[*] = 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.
Exhibit 10.16
LICENSE AGREEMENT
THIS AGREEMENT made December 15, 2000.
BETWEEN:
THE BOARD OF GOVERNORS OF
THE UNIVERSITY OF WESTERN ONTARIO,
(the "University")
AND:
BIOSTREAM, INC.
a corporation incorporated under the laws of the State of Massachusetts,
and having a place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇,
(the "Licensee")
WHEREAS:
A. The University has been engaged in research in the course of which it has
invented or developed a certain technology due to the efforts of the
Inventors in the Department of Chemistry of the University;
B. The Licensee wishes to obtain from the University and the University has
agreed to grant a license to the Licensee to use or cause to be used such
technology to manufacture, market, sell, distribute, lease and/or license
or sublicense products derived or developed from such technology;
NOW THEREFORE in consideration of the premises and of the mutual covenants set
forth in this Agreement, the parties hereto agree as follows:
SECTION 1 - DEFINITIONS
1.01 In this Agreement, unless a contrary intention appears:
(a) "Affiliate" means any corporation, company, partnership, joint
venture or other entity which controls, is controlled by, or is
under common control with, a party to this Agreement; for purposes
of this Section 1.01(a), control shall mean, in the case of
corporate entities, the direct or indirect ownership of voting
shares carrying more than 50% of the votes for the election of
directors and sufficient votes to elect a majority of the board of
directors;
(b) "Business Day" means every day other than Saturday, Sunday, and
statutory holidays in the State of Massachusetts;
(c) "Confidential Information" means the Technology and the information
provided to the University pursuant to Section 8.01;
(d) "Date of Commencement" or "Commencement Date" means the date on
which this Agreement shall come into force, which shall be the
fifteenth day of December, 2000;
(e) "Field of Use" means all uses of the Technology;
(f) "Net Revenue" means the total of all amounts invoiced by Licensee
and its authorized Affiliates and sublicensees and agents for sales
of Products, which for the purposes of royalty payments shall be
limited to those sold in such portions of the Territory to which
Patent Rights apply, net of all separately invoiced and actually
incurred charges relating to such sales, for: (a) credits,
allowances, discounts and rebates to, and chargebacks from the
account of, purchasers in respect of Products; (b) actual freight
and insurance costs incurred in transporting Products to such
purchasers; (c) reasonable and customary cash, quantity and trade
discounts and other price reduction programs in respect of Products;
(d) sales, use value-added and other direct taxes incurred in
respect of Products; and (e) customs duties, surcharges and other
governmental charges incurred in connection with the exportation or
importation of Products. Product shall be deemed to have been sold
and included in Net Revenue the earlier of delivery or payment.
Where any Net Revenue is derived from a country other than Canada,
it shall be converted to the equivalent in Canadian dollars on the
date received by the Licensee or any such Affiliate at the rate of
exchange set by the Bank of Montreal in Toronto for such date, of
converting the currency of such revenue into Canadian dollars. The
amount of Canadian dollars resulting from such conversion shall be
included in the Net Revenue;
(g) "Licensee Improvement" means any addition to or modification of a
component or a material useful in the Technology or the Patent
Rights made by the Licensee or by any authorized Affiliate,
sublicensee, or agent,
(h) "Licensee Processed Material" means any substance, product, or
compound that is processed by the Licensee or by any of its
authorized Affiliates, sublicensees, or agents and which utilizes
the Technology,
(i) "Milestone Payments" has the meaning set forth in Section 5.02,
(j) "Materials" means any substance, product or compound (including all
cell lines, vectors, plasmids, clones, micro organisms, anti-bodies,
antigens, test plates, reagents, chemicals, compounds, physical
samples, models and specimens) delivered by the University to the
Licensee or to any authorized Affiliate, sublicensee, or agent,
(k) "Patent Rights" means pending US National Phase patent application
No. 09/529,017, "Preparation of Radiolabelled Haloaromatics Via
Polymer-Bound
Intermediates", the inventions described and claimed therein, and
any divisions, continuations, continuations-in-part to the extent
that their claims are dominated by existing Patents, and patents
issuing thereon or reissues thereof; and any and all foreign patents
and patent applications corresponding thereto.
(l) "Product(s)" means any goods, products or Licensee Processed
Material covered by one or more claims of the University Patent
Rights or University Improvement or of any Licensee Improvement,
manufactured with or utilizing any Technology,
(m) "Related Person(s)" has the meaning assigned to it in section 251 of
the Income Tax Act of Canada,
(n) "Royalty Due Dates" means the last Business Day of January, April,
July, and October of each and every year during which this Agreement
remains in full force and effect,
(o) "Technology" means the Patent Rights and any and all Materials,
knowledge, know-how and/or techniques invented, developed and/or
acquired, prior to or after the Date of Commencement, by the
University or the Licensee, relating to Patent Rights and is useful
or necessary to the development or production of Products,
(p) "Territory" means worldwide,
(q) "University Improvement" means any addition to or modification of a
component or a material useful in the Technology or the Patent
Rights made by the University,
(r) "University Trade-marks" means any ▇▇▇▇, trade-▇▇▇▇, service ▇▇▇▇,
logo, insignia, seal, design or other symbol or device used by the
University and associated with or referring to the University or any
of its facilities.
SECTION 2 - PROPERTY RIGHTS IN AND TO THE TECHNOLOGY
2.01 OWNERSHIP. The parties acknowledge and agree that the University shall
retain ownership of the Patent Rights and Materials and shall own all
University Improvements made both before and after the Commencement Date.
Licensee shall own all Licensee Improvements.
2.02 FURTHER ASSURANCES. The Licensee shall, at the request of the University,
enter into such further agreements and execute any and all documents as
may be required to confirm that ownership of the Technology resides with
the University.
2.03 LICENSEE TO REPORT LICENSEE IMPROVEMENTS. From time to time and in any
event no more than once every six months, the Licensee shall, at the
request of the
[*] = 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.
University, deliver in writing the details of any and all Licensee
Improvements, modifications and enhancements made by it relating to the
Technology.
SECTION 3 - GRANT OF RIGHTS
3.01 LICENSE. Subject to the terms and conditions hereof, the University hereby
grants to the Licensee and its authorized Affiliates a perpetual,
royalty-bearing exclusive license to manufacture, use, market, sell and
distribute Products within the Field of Use in the Territory and to
commercially exploit the Technology within the Field of Use in the
Territory. Notwithstanding any other provision hereof, the parties
acknowledge and agree that the University shall have the right to use the
Technology and Licensee Improvements without charge whatsoever for
research, scholarly publication, teaching and other non-commercial uses.
3.02 SUBLICENSING. The Licensee may grant sublicenses of the Technology,
subject to the terms and conditions of Section 3.03.
3.03 SUBLICENSES. Licensee shall provide a true and complete copy of any
sublicense agreement or any amendment or termination thereof within thirty
(30) days of entering into any such sublicense agreement, or any amendment
or termination thereof. All sublicense agreements executed by Licensee
pursuant to this Section 3.03 shall be consistent with the terms of this
Agreement including but not limited to Diligence, Milestones, Reports,
Insurance, Termination and Indemnity. Licensee agrees to forward to
Licensor on an annual basis a copy of any report received by Licensee from
its sublicensee(s) which is pertinent to an accounting for the payment of
Milestone Payments (as defined in Section 5.02), royalties or other
sublicense income under such sublicense agreements. Licensee is
responsible for the performance of the sublicensee(s) relevant to this
Agreement. In no event will a Licensee sublicensee be permitted to further
sublicense or to assign or transfer any rights which have been granted to
it by Licensee. Upon termination of this Agreement, any and all existing
sublicenses granted by Licensee shall be assigned to the University.
SECTION 4 - TERM
4.01 TERM. This Agreement shall terminate on the expiration of the last patent
obtained pursuant to Section 7 herein, unless earlier terminated pursuant
to Section 13 herein.
SECTION 5 - INITIAL LICENSE FEE, MILESTONE PAYMENTS AND ROYALTIES
5.01 INITIAL LICENSE FEE. The Licensee agrees to pay to the University, as an
initial license fee, the sum of $[******] (Canadian funds). The said sum
shall be paid concurrently with the execution of this Agreement. The said
sum shall not be refundable to the Licensee under any circumstances, in
whole or in part.
[*] = 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.
5.02 MILESTONE PAYMENTS. Licensee shall pay the University milestone product
development payments with respect to the development of Product as set
forth in the table below, each payment becoming due and payable on the
first date of completion of such milestone regardless of the country in
which such milestone is completed. Regardless of the number of Products
successfully completing a milestone, payment will be made only upon the
first such successful completion by any Product.
Milestone Payment
-------------------------------------- ----------------
Initiation of Phase I Clinical Trail Canadian $[******]
Completion of Phase II Clinical Trial Canadian $[******]
Completion of Phase III Clinical Trial Canadian $[******]
Grant of Regulatory Approval Canadian $[******]
5.03 ROYALTIES.
In consideration of the license granted hereunder, the Licensee shall pay
to the University:
(a) a royalty of [**************] percent ([***]%) of Net Revenue. For
greater clarification, on sales between the Licensee, and/or its
Affiliates, sublicensees or agents for resale purposes, the royalty
shall be paid only on the resale value; and
(b) In the case of sublicenses or other arrangements with third parties
with whom the Licensee is undertaking any efforts to further develop
or commercialize the Technology and/or Product(s) jointly or in
association with such third party, the Licensee shall also pay to
University [****] percent ([*]%) of any income or other
consideration received (e.g. license issue fees, milestone payments,
etc. but excluding reimbursement by sublicensee or the third party
of Licensee's out-of-pocket expenses for research and development).
The non-royalty payment provided for in this Section 5.03(b) will
not apply to the first Product to which the Milestone Payments under
Section 5.02 are applicable; and
(c) In the case of any other sublicenses to third parties, Licensee
shall also pay to University a percentage of any income or other
consideration received (e.g. license issue fees, milestone payments,
etc.) according to the following sliding scale:
(i) if sublicensed within one year after commencement of this
Agreement, [*****] percent ([**]%),
(ii) if sublicensed within year two or three after
commencement of this Agreement, [******] percent ([**]%),
(iii) if sublicensed within year four or five after
commencement of this Agreement, [***] percent ([**]%),
(iv) if sublicensed within year six after commencement of this
Agreement or any time thereafter, [*****] percent ([*]%).
5.04 ROYALTY PAYMENT DATES. The royalty shall become due and payable on each
Royalty Due Date and shall be calculated with respect to the Net Revenue
of the
[*] = 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.
Licensee in the three month period immediately preceding the month in
which the applicable Royalty Due Date falls.
5.05 CURRENCY OF PAYMENTS. All payments made by the Licensee to the University
hereunder shall be made in Canadian dollars without any reduction or
deduction of any nature or kind whatsoever, except as may be prescribed by
Canadian law.
5.06 MINIMAL ANNUAL ROYALTY. The Licensee shall pay a minimum annual royalty to
the University of the sum of [************] dollars (Cdn$[******]) which
is payable at the end of each calendar year in which Licensee does not
sponsor research in the area of radiolabelling technology, at University
at a level of at least [**************] dollars (Cdn$[******]) in that
calendar year. There shall be no requirement for a minimum, annual royalty
in the year 2000. Minimum annual royalties payable under this Section 5.06
shall be credited against the annual running royalty payable under Section
5.03.
SECTION 6 - ASSIGNMENT
6.01 ASSIGNMENT BY THE LICENSEE. Except as provided for in Section 7 herein,
the Licensee will not assign, transfer, mortgage, charge or otherwise
dispose of any or all of the rights, duties or obligations granted to it
under this Agreement without the prior written consent of the University.
The University is prepared to allow an assignment of the License Agreement
with prior written notification to the University. If this License
Agreement is assigned independently of a sale of the Licensee, as a going
concern, other than as an assignment to an Affiliate, then the University
is entitled to the same percentage of proceeds or, consideration as per
the sliding scale pursuant to Section 5.03. The assignee or the Affiliate
as the case may be shall be responsible for performance of the terms of
this License Agreement as though the original signatory thereto.
6.02 ASSIGNMENT BY THE UNIVERSITY. The University shall have the right to
assign its rights, duties and obligations under this Agreement to a
corporation or society of which it is the sole shareholder, in the case of
a corporation with share capital, or of which it controls the membership,
in the case of a corporation or society without share capital. In the
event of such an assignment, the Licensee will release, remise and forever
discharge the University from any and all obligations or covenants,
provided however that such corporation executes a written agreement which
provides that such corporation shall assume all such obligations or
covenants from the University and that the Licensee shall retain all
rights granted to the Licensee pursuant to this Agreement.
SECTION 7 - PATENTS
7.01 PATENT RIGHTS. Licensee hereby recognizes and acknowledges the validity of
the Patent Rights licensed hereunder and agrees not to contest such
validity either directly or indirectly by assisting other parties.
7.02 PATENT PROSECUTION: PATENT COSTS. Licensee shall reimburse the University
for invoiced patent costs incurred related to Patent Rights, in the total
amount of Cdn$12,111 within thirty (30) days of receiving copies of
invoices for such patent costs. From and after the date of this Agreement,
the Licensee shall have primary responsibility for the filing, prosecution
and maintenance of patents and/or patent applications worldwide for those
inventions within the Patent Rights, at the Licensee's expense. The
Licensee shall consult with the University as to the prosecution and
maintenance of all such patent applications within the Patent Rights
reasonably prior to any substantive deadline or action, and shall not
substantially limit the scope of patent protection without the
University's consent. The Licensee shall furnish the University with
copies of all relevant documents upon filing the same with the patent
office of any country.
7.03 COPIES OF PATENT RELATED MATERIALS. The University shall provide the
Licensee with copies of the patent applications and the entire prosecution
history thereof relating to the Patent Rights.
SECTION 8 - CONFIDENTIALITY AND PUBLICATION
8.01 DUTY OF CONFIDENTIALITY. The parties hereto acknowledge and agree that
they will treat the Confidential Information as confidential and that they
will use all reasonable efforts not to disclose or communicate or cause to
be disclosed or communicated the Confidential Information to any person or
corporation except as permitted under a sublicense. Such reasonable
efforts will be no less than the efforts used by the receiving party to
protect its own confidential information.
8.02 LICENSEE INTERNAL PROGRAM. Each of the parties covenants and agrees that
it will initiate and maintain an appropriate internal program limiting the
internal distribution of the Confidential Information to its officers,
servants or agents and requiring appropriate non-disclosure agreements
from any and all persons who may have access to the Confidential
Information.
8.03 PUBLICATION. The University shall be permitted to present at symposia,
national or regional professional meetings, and to publish in journals or
other publications, accounts of its research relating to the Technology
provided that the Licensee shall have been furnished copies of the
disclosure proposed therefor at least 30 days in advance of the
presentation or publication date. If the Licensee does not within 20 days
after receipt of the proposed disclosure object to such presentation or
publication on the grounds that it contains Confidential Information or
confidential information with respect to Licensee Improvements or material
that is patentable, the University may proceed with the presentation or
publication. In the event that the Licensee objects to the presentation or
publication on the grounds,
(a) that it contains Confidential Information or confidential
information with respect to Licensee Improvements, the University
shall co-operate in all reasonable
respects in making revisions to any proposed disclosures to remove
all Confidential Information or confidential information with
respect to Licensee Improvements to the satisfaction of the
Licensee; or
(b) that it contains material that is patentable, the Licensee may
request that the intended disclosure be delayed for an additional
period not exceeding 90 days to permit such patenting to occur.
After such period has elapsed, the University shall be free to
present and/or publish said disclosures.
SECTION 9 - ACCOUNTING RECORDS
9.01 ACCOUNTING RECORDS. The Licensee shall maintain at its principal place of
business, separate accounts and records of business done pursuant to this
Agreement, such accounts and records to be in sufficient detail to enable
proper payments to be made under this Agreement, and the Licensee shall
require Affiliates, sublicensees, and agents to keep similar accounts.
9.02 REPORTS. The Licensee shall deliver to the University by no later than 30
days after the Royalty Due Date, together with the royalty payable
thereunder, a report (the "Accounting") setting out particulars of the
sale, distribution, leasing or sublicensing of the Technology and/or
Products as shall be pertinent to the payment of royalties, including the
following:
(a) the number of Products sold by Licensee and its authorized
Affiliates or permitted sublicensees or agents in each country
during the applicable royalty period:
(b) the Gross Revenue for each Product or Technology charged by Licensee
and its Affiliates or permitted sublicensees or agents during the
applicable royalty period;
(c) a calculation of Net Revenue in each country, including a listing of
applicable deductions;
(d) total royalty payable on Net Revenue in Canadian dollars, together
with the exchange rates used for conversion which shall be the rate
of exchange established by the Bank of Montreal in Toronto on the
date payment is received by the Licensee; and
(e) withholding taxes, if any, required to be deducted as a payment by
the University with respect to such royalty payment.
Licensee shall also provide to the University periodic reports of all
significant stages and milestones in the development, manufacture and
sale, distribute, leasing or sublicensing of the Technology and/or
Products, including but not limited to, the milestones described in
Section 5.02, by no later than thirty (30) days following the
completion of such stage or milestone; such reports shall be in sufficient
detail to enable the University to assess the status of all required
regulatory approvals relating to the Products, and whether the Licensee is
meeting its obligations under Section 10.01 hereof during the relationship
between the parties.
9.03 GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP). The calculation of
royalties shall be made in accordance with generally accepted accounting
principles from time to time approved by the American Institute of
Certified Public Accountants (or any successor institute) applicable as at
the date on which any calculation is required to be made, and applied on a
consistent basis.
9.04 RETENTION OF ACCOUNTS AND RECORDS. The Licensee shall retain the accounts
and records referred to in Section 9.01 for at least three (3) years after
the date upon which they were made and shall permit any duly authorized
representative of the University to inspect such accounts and records
during normal business hours of the Licensee at the University's expense
provided University gives Licensee at least two days notice of its intent
to conduct such an inspection. The Licensee shall furnish such reasonable
evidence as such representative will deem necessary to verify the
Accounting and will permit such representative to make copies of or
extracts form such accounts, records and agreements at the University's
expense.
9.05 SURVIVAL OF THIS SECTION AFTER TERMINATION. Notwithstanding the
termination of this Agreement, this Section 9 shall remain in full force
and effect until:
(c) all payments, including but not limited to royalties, required to be
made by the Licensee to the University under this Agreement have
been made by the Licensee to the University, and
(b) any other claims of any nature or kind whatsoever of the University
against the Licensee have been settled.
SECTION 10 - PRODUCTION AND MARKETING
10.01 DILIGENCE BY LICENSEE. The Licensee shall use commercially reasonable
efforts to: (a) promote, market and sell the Products; (b) utilize the
Technology; and (c) meet or cause to be met the world market demand for
the Products within jurisdictions where Patent Rights exist. The Licensee
shall also comply with the research and development timeline provided in
Schedule "B".
10.02 RESTRICTION ON USE OF UNIVERSITY TRADE-MARKS, NAME. The Licensee shall not
use any of the University Trade-marks or make reference to the University
or its name in any advertising publicity whatsoever, without the prior
written consent of the University. No prior written consent by the
University is required when University is identified solely for the
purposes of disclosures required by law or providing factual information
so long as in either instance there is no implied endorsement of any
Product or use by the Licensee of the Patent Rights. Acknowledgements
customary in scientific publications are expected.
10.03 EVALUATION. In the event that the University is of the view that the
Licensee is in breach of the covenant contained in this Section 10, the
University shall notify the Licensee and the parties hereto shall appoint
an independent evaluator (the "Evaluator"), mutually acceptable to both
parties, to review the efforts made by the Licensee with respect to the
promotion, marketing, sale and distribution of the Products and the
Technology (the "Evaluation").
10.04 EVALUATION (CONTINUED). In the event that the parties cannot agree on the
Evaluator, the Evaluator shall be chosen by arbitration in accordance with
Section 16.03. Evaluations shall be limited to one per calendar year.
10.05 EFFECT OF EVALUATION. If the Evaluator determines that the Licensee is in
breach of the covenant contained in this Section 10, then the University
shall have the right to terminate this Agreement as provided in Section 13
herein. If the Evaluator determines that the Licensee is not in breach of
the covenant contained in this Section 10, then the University shall not
terminate this Agreement for breach of this Section.
10.06 COST OF EVALUATION. The cost of an evaluation hereunder shall be borne 50%
by the Licensee and 50% by the University.
SECTION 11 - INSURANCE
11.01 INSURANCE REQUIRED FOR LICENSEE. One month prior to the first sale of a
Product, the Licensee will give notice to the University of the terms and
amount of the comprehensive public liability and product liability
insurance which it has placed in respect of the same, which in no case
shall be less than the insurance which a reasonable and prudent
corporation carrying on a similar business would acquire. This insurance
shall be placed with a reputable and financially secure insurance carrier,
shall include the University, the Board of Governors, its faculty,
officers, employees, students and agents as additional insureds, and shall
provide primary coverage with respect to the activities contemplated by
this Agreement. Such policy shall include severability of interest and
cross-liability clauses and shall provide that the policy shall not be
canceled or materially altered except upon at least 30 days' written
notice to the University. The University shall have the right to require
reasonable amendments to the terms or the amount of coverage contained in
the policy. Failing the parties agreeing on the appropriate terms or the
amount of coverage, then the matter shall be determined by arbitration as
provided for herein. The Licensee shall provide the University with
certificates of insurance evidencing such coverage seven days before
commencement of sales of any Product and the Licensee covenants not to
sell any Product before such certificate is provided and approved by the
University.
11.02 INSURANCE REQUIRED FOR SUBLICENSEES. The Licensee shall require that each
sublicensee under this Agreement shall procure and maintain, during the
term of the sublicense, public liability and product liability insurance
in reasonable amounts, with a reputable and financially secure insurance
carrier. The Licensee covenants that no party shall be subrogated to the
rights of the Licensee for the purposes of pursuing any claim against the
University.
11.03 INSURANCE NOT TO AFFECT INDEMNITIES. The existence of any insurance
policies above will not relieve the Licensee from their obligations under
the indemnification provisions contained in this Agreement.
SECTION 12 - DISCLAIMER OF WARRANTIES, LIMITATION OF LIABILITY
12.01 NO WARRANTIES. The University makes no representations or warranties,
either express or implied, with respect to the Technology or Products and
specifically disclaims any implied warranty of merchantability or fitness
for a particular purpose. The University warrants and represents that it
has the authority to license the Patent Rights to the Licensee in
accordance with the terms herein.
12.02 NO LIABILITY FOR LOSS OF PROFITS. The University shall not under any
circumstances be liable for any loss of profits, be they direct,
consequential, incidental, or special or other similar or like damages
arising from any defect, error or failure to perform with respect to the
Technology or Products, even if the University has been advised of the
possibility of such damages.
12.03 FURTHER LIMITATION OF LIABILITY. Notwithstanding any other provision of
this Agreement, the University shall not be liable for any indirect,
consequential, incidental, special or other similar damages, that may
arise in any manner.
12.04 ADDITIONAL DISCLAIMERS. Nothing in this Agreement shall be construed as:
(a) a warranty or representation by the University as to the validity or
scope of the License granted pursuant to this Agreement,
(b) a warranty or representation by the University that anything made,
used, sold or otherwise disposed of under the License granted in
this Agreement is or will be free from infringement of patents,
copyrights, trade-marks, registered design or other intellectual
property rights,
(c) an obligation by the University to bring or prosecute actions or
suits against third parties for infringement of patents, copyrights,
trade-marks, registered design or other intellectual property or
contractual rights, or
(d) the conferring by the University of the right to use in advertising
or publicity the University Trade-marks.
12.05 ENFORCEMENT OF TECHNOLOGY. In the event of an alleged infringement of the
Technology or any right with respect to the Technology, the Licensee shall
have the right to prosecute litigation designed to enjoin infringers of
the Technology upon notification to the University. The University agrees
to co-operate to the extent of executing all necessary documents and to
vest in the Licensee the right to institute any such suits so long as all
the direct or indirect costs and expenses of bringing and conducting any
such litigation or settlement shall be borne by the Licensee and in such
event recoveries shall enure to the Licensee.
12.06 INFRINGEMENT ACTIONS BY THIRD PARTIES. In the event of any complaint
alleging infringement or violation of any patent or other proprietary
rights is made against the Licensee with respect to the use of the
Technology or the manufacture, use or sale of the Products, the following
procedure shall be adopted:
(a) the Licensee shall promptly notify the University upon receipt of
any such complaint and shall keep the University fully informed of
the actions and positions taken by the complainant and taken or
proposed to be taken by the Licensee,
(b) subject to this section, all costs and expenses incurred by the
Licensee in investigating, resisting, litigating and settling such a
complaint, including the payment of any award of damages and/or
costs to any third party, shall be borne by the Licensee,
(c) no decision or action concerning or governing any final disposition
of the complaint shall be taken without full consultation with and
by the University,
(d) the University may elect to participate formally in any litigation
involving the complaint, to the extent that the court may permit but
any additional expenses generated by such formal participation shall
be borne entirely by the University (subject to the possibility of
recovery of some or all of such additional expenses from the
complainant),
(e) if the complainant is willing to accept an offer of settlement and
one of the parties to this Agreement is willing to make or accept
such offer and the other is not, then the unwilling party shall
conduct all further proceedings at its own expense, and shall be
responsible for the full amount of any damages, costs, accounting of
profits and settlement costs in excess of those provided in such
offer, but shall be entitled to retain into itself the benefit of
any litigated or settled result entailing a lower payment of costs,
damages, accounting of profits and settlement costs than that
provided in such offer.
(f) the royalties and any milestone payments payable pursuant to this
Agreement shall be paid by the Licensee to the University in trust
from the date the complaint is made until such time as a resolution
of the complaint has been
finalized. If the complainant prevails in the complaint, then the
royalties paid to the University in trust pursuant to this Section
shall be returned to the Licensee, provided that the amount returned
to the Licensee hereunder shall not exceed the amount paid by the
Licensee to the complainant in the settlement or other disposition
of the complaint including reasonable Licensee legal costs. If the
complainant does not prevail in the complaint, then the University
shall be entitled to all royalties paid to it pursuant to this
Section. Where the Licensee is thereafter obliged to also make
royalty payments to the complainant (the "Third Party Payment"), it
shall be entitled to deduct such Third Party Payment from the
royalties otherwise payable hereunder, provided that the royalties
payable to the University shall not be reduced by more than 50% of
the royalties as currently calculated, had the complainant not been
successful.
SECTION 13 - TERMINATION FOR DEFAULT
13.01 This Agreement may be terminated by either party, upon giving notice in
writing to the other of its intention to do so, in the event that:
(a) such party makes an assignment for the benefit of creditors,
appoints a receiver or manager for itself or a substantial part of
its assets, or otherwise takes advantage of any statute or law
designed for the relief of debtors; or
(b) such party is petitioned under any legislation in respect to
bankruptcy or insolvency legislation by a third party and does not
successfully challenge such petition within sixty (60) days
following the filing of such petition; or
(c) any resolution is passed or order made or other steps taken for the
winding up, liquidation or other termination of the corporate
existence of such party, unless such is taken in conjunction with a
corporate restructuring or reorganization or sale of the party as a
going concern, or if such party ceases to carry on business;
it being acknowledged that termination shall be effective upon delivery of
a notice in accordance with Section 16.09 for any of (a), (b) or (c)
hereof, without any further period of time permitted to such defaulting
party to cure the default;
(d) such party fails to pay any monies required to be paid pursuant to
this Agreement within five (5) days of the date due for payment,
provided that written notice of such default has been delivered by
the other party in accordance with Section 16.09 and the defaulting
party fails within ten (10) Business Days after receipt of such
notice to make such payment;
(e) such party fails to perform or otherwise breaches any material
obligation hereunder, and such defaulting party has not cured the
default, failure or breach within thirty (30) days following the
giving of written notice in accordance with Section 16.09 hereof, or
such longer period as may be
reasonably required in the circumstances, so long as the defaulting
party is diligently pursuing its obligations to cure; or
(f) if the Licensee grants a security interest in the Technology to any
other party without the prior written consent of the University.
In no event, shall any such notice of termination or intention to terminate be
deemed to waive any rights of such party's right to claim damages or to any
other remedy which the party giving the notice of breach may have as a
consequence of the other party's failure or breach.
13.02 Intentionally deleted.
13.03 RIGHTS UPON TERMINATION. If this Agreement is terminated pursuant to
Section 13.01,
(a) all remaining Materials shall be returned to the University;
(b) all rights to the Technology (except Licensee Improvements) and the
University Improvements shall revert to the University; and
(c) the Licensee shall cease to use the Technology (except Licensee
Improvements to the extent practicing Licensee Improvements would
not infringe Patent Rights) in any manner whatsoever or to
manufacture the Products within five days of the date on which this
Agreement is terminated ("Effective Date of Termination"),
Saturdays, Sundays and statutory holidays excepted. The Licensee
shall then deliver or cause to be delivered to the University a
complete final accounting of all Net Revenue and of all other
amounts payable to the Licensee in respect of the sublicensing of
the Technology and/or the sale or distribution of Products, within
30 days from the Effective Date of Termination. The accounting will
also specify, in or on such terms as the University may in its sole
discretion require, the inventory or stock of Products manufactured
and remaining unsold (the "Unsold Products") on the Effective Date
of Termination. If requested by the University, the Unsold Products
shall be sold under the direction of the University until the Unsold
Products have all been sold or the University waives any further
interest in the Unsold Products. The Licensee will make royalty
payments to the University in the same manner specified in Section 5
herein on all Unsold Products.
13.04 PRESERVATION OF ALL REMEDIES AND RIGHTS. Upon any termination of this
Agreement, the non-defaulting party shall have the right to enforce one or
more remedies successively or concurrently in accordance with applicable
law and retains all rights and remedies against the defaulting party. The
University may proceed to enforce payment of all debts owed to the
University and to exercise any or all of the
rights and remedies contained herein or otherwise available to the
University by law or in equity.
13.05 NON-WAIVER. No condoning, excusing or overlooking by any party of any
default, breach or non-observance by any other party at any time or times
in respect of any covenants, provisos, or conditions of this Agreement
shall operate as a waiver of such party's rights under this Agreement in
respect of any continuing or subsequent default, breach or non-observance,
so as to defeat in any way the rights of such party in respect of any such
continuing or subsequent default or breach and no waiver shall be inferred
from or implied by anything done or omitted by such party, save only an
express waiver in writing.
No exercise of a specific right or remedy by any party precludes it from
or prejudices it in exercising another right or pursuing another remedy or
maintaining an action to which it may otherwise be entitled either at law
or in equity.
SECTION 14 - INDEMNITY
14.01 LICENSEE'S INDEMNITY. The Licensee hereby agrees to indemnify and hold
harmless the University, its Board of Governors, officers, employees and
agents against any and all claims arising out of the exercise of any
rights of the Licensee under this Agreement including, without limiting
the generality of the foregoing, against any damages or losses,
consequential or otherwise, arising from or out of the use of Technology
or Products licensed under this Agreement by the Licensee or its
Affiliates, sublicensees, or agents, or their customers or end-users
howsoever the same may arise.
14.02 ACKNOWLEDGEMENT OF EXPERTISE BY LICENSEE. The Licensee covenants and
agrees that it has the expertise necessary to handle the Technology and
the Products with care and without danger to the Licensee, its employees,
agents, or the public. The Licensee covenants that it will not accept
delivery of the Technology until it has requested and received from the
University all necessary information and advice to ensure that it is
capable of handling the Technology in a save and prudent manner in
accordance with this Section 14.02.
14.03 COMPLIANCE BY LICENSEE WITH LAWS. The Licensee covenants and agrees that
it will comply with all laws, regulations and ordinances, whether federal,
provincial, municipal or otherwise with respect to the Materials, the
Technology and/or this Agreement.
SECTION 15 - ADDITIONAL COVENANTS OF LICENSEE
15.01 CHANGE OF CONTROL. Unless otherwise agreed between the parties, the
Licensee shall notify the University in writing within 30 days following:
(a) the sale of a controlling interest (as defined in 1.01(a)) in the
Licensee to pass to any person or persons other than those having a
controlling interest at the date hereof whether by reason of
purchase of shares or otherwise, or
(b) a reorganization of the Licensee (whether by merger, amalgamation or
otherwise) or the transfer of any part of its business to a
subsidiary or associated company.
15.02 POWER OF ENTRY. The Licensee shall permit any duly authorized
representative of the University during normal business hours and at the
University's sole risk and expense with two days notice to enter upon and
into any premises of the Licensee for the purpose of inspecting the
Products and the manner of their manufacture and the use of the Materials
and the Technology and generally of ascertaining whether or not the
provisions of this Agreement have been, are being, or will be complied
with by the Licensee.
SECTION 16 - GENERAL
16.01 RELATIONSHIP. Nothing contained herein shall be deemed or construed to
create between the parties hereto a partnership, joint venture or
employment relationship. No party shall have the authority to act on
behalf of any other party, or to commit any other party in any manner or
cause whatsoever or to use any other party's name in any way not
specifically authorized by this Agreement. No party shall be liable for
any act, omission, representation, obligation or debt of any other party,
even if informed of such act, omission, representation, obligation or
debt.
16.02 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the Province of Ontario and the laws of Canada
applicable therein.
16.03 DISPUTE RESOLUTION. In the event of a dispute between the parties arising
out of or in connection with this Agreement or regarding the
interpretation of the provisions hereof, the procedure set forth in
Schedule "A" shall apply.
16.04 INTERIM PROTECTION. Section 16.03 shall not prevent a party hereto from
applying to a court of competent jurisdiction for interim protection such
as, by way of example, an interim injunction.
16.05 ENUREMENT. Subject to the limitations hereinbefore expressed, this
Agreement shall enure to the benefit of and be binding upon the parties,
and their respective successors and permitted assigns.
16.06 HEADINGS. Marginal headings as used in this Agreement are for the
convenience of reference only and do not form a part of this Agreement and
are not be used in the interpretation hereof.
16.07 SURVIVAL OF COVENANTS. The terms and provisions, covenants and conditions
contained in this Agreement which by the terms hereof require their
performance by the parties hereto after the expiration or termination of
this Agreement including, without limitation the provisions of Section 8,
shall be and remain in force notwithstanding such expiration or other
termination of this Agreement for any reason whatsoever.
16.08 SEVERABILITY. In the event that any part, section, clause, paragraph or
subparagraph of this Agreement shall be held to be indefinite, invalid,
illegal or otherwise violable or unenforceable, the entire agreement shall
not fail on account thereof, and the balance of the Agreement shall
continue in full force and effect.
16.09 NOTICES. All notices, requests, directions or other communications
required or permitted herein will be in writing and will be delivered to
the parties hereto respectively as follows:
If to the Licensee:
Biostream, Inc.
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▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇, President and C.E.O.
Telecopier No: ▇▇▇-▇▇▇-▇▇▇▇
If to the University:
Respecting administrative and financial matters, and interpretation,
amendment or termination of this Agreement:
Office of Industry Liaison
▇▇▇▇▇▇▇▇▇-▇▇▇▇▇▇ Building
Room 319
The University of Western Ontario
▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
Attention: Director
Telecopier No: ▇▇▇-▇▇▇-▇▇▇▇
FOR SCIENTIFIC AND TECHNICAL MATTERS:
Department of Chemistry
Faculty of Science
The University of Western Ontario
▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Telecopier No: ▇▇▇-▇▇▇-▇▇▇▇
In order for any notice, request, direction, or other communication to be
effective, it will be delivered in person or sent by registered mail or
facsimile (followed by hard copy) addressed to the party for whom it is
intended at the above-mentioned address and will be deemed to have been
received if delivered in person, when so delivered; and if sent by
registered mail, when the postal receipt is acknowledged by the other
party; if sent by facsimile, when transmitted. Notwithstanding the
foregoing, any notice where a party gives notice of termination or of its
intention to terminate under Section 13 shall be delivered by courier with
signed receipt. The address of either party may be changed by notice in
the manner set out in this provision.
16.10 ENTIRE AGREEMENT. This Agreement sets forth the entire understanding
between the parties and no modifications hereof shall be binding unless
executed in writing by the parties hereto.
16.11 TIME OF THE ESSENCE. Time shall be of the essence of this Agreement.
16.12 NUMBER, GENDER. Whenever the singular or masculine or neuter is used
throughout this Agreement the same shall be construed as meaning the
plural or feminine or body corporate when the context of the parties
hereto may require.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the
date first written above.
THE BOARD OF GOVERNORS OF
THE UNIVERSITY OF WESTERN ONTARIO
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇
Director, Office of Industry Liaison
I have authority to bind the University.
BIOSTREAM, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: PRESIDENT
By:
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Name:
Title:
I/we have authority to bind the Corporation.
SCHEDULE "A"
DISPUTE RESOLUTION
In the event a dispute or disagreement (hereinafter called "Dispute") arises
between the parties in connection with the interpretation of any provision of
this Agreement or the compliance or non-compliance therewith, or the validity or
enforceability thereof, or the performance or non-performance of either party to
the Agreement, the following Dispute resolution process shall be followed by the
parties:
i. A Dispute will be deemed to have arisen upon the delivery of a written
notice by one party to the other describing the Dispute (herein called the
"Dispute Notice"). Upon delivery of the Dispute Notice, the parties agree
to attempt to resolve the Dispute in a prompt and expeditious manner.
Except for the Dispute Notice, all communications between the parties will
be on a without prejudice basis.
ii. If the parties have not been able to resolve the dispute in a prompt and
expeditious manner after delivery of the Dispute Notice, either party may
at any time thereafter request by written notice to the other party that
the Dispute be escalated to Senior Management.
iii. In the event such a request with written notice is made, each party shall
make available the senior executives specified in the following subsection
("Senior Management") who shall meet within fifteen (15) Business Days
after such request is made at the offices of the party which received the
request to attempt to resolve the Dispute.
iv. The Senior Management appointee for each party is as follows:
Licensee: ▇▇. ▇▇▇▇ ▇▇▇▇▇▇, President and CEO
University: ▇▇. ▇▇▇▇ ▇▇▇▇, Director, Office of Industry Liaison
Either party may change its Senior Management appointee upon prior written
notice to the other.
In case such Dispute is not settled amicably by Senior Management within thirty
(30) days of escalation to Senior Management, such Dispute shall be arbitrated
by an Arbitration Board acting in accordance with the provisions of the
Arbitration Act, 1991 (Ontario), whose decision shall be final and binding upon
the parties. The Arbitration Board shall consist of the person or person that
the parties may agree on and in default of agreement within twenty (20) days
following the expiration of the above-mentioned thirty (30) day period, each of
the parties in dispute shall nominate one member to serve on the Arbitration
Board and shall give notice to the other party of the name of its nominee. If
one party fails to give this notice within fifteen (15) days after the other
party has done so, then the member nominated by the other party shall constitute
the
Arbitration Board. If each party gives this notice, then the two members so
nominated by agreement shall select a third member who shall be Chairman. If the
original two members are unable to agree upon a third member within thirty (30)
days after the second notice has been given, then either party may apply to a
Judge of an appropriate court of the jurisdiction in which the arbitration will
take place to appoint the third member who shall be unconditionally accepted by
both parties. The place of arbitration for disputes for which arbitration is
initiated by either party shall be ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇. Each member shall have
knowledge of and experience in the nuclear medicine industry. The language of
any arbitration will be English.
The arbitration hearing shall commence within sixty (60) days after appointment
of the Arbitration Board is done and shall be completed and a binding award
rendered in writing within sixty (60) days after commencement of the hearing
unless exceptional circumstances warrant delay. The decision of the Arbitration
Board may be entered in any court of competent jurisdiction and execution
entered thereupon forthwith. The law specified in Section 16.02 of This
Agreement above shall apply.
Each party shall bear the cost of preparing its own case. The Arbitration Board
shall have the right to include in the award the prevailing party's costs of
arbitration and reasonable fees of attorneys, accountants, engineers and other
professionals incurred by it in connection with the arbitration.
Notwithstanding the provisions of this Schedule "A", the parties recognize that
a party may desire to seek emergency, provisional, or summary relief (including
temporary injunctive relief) to enforce the provisions of this Agreement
relating to protection of Intellectual Property and/or Confidential Information.
A party may seek such relief, provided, however, that immediately following the
issuance of any emergency, provisional, temporary injunctive or summary relief,
any such judicial proceedings shall be stayed (and each party shall consent to
such stay) pending resolution of any related underlying claims between the
parties.
SCHEDULE "B"
DILIGENCE BY LICENSEE
Years 2001 and 2002 Licensee is funding additional research by way of a two-year
contract research agreement with the University. During this period there shall
be no additional diligence requirements.
During the year 2003, Licensee will label one Product candidate with the
licensed technology and complete all animal toxicology studies necessary to file
an IND in the US and shall file an IND either in the US or its equivalent in
Canada.
During the year 2004, Licensee will begin a Phase I clinical trial of a Product
candidate.
During the year 2005, Licensee will begin a Phase II clinical trial of a Product
candidate.
During the year 2006, Licensee will begin a Phase III clinical trial of a
Product candidate.
During the year 2007, Licensee will file a US NDA or its equivalent in Canada
for a Product candidate.
Licensee will achieve its first sale of Product within six months of US FDA
approval of a NDA or equivalent approval in Canada.
If at any time the Product candidate fails in human trials, Licensee shall
within 30 days of that determination notify the University and Licensee shall
have the opportunity to label another Product candidate with the licensed
technology and the timeline for Diligence by Licensee shall be restarted.
In any year after 2002 if Licensee funds additional research on the licensed
technology at the same or greater levels as in 2001 and 2002, then the Section
10.01 diligence requirements shall be waived for that year.