EXHIBIT 10.7
(REDACTED)
[ * ] = Confidential materials omitted and filed separately with the
Securities and Exchange Commission.
Page 1
THIS AGREEMENT is entered into as of the 21st day of January, 1999 (the
"Effective Date") by and between the University Court of the University of
Edinburgh ("University"), and Agritope, Inc., a Delaware corporation
("Agritope").
A. University, in part through the use of activation tagging
techniques, intends to develop, by means of the research program to be carried
out pursuant to this Agreement and will therefore own all right, title and
interest in and to certain Arabidopsis plants, and associated germplasm, gene
constructs, seeds and other tissues, DNA sequences and information derived by
University therefrom (together called herein the "Collection").
B. Agritope is experienced in the management of large scale research
programs and in genetic studies and techniques likely to be useful in the
screening and analysis of the Collection. Agritope believes that useful
information may be derived from the Collection, which may aid in the discovery
or development of commercializable products, and desires to help, support and
participate with University in such a research program for that purpose.
C. University desires Agritope's support and participation in such a
research program, and is willing to grant Agritope certain licenses and options
to University and certain third-party rights in connection therewith and with
the potential commercialization of such products.
NOW THEREFORE the parties hereby agree as follows:
1. DEFINITIONS
1.1 "AFFILIATE" of Agritope shall mean any entity that, directly or
indirectly, owns and controls the voting of at least 50% of the
voting capital shares of Agritope (a "Parent" entity), or at least
50% of the voting capital shares (or equivalent control) of which
is, directly or indirectly, owned, and the voting of which is
controlled, by Agritope, its Parent or any other Affiliate of
Agritope.
1.2 "AGRITOPE-DISCOVERED PRODUCTS" shall mean genes, information about
gene function, products, processes and technologies (including
without limitation Joint Inventions), the discovery or isolation
of which was made by Agritope or its Affiliates from or using
physical materials provided to Agritope by University as part of
the Collection, whether or not in the course of the Research
Program, and whether or not the same also may be
University-Discovered Products or Third-Party
Researcher-Discovered Products.
1.3 "COMMITMENT DATE" shall mean, as to any Licensed Product or
Agritope-Discovered Product, the first date on which Agritope or
its Affiliate has done any of the following, bearing on such
product:
(a) submitted any regulatory filing;
(b) commenced any material field trial;
Page 2
(c) entered into any relationship with a commercialization
party such as a distributor, seed company, and other
marketer.
1.4 "CONFIDENTIAL TECHNOLOGY" shall mean all technology and related
information that is, at the relevant time hereunder, required to
be protected as confidential pursuant to Section 7 hereof.
"Confidential Program Technology" shall mean the Program
Technology that is also Confidential Technology.
1.5 "ENABLEMENT PERIOD" shall mean the period beginning on the
Effective Date and extending until the third anniversary of the
last payment made by Agritope to University under Section 3
hereof.
1.6 "EXCLUSIVITY PERIOD" shall mean that period during the License
Period that is determined on a territory by territory basis for
each Agritope-Discovered Product and that extends from the
Effective Date until there are no longer any Licensed Patents in
that territory applicable to the making, using, selling, offering
for sale or importing of the relevant Agritope-Discovered Product,
or, if later, until all of the Confidential Program Technology
relevant to the applicable Agritope-Discovered Product or its
development has been disclosed without restriction to the public
(but in the case of territories in the European Union where there
are no longer any Licensed Patents based at least in part on
technology existing as of the Effective Date, the Exclusivity
Period applicable to the relevant Agritope-Discovered Product will
not extend longer in such territory than ten years from the first
commercial sale thereof in any territory in the European Union).
Restrictions on passive marketing (i.e., merely accepting
unsolicited orders) of a Licensed Product in the European Union
will not (unless otherwise permitted under applicable law) last
more than five years from the first commercial sale thereof in any
territory in the European Union.
1.7 "INVENTOR'S DISCLOSURE" shall mean the formal written
documentation by a scientist or other inventor of any Program
Technology with respect to such Program Technology. A "Preliminary
Inventor's Disclosure" means such documentation that includes at
least a description of the nature and operative principle of the
Program Technology, and of its likely uses. The "Interim
Inventor's Disclosure" shall mean a disclosure, including
information (to the extent available) of the sort to be mutually
agreed by the parties following the submission of the Preliminary
Inventor's Disclosure, and to be submitted within six months
following the submission of the Preliminary Inventor's Disclosure.
The "Final Inventor's Disclosure" shall mean such a disclosure
that includes at least the information of a Preliminary Inventor's
Disclosure, plus a full technical disclosure of a technology, and,
where such Program Technology may be patentable, also including
all information normally required to support a regular (i.e., not
merely provisional) patent application thereon, considered in the
light of normal industry and academic practice for such
disclosures.
1.8 "JOINT INVENTIONS" shall mean any inventions or technology that is
Page 3
jointly conceived or reduced to practice by or for University and
Agritope (or University and any Agritope Affiliate).
1.9 "LICENSE PERIOD" shall mean, as to each Licensed Product and each
Agritope-Discovered Product in each territory in the world, the
period from the Option Exercise through the last to occur of the
following:
(a) the [ * ] of the first commercial launch of such product
anywhere in the world;
(b) the expiration of the Exclusivity Period applicable to
such a product in such territory.
1.10 "LICENSED PATENTS" shall mean University's or any Third-Party
Researcher's rights under patents in any and all territories, if
any, obtained and in force during the term of this Agreement, and
all patent applications arising on or after the Effective Date, in
each case covering or disclosing: (a) any aspect or part of the
Collection or the development or use thereof; (b) any of
University's techniques, improvements, modifications, alterations,
or enhancements to the Collection or with respect to the design,
development or use of such collections developed in the course of
the Research Program; or (c) any inventions that are made or
acquired in whole or in part during and in the course of the
Research Program or that otherwise disclose or cover any of the
Program Technology.
1.11 "LICENSED PRODUCTS" shall mean the University-Discovered Products
and the Third-Party Researcher-Discovered Products, and any of
them.
1.12 "NET SALES" shall mean payments received by Agritope or an
Affiliate from non-Affiliates to the extent pertaining to net
sales of a Licensed Product or an Agritope-Discovered Product by
Agritope or such Affiliate, as the case may be. The calculation of
Net Sales shall include amounts specifically identifiable to such
Licensed Product or Agritope-Discovered Product and amounts
allocated to the Licensed Product or Agritope-Discovered Product,
it being understood that amounts which are not specifically
identifiable to the Licensed Product or Agritope-Discovered
Product by virtue of their being identifiable to a group of
products that includes the Licensed Product or Agritope-Discovered
Product shall be allocated thereto in a consistent and equitable
manner which will equitably reflect the contribution of the
Licensed Product or Agritope-Discovered Product to such Net Sales.
Amounts to be included in the calculation of Net Sales shall be
those representing the gross amount received, less:
(a) quantity and/or normal and customary cash discounts
allowed or taken;
(b) credits, free goods, rebates and/or adjustments allowed
to or taken by bona fide arms' length purchasers by
reason of rejections, returns, retroactive price
reductions, or volume purchasing discounts; and
[ * ] = Confidential materials omitted and filed separately with the
Securities and Exchange Commission.
Page 4
(c) allowances for freight, taxes and insurance.
1.13 "PROGRAM COORDINATOR(S)" shall mean the individual at Agritope and
the individual at University that are given the primary
responsibility to coordinate and to facilitate the respective
parties' activities in terms of the Research Program. University's
initial Program Coordinator is ▇▇▇▇▇ ▇▇▇▇, Ph.D., and Agritope's
initial Program Coordinator is D. ▇▇ ▇▇▇▇▇▇, Ph.D. The parties may
replace their respective Program Coordinators from time to time as
the need arises due to departures of personnel or the like,
provided that the replacement is reasonably acceptable to the
other party.
1.14 "PROGRAM TECHNOLOGY" shall mean the Collection as developed by
University in terms of the Research Program and all related
information, technical or otherwise developed or discovered by
University in terms of the Research Program (or by a Third-Party
Researcher in whole or in part from or using any part of the
Collection, whether or not in the course of the Research Program,
but during the Funding Period), including, but not limited to,
that comprised in techniques, improvements, modifications,
alterations, or enhancements with respect to the design,
development or use of such collections, formulae, protein
sequences, gene constructs, genes, information about gene
function, data, techniques, manuals, instructions, samples, or
inventions, development processes, assays, improvements, and
specifications.
1.15 "RESEARCH PROGRAM" shall mean the program of work to be carried
out by University in accordance with the provisions of Section 2
hereof on behalf of Agritope.
1.16 "SUBLICENSING FEES" shall mean the total consideration, in cash or
in-kind, including without limitation up front payments and
royalties, received by Agritope or an Affiliate from
non-Affiliates in return for the grant of any sublicense by it of
any rights under any of the Licensed Patents or Program
Technology, but excluding: [ * ] The calculation of Sublicensing
Fees shall include amounts specifically identifiable to the rights
sublicensed and amounts allocated to such rights, it being
understood that amounts which are not specifically identifiable to
the sublicensed rights by virtue of their being identifiable to a
group of products or services that includes the sublicensed rights
shall be allocated thereto in a consistent and equitable manner
which will equitably reflect the contribution of the sublicensed
rights to such Sublicensing Fees.
1.17 "THIRD-PARTY RESEARCHER" shall mean any person or entity (other
than staff or students of the University) to which the University
provides any portion of the Collection, or any access thereto or
rights to the use thereof, it being agreed that University shall,
within thirty days thereof, give Agritope notice of any such
provision of any of the Collection to any third party.
1.18 "THIRD-PARTY RESEARCHER-DISCOVERED PRODUCTS" shall mean genes,
[ * ] = Confidential materials omitted and filed separately with the
Securities and Exchange Commission.
Page 5
information about gene function, products, processes and
technologies (including without limitation Joint Inventions), the
discovery or isolation of which was made by a Third-Party
Researcher from or using physical materials that are part of the
Collection and that were provided to such third party by the
University, whether or not in the course of the Research Program.
1.19 "UNIVERSITY-DISCOVERED PRODUCTS" shall mean:
(a) the "Unrestricted University-Discovered Products" which are
genes, information about gene function, products, processes
and technologies (including without limitation Joint
Inventions), the discovery or isolation of which was, prior to
the 90th day following the end of the Funding Period, made by
University from or using physical materials that are part of
the Collection, whether or not in the course of the Research
Program, funded through (i) the use in whole or in part of
Agritope's funding (other than the mere use of the Collection)
or (ii) University's own resources (without any third-party
funding) or (iii) third-party sources under terms which do not
have any conditions or requirements that would be inconsistent
with Agritope's obtaining exclusive rights as described in
Section 4.6; and
(b) the "Restricted University-Discovered Products" which are
genes, information about gene function, products, processes
and technologies (including without limitation Joint
Inventions), the discovery or isolation of which was, prior to
the 90th day following the end of the Funding Period, made by
University from or using physical materials that are part of
the Collection, whether or not in the course of the Research
Program, funded without any use of Agritope's funding (other
than the mere use of the Collection) and with third-party
funding sources under terms which require (despite all
reasonable efforts of the University, after consultation with
Agritope, to avoid the imposition of such requirement) that
such source will obtain a commercialization right in
discoveries made with such funding that would be inconsistent
with Agritope's obtaining exclusive rights as described in
Section 4.6.
2. RESEARCH PROGRAM
2.1 University and Agritope shall cooperatively and in good faith
engage in and conduct the Research Program. The conduct of the
Research Program shall be coordinated on a day-to-day basis by the
parties' Program Coordinators, in consultation with each other.
The Program Coordinators will be guided by the detailed Research
Plan to be approved by the parties in terms of Section 2.2 hereof.
Any material changes to the Research Plan will require the written
approval of both parties.
2.2 Forthwith after the Effective Date, and subject to payment by
Agritope to University of the sum specified in Section 3.1 hereof,
Page 6
the parties will consult and co-operate with each other in the
preparation of a formal and complete Research Plan document
directed at the achievement of the tasks described in Section 2.4
(the "Research Plan") to be finalised within a period not
exceeding twelve months from the Effective Date.
2.3 Agritope will be entitled to give formal notice to University of
its wish to proceed with the Research Program (the "Option
Exercise") at any time from the Effective Date through the later
of the first anniversary of the Effective Date or the thirtieth
(30th) day following the finalization of the Research Plan.
2.4 Forthwith after the Option Exercise, and subject to payment by
Agritope to University on the due dates of the sums specified in
Sections 3.2 and 3.3 hereof, University will, in accordance with
the Research Plan, carry out the following principal tasks (as
well, incidentally, as possibly developing new and improved
techniques, modifications, alterations, or enhancements with
respect to the design, development or use of collections such as
the Collection):
(i) create activation tagged lines;
(ii) grow primary transformants of Arabidopsis plants;
(iii) document interesting visible traits;
(iv) collect, archive/register, and store seed of primary
transformants; transmit samples of all such seeds to
Agritope;
(v) screen for various traits of special interest to
University researchers, and characterise the underlying
genes and gene function;
(vi) submit periodic and final documentation and
communications to Agritope of the results of all
University activities and, as reported to the University,
of any activities of Third-Party Researchers bearing in
any way on the Program Technology or this Agreement,
including without limitation in each case (as to the
University and Third-Party Researchers) copies of all
Inventor's Disclosures within 10 days of their first
preparation; and
(vii) University will, during the period from the Effective
Date until Agritope makes its last payment under Section
3 (the "Funding Period"), consult and cooperate with
Agritope as reasonably requested in connection with
Agritope's and its Affiliates' and sublicensees' further
use of the Collection.
3. OPTION FEE; RESEARCH PROGRAM FUNDING
3.1 Agritope shall pay University a non-refundable fee of US $10,000
within thirty days following the Effective Date, which the University
agrees to apply to support the University's Institute of Cell and
Molecular Biology.
Page 7
3.2 Beginning on the first day of the first calendar month following
the Option Exercise, Agritope shall pay University the sum of US
$5,000 on the first day of each quarter (which shall be a period
of three consecutive calendar months, but not necessarily a
calendar quarter), and continuing until the sum of US $100,000
(twenty such quarterly payments) has been paid under this Section.
Such funds shall be administered in such ways as the University's
Project Coordinator reasonably considers shall most effectively
enhance the academic impact and industrial value of the
Collection.
3.3 Beginning on the first day of the first calendar month following
the Option Exercise, Agritope shall pay University an additional
sum of $150,000 on the first day of each such quarter, and
continuing until the sum of $600,000 (four such quarterly
payments) has been paid under this Section. Such funds shall be
applied to support University's Research Program activities
specifically described in Section 2.
3.4 The sums stated above are exclusive of UK value added tax or
similar UK fiscal taxes, if any, payable thereon either now or at
any time hereafter, and where any such taxes are applicable, all
payments to University shall be accompanied by the relevant tax at
the rate in force at the time when the relevant payment fell due.
3.5 In the event of non-payment of any sum due by Agritope on the due
date for payment, interest shall be payable thereon by Agritope
from the date when it fell due until paid at the rate of 3% per
annum above the Bank of Scotland base rate from time to time.
3.6 Except for the payments described above in this Section 3, each of
the parties shall bear all of its own costs and expenses of the
conduct of the Research Program and the performance of its tasks
thereunder.
4. OWNERSHIP OF INTELLECTUAL PROPERTY RIGHTS
4.1 Each party will, as between it and the other party hereto, retain
ownership of any and all inventions, copyrights, trade secrets,
patent rights and other technology and rights to the extent
conceived or developed by its personnel or contractors, and
University and Agritope (or University and an applicable Agritope
Affiliate) shall co-own all Joint Inventions.
4.2 University hereby grants to Agritope and its Affiliates a
nonexclusive, paid-up, royalty-free, worldwide license, with right
to sublicense, to use and to exercise the Licensed Patents and the
Program Technology for research purposes.
4.3 In recognition of Agritope's payments hereunder and its support in
the creation of the Collection, University hereby undertakes not
to give any third party access for any purpose to the Collection
during the Enablement Period, provided that this shall not
preclude access to the Collection by University staff or students
Page 8
or any bona fide, non-profit Third-Party Researcher for research
purposes only so long as University contractually prohibits any
commercialisation or other exploitation of any part of the
Collection by any such Third-Party Researcher during the
Enablement Period and obtains in proper form grants of all rights
necessary from any Third-Party Researchers in order for University
to make the grants to Agritope and its Affiliates hereunder in and
to the Program Technology, the Licensed Patents and any
Third-Party Researcher-Discovered Products.
4.4 University hereby grants to Agritope and its Affiliates a
worldwide license, with right to sublicense, under the Licensed
Patents and the Program Technology to make, have made, use, sell,
offer for sale, and import any and all Licensed Products and
Agritope-Discovered Products during the License Period. Such
license shall be exclusive in the relevant territories during the
Exclusivity Periods applicable to the relevant Agritope-Discovered
Products and otherwise shall be nonexclusive (subject to later
agreement on an exclusive license pursuant to Section 4.6).
Agritope will notify University of any sublicenses granted
hereunder within thirty days after each such grant.
4.5 If Agritope or its Affiliates or sublicensee(s) wish to exploit a
Licensed Product or an Agritope-Discovered Product commercially it
or they shall be entitled to do so, but Agritope shall be obliged
to pay to University a royalty (the "Royalties") equal to:
(a) [ * ] of Sublicensing Fees (retaining their character as
cash or in-kind) received during the License Period; and
(b) [ * ] of Net Sales during the License Period for the right
to use the Licensed Patents and the Program Technology in
connection with such Licensed Product or Agritope-Discovered
Product.
(c) All Royalties shall be payable in US dollars and shall be
due quarterly within 60 days following the end of each
calendar quarter in respect of Sublicensing Fees and Net
Sales received in such calendar quarter. Each such payment
shall be accompanied by a statement of Sublicensing Fees and
Net Sales for the quarter and the calculation of Royalties
payable hereunder. Agritope and its Affiliates shall keep
complete, true and accurate records for the purpose of
showing the derivation of all Royalties payable to
University under this Agreement. Agritope shall report at
least quarterly to University as to whether there have been
any Sublicensing Fees or Net Sales since the date of the
last such report. University or its representatives shall
have the right to inspect, copy, and audit such records at
any time during reasonable business hours upon notice to
[ * ] = Confidential materials omitted and filed separately with the
Securities and Exchange Commission.
Page 9
Agritope or its Affiliate. Information gathered during any
such inspection or audit shall be held in confidence by
University, except to the extent any of the exceptions
stated in Sections 7.1.1 - 7.1.6 apply thereto. Any such
audit shall be at the expense of University, unless the
inspection or audit reveals that, with respect to the period
under audit, less than 95% of the Royalties due to
University hereunder have been paid, in which event Agritope
shall pay or reimburse University for the reasonable
expenses of such inspection or audit (but not in any case in
excess of the full amount of the deficiency discovered in
such audit), in addition to University's other remedies for
such underpayment.
4.6 University hereby grants to Agritope and its Affiliates the right,
during the Enablement Period, to obtain an exclusive,
royalty-bearing, worldwide license, with right to sublicense, on
the terms and conditions hereof (other than royalty rates and due
diligence provisions, including minimum financial return
provisions), to exploit, for the duration of the License Period,
on the following basis, Unrestricted University-Discovered
Products (but not Restricted University-Discovered Products and
not any Unrestricted University-Discovered Product as to which
Agritope has not, prior to the thirty-first day following the date
of the Preliminary Inventor's Disclosure, elected that at least a
provisional patent application be made with respect thereto) :-
4.6.1 University shall not actively seek, nor shall it grant
any license to any third party with respect to such an
Unrestricted University-Discovered Product, unless this
section has first been satisfied. If, prior to the
thirty-first (31st) day following the date University
provides to Agritope the Interim Inventor's Disclosure for
such Unrestricted University-Discovered Product (the "Rights
Expiration Date"), Agritope does not notify University that
Agritope and its Affiliates desire to obtain an exclusive
license to such Unrestricted University-Discovered Product,
University will be free to negotiate for and to grant such a
license to a third party, subject to the continuing
nonexclusive licenses granted hereunder to Agritope and its
Affiliates. If, prior to the Rights Expiration Date,
Agritope notifies University that Agritope desires to enter
into negotiations for such a license, University shall, for
an additional period of [ * ], negotiate exclusively and in
good faith with Agritope to determine the royalty and due
diligence and minimum financial return provisions with
respect thereto.
4.6.2 If the procedure in Section 4.6.1 has not been followed as
to any Unrestricted University-Discovered Product, Agritope
may at any time during the Enablement Period notify
University that Agritope or its Affiliate desires to obtain
an exclusive, royalty-bearing, worldwide license, with right
to sublicense, to exploit such Unrestricted
University-Discovered Product for the duration of the
[ * ] = Confidential materials omitted and filed separately with the
Securities and Exchange Commission.
Page 10
License Period. In such event, University shall, for a
period of [ * ], negotiate exclusively and in good faith
with Agritope or its Affiliate to determine the royalty and
due diligence and minimum financial return provisions with
respect thereto.
4.6.3 If the parties have failed to agree on the level of
royalties and the due diligence and minimum financial return
provisions during the [ * ] negotiation period, it shall be
open to either party to request, at any time within a
further period of [ * ], that these matters will be finally
determined in accordance with reasonable and usual industry
practice for such exclusive licenses by an expert who shall
be mutually appointed by both parties.
4.7 For the avoidance of doubt:
4.7.1 nothing in this Agreement shall restrict University's right
to use, or in accordance herewith to permit the use by
Third-Party Researchers of, fundamental knowledge acquired
by it in the course of the Research Program for education
and/or research;
4.7.2 Agritope further recognises that by charity law under
University policy the results of the Research Program should
be publishable and agrees that the Program Coordinator and
any other researchers engaged in the Research Program may
present at seminars, symposia, national or regional
professional meetings and publish in journals, theses or
dissertations or otherwise of their own choosing, methods
and results of the Research Program, provided however that
Agritope have been furnished copies of any proposed
publication or presentation at least three months in advance
of the submission of such proposed publication or
presentation to a journal editor or other third party.
Agritope shall have one month after receipt of said copies
to object to such proposed presentation or proposed
publication if in Agritope's sole opinion a delay of
publication is necessary in order to protect its commercial
interests, or the commercial use to Agritope or its
licensees of information derived from the Research Program,
including the need to file protective applications with
respect to the information proposed to be published. In the
event that Agritope makes such objection, the Program
Coordinator or such researchers shall refrain from making
such publication or presentation for a maximum of three
months from the date of receipt of such objection in order
for Agritope to obtain appropriate protective applications.
A delay imposed on submission for publication as a result of
a requirement made by Agritope shall not exceed four months
from the date of receipt of the said copies by Agritope,
although University will not unreasonably refuse a request
from Agritope for additional delay in the event that
intellectual property rights might otherwise be lost.
[ * ] = Confidential materials omitted and filed separately with the
Securities and Exchange Commission.
Page 11
5. PATENT PROSECUTION AND MAINTENANCE.
5.1 University or a Third-Party Researcher (as University and the
Third-Party Researcher may agree) shall control the preparation,
filing, prosecution and maintenance of any Licensed Patents, other
than Joint Inventions. If Agritope desires that a patent filing
(whether provisional or regular) be made with respect to any
Program Technology, Agritope may at its election direct the
University to make such a filing, and the University shall do so.
Such filings shall be made by University at Agritope's expense
(subject to the requirement that such expenses be reasonable and
incurred in accordance with Section 5.3); provided, however, that
if University or such Third-Party Researcher licenses any such
Licensed Patents in such Program Technology to any third party
subsequently to Agritope's having paid any of Agritope's Share
hereunder with respect thereto, University shall reimburse
Agritope an amount equal to such other licensee(s)' prorata share
of the expenses described in Section 5.4, as if Agritope and such
other licensee(s) had been licensees of such Licensed Patent from
the first date that such Agritope Share began to accrue hereunder.
5.2 Agritope or its Affiliate shall have the right, in its sole
discretion and at its expense, to control the preparation, filing,
prosecution and maintenance of patents on any and all Joint
Inventions.
5.3 The party in control of such patent activities shall use its good
faith efforts to provide the other with an opportunity to review
and comment on the text of each patent application before filing,
and shall supply such other party with a copy of such patent
application as filed, together with notice of its filing date and
serial number. Each party shall cooperate with the other party,
execute all lawful papers and instruments and make all rightful
oaths and declarations as may be necessary in the preparation,
prosecution and maintenance of all applications and patents
described in this Section.
Page 12
5.4 As used herein, "AGRITOPE'S SHARE" shall mean that percentage of
the out-of-pocket expenses of University incurred in connection
with the preparation, filing, prosecution up to and through appeal
from a final rejection by a patent examiner, and maintenance of
the applicable patent applications and patents, including the
reasonable fees and expenses of attorneys and patent agents,
filing fees and maintenance fees, and the filing of applications
under the Patent Cooperation Treaty, but excluding costs
associated with any patent infringement actions. Agritope's Share
shall be a prorata percentage, shared fairly with the other
University licensees, as to patent applications and patents that
are licensed by University to any third party. That is, where
there are no such other licensees, Agritope's Share shall be 100%,
and where the University subsequently makes a grant of a license
to a third party (i.e., where Agritope has waived its rights to
obtain an exclusive under Section 4.6), Agritope's Share shall,
effective from the first date that Agritope bore any such expenses
hereunder, be such prorata percentage (half where there is one
such other licensee, one-third where there are two, and so on),
and the University shall cause Agritope to be reimbursed for prior
amounts borne by Agritope, such that Agritope and such other
licensees will have borne their shares of all such expenses to
that time. Where Agritope acquires an exclusive license pursuant
to Section 4.6, the Agritope Share shall remain 100%, and Agritope
shall bear, or reimburse University for, any related patent costs
including renewal fees not already borne by Agritope hereunder.
6. TERM AND TERMINATION
6.1 The term of this Agreement shall begin on the Effective Date and
shall, unless earlier terminated as provided herein, continue
until expiration of the last remaining License Period. If the term
of this Agreement is not so terminated prior to such expiration,
any and all then-remaining licenses to Agritope and its Affiliates
hereunder shall, upon and after such expiration, become
nonexclusive, royalty-free, paid-up and irrevocable.
6.2 Agritope may at its option terminate this Agreement at any time
prior to the Option Exercise upon at least 28 days' written notice
to University. Either Agritope or University may at its option and
by 28 days' written notice to the other, terminate this Agreement
at any time following the later of the first anniversary of the
Effective Date or the thirtieth (30th) day following the
finalization of the Research Plan, if (and only if) the Option
Exercise has not occurred prior to that time.
6.3 Neither party shall be entitled, except by agreement with the
other party, to terminate this Agreement until all the payments
due under Section 3.3 have been made, but thereafter Agritope may
terminate this Agreement at any time upon at least 120 days'
written notice to University.
Page 13
6.4 If either party materially breaches any of the terms, conditions
or agreements contained in this Agreement to be kept, observed or
performed by it, the other party may terminate this Agreement, at
its option and without prejudice to any of its other legal or
equitable rights or remedies, by giving the party who committed
the breach ninety days' notice in writing, unless the notified
party within such 90-day period shall have cured the breach;
provided, however, that without prejudice to University's other
rights or remedies hereunder for a breach by Agritope,
University's license under Section 4.4 with respect to any
Licensed Product or Agritope-Discovered Product shall not be
terminated for any reason following the Commitment Date therefor,
it being agreed, however, that Agritope shall be required to
obtain, in its sublicenses, and its agreements with its
Affiliates, the agreement of such sublicensee and Affiliates to
pay, if Agritope does not, any royalties due from Agritope to the
University pursuant to Section 4.5.
6.5 Agritope's obligations regarding payment of royalties accrued as
of the date of termination, and the provisions of Sections 7, 9
and 10 hereof shall survive any expiration or termination of this
Agreement.
6.6 If the performance by any party of any of its obligations under
this Agreement (other than an obligation to make payment) shall be
prevented by circumstances beyond its reasonable control then such
party shall be excused from performance of the obligation for the
duration of the relevant event. Any party so delayed or impeded
shall promptly inform the other parties of the nature of the
relevant cause and of the expected duration of the relevant delay
or impediment.
7. CONFIDENTIALITY
7.1 In the course of the Research Program, whether before or after the
Effective Date, a party may disclose, or may have disclosed, to
the other confidential information belonging to the disclosing
party (the "Discloser's Technology"). The receiving party will
maintain in confidence the Discloser's Technology and will not use
it for any purpose except as authorized hereunder. Each party
shall safeguard such information against disclosure to third
parties, including without limitation employees and persons
working or consulting for such party that do not have an
established, current need to know such information for purposes
authorized under this Agreement. This obligation of
confidentiality does not apply to restrict use or disclosure by
the receiving party of information and material that meet one or
more of the following criteria:
7.1.1 they were properly in the possession of the receiving
party, without any restriction on use or disclosure, prior
to receipt from the other party;
7.1.2 they are at the time of disclosure hereunder in the
public domain by public use, publication, or general
knowledge;
Page 14
7.1.3 they become general or public knowledge through no fault
of the receiving party following disclosure hereunder;
7.1.4 they are properly obtained by the receiving party on a
non-confidential basis from a third party not under a
confidentiality obligation to the disclosing party hereto;
7.1.5 they are independently developed by or on behalf of the
receiving party without the assistance of the confidential
information of the other party;
7.1.6 they are required to be disclosed by order of any court
or governmental authority; provided, however, that the
receiving party shall use its best efforts to give the
disclosing party prior notice of any such disclosure so as
to afford the disclosing party a reasonable opportunity to
seek, at the expense of the disclosing party, such
protective orders or other relief as may be available in the
circumstances.
7.2 Notwithstanding the foregoing provisions Agritope or its Affiliate
shall be permitted to disclose:
7.2.1 any Confidential Program Technology as may be required
to be necessarily revealed to any regulatory authorities or,
in connection with the exploitation of any Licensed Product
or Agritope-Discovered Product, to the extent that it
requires to be necessarily revealed to any potential
licensee or to collaborators and other persons performing
necessary tests and studies, which disclosure shall be made
subject to similar conditions of confidentiality and limited
use as apply to Agritope; and
7.2.2 any Confidential Program Technology to its patent
attorney or agent or any patent authority in any country as
shall require to be necessarily revealed for filing or
prosecuting any patent application with respect to any
Agritope-Discovered Product.
Page 15
7.3 Subject to Sections 7.1 and 7.2 above neither party shall make any
public announcement or other publication regarding this Agreement
(whether as to the existence or terms hereof) or the Research
Program or the results thereof without the prior, written consent
of the other party, which consent shall not be unreasonably
withheld; provided that neither the foregoing nor Section 7.4
shall prohibit any disclosure that is required by any applicable
law, regulation, or by any competent governmental authority
(despite the affected party's good faith efforts consistent with
law to prevent the applicability of such a requirement).
7.4 Agritope and its Affiliates will not use the name of University,
or of any member of the University staff engaged in the Research
Program, in any publicity, advertising or news release without the
prior written approval of an authorised representative or
University. Neither will University use the name of Agritope or
its Affiliates, or any employee of Agritope or its Affiliates, in
any publicity without the prior written approval of Agritope and
such Affiliate.
8. INFRINGEMENT
8.1 Each party shall promptly inform the other of any suspected
infringement of any of the Licensed Patents or the infringement or
misappropriation of Confidential Program Technology by a third
party, to the extent such infringement involves the manufacture,
use, or sale of an Agritope-Discovered Product in any applicable
Exclusivity Period or of an Unrestricted University-Discovered
Product exclusively licensed under Section 4.6 ("Covered
Infringement").
8.2 If a suspected infringement or misappropriation does not involve a
Covered Infringement, University may take, or refrain from taking,
any action it chooses, with or without notice to Agritope, and
Agritope shall have no right to take any action with respect to
such suspected infringement or misappropriation, nor to any
recoveries with respect thereto. University will exert reasonable
efforts to keep Agritope informed of actions University may take
as described in the preceding sentence. If the suspected
infringement or misappropriation involves a Covered Infringement,
University shall, within 30 days of the first notice referred to
in Section 8.1, inform Agritope whether or not University intends
to institute court action or proceedings against such third party
with respect to a Covered Infringement. Agritope will not take any
steps toward instituting court action or proceedings against any
third party involving a Covered Infringement until University has
informed Agritope of its intention pursuant to the previous
sentence.
8.3 If University notifies Agritope that it intends to institute court
action or proceedings against a third party with respect to a
Covered Infringement, and Agritope and its Affiliates do not agree
to join in such court action or proceedings as provided in Section
8.4, University may bring such court action or proceedings on its
own and shall in such event bear all costs of, and shall exercise
all control over, such court action or proceedings. University
Page 16
may, at its expense, bring such action in the name of Agritope or
its Affiliate and/or cause Agritope or its Affiliate to be joined
in the suit as a plaintiff. Recoveries, if any, whether by
judgment, award, decree or settlement, shall belong solely to
University.
8.4 If University notifies Agritope that it desires to institute court
action or proceedings against such third party with respect to a
Covered Infringement, and Agritope or its Affiliate notifies
University within 30 days after receipt of such notice that
Agritope or its Affiliate desires to institute court action or
proceedings jointly, the court action or proceedings shall be
brought jointly in the names of both parties and all costs thereof
shall be borne equally. Recoveries, if any, whether by judgment,
award, decree or settlement shall, after the reimbursement of each
of University and Agritope or its Affiliate for its share of the
joint costs in such action, be shared between University and
Agritope or its Affiliate as the interests of the parties were
affected by the infringement.
8.5 If University notifies Agritope that it does not intend to
institute court action or proceedings against such third party
with respect to a Covered Infringement (or fails to give any
notice in this respect or to actually bring a court action or
proceedings against the third party), Agritope or its Affiliate
may institute court action or proceedings on its own. Agritope or
such Affiliate shall bear all costs of, and shall exercise all
control over, such court action or proceedings. Recoveries, if
any, whether by judgment, award, decree or settlement, shall
belong solely to Agritope and its Affiliate.
8.6 Should either University or Agritope or its Affiliates commence a
court action or proceedings under the provisions of this Section 8
and thereafter elect to abandon the same, it shall give timely
notice to the other party, who may, if it so desires, be joined as
a plaintiff in the court action or proceedings (or continue as
such if it is already one) and continue prosecution of such court
action or proceedings, provided, however, that the sharing of
expenses and any recovery of such court action or proceedings
shall be as equitably agreed upon between University and Agritope
or its Affiliate.
9. REPRESENTATIONS, WARRANTIES AND INDEMNITIES
9.1 University represents and warrants that it has full right and
authority to grant the option and the licenses granted herein.
9.2 Each party represents and warrants to the other that to the best
of its knowledge and belief it has obtained, and will at all times
during the term of this Agreement hold and comply with, all
licenses, permits and authorizations necessary to perform this
Agreement, as now or hereafter required under any applicable
statutes, laws, ordinances, rules and regulations of any
applicable national, international and local governments and
governmental entities, and in the event of being notified of any
Page 17
deficiency undertakes promptly to use all reasonable endeavours to
obtain all such licenses, permits and authorisations.
9.3 Each party undertakes to use all reasonable endeavours to ensure
the accuracy of all information and material provided by it to the
other party in relation to the Research Program and in the event
of being notified of any error or other deficiency therein, or of
the same coming to its notice, promptly to use all reasonable
endeavours to supply appropriate corrections. Subject thereto
neither party shall be under any further obligation or liability
in respect of any error or deficiency (whether before or after the
date hereof) and no warranty or representation of any kind is made
or given or to be implied as to it sufficiency, accuracy or
fitness for purpose or freedom from infringement of intellectual
property rights and the recipient party shall in each case be
entirely responsible for the use to which it puts the same.
9.4 Save and subject as aforesaid University shall indemnify Agritope
against any and all liability, loss, damage, costs, legal costs
(including without limitation reasonable attorneys' fees),
professional and other expenses of any nature whatsoever incurred
or suffered by Agritope to the extent and only to the extent
Agritope is required to meet a claim by any third party from any
University negligence, intentional misconduct, or from any breach
of University's duties, obligations or warranties hereunder. With
respect to any matter for which University has indemnified
Agritope hereunder, University shall be afforded the right to
control the defense of all actions, to enter into all settlements,
judgments or other arrangements in respect thereof, provided that
University undertakes and pursues such defense with competent
counsel reasonably acceptable to Agritope. Agritope agrees to
notify University promptly after it becomes aware of any claim,
action or proceeding by a third party and to co-operate with
University, at University's expense, in any defense or prosecution
thereof.
9.5 Save and subject as aforesaid Agritope shall indemnify University
against any and all liability, loss, damage, costs, legal costs
(including without limitation reasonable attorneys' fees),
professional and other expenses of any nature whatsoever incurred
or suffered by University to the extent and only to the extent
University is required to meet a claim by any third party from any
Agritope negligence, intentional misconduct, or from any breach of
Agritope's duties, obligations or warranties hereunder, or in
respect of any injury or damage caused by Agritope's or its
Affiliates', or sublicensees' use or exploitation of the rights
granted hereunder or pursuant to the terms of this Agreement. With
respect to any matter for which Agritope has indemnified
University hereunder, Agritope shall be afforded the right to
control the defense of all actions, to enter into all settlements,
judgments or other arrangements in respect thereof, provided that
Agritope undertakes and pursues such defense with competent
counsel reasonably acceptable to University. University agrees to
notify Agritope promptly after it becomes aware of any claim,
action or proceeding by a third party and to co-operate with
Agritope, at Agritope's expense, in any defense or prosecution
thereof.
Page 18
9.6 THE FOREGOING WARRANTIES AND INDEMNITIES ARE IN LIEU OF, AND THE
PARTIES EACH DISCLAIM, ALL OTHER WARRANTIES, EXPRESS, IMPLIED OR
ARISING BY LAW, INCLUDING WITHOUT LIMITATION ANY IMPLIED
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE.
10. MISCELLANEOUS
10.1 This Agreement constitutes the entire agreement and supersedes all
prior agreements and understandings, both written and oral,
between the parties hereto with respect to the subject matter
hereof.
10.2 This Agreement shall not be assignable by either party without the
prior written consent of the other party, which consent will not
be unreasonably withheld, provided that Agritope shall be entitled
to assign its interest in this Agreement to any Affiliate that is
demonstrably able to fulfil Agritope's obligations hereunder, and
either party shall be entitled to assign its interest in this
Agreement where the assignment arises as a result of the assigning
of all or substantially of all its assets.
10.3 All notices, requests or other communication provided for or
permitted hereunder shall be given in writing and shall be hand
delivered or sent by facsimile (followed by a mailed or couriered
confirmation copy), reputable courier or by registered or
certified mail, postage prepaid, return receipt requested, to the
address set forth on the signature page of this Agreement, or to
such other address as either party may inform the other of in
writing. Notices will be deemed delivered on the earliest of
transmission by facsimile, actual receipt or five days after
mailing as set forth herein.
10.4 Any terms of this Agreement may be amended, modified or waived
only in a writing signed by both parties.
10.5 If any provision of this Agreement shall be held invalid, illegal
or unenforceable, such provision shall be enforced to the maximum
extent permitted by law and the parties' fundamental intentions
hereunder, and the remaining provisions shall not be affected or
impaired.
10.6 Nothing herein contained shall constitute this a joint venture
agreement or constitute either party as the partner, principal or
agent of the other, this being an Agreement between independent
contracting entities. Neither party shall have the authority to
bind the other in any respect whatsoever to third parties. Except
as provided herein, nothing contained in this Agreement shall be
construed as conferring any right on either party to use any name,
trade name, trademark or other designation of the other party
hereto, unless the express, written permission of such other party
has been obtained.
Page 19
10.7 This Agreement shall be governed by, and construed and enforced in
accordance with, the laws of Scotland and the parties hereto
submit to the non-exclusive jurisdiction of the Scottish Courts.
IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
officers to execute and acknowledge this Agreement as of the date first written
above.
UNIVERSITY COURT OF THE AGRITOPE, INC.
UNIVERSITY OF EDINBURGH
By: /S/ ▇▇▇▇▇ ▇▇▇▇▇▇ By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------- ------------------------------
Its: DEPUTY DIRECTOR, RESEARCH ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
-------------------------
AND INNOVATION Address: ▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇.
-------------- ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
Address: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ Fax: ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
Scotland, UK Attn: President
Fax: ▇▇ ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
Attn: The Secretary
Page 20