which are expressly indicated to
survive termination or expiration of this Agreement. The rights of the Parties
upon termination described in this Agreement shall not be exclusive of any other
rights or claims at law or in equity that either Party may have against the
other arising out of this Agreement.
(b) Termination, relinquishment or expiration of this Agreement shall
not terminate each Party's obligation to pay all royalties, milestone payments
and other monetary obligations that may have accrued hereunder prior to such
termination. All of the Parties' rights and obligations under Sections 5.1, 5.2,
5.3, 7.6, 9, 10, 11 (solely with respect to actions pending at such time), 12.2,
12.5, 12.6, 12.7, 12.8, 12.9, 14.1 (if in effect at such time), 14.3, 14.5,
14.12, 14.13 and 14.14 shall survive termination, relinquishment or expiration
hereof.
13. FORCE MAJEURE
Neither Party shall be held liable or responsible to the other Party nor
be deemed to be in default under or in breach of any provision of this Agreement
for failure or delay in fulfilling or performing any obligation under this
Agreement when such failure or delay is due to force majeure, and without the
fault or negligence of the Party so failing or delaying. For purposes of this
Agreement, force majeure shall be defined as causes beyond the control of the
Party, including, without limitation, acts of God; acts, regulations, or laws of
any government; war; civil commotion; destruction of production facilities or
materials by fire, flood, earthquake, explosion or storm; labor disturbances;
epidemic; and failure of public utilities or common carriers. In such event
GAMETE or VIACELL, as the case may be, shall immediately notify the other Party
of such inability and of the period for which such inability is expected to
continue. The Party giving such notice shall thereupon be excused from such of
its obligations under this Agreement as it is thereby disabled from performing
for so long as it is so disabled and for thirty (30) days thereafter. To the
extent possible, each Party shall use reasonable efforts to minimize the
duration of any force majeure.
14. MISCELLANEOUS
14.1. RELATIONSHIP OF PARTIES. Nothing in this Agreement is intended or
shall be deemed to constitute a partnership, agency, employment or joint venture
relationship between the Parties. Neither Party shall be entitled to, or shall,
incur any debts or make any commitments for the other, except to the extent, if
at all, specifically provided herein.
14.2. INSURANCE. VIACELL will use reasonable efforts to have GAMETE named
as an additional insured on any insurance policies of VIACELL related to
activities under this Agreement deemed appropriate by GAMETE, any increase in
premiums in such policies to be paid by GAMETE.
14.3. ASSIGNMENT. (a) Each Party shall be entitled to assign this
Agreement to any of its Affiliates upon sixty (60) days' prior written notice to
the other Party; provided, however, that in the event of any such assignment,
the assigning Party shall remain jointly and severally liable with respect to
all of its obligations hereunder, and in the
30
event of any default relating to any such obligations, the other Party shall be
entitled to proceed against either such Affiliate or directly against the
assigning Party, as such other Party may determine in its sole discretion, to
enforce this Agreement.
(b) Except as provided in Section 14.3(a), neither Party shall be
entitled to assign its rights hereunder without the express written consent of
the other Party, except that each Party may assign this Agreement to any
assignee of all or substantially all of such Party's business (or, after the
second anniversary of the Effective Date, that portion thereof to which this
Agreement relates) or in the event of such Party's merger, consolidation or
similar transaction.
(c) No assignment contemplated by this Section 14.3 shall be valid or
effective unless and until the assignee/transferee shall agree in writing to be
bound by the provisions of this Agreement. Any purported assignment of this
Agreement made in contravention of the provisions of this Section shall be null
and void.
14.4. DISCLAIMER OF WARRANTIES. EXCEPT AS EXPRESSLY PROVIDED IN SECTIONS
2 AND 3.1, THE PARTIES EXPRESSLY DISCLAIM ALL OTHER WARRANTIES, EXPRESS OR
IMPLIED, INCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY, FITNESS FOR
A PARTICULAR PURPOSE, OR NON-INFRINGEMENT OF THIRD PARTY RIGHTS, OR ARISING FROM
A COURSE OF DEALING OR USAGE OF TRADE PRACTICE.
14.5. FURTHER ACTIONS. Each Party shall execute, acknowledge and deliver
such further instruments, and take all such other acts, as may be necessary or
appropriate in order to carry out the purposes and intent of this Agreement.
14.6. NOTICE. Any notice or request required or permitted to be given
under or in connection with this Agreement shall be deemed to have been
sufficiently given if in writing and personally delivered or sent by certified
mail (return receipt requested), facsimile transmission (receipt verified), or
overnight express courier service (signature required), prepaid, to the Party
for which such notice is intended, at the address set forth for such Party
below:
(i) In the case of VIACELL, to:
ViaCell, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to:
Ropes & ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇
▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esq.
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
(ii) In the case of GAMETE, to:
Gamete Technology, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
North Kingston, Rhode Island
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
or to such other address for such Party as it shall have specified by like
notice to the other Party, provided that notices of a change of address shall be
effective only upon actual receipt thereof. If delivered personally or by
facsimile transmission, the date of delivery shall be deemed to be the date on
which such notice or request was given. If sent by overnight express courier
service, the date of delivery shall be deemed to be the next business day after
such notice or request was deposited with such service. If sent by certified
mail, the date of delivery shall be deemed to be the fifth (5th) business day
after such notice or request was deposited with the postal service in the
country of mailing.
14.7. USE OF NAME. Except as otherwise provided herein, neither Party
shall have any right, express or implied, to use in any manner the name or other
designation of the other Party or any other trade name or trademark of the other
Party (including, without limitation, any Trademark) for any purpose in
connection with the performance of this Agreement. Neither Party shall use the
name of MGH or of any staff member, officer, employee or student of MGH or any
adaptation thereof in any advertising, promotional or sales literature,
publicity or in any document employed to obtain funds or financing without the
prior written approval of MGH.
14.8. PUBLIC ANNOUNCEMENTS. (a) Except as required by law (including,
without limitation, the applicable disclosure requirements of any relevant
regulatory authority or stock exchange) and as permitted by Section 10.2,
neither Party shall make any public announcement concerning this Agreement
without the prior written consent of the other Party, which shall not be
unreasonably withheld or delayed. It shall not be unreasonable for a Party to
withhold consent with respect to any public announcement containing any of such
Party's Confidential Information. In the event of any required or proposed
public announcement, (i) the Parties shall consult with each other in good faith
as to the timing thereof, and (ii) the Party making such announcement shall
provide the other Party with a copy of the proposed text prior to such
announcement sufficiently in advance of the scheduled release of such
announcement to afford such other Party a reasonable opportunity to review and
comment upon the proposed text. Notwithstanding the foregoing, the Parties agree
to prepare a mutually agreeable press release that may be used by either Party
in connection with this Agreement and, so long as the underlying facts contained
in such public announcement have not changed, any further announcement
containing substantially the same information may be used without the
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need to seek the consent of the other Party. The Joint Development Committee may
make changes to the announcement as are advisable in its reasonable discretion.
(b) Each Party acknowledges and agrees that the other Party needs to
communicate with its investors regularly and keep them apprised of the
development status of the products in which such Party has an interest. In order
to facilitate this communication, promptly after the Effective Date each Party
shall designate, from time to time, one employee who shall have primary
responsibility for reviewing and approving all proposed investor communications
of the other Party, to the extent that they pertain to this Agreement, any
Covered Product or any other subject matter hereof. Each Party shall instruct
such employee to review the content of such draft communications as
expeditiously as possible and otherwise to cooperate with and assist the other
Party in connection therewith, so long as the number of such communications and
the timing thereof are reasonable.
(c) Following a Party's consent to or approval of the public
announcement of any information pursuant to this Section 14.8, so
long as the underlying facts contained in such public
announcement have not changed, both Parties shall be entitled to
make subsequent public announcements of such information without
renewed compliance with this Section 14.8, unless the scope
and/or duration of such consent or approval is expressly limited.
The Joint Development Committee may make changes to the
announcement as are advisable in its reasonable discretion.
(d) Neither Party shall use the name of MGH or of any staff member,
officer, employee or student of MGH or any adaptation thereof in
any advertising, promotional or sales literature, publicity or in
any document employed to obtain funds or financing without the
prior written approval of MGH.
14.9. WAIVER. A waiver by either Party of any of the terms and conditions
of this Agreement in any instance shall not be deemed or construed to be a
waiver of such term or condition for the future, or of any subsequent breach
hereof. All rights, remedies, undertakings, obligations and agreements contained
in this Agreement shall be cumulative, and none of them shall be in limitation
of any other remedy, right, undertaking, obligation or agreement of either
Party.
14.10. COMPLIANCE WITH LAW. Nothing in this Agreement shall be deemed to
permit a Party to export, re-export or otherwise transfer any Covered Product
sold under this Agreement without compliance with applicable laws.
14.11. SEVERABILITY. When possible, each provision of this Agreement will
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be prohibited by or invalid
under applicable law, such provision shall be ineffective only to the extent of
such prohibition or invalidity, without invalidating the remainder of this
Agreement.
33
14.12. AMENDMENT. No amendment, modification or supplement of any
provisions of this Agreement shall be valid or effective unless made in writing
and signed by a duly authorized officer of each Party.
14.13. GOVERNING LAW; ENGLISH ORIGINAL; JURISDICTION. (a) This Agreement
shall be governed by and interpreted in accordance with the laws of the
Commonwealth of Massachusetts without regard to its choice of law principles.
The English original of this Agreement shall prevail over any translation
hereof.
(b) Without prejudice to the rights and obligations of the Parties under
Section 14.14, each Party hereby consents to the in personam jurisdiction of any
state or federal court sitting in the Commonwealth of Massachusetts with respect
to any matter arising in connection with this Agreement and further consents to
the service of any process, notice of motion or other application to any such
court or a judge thereof outside the Commonwealth of Massachusetts by registered
or certified mail or personal service, provided that reasonable time is allowed
for appearance. Each Party hereby waives, to the greatest extent it may do so,
any defense it may have on the grounds of inconvenient forum with respect to any
action or proceeding maintained in any state or federal court in Massachusetts.
14.14. ARBITRATION. (a) Any dispute arising out of or relating to any
provisions of this Agreement shall be finally settled by arbitration to be held
in Boston, Massachusetts, under the auspices and then current commercial
arbitration rules of the American Arbitration Association (the "AAA"). Such
arbitration shall be conducted by three (3) arbitrators. Within thirty (30) days
after the commencement of any arbitration, each Party shall appoint one
arbitrator, and these two arbitrators shall jointly appoint the third
arbitrator, who shall have significant experience in health care or
pharmaceutical drug development and commercialization; provided, however, that
if the two arbitrators appointed by the Parties are unable to agree upon the
third arbitrator within thirty (30) days after their appointment, then the third
arbitrator shall be appointed by the AAA. The Parties shall instruct such
arbitrators to render a determination of any such dispute within four (4) months
after their appointment. All arbitration proceedings shall be conducted in
English. Judgment upon any award rendered may be entered in any court having
jurisdiction, or application may be made to such court for a judicial acceptance
of the award and an order of enforcement, as the case may be.
(b) Section 14.14(a) shall not prohibit a Party from seeking injunctive
relief from a court of competent jurisdiction in the event of a breach or
prospective breach of this Agreement by the other Party which would cause
irreparable harm to the first Party.
14.15. NO CONSEQUENTIAL DAMAGES. IN NO EVENT SHALL EITHER PARTY OR ANY OF
ITS RESPECTIVE AFFILIATES OR SUBLICENSEES BE LIABLE TO THE OTHER PARTY OR ANY OF
ITS AFFILIATES OR SUBLICENSEES FOR SPECIAL, INDIRECT, INCIDENTAL OR
CONSEQUENTIAL DAMAGES, WHETHER IN CONTRACT, WARRANTY, TORT, NEGLIGENCE, STRICT
LIABILITY OR OTHERWISE, INCLUDING, BUT NOT LIMITED TO, LOSS OF
34
PROFITS OR REVENUE, OR CLAIMS OF CUSTOMERS OF ANY OF THEM OR OTHER THIRD PARTIES
FOR SUCH OR OTHER DAMAGES.
14.16. ENTIRE AGREEMENT. This Agreement (together with the Exhibits
hereto) sets forth the entire agreement and understanding between the Parties as
to the subject matter hereof and merges all prior discussions and negotiations
between them, and neither of the Parties shall be bound by any conditions,
definitions, warranties, understandings or representations with respect to such
subject matter other than as expressly provided herein or as duly set forth on
or subsequent to the Effective Date in writing and signed by a proper and duly
authorized officer or representative of the Party to be bound thereby. Without
limiting the generality of the foregoing, the terms and conditions of this
Agreement shall supersede the terms and conditions of any confidentiality,
non-disclosure or similar such agreement that the Parties may have executed
prior to the Effective Date.
14.17. PARTIES IN INTEREST. All the terms and provisions of this
Agreement shall be binding upon, inure to the benefit of and be enforceable by
the Parties hereto and their respective permitted successors and assigns.
14.18. DESCRIPTIVE HEADINGS. The descriptive headings of this Agreement
are for convenience only, and shall be of no force or effect in construing or
interpreting any of the provisions of this Agreement.
14.19. COUNTERPARTS. This Agreement may be executed simultaneously in two
counterparts, any one of which need not contain the signature of more than one
Party, but both such counterparts taken together shall constitute one and the
same agreement.
35
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
executed by its duly authorized officer as of the day and year first above
written.
GAMETE TECHNOLOGY, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
_____________________________________________
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chief Executive Officer
VIACELL, INC.
By: /s/ ▇▇▇▇ ▇. Beer
_____________________________________________
▇▇▇▇ ▇. Beer, Chief Executive Officer
EXHIBIT A
MGH License Agreement
2
EXHIBIT B
Patent Rights
[**]
The above patent applications include all corresponding foreign applications and
filings.
EXHIBIT C
Initial Members of Joint Development Committee
VIACELL Designees: [**]
GAMETE
Designees: [**]
EXHIBIT D
Consultant will provide two permanent members to the Joint Development
Committee to carry out responsibilities as described at Sections 4.2, 4.3,
4.4, 4.5, and 5.4 of that certain Co-Development and License Agreement by and
between ViaCell, Inc., and Gamete Technology, Inc. ("the Agreement".)
Additionally, Consultant will:
Provide advice, counsel and information regarding markets, competition, emerging
technologies, and additional areas as identified, in the Field;
Assist in the specification of such device(s) and/or methods of standardizing
delivery in the Field;
Manage, account for, and periodically report on advances or reimbursement
provide by ViaCell to Gamete in the development of the protocol, and/or clinical
trials;
Oversee and comply with obligations arising under the Agreement at Sections 3.2
(a), (b), (d), (e), and (f);
Provide such other services as may from time to time be agreed to by the parties
in writing.