EXHIBIT 10.6
CALTECH / OMNICORDER TECHNOLOGIES, INC.
LICENSE AGREEMENT
This License Agreement is effective as of the 11th day of May, 1998
(the "Effective Date"), between California Institute of Technology, ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ("Caltech") and OmniCorder
Technologies, Inc. ("OCT"), a Delaware Corporation, having a principal place of
business at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇., ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ("Licensee").
WHEREAS, Caltech, through its Jet Propulsion Laboratory (JPL), has been
engaged in research on Quantum-Well Infrared Photodetector Devices, that was
conducted for the United States Government under Contract NAS7-1 260 between
Caltech and the U.S. National Aeronautics and Space Administration (NASA): and
WHEREAS, Caltech warrants that it controls and is the sole owner by
assignment of the inventions and software listed in Exhibit A attached hereto
(the "Inventions") and related patent rights, subject to certain rights of the
United States Government; and
WHEREAS, Licensee is a start-up company engaged in manufacture and sale
of products and services in the Field; and
WHEREAS, Licensee is desirous of obtaining, and Caltech wishes to grant
to Licensee, an exclusive license within the Field to Licensed Patent Rights and
a nonexclusive license to the Technology as defined in Paragraphs 1.4 and 1.5 of
this License Agreement.
NOW, THEREFORE, the parties agree as follows:
ARTICLE 1. DEFINITIONS
1.1 "Licensed Products" means any product, device or system which is
covered by, or is made by a process covered by, any valid claim of any Licensed
Patent Rights, or which utilizes the Technology.
1.2 "Licensed Services" means the provision of diagnostic or screening
services utilizing the Licensed Products or which utilizes the Technology.
1.3 "Deductible Expenses" means the following items of expense incurred
in connection with sales of Licensed Products to the extent paid or allowed by
Licensee or a Related Company and included in accordance with recognized
principles of accounting in the gross sales price billed: (a) sales, use or
turnover taxes; (b) excise taxes, custom duties or consular fees; (c)
transportation, freight, and handling charges, and insurance on shipments to
customers; (d) trade, cash or quantity discounts or rebates to the extent
actually granted; (e) agent fees or commissions; (f) rebates, refunds, and
credits for any rejected or returned Licensed Products or because of retroactive
price reductions, rebates or chargebacks; and (g) uncollected accounts
receivable attributable to sales of Licensed Products.
1.4 "Related Company" means any corporation, limited liability company
or other legal entity directly or indirectly controlled by, or controlling, or
under common control with Licensee or its successors or assigns, or any
successor or assign of such an entity.
1.5 "Licensed Patent Rights" means worldwide rights to the inventions
described and claimed in the patents, patent applications and invention
disclosures listed in Exhibit A attached hereto; any patents which issue on the
applications or disclosures listed in Exhibit A; reissues; reexaminations,
renewals, extensions, divisionals, continuations, and continuations-in-part of
the
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foregoing; and any foreign counterparts and any other forms of protection
directed to the inventions covered by the patents, applications and invention
disclosures listed in Exhibit A.
1.6 "Technology" means all documented proprietary information, to
include procedures and techniques (know-how), methods, prototypes, samples,
designs, technical data, drawings and reports owned by Caltech / JPL that may be
useful- in the efficient and effective development of Licensed Products and
Licensed Services and which directly relate to the Licensed Patent Rights, but
which are not the subject of the Licensed Patent Rights and which are readily
available from the laboratory of ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ at JPL and provided in a
mutually agreeable form during the period of prosecution of Licensed Patent
Rights. Inventions which are the subject of applications for patents listed in
Exhibit A and which do not issue into patents or Licensed Products which do not
infringe a Valid Claim of Licensed Patent Rights shall be considered to be
Technology.
1.7 "Field" means detection of passively emitted infrared flux or
induced fluorescence from tissue, organs or organ systems for the generation of
images of temperature, emissivity, fluorescence or the modulation of regional
temperature for commercial medical and veterinary diagnostic applications,
including related commercial devices for research, clinical trials and forensic
applications.
1.8 "Net Revenues" means the aggregate amount received by Licensee and
Related Companies from the sale to unrelated third parties of Licensed Products
or Licensed Services, less Deductible Expenses.
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1.9 "Combination Product" means any Licensed Product or Licensed
Services sold in combination with a second discrete product containing one or
more active ingredients or components -Which are not Licensed Products or
Licensed Services.
1.10 "Valid Claim" means the claims of issued patents and patent
applications within the Licensed Patent Rights.
1.11 "Sublicensing" means a grant of permission by Licensee to any
third party or entity (not a Related Company) to exploit Licensed Patent Rights
or Technology for applications for which Licensee, is not directly engaged in
offering Licensed Products or Licensed Services.
ARTICLE 2. PATENT LICENSE GRANT
2.1 Caltech hereby grants to Licensee:
(a) a worldwide, exclusive royalty-bearing license within the
Field under Licensed Patent Rights to make, have made, import, have
imported, sublicense, have sublicensed, use, have used, sell, and have
sold Licensed Products and Licensed Services; and
(b) a worldwide, nonexclusive royalty-bearing license to the
Technology for the development of Licensed Products and Caltech agrees
that it will not provide any third party rights to Technology that
would allow such third party to commercially develop Licensed Products
in a jurisdiction for which licensee is paying royalties under 3.2.b.
This license is subject to:
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(a) the reservation of Caltech / JPL's right to make, have
made, and use Licensed Products for noncommercial educational and
research purposes, but not for sale or other distribution to third
parties; and
(b) the rights of the U.S. Government under ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇ Code, Sections 203-204, including but not limited to the grant
to the U.S. Government of a nonexclusive, nontransferable, irrevocable,
paid-up license to practice or have practiced any invention conceived
or first actually reduced to practice in the performance of work for or
on behalf of the U.S. Government throughout the world.
This license is not transferable by Licensee except as provided in Paragraph
14.4, but Licensee shall have the right to grant nonexclusive or exclusive
Sublicenses hereunder, provided that:
(a) Licensee shall include all its Sublicensing income in
Licensee's reports to Caltech, as provided in Paragraph 7.2, and
Licensee shall pay royalties thereon to Caltech pursuant to Paragraph
3.1; and
(b) Licensee shall furnish Caltech within thirty (30) days of
the execution thereof, a true and complete copy of each Sublicense and
any changes or additions thereto.
2.2 The grant of Licensed Patent Rights shall continue, unless sooner
terminated in accordance with the provisions of this Agreement, until the last
of the patents of the Licensed Patent Rights expires. After the last of the
patents of the Licensed Patent Rights expires. Licensee shall retain a paidup
royalty-free nonexclusive license to the Technology.
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ARTICLE 3. ROYALTIES
3.1 In countries where manufacture, sale, or use of Licensed Products
or the conduct of services is covered by a patent or patent application and
Licensed Products or Licensed Services are manufactured and sold by or for
Licensee or a Related Company, Licensee shall pay Caltech a royalty of:
(a) three percent (3%) of Net Revenues from the sale of
Licensed Products or Licensed Services by Licensee or Related Company,
but this shall not apply to revenues derived from Sublicenses; and
(b) twenty percent (20%) of the royalties or other revenues
Licensee or Related Company receives from Sublicenses other, than from
Related Companies for the sale of Licensed Products or Licensed
Services. Such royalties or other revenues specifically shall not
include (a) payments made by a Sublicensee in consideration of equity
or debt securities of Licensee; (b) payments made by a Sublicensee to
support research activities to be undertaken by Licensee; (c) payments
made upon the achievement by Licensee and Related Company of specified
milestones or benchmarks relating to the development of Licensed
Products; (d) pilot studies; (e) performance-based milestones; (f) the
license or Sublicense of any intellectual property other than
Technology; (g) reimbursement for patent or other expenses, or (h) `the
exclusive or nonexclusive regional license from Licensee to health care
providers for the application of clinical screening and/or diagnosis,
utilizing Licensee's proprietary technology alone or in combination
with a Licensed Product or Licensed Service.
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3.2 In countries where manufacture, sale, or use of Licensed Products
or Licensed Services is not covered by a patent or patent application but the
Licensed Patent Rights or Technology is utilized and Licensed Products are
manufactured and sold by or for Licensee or a Related Company prior to
expiration of any directly related patent, Licensee shall pay Caltech:
(a) one and one-half percent (1.5%) of Net Revenues from the
sale of Licensed Products or Licensed Services by Licensee or Related
Company, but this shall not apply to revenues derived from Sublicenses;
and
(b) ten percent (10%) of the royalties or other revenues
Licensee or Related Company received from Sublicensees other than
related companies for the sale of Licensed Products or Licensed
Services. Such royalties or other revenues specifically shall not
include (a) payments made by a Sublicensee in consideration of equity
or debt securities of Licensee; (b) payments made by a Sublicensee to
support research activities to be undertaken by Licensee or Related
Company; (c) payments made upon the achievement by Licensee or Related
Company of specified milestones or benchmarks relating to the
development of Licensed Products; (d) pilot studies; (e)
performance-based milestones; (f) the license or Sublicense of any
intellectual property other than Licensed Patent Rights or Technology;
(g) reimbursement for patent or other expenses, or (h) the exclusive or
nonexclusive regional license from Licensee to health care providers
for the application of clinical screening and/or diagnosis, utilizing
Licensee's proprietary technology alone or in combination with Licensed
Products or Licensed Services.
3.3 In the event that products are sold in the form of Combination
Products containing one or more active ingredients or components, other than
Licensed Products. Net
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Revenues for such Combination Products will be calculated on a worldwide basis
by multiplying actual net sales of such combination products by the fraction
A/(A+B) where A is the average invoice price during the period of the Licensed
Product when sold separately. and B is the average invoice price of-any other
active component or components in the combination when sold separately by
Licensee, a Related Company, or a Sublicensee. If the active component(s) in the
combination that are not Licensed Products are not sold separately by Licensee,
a Related Company, or a Sublicensee, Net Sales shall be calculated by
multiplying actual net sales of such Combination Products by the fraction A/C
where A is the average invoice price of the Licensed Product when sold
separately and C is the average invoice price of the combination product. If
neither the Licensed Product nor the Combination Product is sold separately by
Licensee, a Related Company, or a Sublicensee, Net Revenues shall be calculated
as above except that A shall be the total manufacturing cost of Licensed Product
and C shall be the total manufacturing cost of the combination.
3.4 If, in any one year period commencing on an anniversary date of
this Agreement after January 31, 1999, Licensee does not pay a minimum of
$10,000.00 in royalties under Paragraphs 3.1 and 3.2, or pay any higher amounts
due thereunder, Caltech shall have the right to terminate this Agreement under
Article 10.1.
3.5 If Licensee or a Related Company is required to make any payment
(including, but not limited to, royalties or other license fees) to one or more
third parties to obtain a license or similar right in the absence of which it
could not legally make, import, use or sell Licensed Products or Licensed
Services in any country, and Licensee provides Caltech with reasonably
satisfactory evidence for such requirement, such third-party payments shall be
fully creditable against royalties owed to Caltech hereunder, provided that in
no one year shall such expenses be
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credited against more than twenty-five percent (25%) of royalty payments to
Caltech. Any excess such expenses for any one year may be carried over and
creditable against royalties owed in future years.
3.6 Notwithstanding the provisions of this Article 3, no royalty shall
be payable to Caltech with respect to any sales of Licensed Products or Licensed
Services to the United States Government, or sales made solely to permit the
United States Government to practice or have practiced or use on its behalf any
invention or process covered by Licensed Patent Rights.
3.7 For the purpose of determining royalties payable under this
Agreement, any royalties or other revenues Licensee receives from Sublicensees
in currencies other than U.S. dollars and any Net Revenues denominated in
currencies other than U.S. dollars shall be converted into U.S. dollars
according to Licensee's reasonable standard internal conversion procedures,
including Licensee's standard internal rates and conversion schedule.
3.8 Any Sublicenses granted by Licensee under the Licensed Patent
Rights shall remain in effect and be assigned to Caltech in the event this
license terminates pursuant to Article 9. Caltech shall assume all the rights
and obligations of Licensee.
ARTICLE 4. LICENSEE EQUITY INTEREST
4.1 Licensee agrees to issue to CALTECH, in consideration of Licensee's
receipt of the intangible property rights granted under this Agreement, an
equity interest in Licensee, or a Related Company that will develop and sell
Licensed Products or Licensed Services, equal to four percent (4%) of the total
equity interest issued upon the initial organization of such company (prior to
any investment by a third party), provided further that said equity interest
shall only vest to Caltech as to the following schedule: 50% within 30 days of
Effective Date; 25%
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within one year of Effective Date; 25% within two years of Effective Date If
Licensee terminates this Agreement prior to the vesting of any installment as
specified above, Caltech shall not be entitled to such interest.
4.2 Caltech agrees that, in the event of any underwritten or public
offering of securities of Licensee or a related company, Caltech shall comply
with and agree to any reasonable restriction on the transfer of equity interest,
or any part thereof, imposed by an underwriter, and shall perform all acts and
sign all necessary documents required with respect thereto. The provisions of
this Paragraph 4.2 shall survive termination of this Agreement.
ARTICLE 5. DUE DILIGENCE
5.1 Licensee shall have discretion over the commercialization of
Licensed Products and Licensed Services. However, Licensee agrees to use all
reasonable commercial efforts to introduce commercial Licensed Product(s) and
Licensed Services in the United States as soon as practical, consistent with
sound and reasonable business practices and judgments. Licensee shall be deemed
to have satisfied its obligations under this Paragraph if Licensee has an
ongoing and active research program or marketing program, as appropriate,
directed toward production and use of Licensed Products or Licensed Services for
applications in the Field. If Licensee markets products or services utilizing
infrared detection technology other than that covered by Licensed Products for
any application in the Field, then this License shall be reduced to nonexclusive
for such specific application under Paragraph 5.3 of this Agreement. Licensee
agrees to make a good faith effort to Sublicense for any application in the
Field not being commercialized by it. Any such efforts of Licensee's
Sublicensees shall be considered efforts of Licensee for the sole purpose of
determining Licensee's compliance with its obligation under this Paragraph.
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5.2 After the first year from the Effective Date, Caltech shall have
the right, no more often than twice each year, to require Licensee to report to
Caltech in writing on its progress in introducing commercial Licensed Products
and Licensed Services in the United States and foreign jurisdictions in which
Licensee has rights to licensed Patents or Technology.
5.3 If Licensee is not fulfilling its obligations under Paragraph 5.1
with respect to all or any part of Licensed Products and Caltech so notifies
Licensee in writing, and Caltech introduces to Licensee a third party which it
requests Licensee to Sublicense a specific application for development, then
Caltech and Licensee shall negotiate in good faith as to whether a commercially
reasonable Sublicense can be negotiated with such third party. If the parties do
not reach agreement within ninety (90) days, any additional efforts shall be
determined in accordance with Article 12. If Licensee then fails to make any
required efforts, and does not remedy that failure within sixty (60) days after
further written notice to Licensee, Caltech may convert the license granted in
Paragraph 2.1 to a nonexclusive license as to the specific application as to
which Licensee is, pursuant to Article 12, not deemed to be in compliance with
Para. 5.1, and the royalties payable under this Agreement shall be reduced by
fifty percent (50%) for Licensed Products sold under such a nonexclusive
license.
ARTICLE 6. INFRINGEMENT BY THIRD PARTY
6.1 Caltech shall protect the Licensed Patent Rights from infringement
and prosecute infringers when, in its sole reasonable judgment, such action may
be reasonably necessary, proper and justified. Notwithstanding the foregoing,
Licensee shall have the right to Sublicense any alleged infringer pursuant to
Paragraph 2.1.
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6.2 If Licensee shall have supplied Caltech with evidence of
infringement of Licensed Patent Rights by a third party, Licensee may by notice
request Caltech to take steps to enforce the Licensed Patent Rights. If Licensee
does so, and Caltech does not, within fifteen (15) days of the receipt of such
notice, either (a) cause the infringement to terminate or (b) initiate a legal
action against the infringer, Licensee may, upon notice to Caltech, initiate an
action against the infringer at Licensee's expense, either in Licensee's name or
in Caltech's name if so required by law.
6.3 If a declaratory judgment action alleging invalidity,
unenforceability or infringement of any of the Licensed Patent Rights is brought
against Licensee and/or Caltech, Caltech shall defend same in accordance with
Section 6.1. Licensee shall have sole control of the action if Licensee agrees
to bear all the costs of the action subject to Article 6.8.
6.4 In the event one party shall carry on a legal action pursuant to
Paragraphs 6.1, 6.2 or 6.3, the other party shall fully cooperate with and
supply all assistance reasonably requested by the party carrying on such action,
including by using its best efforts to have its employees testify when requested
and to make available relevant records, papers, information, samples, specimens,
and the like. A party controlling an action pursuant to Paragraphs 6.2 or 6.3
shall bear the reasonable expenses incurred by said other party in providing
such assistance and cooperation as is requested pursuant to this Paragraph. A
party carrying on such an action shall keep the other party informed of the
progress of such action, and said other party shall be entitled to be
represented by counsel in connection with such action at its own expense. To the
extent not reimbursed by Caltech, Licensee's reasonable and customary expenses
for such action (including attorneys' fees) shall be fully creditable against
royalties owed to Caltech hereunder, provided that in no one year shall such
expenses be credited against more than fifty percent (50%) of
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royalty payments to Caltech. Any express such expenses may be carried over and
credited against royalties owed in future years.
6.5 The party controlling any action referred to in this Article 6
shall have the right to settle any claims, but only upon terms and conditions
that are reasonably acceptable to the other party. Should either party elect to
abandon such an action other than pursuant to a settlement with the alleged
infringer that is reasonably acceptable to the other party, the party
controlling the action shall give timely notice to the other party who, if it so
desires. may continue the action; provided, however, that the sharing of
expenses and any recovery in such suit shall. be as agreed upon. between the
parties.
6.6 Any amounts paid to a party by third-parties as the result of such
an action (such as in satisfaction of a judgment or pursuant to a settlement)
shall first be applied to reimbursement of the unreimbursed expenses (including
attorneys' fees) incurred by either party and then to the payment to Caltech of
any royalties against which were credited expenses of the action in accordance
with Paragraph 6.4. Any remainder shall be divided between the parties as
follows:.
(a) To the extent the amount recovered reflects lost profits
of Licensee, Licensee shall retain the remainder, less the amount of
any royalties that would have been due Caltech on sales of Licensed
Product lost by Licensee as a result of the infringement had Licensee
made such sales, provided that Licensee shall in any event retain at
least seventy percent (70%) of the remainder; and
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(b) Caltech shall receive an amount equal to the royalties it
would have received if such sales had been made by Licensee, provided
such amount shall in no event exceed thirty percent (30%) of the
remainder; or
(c) to the extent the amount recovered does not reflect lost
profits, seventy percent (70%) shall be paid to the party initiating
the action and thirty percent (30%) to the other party.
6.7 If an infringement or infringements by third parties of Licensed
Patent Rights is on a scale that significantly affects sates of Licensed
Products, and neither Caltech nor Licensee elect to bring an infringement suit
against the infringers, the royalties hereunder payable by Licensee pursuant to
Article III shall be reduced by twenty-five percent (25%) of the sums otherwise
payable if Licensee presents information to Caltech that such infringer has
refused to enter into a royalty-bearing, Sublicensing agreement with Licensee on
terms reasonably acceptable to Licensee.
6.8 The allowed reductions set forth in Paragraphs 6.4 and 6.7 shall
not exceed, in the aggregate, twenty-five percent (25%) of the sums otherwise
payable during any year. Any excess such expenses for any year may be carried
over and creditable against royalties owed in future years.
ARTICLE 7. BENEFITS OF LITIGATION, EXPIRATION OR ABANDONMENT
7.1 General. In a case where one or more patents or particular claims
thereof within the Licensed Patent Rights expire, or are abandoned, or are
declared invalid or unenforceable or otherwise construed by a court of last
resort or by a lower court from whose decree no appeal is
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taken, or certiorari is not granted within the period allowed therefor, then the
effect thereof hereunder shall be:
(a) that such patents or particular claims shall, as of the
date of expiration or abandonment or final decision as the case may be,
cease to be included within the Licensed Patent Rights for the purpose
of this Agreement; and
(b) that such construction so placed upon the Licensed Patent
Rights by the court shall be followed from and after the date of entry
of the decision, and royalties shall thereafter be payable by Licensee
only in accordance with such construction; and
(c) in the event that Licensee challenges the validity of
Licensed Patent Rights, Licensee may not cease paying royalties as of
the date validity of the claims in issue are challenged, but rather may
cease paying royalties as to those claims only after a final
adjudication of invalidity of those claims.
7.2 Adjustment. In the event that any of the contingencies provided for
in Paragraph 7.1 occurs, Caltech agrees to renegotiate in good faith with
Licensee a reasonable royalty rate under the remaining Licensed Patent Rights
which are unexpired and in effect and under which Licensee desires to retain a
License.
ARTICLE 8. RECORDS, REPORTS AND PAYMENTS
8.1 Licensee shall keep records and books of account in respect of all
Licensed Products and conduct of services made and sold by Licensee or Related
Companies under this Agreement and of royalties or other revenues Licensee
receives from Sublicensees other than Related Companies for the sale of Licensed
Products and Licensed Services. Caltech shall have
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the right, during business hours, no more often than annually, to examine, or to
have its designated auditors examine, such records and books provided Caltech
gives Licensee five (5) business days notice. Licensee shall keep the same for
at least three (3) years after it pays Caltech the royalties due for such
Licensed Products and require Related Companies to do the same. Caltech shall
not disclose to any third party any confidential information learned through an
examination of such records and books, nor shall Caltech use any such
information for any purpose other than determining and enforcing its rights
under this Agreement.
8.2 On or before the last day of each February and August for so tong
as royalties are payable under this Agreement, Licensee shall render to Caltech
a report in writing, setting forth the number of units of Licensed Products
manufactured and the number of units sold or services delivered during the
preceding semiannual period by Licensee and Related Companies, and the royalties
or other revenues Licensee received from Sublicensees other than Related
Companies during the preceding semiannual period for the sale of Licensed
Products. Each such report shall also set forth an explanation of the
calculation of the royalties payable hereunder and be accompanied by payment of
the royalties shown by said report to be due Caltech. Notwithstanding foregoing,
if (a) Caltech materially breaches this Agreement, and (b) Licensee gives
Caltech written notice of the breach, and (C) Caltech has not cured the breach
by the time a payment is due under this Paragraph, then Licensee may make the
required payment into an interest bearing escrow account to be released when the
breach is cured, less any damages that may be payable to Licensee by virtue of
Caltech's breach.
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ARTICLE 9. PAYMENT OF PATENT COSTS
9.1 Licensee shall, in connection with the preparation, filing, and
prosecution, issuance and maintenance of the Licensed Patent Rights in the
United States:
(a) pay fifty percent (50%) of all attorney fees accrued both
prior to and subsequent to the Effective Date for services performed to
obtain the issuance of the Licensed Patent Rights, and all patent and
government fees for services performed after the issuance of Licensed
Patent Rights; and
(b) pay fifty percent (50%) of all Patent Office maintenance
fees.
9.2 Licensee shall, in connection with the preparation, filing,
prosecution, issuance and maintenance of the Licensed Patent Rights in foreign
jurisdictions where Licensee has requested in writing that Caltech apply for,
prosecute or maintain any Licensed Patent Rights:
(a) pay one hundred percent (100%) of all attorney fees
accrued both prior to and subsequent to the Effective Date for services
performed to obtain the issuance of the Licensed Patent Rights, and all
patent and government fees for services performed after the issuance of
Licensed Patent Rights; and
(b) reimburses 100% .of all Patent. Office maintenance fees;
provided that Licensee shall not be required to reimburse such amounts to the
extent that Caltech has the right to seek reimbursement of such amounts from any
other licensee of the Licensed Patent Rights; and further provided that for each
foreign jurisdiction for which Licensee reimburses any amounts under this
Paragraph 9.2, Licensee shall receive a credit equal to the full
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amount of such reimbursement toward any amounts payable under Article 3 for the
sale of Licensed Products or Licensed Services in that jurisdiction.
9.3 Payment shall be made to Caltech within thirty (30) days following
receipt by Licensee from Caltech of (a) an invoice covering such fees and (b)
reasonably satisfactory evidence that such fees were paid. 1o the extent that
Licensee terminates this Agreement pursuant to Paragraph 10.2, Licensee shall
have no further liability under Paragraph 9.1 for fees relating to applications
or patents affected by the termination.
9.4 Caltech shall have the right to apply for, prosecute and maintain
during the term of this Agreement the Licensed Patent Rights and other rights
conferred pursuant to Paragraph 2.1 of this Agreement. The application filings,
prosecution, maintenance and payment of all fees and expenses, including legal
fees, relating to such Licensed Patent Rights shall be the responsibility of
Caltech, provided that Licensee shall reimburse Caltech for all reasonable fees
and expenses, including reasonable legal fees, incurred in such application
filings, prosecution and maintenance under Paragraphs 9.1 and 9.2 of this
Agreement. Patent attorneys chosen by Caltech shall handle all patent filings
and prosecutions on behalf of Caltech, provided, however, Licensee shall be
entitled to review and comment upon and approve alt actions undertaken in the
prosecution of all patents and applications. If Caltech elects not to continue
the prosecution of any of the Licensed Patent Rights, it shall so inform
Licensee who shall have the right to continue such prosecution at its own
expense. Caltech shall cooperate with Licensee and grant the necessary parties
of appointment to enable Licensee to continue such prosecution.
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ARTICLE 10. TERMINATION
10.1 Caltech shall have the right to terminate this Agreement if
Licensee fails to make any payment due hereunder and Licensee continues to fail
to make the payment, either to Caltech directly or by placing any disputed
amount into an interest bearing escrow account to be released when the dispute
is resolved, for a period of sixty (60) days after receiving notice from Caltech
specifying Licensee's failure. Upon any such termination, (a) Licensee and
Related Companies shall have six (6) months to complete the manufacture of any
Licensed Products that then are work in progress and to sell their inventory of
Licensed Products, provided Licensee pays the applicable royalties in accordance
with Paragraph 8.2, and (b) Caltech shall accept an assignment by Licensee of
any Sublicenses granted by Licensee to entities other than Related Companies,
and any Sublicense so assigned shall remain in full force and effect.
10.2 Licensee shall have the right to terminate this Agreement either
in its entirety or as to any jurisdiction or any part of the Licensed Patent
Rights upon sixty (60) days written notice. If Licensee does so, it shall submit
all required reports and make all required payments in accordance with Paragraph
8.2.
10.3 No termination of this Agreement shall relieve Licensee of the
liability for payment of any royalty due for Licensed Products or Licensed
Services made prior to the effective date of such termination.
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ARTICLE 11. WARRANTIES AND NEGATION OF WARRANTIES, IMPLIED LICENSES AND AGENCY
11.1 Caltech represents and warrants that it owns all right, title and
interest in and to the Licensed Patent Rights, subject to the license and
march-in rights of the United States Government under ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇
Code, Sections 203-204.
11.2 Caltech represents and warrants that it has complied with all of
its obligations under Contract NAS7-1 260, such as those described in ▇▇▇▇▇ ▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇▇ Code, Section 202, with respect to all of the Licensed Patent
Rights.
11.3 Caltech represents and warrants that it has not granted any right
or interest in any of the Licensed Patent Rights that is inconsistent with the
rights granted to Licensee herein.
11.4 Nothing in this Agreement shall be construed as:
(a) a representation or warranty of Caltech as to the validity
or scope of Licensed Patent Rights or any claim thereof; or
(b) a representation or warranty that any Licensed Product or
Licensed Service is or ▇▇▇▇ be free from infringement of rights of
third parties (except to the extent that Paragraph 11.3 constitutes a
representation and warranty that Licensed Products will not infringe
rights of third parties in the Licensed Patent Rights); or
(c) an obligation to bring or prosecute actions or suits
against third parties for infringement.
11.5 Caltech MAKES NO EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE, AND ASSUMES
20
NO RESPONSIBILITIES WHATEVER WITH RESPECT TO THE USE, SALE, OR OTHER DISPOSITION
BY Licensee OF LICENSED PRODUCT(S).
11.6 Caltech and Licensee are independent parties in this Agreement.
Accordingly, there is no agency relationship between Caltech and Licensee under
this Agreement with respect to any products made or sold, or any methods used,
by Licensee under this Agreement.
ARTICLE 12. ARBITRATION
12.1 Any controversy or claim arising out of or related to this
Agreement, or the breach thereof, shall be settled by arbitration in Los
Angeles, California, in accordance with the Commercial Arbitration Rules of the
American Arbitration Association, and judgment upon the award rendered by the
arbitrator(s) may be entered in any court having jurisdiction thereof.
ARTICLE 13. PRODUCT LIABILITY
13.1 Licensee agrees that Caltech shall have no liability to Licensee
or to any purchasers or users of Licensed Products or Licensed Services made,
sold or provided by Licensee for any claims, demands, tosses, costs, or damages
suffered by Licensee, or purchasers or users of Licensed Products and services,
or any other party, which may result from personal injury, death, or property
damage related to the manufacture, use, or sale of such Licensed Products and
services ("Claims"). Licensee agrees to defend, indemnify, and hold harmless
Caltech, its trustees, officers, agents, and employees from any such Claims,
demands, losses, costs or damages.
13.2 At such time as Licensee begins to sell or distribute Licensed
Products (other than for the purpose of obtaining regulatory approvals) or
conduct services, Licensee shall at its sole
21
expense, procure and maintain policies of comprehensive general liability
insurance in amounts not less than $2,000,000 per incident and $2,000,000 in
annual aggregate and naming those indemnified under Paragraph 13.1 as additional
insureds. Such comprehensive general liability insurance shall provide (a)
product liability coverage and (b) broad form contractual liability coverage for
Licensee's indemnification under Paragraph 13.1. In the event the aforesaid
product liability coverage does not provide for occurrence liability, Licensee
shall maintain such comprehensive general liability insurance for a reasonable
period of not less than five (5) years after it has ceased commercial
distribution or use of any Licensed Product or the conduct of services.
13.3 Licensee shall provide Caltech with written evidence of such
insurance upon request of Caltech. Licensee shall provide Caltech with notice at
least fifteen (15) days prior to any cancellation, non-renewal or material
change in such insurance, to the extent Licensee receives advance notice of such
mailers from its insurer. lf Licensee does not obtain replacement insurance
providing comparable coverage within sixty (60) days following the date of such
cancellation, non-renewal or material change. Caltech shall have the right to
terminate this Agreement effective at the end of such sixty (60) day period
without any additional waiting period; provided that if Licensee uses reasonable
efforts but is unable to obtain the required insurance at commercially
reasonable rates, Caltech shall not have the right to terminate this Agreement,
and Caltech instead shall cooperate with Licensee to either grant a waiver of
Licensee's obligations under this Article or assist Licensee in identifying a
carrier to provide such insurance or in developing a program for self-insurance
or other alternative measures. This Article 13 shall survive the expiration or
termination of this Agreement.
22
ARTICLE 14. MISCELLANEOUS
14.1 Licensee agrees that it shall not use the name of Caltech, or
California Institute of Technology, JPL or Jet Propulsion Laboratory, in any
advertising or publicity material, or make any form of representation or
statement which would constitute an express or implied endorsement by Caltech of
any Licensed Product, and that it shall not authorize others to do so, without
first having obtained written approval from Caltech.
14.2 Licensee agrees to ▇▇▇▇ the appropriate U.S. patent number or
numbers on all Licensed Products made or sold in the United States, and to
require its Sublicensees to do the same.
14.3 Licensee has the right to disclose that it has an exclusive
License in the Field from Caltech to Licensed Patents (as designated by Caltech
Case Numbers, Patent Titles and Filing Dates for pending patent applications) to
prospective joint venture partners, investors, sublicensees, healthcare provider
companies, and appropriate managers and executives of prospective customers for
Licensed Products and Licensed Services. Licensee agrees to accept all other
information regarding the License Agreement as "Confidential Information" under
the Mutual Confidential Disclosure Agreement of March 5, 1997 and attached to
the License Agreement as Exhibit B.
14.4 This Agreement and the Mutual Confidential Disclosure Agreement
sets forth the complete agreement of the parties concerning the subject mater
hereof. No claimed oral agreement in respect thereto shall be considered as any
part hereof. No waiver of or change in any of the terms hereof subsequent to the
execution hereof claimed to have been made by any
23
representative of either party shall have any force or effect unless in writing,
signed by duly authorized representatives of the parties.
14.5 This Agreement shall be binding upon. and inure to the benefit of
any successor or assignee of Caltech. This Agreement is not assignable by
Licensee without the prior written consent of Caltech, except that without the
prior written consent of Caltech, any Related Company, or any successor of, or
purchaser of a substantial part of the assets of the business to which this
Agreement pertains, may be assigned and receive the benefits of this Agreement.
Any permitted assignee shall succeed to all of the rights and obligations of
Licensee under this Agreement.
14.6 Licensee agrees that any Licensed Products sold in the United
States by Licensee or its Sublicensees shall be manufactured substantially in
the United States.
14.7 This Agreement is subject in all respects to the laws and
regulations of the United States of America, including the Export Administration
Act of 1979, as amended, and any regulations thereunder.
14.8 This Agreement shall be deemed to have been entered into in
California and shall be construed and enforced in accordance with California
law.
14.9 Any notice or communication required or permitted to be given or
made under this Agreement shall be addressed as follows:
Caltech: Office of Technology Transfer
California Institute of Technology
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (▇▇ ▇▇▇-▇▇)
▇▇▇▇▇▇▇▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
24
Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇
E-Mail ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇▇▇▇▇.▇▇▇
Licensee: OmniCorder Technologies, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No. (▇▇▇) ▇▇▇-▇▇▇▇
E-Mail ▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
Either party may notify the other in writing of a change of address or telephone
numbers, in which event any subsequent communication relative to this Agreement
shall be sent to the last said notified address or number. All notices and
communications relating to this Agreement shall be deemed to have been given
when received. This agreement may be executed in counterparts, each of which
shall constitute an original and together, a single binding instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed:
CALIFORNIA INSTITUTE OF TECHNOLOGY (Caltech)
By:
--------------------------------------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Director, Office of Technology Transfer
Date:
------------------------------------------------------------------
OMNICORDER TECHNOLOGIES, INC. (Licensee)
By:
-------------------------------------------------------------------
Name:
---------------------------------------------------------
Title:
--------------------------------------------------------
Date:
---------------------------------------------------------
25
CALIFORNIA INSTITUTE OF TECHNOLOGY
OFFICE OF TECHNOLOGY TRANSFER
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, MAIL CODE 210-85
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Voice! message (▇▇▇) ▇▇▇-▇▇▇▇, Facsimile (▇▇▇) ▇▇▇-▇▇▇▇
E-mail ▇▇▇.▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇
▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇ Wednesday, May 20, 1998
President and CEO
OmniCorder Technologies, Inc. [VIA FACSIMILE TO ▇▇▇-▇▇▇-▇▇▇▇]
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Subject: Caltech / OmniCorder Option Agreement and License Agreement
Dear ▇▇▇▇,
As we discussed today on your cell phone, this letter will serve to modify the
existing OmniCorder / Caltech Option Agreement of August 27, 1998 (Effective
Date) to extend the Option Period from nine (9) months to ten (10) months from
the Effective Date. This extension will be for no additional consideration and
will allow more time for both of us to review the additional provisional US
patent applications for "QWIP" related JPL technology.
I will update EXHIBIT A of the attached License Agreement after we have a review
by our patent attorney and a decision on which of the pending provisional
applications, if any, will be filed as non-provisional CIP applications to the
parent CIT 2426(08/708,076) application.
You indicated that you would have a revised form of the License Agreement sent
for our review. From our previous discussions and your letter of April 23, 1998,
I expect that we will find your proposed revisions acceptable. If so, we will
return two originals of the updated License Agreement to you so that you may
exercise your option and acquire the license, should you choose to do so.
Sincerely,
▇▇▇▇▇ ▇. ▇▇▇▇▇, Ph.D.
By: Agreed and Acknowledged by:
------------------------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Director ------------------------------
Office of Technology Transfer ------------------------------
California Institute of Technology OmniCorder Technologies, Inc.
Date: Date:
---------------------------------------- ---------------------------
CALIFORNIA INSTITUTE OF TECHNOLOGY
OFFICE OF TECHNOLOGY TRANSFER
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇. MAIL CODC 210-85
▇▇▇▇▇▇▇▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
TELEPHONE: (▇▇▇) ▇▇▇-▇▇▇▇
FACSIMILE: (▇▇▇) ▇▇▇-▇▇▇▇
E-MAIL: ▇▇▇.▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇
Friday, December 4, 1998
▇▇. ▇▇▇▇ ▇▇▇▇▇
President and CEO [VIA FACSIMILE TO ▇▇▇-▇▇▇-▇▇▇▇]
OmniCorder Technologies, Inc.
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Subject: ViaSpace claims concerning QWIP
Dear ▇▇▇▇,
In response to your e-mail of November 4, 1998, this letter is to acknowledge
OmniCorder's rights under the Caltech / OmniCorder Technologies, Inc. License
Agreement. Under this license OmniCorder has exclusive rights to the Caltech /
JPL QWIP technology in the field of use defined as:
"Field" means detection of passively emitted flux or induced
fluorescence from tissue, organs or organ systems for the generation of
images of temperature. emissivity, fluorescence or the modulation of
regional temperature for commercial medical and veterinary
applications, including related commercial devices for research,
clinical trials and forensic applications.
Any statements that have been made that are inconsistent with these rights of
OmniCorder are either misquotes or inaccuracies. Caltech regrets if such
statements may have raised any inappropriate concerns among any potential
investors, strategic partners or customers of OmniCorder. Our Office of
Technology Transfer at Caltech, with your permission, is quite willing to assure
such parties of the rights that OmniCorder has under its license with Caltech.
Sincerely,
▇▇▇▇▇ ▇. ▇▇▇▇▇, Ph.D.
CALIFORNIA INSTITUTE OF TECHNOLOGY
OFFICE OF TECHNOLOGY TRANSFER
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, MAIL CODE 210-85
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Voice / message (▇▇▇) ▇▇▇-▇▇▇▇. Facsimile (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇.▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇
▇▇. ▇▇▇▇ ▇▇▇▇▇ Wednesday, May 20, 1998
President and CEO
OmniCorder Technologies, Inc. [VIA FACSIMILE TO ▇▇▇-▇▇▇-▇▇▇▇]
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Subject: Caltech / OmniCorder Option Agreement and License Agreement
Dear ▇▇▇▇,
As we discussed today on your cell phone, this letter will serve to modify the
existing OmniCorder / Caltech Option Agreement of August 27, 1998 (Effective
Date) to extend the Option Period from nine (9) months to ten (10) months from
the Effective Date. This extension will be for no additional consideration and
will allow more time for both of us to review the additional provisional US
patent applications for "QWIP" related JPL technology.
I will update EXHIBIT A of the attached License Agreement after we have a review
by our patent attorney and a decision on which of the pending provisional
applications, if any, will be filed as non-provisional CIP applications to the
parent CIT 2426 (08/708,076) application.
You indicated that you would have a revised form of the License Agreement sent
for our review. From our previous discussions and your letter of April 23, 1998,
I expect that we will find your proposed revisions acceptable. If so, we will
return two originals of the updated License Agreement to you so that you may
exercise your option and acquire the license, should you choose to do so.
Sincerely,
▇▇▇▇▇ ▇. ▇▇▇▇▇, Ph.D.
By: Agreed and Acknowledged by:
------------------------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Director ------------------------------
Office of Technology Transfer ------------------------------
California Institute of Technology OmniCorder Technologies, Inc.
Date: Date:
---------------------------------------- ---------------------------