Exhibit 10.12
-------------
CuraGen Corporation has omitted from this Exhibit 10.12 portions of the
Agreement for which CuraGen Corporation has requested confidential treatment
from the Securities and Exchange Commission. The portions of the Agreement for
which confidential treatment has been requested are marked with X's in brackets
and such confidential portions have been filed separately with the Securities
and Exchange Commission.
Agreement No. 96-0126
STANDARD NONEXCLUSIVE LICENSE AGREEMENT - ▇▇▇▇▇▇▇ TECHNOLOGY
------------------------------------------------------------
This Agreement is made effective the 1st day of July, 1996, by and between
Wisconsin Alumni Research Foundation (hereinafter called "▇▇▇▇"), a nonstock,
nonprofit Wisconsin corporation, and CuraGen Corporation(hereinafter called
("CuraGen"), a corporation organized and existing under the laws of Delaware;
WHEREAS, ▇▇▇▇ owns certain inventions that are described in the "Licensed
Patents" defined below and the Technology, and ▇▇▇▇ is willing to grant a
license to CuraGen under any one or all of the Licensed Patents and/or the
Technology and CuraGen desires a license under all of them.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth below, the parties covenant and agree as follows:
Section 1. Definitions.
-----------
For the purpose of this Agreement, the Appendix A definitions shall apply.
Section 2. Grant.
-----
A. License.
-------
▇▇▇▇ hereby grants to CuraGen a nonexclusive license, limited to the
Licensed Field and the Licensed Territory, under the Licensed Patents and under
the Technology to make, have made, use, sell, offer for sale, and import
Products.
B. Standstill.
----------
▇▇▇▇ agrees it will not grant any other party a license under the Licensed
Patents in the Licensed Field in the Licensed Territory through August 30, 2002
if CuraGen pays the following standstill fees:
Standstill Fees Date
--------------- ----
[XXXXXXX] [XXXXXXX]
[XXXXXXX] [XXXXXXX]
[XXXXXXX] [XXXXXXX]
[XXXXXXX] [XXXXXXX]
[XXXXXXX] [XXXXXXX]
In the event CuraGen elects not to pay any or all of the standstill fees, the
standstill provision shall expire and ▇▇▇▇ may license other parties under the
Licensed Patents in the Licensed Field and the Licensed Territory. ▇▇▇▇ agrees
to discuss and reasonably negotiate extension of the standstill period beyond
the August 30, 2002 expiration date. Upon termination of the
[Confidential treatment requested]
standstill provision set forth in this Section 2B, all other terms of this
Agreement shall remain in full force and effect
Section 3. Consideration.
-------------
A. Development.
-----------
CuraGen agrees to use diligent efforts in the exercise of its reasonable
business judment to develop, produce and market Products, and to pursue the
development plan set forth in the ▇▇▇▇▇ Chart submitted by CuraGen upon
execution of this Agreement and attached as Appendix C, and will provide ▇▇▇▇
with an annual letter describing the progress made therein. ▇▇▇▇ agrees to keep
such letter confidential pursuant to Section 12.
B. License Fee.
-----------
CuraGen agrees to pay to ▇▇▇▇ a license fee of [XXXXXXXX]. The first
installment shall be due and payable on or before August 30, 1996. The second
installment shall be due and payable on or before August 30, 1997. The final
installment shall be due and payable on or before August. 30, 1998.
C. Royalty.
-------
(i) In addition to the Section 3B license fee, CuraGen agrees
to pay to ▇▇▇▇ as earned royalties" a royalty calculated as a percentage of the
Selling Price of Products in accordance with the terms and conditions of this
Agreement subject however to any credits permitted hereunder. The royalty is
deemed earned as of the date the Product is actually sold and paid for. The
royalty shall remain fixed while this Agreement is in effect at a rate of
[XXXXXXXX] of the Selling Price.
(ii) Notwithstanding the foregoing, ▇▇▇▇ hereby grants to
CuraGen the right to sell as many as [XXXXXXXX].
D. Offset Against Royalties.
------------------------
In the event that CuraGen or its Affiliate(s) cannot manufacture or sell a
particular Product without infringing the patent of a third party, CuraGen shall
have the right to negotiate with the third party for a license under the third
party's patent rights; and then CuraGen shall have the right to reduce CuraGen
`s royalty payments to ▇▇▇▇ by up to [XXXXXXXXXXXXXXXXX] of the amount which
CuraGen is obligated to pay such third party for such patent license. However,
in no event shall this offset for third party licensing costs exceed [XXXXX
XXXXXXXXXXXX] of the royalties owed to ▇▇▇▇ in any given calendar year.
2
[Confidential Treatment Requested]
E. Accounting: Payments.
--------------------
(i) Amounts owing to ▇▇▇▇ under Section 3C shall be paid on
a quarterly basis, with such amounts due and received by ▇▇▇▇ on or before the
sixtieth day following the end of the calendar quarter ending on March 31, June
30, September 30 or December 31 in which such amounts were earned. The balance
of any amounts which remain unpaid more than sixty (60) days after they are due
to ▇▇▇▇ shall accrue interest until paid at the rate of the lesser of one
percent (1%) per month or the maximum amount allowed under applicable law.
However, in no event shall this interest provision be construed as a grant of
permission for any payment delays.
(ii) Except as otherwise directed, all amounts owing to ▇▇▇▇
under this Agreement shall be paid in U.S. dollars to ▇▇▇▇ at the address
provided in Section 14(a). All royalties owing with respect to Selling Prices
stated in currencies other than U.S. dollars shall be converted at the rate
shown in the Federal Reserve Noon Valuation - Value of Foreign Currencies on the
day preceding the payment.
(iii) A full accounting showing how any amounts owing to ▇▇▇▇
under Section 3C have been calculated shall be submitted to ▇▇▇▇ on the date of
each such payment. Such accounting shall be on a per-country and product line,
model or tradename basis and shall be summarized on the form shown in Appendix C
of this Agreement. In the event no payment is owed to ▇▇▇▇, a statement setting
forth that fact shall be supplied to ▇▇▇▇.
Section 4. Certain Warranties of ▇▇▇▇.
--------------------------
▇. ▇▇▇▇ warrants that except as otherwise provided under Section
11 of this Agreement with respect to U.S. Government interests, it .is the owner
of the Licensed Pa tents and has the right to grant the licenses granted to
CuraGen in this Agreement. However, nothing in this Agreement shall be construed
as:
(i) any of Licensed Patents; a warranty or representation
by ▇▇▇▇ as to the validity or scope of
(ii) a warranty or representation that anything made, used,
sold or otherwise disposed of under the license granted in this Agreement will
or will not infringe patents of third parties; or
(iii) an obligation to furnish any know-how not provided in
Licensed Patents or any services other than those specified in this Agreement.
B. EXCEPT AS EXPRESSLY SET FORTH HEREIN, ▇▇▇▇ MAKES NO
REPRESENTATIONS, EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED,
AND ASSUMES NO RESPONSIBILITIES WHATSOEVER WITH RESPECT TO USE, SALE, OR OTHER
DISPOSITION BY CURAGEN OR ITS VENDEES OR OTHER
3
TRANSFEREES OF PRODUCTS INCORPORATING OR MADE BY USE OF INVENTIONS LICENSED
UNDER THIS AGREEMENT.
Section 5. Recordkeeping.
-------------
A. CuraGen shall keep books and records sufficient to verify the
accuracy and completeness of CuraGen's accounting referred to above, including
without limitation inventory, purchase and invoice records relating to the
Products or their manufacture. Such books and records shall be preserved for a
period not less than five years after they are created during and after the term
of this Agreement.
B. CuraGen shall take all steps necessary so that ▇▇▇▇ may within
thirty days of its request review and copy all the books and records at a single
U.S. location to verify the accuracy of CuraGen's accounting. Such review shall
be made not more than once each calendar year, upon reasonable notice and during
regular business hours, at the expense of ▇▇▇▇ by a Certified Public Accountant
to whom CuraGen has no reasonable objection.
C. deficiency outstanding outstanding amounts as If a royalty
payment deficiency is determined, CuraGen shall pay the royalty within thirty
(30) days of receiving written notice thereof, plus interest on described in
Section 3E(i).
Section 6. Term: Termination.
-----------------
A. The term of this license shall begin on the effective date of
this Agreement and continue until the expiration of the last to expire of the
Licensed Patents.
B. CuraGen may terminate this Agreement at any time by giving at
least sixty (60) days' prior written and unambiguous notice of such termination
to ▇▇▇▇.
C. In the event either party shall materially breach any of the
terms, conditions and agreements contained in this Agreement to be kept,
observed and performed by it, then the other party may terminate this Agreement,
at its option and without prejudice to any of its other legal and equitable
rights and remedies; by giving the party who committed the breach sixty (60)
days notice in writing, particularly specifying the breach, unless the notified
party within such sixty (60) day period shall have rectified the breach.
D. Upon the termination of this Agreement, CuraGen shall remain
obligated to provide an accounting for and to pay royalties earned up to the
date of the termination and any minimum royalties shall be prorated as of the
date of termination by the ., number of days elapsed in the applicable calendar
year.
4
Section 7. Assignability.
-------------
This Agreement may not be transferred or assigned by either party without
the prior written consent of the other party, except that CuraGen may freely
assign this Agreement to an Affiliate or to an entity acquiring substantially
all of its business to which Products relate.
Section 8. Patent Marking.
--------------
CuraGen shall insure that it applies patent markings that meet all
requirements of U.S. law, 35 U.S.C. 287, with respect to all Products subject to
this Agreement.
Section 9. Product Liability: Conduct of Business.
--------------------------------------
A. CuraGen shall, at all times during the term of this Agreement
and thereafter, indemnify, defend and hold ▇▇▇▇, and the inventors of the
Licensed Patents and the authors and inventors of the Technology harmless
against all claims and expenses, including legal expenses and reasonable
attorneys fees, arising out of the death of or injury to any person or persons
or out of any damage to property and against any other claim, proceeding,
demand, expense and liability of any kind whatsoever (other than patent
infringement claims) resulting from the production, manufacture, sale, use,
lease, consumption or advertisement of Products arising from any right or
obligation of CuraGen hereunder. ▇▇▇▇ at all times reserves the right to select
and retain counsel of its own to defend ▇▇▇▇'▇ interests.
B. CuraGen warrants that it now maintains and will continue to
maintain liability insurance coverage appropriate to the risk involved in
marketing the products subject to this Agreement and that such insurance
coverage lists WARP and the inventors of the Licensed Patents and the authors
and inventors of the Technology as additional insureds. Within ninety (90) days
after the execution of this Agreement and thereafter annually between January 1
and January 31 of each year, CuraGen will present evidence to ▇▇▇▇ that the
coverage is being maintained with ▇▇▇▇ and its inventors listed as additional
insureds if the Licensed Product has an in vivo effect. In addition, CuraGen
shall provide ▇▇▇▇ with at least 30 days prior written notice of any change in
or cancellation of the insurance coverage.
Section 10. Use of Names.
------------
CuraGen shall not use ▇▇▇▇'▇ name, the name of any inventor or author of
inventions or technology governed by this Agreement, or the name of the
University of Wisconsin in sales promotion, advertising, or any other form of
publicity without the prior written approval of the entity or person whose name
is being used. Notwithstanding the foregoing, CuraGen may state in written
materials that CuraGen has obtained a license from ▇▇▇▇ to the technology which
is the subject of this Agreement.
5
Section 11. United States Government Interests.
----------------------------------
It is understood that the United States Government (through any of its
agencies or otherwise) has funded research, during the course of or under which
any of the inventions of the Licensed Pa' tents were conceived or made, the
United States Government is entitled, as a right, under the provisions of 35
U.S.C. (S) 200-212 and applicable regulations of Chapter 37 of the Code of
Federal Regulations, to a nonexclusive, nontransferable, irrevocable, paid-up
license to practice or have practiced the invention of such Licensed Patents for
governmental purposes. Any license granted to CuraGen in this Agreement shall be
subject to such right.
Section 12. Confidential Information.
------------------------
The following provisions relate to restrictions on the disclosure and use
of Confidential Information by the parties:
A. Confidentiality. CuraGen and ▇▇▇▇ each agree to treat as
confidential and to use only in the conduct of its business, all Confidential
Information disclosed to it by the other party.
B. Non-Disclosure and Non-Use. CuraGen and ▇▇▇▇ each agrees not to
disclose any of the Confidential Information received from the other party to
any unauthorized third party and not to use any of the Confidential Information
except in the conduct of its business until the later of (a) five years from the
effective date of this Agreement; or (b) two years from the effective date of
termination.
C. Release from Restrictions. All information which is
characterized as Confidential Information shall cease to be confidential and
CuraGen and/or ▇▇▇▇ shall be released from their respective obligations under
Sections 1 2A and 1 2B hereof on the date when, through no fault or omission of
the party seeking such release, such information becomes (a) disclosed in
published literature; (b) generally available to industry; `or `(c) obtained by
the party seeking such release from a third party without binder of secrecy,
provided, however, that such third party has no confidentiality obligations to
the other party.
Section 13. Miscellaneous.
-------------
This Agreement shall be construed in accordance with the internal laws of
the State of Wisconsin. If any provisions of this Agreement are or shall come
into conflict with the laws or regulations of any jurisdiction or any
governmental entity having jurisdiction over the parties or this Agreement,
those provisions shall be deemed automatically deleted, if such deletion is
allowed by relevant law, and the remaining terms and conditions of this
Agreement shall remain in ,full force and effect. If such a deletion is not so
allowed or if such a deletion leaves terms thereby made clearly illogical or
inappropriate in effect, the parties agree to substitute new terms as similar in
effect to the present terms of this Agreement as may be allowed under the
applicable laws and regulations. The parties hereto are independent contractors
and not joint venturers or partners.
6
Section 14. Notices.
-------
Any notice required to be given pursuant to the provisions of this
Agreement shall be in writing and shall, be deemed to have been given at, the
earlier of the time when actually received as a' consequence of any effective
method of delivery, including but not limited to hand delivery, transmission by
telecopier, or delivery by a professional courier service or the time when sent
by certified or registered mail addressed to the party for whom intended at the
address below or at such changed address as the party shall have specified by
written notice, provided that any notice of change of address shall be effective
only upon actual receipt.
(a) Wisconsin Alumni Research Foundation
Attn: Managing Director
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(b) CuraGen Corporation
Attn: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Ph.D.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Section 15. Integration.
-----------
This Agreement constitutes the full understanding between the parties with
reference to the subject matter hereof, and no statements or agreements by or
between the parties, whether orally or in writing, made prior to or at the
signing hereof, shall vary or modify the written terms of this Agreement.
Neither party shall claim any amendment, modification, or release from any
provisions of this Agreement by mutual agreement, acknowledgement, or otherwise,
unless such mutual agreement is in writing, signed by the other party, and
specifically states that it is an amendment to this Agreement.
Section 16. Benefits.
--------
All terms and provisions of this Agreement shall bind and inure to the benefit
of the parties hereto, and upon their respective successors and assigns as those
are permitted under the terms of this Agreement.
Section 17. Contract Formation and Authority.
--------------------------------
The persons signing on behalf of ▇▇▇▇ and CuraGen hereby warrant and
represent that they have authority to execute this Agreement on behalf of the
party for whom they have signed.
7
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement on
the dates indicated below.
WISCONSIN ALUMNI RESEARCH FOUNDATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Date: August 20, 1996
------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Managing Director
CURAGEN CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Date: August 13, 1996
------------------------------------
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President
________________________________________________________________________________
Reviewed by ▇▇▇▇'▇ Attorney:
/s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇▇
----------------------------------------
▇▇▇▇▇▇▇▇▇ ▇. ▇. ▇▇▇▇▇▇, Esq.
August 17, 1996
(▇▇▇▇'▇ attorney shall not be deemed a signatory to this Agreement.)
8
APPENDIX A
A. "Licensed Patents" shall refer to and mean those patents and patent
applications listed on Appendix B hereto, and reissues and extensions of such
patents, and continuations, continuations-in-part, divisions, and renewals of
such applications; and United States and foreign patents granted thereon, and
reissues and extensions thereof.
B. "Affiliates" shall mean any corporation, company, partnership, joint
venture or other entity which controls, is controlled or under common' control
with CuraGen or ▇▇▇▇ as the case may be. For the purposes of this definition,
control shall mean the direct or indirect ownership of at least fifty percent
(50%) or, if less than fifty percent (50%), the maximum percentage as allowed by
applicable law of (a) the stock shares entitled to vote for the election of
directors; or (b) ownership interest.
C. "Products" shall refer to and mean [XXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX]
D. "Date of First Commercial Sale" shall mean the date when cumulative
sales to the retail market of Products exceeds [XXXXXXXXX].
E. "Selling Price" shall mean, in the case of Products that are sold, the
invoice price to the retail customer of Products (regardless of uncollectible
accounts) less any discounts, shipping costs, allowances because of returned
Products, or `sales taxes. In the event of a sale to a previous purchaser of
Products of a component that incorporates the technology of the Licensed
Patents, the "Selling Price" will be the price of solely the component.
F "Licensed Field" shall be limited to the field of [XXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX].
G. "Licensed Territory" shall be worldwide.
H. "Confidential Information" shall mean this Agreement, the Development
Plan and Development Reports, and any and all books, records and business
information required to be supplied to ▇▇▇▇ by CuraGen under the terms of this
Agreement.
9
[Confidential Treatment Requested]
APPENDIX B
LICENSED PATENTS AND PATENT APPLICATIONS
----------------------------------------
REFERENCE PATENT ISSUE APPLIC. SERIAL
NUMBER COUNTRY NUMBER DATE NUMBER
--------------------------------------------------------------------------------
[XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX]
XXXXXXXX XXXX XXXXXXXXX XXXXXXX
XXXXXXXX XXXX XXXXXXXXX XXXXXXX
XXXXXXXX XXXXXX XXXXXXX
XXXXXXXX XXX XXXXXXXXXX
XXXXXXXX XXXXX XXXXXXXX
10
[Confidential Treatment Requested]
▇▇▇▇ ROYALTY REPORT
-------------------
CuraGen:____________________________ Agreement No.:_________________
Inventor:___________________________ P#: P
-------------------------------------
Period Covered: From: / /199 Through: / /199
------------- --------------------------
Prepared By: _____________ Date: _______________________________
Approved By: _____________ Date: _______________________________
If license covers several major lines, please
prepare a separate report for each line.
Then combine all product lines into a summary
report.
Report Type: Single Product Line Report:______________________________
Multiproduct Summary Report. Page 1 of ____ Pages
Product Line Detail. Line:________ Tradename:_______
Page:____________
Report Currency: U.S. Dollars Other______________________________________
==============================================================================================
Gross * Less: Net Royalty Period Royalty Amount
Country Sales Allowances Sales Rate
==============================================================================================
This Year Last Year
----------------------------------------------------------------------------------------------
U.S.A.
----------------------------------------------------------------------------------------------
Canada
==============================================================================================
Europe
------
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
==============================================================================================
Japan
==============================================================================================
Other
-----
==============================================================================================
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------
==============================================================================================
TOTAL:
==============================================================================================
Total Royalty:______________ Conversion Rate:_______________ Royalty in U.S.
Dollars: $______________
The following royalty forecast is non-binding and for ▇▇▇▇'▇ internal
planning purposes only:
Royalty Forecast Under This Agreement: Next Quarter:_____Q2:_____Q3:_____Q4:___
________________________________________________________________________________
* On a separate page, please indicate the reasons for returns or other
adjustments if significant.
Also note any unusual occurrences that affected royalty amounts during this
period.
To assist ▇▇▇▇'▇ forecasting, please comment on any significant expected trends
in sales volume.
________________________________________________________________________________
APPENDIX D
DEVELOPMENT PLAN
----------------
[XXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXX XXXX XXXX
XXXXXXXXX XX XX XX XX XX XX XX XX XXXXXXXXXXXXXX
XXXXX
XXXXXXXXXXXXXXXXX X
XXXXXX
XXXXXXXXXXXXXXXXXX
X
XXXXXXXXXXXXXXXXXXXXX X
XXXXXXXXXXXXXXXXXXXXXX X
XXXXXXXXXXXXXXXXX X XXXXXX XXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXX X XXXXXX XXXXXXXXXXXXXXX
[Confidential Treatment Requested]
