Exhibit 10.31
THIS AGREEMENT is made on 16 March, 2000
BETWEEN
(1) OXFORD GENE TECHNOLOGY IP LIMITED a company incorporated in England and
Wales under number 3845467, whose registered office is at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ ("OGT"); and
(2) ROSETTA INPHARMATICS, INC., a Delaware corporation whose principal
executive offices are at ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, ▇▇▇
("ROSETTA")
RECITALS
(A) OGT controls patents and pending applications relating to Nucleic Acid
Arrays (as defined herein) and related technology.
(B) OGT has agreed to grant and Rosetta has agreed to take a license under
such patents subject to and in accordance with the terms of this
Agreement.
(C) Rosetta has exclusively licensed to Agilent Technologies, Inc., a Delaware
corporation (as successor in interest to certain holdings of the
Hewlett-Packard Company) ("AGILENT"), certain Inkjet Patents pursuant to
that certain Gene Expression Collaboration Agreement dated as of October
1, 1999 (the "ROSETTA/AGILENT COLLABORATION AGREEMENT") between Rosetta
and Agilent.
(D) Agilent may, with the consent of Rosetta and pursuant to the
Rosetta/Agilent Collaboration Agreement, sublicense certain of its rights
in, to and under the Inkjet Patents.
(E) Oxford Gene Technology (operations) Ltd. ("OGT OPERATIONS") (a
Wholly-owned Subsidiary of OGT) and Agilent have entered into a Supply
Agreement and License dated as of December 6, 1999 (the "OGT/AGILENT
AGREEMENT") pursuant to which Agilent has, subject to the consent of
Rosetta, sublicensed certain of its rights in, to and under the Inkjet
Patents.
(F) Rosetta will consent to the sublicense to OGT Operations by Agilent of
certain rights in, to and under the Inkjet Patents subject to and in
accordance with the terms and conditions of this Agreement.
OPERATIVE PROVISIONS
1. DEFINITIONS AND INTERPRETATIONS
1.1 In this Agreement the following words and expressions have the following
meanings:
"AFFILIATE" of a Party means any present or future Entity that Controls,
is Controlled by, or is under the Control of the same Entity or Entities
as, the Party, but only for so long as such Control continues;
"ARRAY MAKER" means a device designed to fabricate Nucleic Acid Arrays;
"CALENDAR QUARTER" means a period of three months ending on 31 March, 30
June, 30 September or 31 December;
"CONTROL(S)(LED)" means with respect to an Entity, the possession,
directly or indirectly, of more than fifty per cent (50%) of the issued
share capital or other issued stock or securities of, or the voting power
in, such Entity;
"COVERED BY A VALID CLAIM" means, in relation to a product, that its
manufacture, importation, Supply or use would, and in relation to a
process, that its practice would, but for the licenses herein or, in the
case of OGT, but for the licenses in the OGT/Agilent Agreement, infringe a
Valid Claim;
"DATABASE" means a collection of information derived from one or more
Nucleic Acid Arrays, which is licensed for value to multiple third
parties, but does not include a database for internal use exclusively by
an Entity;
"EFFECTIVE DATE" means the date first set forth above;
"END-USER" means an end-user of Royalty-Bearing Services Supplied by
Rosetta;
"ENTITY" means any natural or legal person, partnership, association or
governmental authority;
"EXCLUDED FIELDS" means any of the following activities:
(a) the use of a Nucleic Acid Array for or in connection with
any activity other than gene expression profiling or
non-commercial genotyping
(b) the exercise of any of the rights licensed under this
Agreement for the purposes of the manufacture, having
manufactured, use, supply, creation or contribution to
the creation of Incyte Express Ion Databases; and
(c) the manufacture or having manufactured of Nucleic Acid
Arrays by a method other than In-Situ Inkjet Synthesis
"INCYTE EXPRESSION DATABASE" means a Database consisting entirely or
substantially of gene expression data and containing at least five hundred
data points, where a single data point is data relating to the level of
expression of one gene in one sample;
"INKJET DEPOSITION" means a method for the fabrication of Nucleic Acid
Arrays on a solid support by deposition of a pre-synthesized
oligonucleotide on such solid support
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
2
at a specific location using an inkjet printing device to deliver to
defined locations on the surface of the solid support such pre-synthesized
oligonucleotides;
"IN-SITU INKJET SYNTHESIS" means a method for the fabrication of Nucleic
Acid Arrays on a solid support by synthesizing by chemical means
individual nucleic acids directly on such solid support at specific
locations on the Nucleic Acid Array using an inkjet printing device to
deliver to defined locations on the surface of the solid support
precursors for or reagents which allow mononucleotide additions.
"INSTRUMENT" means readers, fluids stations, hybridization devices, sample
logging, handling and processing systems, detection and measurement
equipment, computer work stations (and associated software) and other
instruments or systems used in the preparation or use of Nucleic Acid
Arrays or the extraction or processing of data from Nucleic Acid Arrays;
"INKJET PATENTS" means all the rights held by Rosetta on the date of the
OGT/Agilent Agreement or acquired by Rosetta during the term of the
OGT/Agilent Agreement which are licensed to Agilent under the
Rosetta/Agilent Collaboration Agreement and which cover instrumentation
and methods for making Nucleic Acid Arrays. Inkjet Patents includes
patents required for the general use of an Array Maker to make Nucleic
Acid Arrays but excludes patents relating to particular Nucleic Acid
Arrays, Nucleic Acid Array or probe design, or probe sequences, provided,
however, if the Inkjet Patents are licensed to OGT Operations or any
successor to its business under Clauses 4.3 or 4.4, the reference to the
term of the OGT/Agilent Agreement shall be to the Term;
"LICENSED PROCESS" means any process, method or procedure which is Covered
by a Valid Claim;
"LICENSED PRODUCT" means a Nucleic Acid Array and any component thereof,
an Instrument, kit, reagent, computer software or other product, apparatus
or composition of matter of whatever nature which is Covered by a Valid
Claim, but not including a Database or other information (other than a
Database or information which is an integral part of a product);
"NET SALES" means amounts invoiced by Rosetta or OGT, as the case may be,
or an Affiliate of either on all arm's-length sales of Royalty Bearing
Services to a party which is not an Affiliate of the supplying Party, less
the following deductions from such gross amounts which are actually
incurred, to the extent that they are reasonable and customary:
(a) credits or allowances actually granted, rejection of results
derived from the Supply of Royalty Bearing Services, and
retroactive price reductions;
(b) freight, postage, shipping, customs duties and insurance
charges;
(c) normal and customary trade, cash and quantity discounts,
allowances and credits;
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
3
(d) sales, value added or similar taxes measured by the invoice
amount, when included in invoice;
(e) charge back payments and rebates granted to managed health
care organizations or to federal, state and local governments,
their agencies, and purchasers and reimbursers;
(f) commissions paid to third parties other than sales personnel
and sale representatives or sales agents; and
(g) rebates (or equivalents thereof) granted to or charged by
national, state or local governmental authorities in countries
other than the United States.
The value of Royalty-Bearing Services Supplied or used by Rosetta or OGT,
as the case may be, or an Affiliate of either for quality control purposes
shall not be included in the calculation of Net Sales. Net Sales will
include technology access fees paid specifically in consideration of
access to Royalty-Bearing Services.
Except as otherwise provided above, if Rosetta or OGT, as the case may be,
or an Affiliate of either makes any Supply to commercial third parties of
Royalty-Bearing Services for other than monetary value in whole or in
part, or otherwise than at arm's length, such Supply shall be considered a
Supply hereunder for accounting and royalty purposes. Net Sales for any
such non-monetary transfer shall be calculated using the average realised
price for the Royalty-Bearing Service charged by Rosetta or OGT or their
respective Affiliates, as the case may be, during the royalty-paying
period in which such Supply occurs. If no such price is ascertainable, Net
Sales will be the fully-burdened cost to Rosetta or OGT or their
respective Affiliates, as the case may be, of providing the
Royalty-Bearing Service multiplied by [***].
Except as otherwise provided in Clause 6 hereof in respect of Rosetta, and
Clause 7 hereof in respect of OGT, in the event that a Royalty-Bearing
Service is Supplied in combination with other apparatus, products,
services, software or information, or in any other combination, and the
Royalty-Bearing Service is not separately valued on the invoice or other
document evidencing such Supply, the Net Sales of the Royalty-Bearing
Service shall be calculated using the price generally charged by Rosetta
or OGT or their respective Affiliates, as the case may be, for the
Royalty-Bearing Service during the royalty-paying period in question when
Supplied separately. If both the Royalty-Bearing Service and the other
components of the combination product or service may be invoiced
separately but are being Supplied at a combination price which is less
than the total if invoiced separately then the Net Sales of the
Royalty-Bearing Service shall be calculated by multiplying the invoice
amount for the combination by a fraction the numerator of which is the
price generally charged by Rosetta or OGT or their respective Affiliates,
as the case may be, for the Royalty-Bearing Service during the
royalty-paying period in question, and the denominator of which is the sum
of amounts generally charged by Rosetta or OGT or their respective
Affiliates, as the case may be, for the Royalty-Bearing Service and such
other components during the royalty-paying period in question. Where the
Royalty-Bearing
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
4
Service has not previously been Supplied separately, does not have an
invoice price and is Supplied in combination as above, then Net Sales for
the purposes of calculating royalty will be calculated using the
fully-burdened cost to Rosetta or OGT or their respective Affiliates, as
the case may be, of providing of the Royalty-Bearing Service multiplied by
[***];
"NUCLEIC ACID ARRAY" means an array of nucleic acids attached to a solid
support;
"PATENT RIGHTS" means U.S. Patents Nos. 5,700,637 and 5,436,327 [***] and
all continuations, continuations-in-part, divisionals, re-examinations and
reissues, and any patents issuing therefrom or claiming common priority
thereto, together with any other patents which issue to OGT, or which
otherwise come into the ownership or under the control of OGT during the
term and which OGT has the right to license, and which relate, but only
to the extent that they relate, to the general use of Nucleic Acid Arrays,
including methods for making or analyzing Nucleic Acid Arrays and for
creating Rosetta Ratio-based Databases, but excluding therefrom any
such patents that relate but only to the extent that they relate to
instrumentation for the reading of Nucleic Acid Arrays, the design of
probes for use on Nucleic Acid Arrays, particular sequences used on
Nucleic Acid Arrays, software used in instrumentation for reading Nucleic
Acid Arrays or in probe design, microfluidics or the control or assurance
of the quality of Nucleic Acid Arrays;
"ROSETTA RATIO-BASED DATABASE" means a Database containing relative levels
of expressed genes within or between cells wherein such Database may be
built from data where measurements from one RNA sample are compared with
those from another RNA sample; provided, however, a Rosetta Ratio-based
Database shall in no event include an Incyte Expression Database;
"RESOLVER SOFTWARE" means Rosetta's software package with the features set
forth in EXHIBIT A;
"ROYALTY-BEARING SERVICE" means any service which comprises the use by the
provider of the service of one or more Licensed Processes or Licensed
Products, including the licensing or Supply of, or rendition of services
related to, Rosetta Ratio-based Databases or other information which was
generated or a substantial proportion of which was generated by the use of
one or more Licensed Products or Licensed Processes;
"SUPPL(Y)(IED)(YING)" means sell, supply, lend, let out on hire, lease or
any other disposal, and in the case of services, includes the provision of
access to information;
"TERM" means the period of time from the Effective Date to and
including the date of the last to expire of U.S. Patent Nos. 5,700,637
and 5,436,327 [***] and all continuations, continuations-in-part,
divisionals, re-examinations and reissues, and any patents issuing
therefrom or claiming common priority thereto;
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
5
"VALID CLAIM" means a claim of an issued and subsisting patent in the OGT
Patent Rights or the Inkjet Patents, as the case may be, which claim has
not been finally held to be invalid or unenforceable in a proceeding from
which no further appeal may be taken within the time limit for taking such
appeal; and
"WHOLLY-OWNED SUBSIDIARY" of a Party means an Entity of which the Party
possesses, directly or indirectly, one hundred per cent (100%) (or the
maximum amount permitted by law) of the issued share capital or other
issued stock or securities, or the voting power, but only while such
possession continues.
1.2 In this Agreement:
(a) references to clauses are to the clauses of this Agreement;
(b) references to the Parties are to the parties to this Agreement;
(c) headings are used for convenience only and do not affect its
interpretation;
(d) references to the singular include the plural and vice versa;
(e) references to the masculine include the feminine;
(f) references to a statutory provision include references to the
statutory provision as modified or re-enacted or both from time to
time and to any subordinate legislation made under the statutory
provision; and
(g) references to the agreed form mean to a form agreed between the
parties prior to the date hereof and initialed by each of them.
2. GRANT OF RIGHTS TO ROSETTA BY OGT
2.1 Subject to the terms of this Agreement, OGT hereby grants to Rosetta and
Rosetta accepts, a non-exclusive, royalty-bearing, worldwide sub-license
under the OGT Patent Rights to manufacture, have manufactured and use
Nucleic Acid Arrays for internal purposes only, to create and contribute
to the creation of Rosetta Ratio-based Databases, and to Supply and offer
for Supply Royalty-Bearing Services, in each case in all fields other than
the Excluded Fields.
2.2 OGT will on or about each anniversary of the Effective Date notify Rosetta
in writing of any patents in the OGT Patent Rights which have issued or
been granted in the preceding 12 months. Any failure to so notify Rosetta
will have no effect on the rights granted hereunder.
2.3 No implied right or license is granted to Rosetta under the OGT Patent
Rights, including the right to grant sub-licenses. Other than as expressly
granted herein, no licenses or right to grant sub-licenses either by
estoppel, implication or otherwise are granted herein.
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
6
2.4 The licenses and other rights granted to Rosetta under this Agreement
extend to all Wholly-owned Subsidiaries of Rosetta, subject to such
Wholly-owned Subsidiaries undertaking in writing to OGT to accept all
corresponding obligations, exceptions and limitations. In particular,
Rosetta undertakes not to carry out during the Term any activities which
fall within the Excluded Fields.
3. ROSETTA CONSENT TO SUBLICENSE UNDER OGT/AGILENT AGREEMENT
3.1 Subject to the terms of this Agreement, Rosetta hereby consents to the
sublicense to OGT Operations by Agilent under the OGT/Agilent Agreement of
certain of Agilent's rights in, to and under the Inkjet Patents, but only
to the extent of the licenses granted in the OGT/Agilent Agreement.
3.2 Rosetta will on or about each anniversary of the Effective Date notify OGT
in writing of any patents in the Inkjet Patents which have issued or been
granted in the preceding 12 months. Any failure to so notify Rosetta will
have no effect on the rights granted under the OGT/Agilent Agreement.
3.3 No implied right or license is granted to OGT under the Inkjet Patents,
nor is any consent given hereby to a sublicense to the Inkjet Patents. No
license or right to grant sub-licenses either by estoppel, implication or
otherwise are granted nor is any consent to a further sublicense granted
hereby.
3.4 The consent provided by Rosetta to the sublicense to OGT Operations by
Agilent hereunder shall extend to all Wholly-owned Subsidiaries of OGT,
subject to such Wholly-owned Subsidiaries undertaking in writing to
Rosetta to accept all corresponding obligations, exceptions and
limitations.
4. ROSETTA'S OBLIGATIONS
4.1 In Rosetta's contracts with End-Users of Royalty-Bearing Services,
End-Users shall agree not to sell, or otherwise provide to any third party
in exchange for value, data derived from or contained in any Rosetta
Ratio-based Database created by Rosetta, or of which Rosetta substantially
contributed to the creation ("END-USER DATA"); provided, however, nothing
herein shall be construed as preventing or restricting an End-User's right
to provide access to End-User Data to a third party with which such
End-User has a Collaboration, or if the End-User Data is intended by the
End-User for use in the diagnosis and monitoring of a human disease, state
or condition of a particular person. A "Collaboration," as used herein,
means a bona fide scientific collaboration between an End-User and a third
party under a written contract and research plan in a specified area, in
which (a) such third party receives biological materials and/or
proprietary information of End-User or End-User receives biological
materials and/or proprietary information of the third party, (b) End-User
obtains significant proprietary rights if significant intellectual
property is generated in the collaboration, (c) the collaboration is
within End-User's normal business model but only to the extent End-User's
normal business model does not include the provision of
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
7
nucleic acid hybridization services or products or database distribution
services or products for third parties, (d) End-User and its collaborator
provide significant scientific input to the collaboration in addition to
End-User Data, wherein significant scientific input includes, for example,
material input to experimental design, material contributions to
experimental execution and material data analysis and (e) the End-User
Data are used primarily to facilitate End-User's research, development, or
commercialization of particular molecules, classes of molecule, or
therapeutic areas. A Collaboration shall not include an arrangement in
which an End-User provides Royalty-Bearing Services on a fee-for-service
or similar basis.
4.2 Except as otherwise provided below, Rosetta agrees to indemnify and hold
OGT harmless from and against any losses, liabilities, damages and
expenses (including reasonable attorney's fees and costs) suffered or
incurred, and claims made, in connection with third party claims, demands,
actions or other proceedings for personal injuries or any product recall
to the extent caused by (a) any and all uses or Supply of Royalty-Bearing
Services by Rosetta or its Affiliates, (b) any manufacturing defect in any
Licensed Products manufactured by or on behalf of Rosetta or (c) any other
act or omission of Rosetta in connection with the Supply of
Royalty-Bearing Services except to the extent such losses, liabilities,
damages and expenses (including reasonable attorney's fees and costs)
result from the recklessness or intentional misconduct of OGT.
4.3 In the event that for any reason the OGT/Agilent Agreement shall terminate
or expire, Rosetta shall, to the extent that it shall not at such time be
prohibited, contractually or otherwise, license to OGT Operations or any
successor to its business the Inkjet Patents on the same terms and
conditions as the consent provided for herein for a period equal to the
remainder of the Term hereunder.
4.4 Rosetta shall provide notice to OGT promptly upon any expiration or
termination of the Rosetta/Agilent Collaboration Agreement, and upon any
such expiration or termination Rosetta shall, to the extent that it shall
not at such time be prohibited, contractually or otherwise, license to OGT
Operations or any successor to its business the Inkjet Patents on the same
terms and conditions as the consent provided for herein for a period equal
to the remainder of the Term.
4.5 Rosetta agrees to license to OGT Operations on the same terms as the
Inkjet Patents (including Clause 13.2), for the Term, all patents or other
intellectual property rights which it owns or controls during the Term
(other than the Inkjet Patents) which cover, but only to the extent that
they cover, instrumentation and methods for making Nucleic Acid Arrays,
but not including any patent rights which cover, but only to the extent
they cover, instrumentation for the reading of Nucleic Acid Arrays, the
design of probes for use on Nucleic Acid Arrays, particular sequences used
on Nucleic Acid Arrays, software used in instrumentation for reading
Nucleic Acid Arrays or in probe design, microfluidics or the control or
assurance of the quality of Nucleic Acid Arrays.
4.6 Rosetta agrees to comply promptly and in full with all requests by Agilent
made pursuant to and in accordance with the Rosetta/Agilent Collaboration
Agreement to enable Agilent to comply with its relevant obligations to OGT
Operations under the
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
8
OGT/Agilent Agreement, including in the manufacture and supply of Array
Makers and the provision of technical support in relation to such Array
Makers, subject to OGT complying with its corresponding obligations.
Rosetta further agrees with OGT itself to comply with such obligations of
Agilent under the OGT/Agilent Agreement both during the subsistence of
that Agreement and in the event that that Agreement is terminated for any
reason, subject always to OGT complying with its correponding obligations.
5. OGT'S OBLIGATIONS
5.1 Except as otherwise provided below, OGT agrees to indemnify and hold
Rosetta harmless from and against any losses, liabilities, damages and
expenses (including reasonable attorney's fees and costs) suffered or
incurred, and claims made, in connection with third party claims, demands,
actions or other proceedings to the extent caused by (a) any and all uses
of Inkjet Patents by OGT or its Affiliates, (b) any manufacturing defect
in any Licensed Products manufactured by or on behalf of OGT or its
Affiliates or (c) any other act or omission of OGT or its Affiliates in
connection with the use of Licensed Products or the Supply of
Royalty-Bearing Services except to the extent such losses, liabilities,
damages and expenses (including reasonable attorney's fees and costs)
result from the recklessness or intentional misconduct of Rosetta.
5.2 OGT agrees to cause OGT Operations to strictly abide by the terms and
conditions of the OGT/Agilent Agreement, and OGT agrees to provide notice
to Rosetta promptly upon any expiration or termination of the OGT/Agilent
Agreement. In no event will OGT use, or permit its Affiliates to use, any
process or method Covered by a Valid Claim of the Inkjet Patents to
fabricate for supply to any single third party customer during any
calendar year greater than [***] Nucleic Acid Arrays of a single design as
those terms are further elaborated in the OGT/Agilent Agreement.
5.3 OGT agrees that in any settlement of any of its legal and patent
proceedings against Affymetrix, Inc. it will not to make any admissions
or concessions as to the validity of any patent owned by Affymetrix to
the extent that they relate to the manufacture of Nucleic Acid Arrays
by In-Situ Inkjet Synthesis or Inkjet Deposition without either the
consent of Rosetta or Rosetta's having first obtained a license under
such patents in terms satisfactory to it.
6. CONSIDERATION PAID BY ROSETTA
6.1 Within seven days after the Effective Date, Rosetta will pay to OGT a
licence fee in the sum of U.S. $1.0 million. The licence fee will not be
creditable against royalty or other payments due to OGT under this
Agreement. In addition, Rosetta will within seven days after the
Effective Date, pursuant to the Common Stock Issuance Agreement attached
hereto as EXHIBIT B, issue to OGT [***] shares of its common stock, par
value $0.001.
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
9
6.2 Rosetta shall pay to OGT (i) [***] related to the Supply by Rosetta of
Royalty Bearing Services substantially all of which consist of the
generation of data derived directly from Nucleic Acid Arrays and the
supply of such data to a single user and (ii) [***] related to the
Supply by Rosetta of all other Royalty Bearing Services whether or not
provided with Rosetta software, tools, annotated information or other
economically material services.
6.3 Rosetta will on request provide to OGT, at Rosetta's fully-burdened cost,
one copy of its Resolver Software for use by OGT for one year from the
date of delivery to OGT, and all maintenance related to such Resolver
Software will be provided to OGT by Rosetta without charge during such
one-year period. In addition, Rosetta will provide at the time of delivery
of the Resolver Software to OGT, at Rosetta's fully-burden cost, all
third-party hardware and software configurations necessary for operation
of the Resolver Software. If OGT shall elect to continue its use and
operation of Resolver Software beyond a period of one year from its
delivery to OGT, Rosetta shall provide maintenance and support services to
OGT at such rates as shall be consistent with licenses of Resolver
Software to licensees similarly situated to OGT.
6.4 If during the Term it is necessary or desirable for Rosetta to obtain a
license from any third party ("THIRD PARTY LICENSE") other than an
Affiliate or continue in effect any license in existence as of the
Effective Date with any person other than an Affiliate in order to avoid
infringing such third party's patent(s) in the course of Rosetta's Supply
of Royalty-Bearing Services, the amounts payable under Clause 6.2 hereof
shall be reduced by the amount of the royalties paid under the Third Party
License, provided that the amounts payable by Rosetta to OGT shall not be
reduced by more than [***] of the amount which would have been payable
in the absence of this clause 6.4.
7. CONSIDERATION PAID BY OGT
7.1 In consideration for the consent by Rosetta to the sublicense of the
Inkjet Patents under the OGT/Agilent Agreement, OGT shall pay to Rosetta
[***] related to the Supply by OGT of all Royalty Bearing Services.
7.2 If during the Term it is necessary or desirable for OGT to obtain a
license from any third party ("THIRD PARTY LICENSE") other than an
Affiliate or continue in effect any license in existence as of the
Effective Date with any person other than an Affiliate in order to avoid
infringing such third party's patent(s) in the course of OGT's Supply of
Royalty-Bearing Services, the amounts payable under Clause 7.1 hereof
shall be reduced by the amount of the royalties paid under the Third Party
License, provided that the amounts payable by OGT to Rosetta shall not be
reduced by more than [***] of the amount which would have been payable
in the absence of this clause 7.1.
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
10
8. PAYMENT TERMS
8.1 Amounts due under this Agreement shall be paid within [***] of the end
of each Calendar Quarter in respect of amounts that have accrued during
that Calendar Quarter pursuant to the provisions of Clause 6 and 7, and
within [***] of the end of the Term.
8.2 All sums due under this Agreement:
(a) are exclusive of Value Added Tax or other sales tax which where
applicable will be paid by the paying party;
(b) will be paid in US Dollars to the credit of a bank account nominated
by the payee;
(c) shall be made without deduction of income tax or other taxes,
charges or duties that may be imposed, except and so far as the
paying Party is required to deduct the same to comply with
applicable laws, in which case the parties will co-operate in all
reasonable respects necessary to take advantage of such double
taxation agreements as may be available; and
(d) shall be made by the due date, failing which the recipient party may
charge interest on any outstanding amount on a daily basis at a rate
equivalent to [***] per year above the Barclays Bank plc base
lending rate then in force.
8.3 If at any time during the Term a Party is prohibited from making any of
the payments required hereunder by a governmental authority in any country
then such Party will within the prescribed period for making such payments
in the appropriate manner use its best endeavors to secure from the proper
authority in the relevant country permission to make such payments and
will make them within seven days of receiving such permission. If such
permission is not received within 30 days of such Party making a request
for such permission then the Party to whom such payment is owed may
request the other Party to deposit the payments due in the currency of the
relevant country either in a bank account designated by such Party within
such country or such royalty payments will be made to an Affiliate
designated by such Party and having offices in the relevant country.
8.4 Each payment made hereunder shall be accompanied by a statement setting
out the total Net Sales for which amounts shall have accrued under Clause
6 or Clause 7, as the case may be, during the period to which the royalty
payment relates.
8.5 Each Party will keep for a minimum period of six (6) years from the time
of creation at its normal place of business detailed and up-to-date
records and accounts showing the value of Royalty-Bearing Services
Supplied by it sufficient to ascertain the amounts due under this
Agreement. Each Party will make such records and accounts available, on
reasonable notice, for inspection no more than once in any calendar year
during local business hours by an independent chartered or certified
accountant from a firm of accountants nominated by each party and
acceptable to other for the sole
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
11
purpose of verifying the accuracy of any statement or report given to the
other pursuant hereto. The accountant will be required to keep
confidential all information learnt during any such inspection, and only
to disclose to the other party such details as may be necessary to report
on the accuracy of the statement or report. A Party requesting an audit
will be responsible for the accountant's charges unless the accountant is
satisfied that there is an underpayment of more than [***] in the
period audited, in which case the audited party will pay its reasonable
charges in respect of that inspection.
9. PATENT INFRINGEMENT AND ENFORCEMENT
9.1 If Rosetta detects or suspects any infringement of the OGT Patent Rights,
and if OGT detects or suspects any infringement of the Inkjet Patents,
each Party will promptly notify the other and provide all details within
its knowledge with respect to the same. Each of Rosetta and OGT will
cooperate and provide the other with all assistance requested for the
purpose of any such action brought by the other with respect to any such
infringement or suspected infringement.
9.2 No Party will be under any obligation by virtue of this Agreement to take
any action whether through the institution of legal proceedings or
otherwise with respect to any infringement or suspected infringement of
the OGT Patent Rights in the case of OGT, or Inkjet Patents in the case of
Rosetta; provided, however, if a party in its absolute discretion decides
to take any such action, then without prejudice to any separate agreement
that the Parties may enter into, or have entered into, it will do so at
its own costs and the other Party will have no claim to any sums received.
10. CONFIDENTIALITY
10.1 Each Party ("RECEIVING PARTY") undertakes:
(a) to maintain as secret and confidential all technical and commercial
information obtained directly or indirectly from the other Party
("DISCLOSING PARTY") in the course of or in anticipation of this
Agreement (including the terms and conditions of this Agreement) and
to respect the Disclosing Party's rights therein;
(b) to use the same exclusively for the purposes of this Agreement; and
(c) to disclose the same only to those of its employees, contractors,
consultants to whom and to the extent that such a disclosure is
reasonably necessary for the purposes of this Agreement and related
agreements between the Parties or their Affiliates.
10.2 The provisions of clause 10.1 will not apply to information which the
Receiving Party can demonstrate by reasonable, written evidence:
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
12
(a) was, prior to its receipt by the Receiving Party from the Disclosing
Party, in the possession of the Receiving Party without an
obligation of confidentiality; or
(b) is subsequently disclosed to the Receiving Party without any
obligations of confidence by a third party who has not derived it
directly or indirectly from the Disclosing Party; or
(c) is or becomes generally available to the public through no act or
default of the Receiving Party or its agents, employees, Affiliates
or sublicensees; or
(d) the Receiving Party is required to disclose by or to the courts of
any competent jurisdiction, or to any government, regulatory agency
or financial authority, provided that the Receiving Party shall
(i) inform the Disclosing Party as soon as is reasonably
practicable, and
(ii) at the Disclosing Party's request seek to persuade the court,
agency or authority to have the information treated in a
confidential manner, where this is possible under the court,
agency or authority's procedures; or
(e) is independently developed by Recipient without the aid,
application, or use of information received from the Disclosing
Party, as can be demonstrated by written records created at the time
of such independent development; or
(f) in the case of information disclosed by OGT to Rosetta, is disclosed
to actual or potential End-Users of Royalty-Bearing Services, in so
far as such disclosure is reasonably necessary to promote the use of
Licensed Products or the Supply of Royalty-Bearing Services,
provided that the End-Users sign a written confidentiality
undertaking at least as restrictive as clauses 10.1 and 10.2.
10.3 The Receiving Party will procure that all of its employees, contractors
and sublicensees pursuant to this Agreement (if any) who could have access
to any of the Disclosing Party's information to which clause 10.1 applies
shall be made aware of and subject to these obligations and shall have
entered into written undertakings of confidentiality at least as
restrictive as clauses 10.1 and 10.2 and which apply to the Disclosing
Party's information.
11. WARRANTIES AND WARRANTY DISCLAIMERS
11.1 Each Party warrants to the other that it has the full right and power to
enter into this Agreement. OGT further warrants that it is entitled to
license the OGT Patent Rights as licensed herein and has not previously
assigned them or entered into any agreement relating to them which might
affect its ability to license the OGT Patent Rights in accordance with the
provisions of this Agreement.
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
13
11.2 Each Party acknowledges that in entering into this Agreement it does not
do so in reliance on any representation, warranty or other provision
except as expressly provided in this Agreement and any conditions,
warranties or other terms implied by statute or common law are excluded
from this Agreement to the full extent permitted by law.
11.3 Notwithstanding anything contained herein to the contrary, OGT does not
give any warranty, representation or undertaking:
(a) as to the efficacy or usefulness of the OGT Patent Rights or any
inventions claimed therein;
(b) that any of the OGT Patent Rights are or will be valid or subsisting
or (in the case of applications) will proceed to grant;
(c) that the exploitation of any the OGT Patent Rights or the
manufacture or use of Licensed Products or the Supply of
Royalty-Bearing Services or the exercise of any other rights
licensed hereunder, will not infringe any other intellectual
property or other rights of any other Entity; or
(d) as imposing any obligation on OGT to bring or prosecute actions or
proceedings against third parties for infringement or to defend any
actions or proceedings for revocation of any the OGT Patent Rights.
11.4 Notwithstanding anything contained herein to the contrary, Rosetta does
not give any warranty, representation or undertaking:
(a) as to the efficacy or usefulness of the Inkjet Patents or any
inventions claimed therein;
(b) that any of the patent rights comprising Inkjet Patents are or will
be valid or subsisting or (in the case of applications) will proceed
to grant;
(c) that the exploitation of any the Inkjet Patents or the manufacture,
use or sale of Nucleic Acid Arrays, will not infringe any other
intellectual property or other rights of any other Entity; or
(d) as imposing any obligation on Rosetta to bring or prosecute actions
or proceedings against third parties for infringement or to defend
any actions or proceedings for revocation of any the Inkjet Patents.
11.5 IT IS UNDERSTOOD AND AGREED BETWEEN THE PARTIES THAT, EXCEPT AS EXPRESSLY
PROVIDED IN THIS AGREEMENT, ANY AND ALL RIGHTS LICENSED, CONSENTS GRANTED
AND INFORMATION MADE AVAILABLE BY ONE PARTY TO THE OTHER IS LICENSED,
GRANTED AND MADE AVAILABLE "AS IS". NEITHER PARTY MAKES ANY
REPRESENTATIONS OR WARRANTIES (OTHER THAN THE WARRANTY IN CLAUSE 11.1) OF
ANY KIND, WHETHER EXPRESS OR IMPLIED, WITH RESPECT TO SUCH RIGHTS, CONSENT
OR INFORMATION, INCLUDING BUT NOT LIMITED TO
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
14
ANY REPRESENTATION OR WARRANTY CONCERNING THE PERFORMANCE OF ANY LICENSED
PRODUCT OR ROYALTY-BEARING SERVICE. EACH PARTY DISCLAIMS ALL WARRANTIES,
EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTIES OF QUALITY,
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
12. DURATION AND TERMINATION
12.1 This Agreement and the licenses granted under it will come into effect on
the Effective Date and unless terminated earlier in accordance with this
clause will continue in force until expiration of the Term.
12.2 Subject to the next following sentence, if Rosetta is in breach of any
payment obligation under this Agreement or is in material breach of any
other term or condition of this Agreement, OGT may give written notice to
Rosetta specifying the breach and requiring its remedy. If the breach has
not been remedied within a period of 60 days from service of the notice to
Rosetta, OGT will have the right to terminate the licences granted to
Rosetta under this agreement. In no event will OGT have the right to
terminate this Agreement or the licences granted to Rosetta under this
Agreement by reason of any breach by Rosetta of the prohibition in this
Agreement relating to Incyte Expression Databases.
12.3 Either party may terminate the licences granted to the other under this
Agreement immediately by written notice if an interim order is applied for
or made, or a voluntary arrangement approved, or if a petition for a
bankruptcy order is presented or a bankruptcy order is made against the
other party or if a receiver or trustee in bankruptcy is appointed or a
voluntary arrangement is proposed or approved or an administration order
is made, or a receiver or administrative receiver is appointed of any of
the other party's assets or undertaking or a winding-up resolution or
petition is passed or presented (otherwise than for the purposes of
reconstruction or amalgamation) or if any circumstances arise which
entitle the court or a creditor to appoint a receiver, administrative
receiver or administrator or to present a winding-up petition or make a
winding-up order of other similar or equivalent action is taken against or
by such other party by reason of its insolvency or in consequence of debt.
12.4 OGT may terminate the licences granted to Rosetta under this Agreement
forthwith by written notice to Rosetta if any Entity or group of Entities
which does not have Control of Rosetta at the Effective Date acquires
Control (other than pursuant to the public offering of such Entity's
securities) during the Term hereof and within thirty (30) days of such
acquisition such Entity or Entities has not or have not agreed with OGT in
writing that any patent rights which cover instrumentation and methods for
making Nucleic Acid Arrays, but not including any patent rights which
cover instrumentation for the reading of Nucleic Acid Arrays, the design
of probes for use on Nucleic Acid Arrays, particular sequences used on
Nucleic Acid Arrays, software used in instrumentation for reading Nucleic
Acid Arrays or in probe design, microfluidics or the control or assurance
of the quality of Nucleic Acid Arrays, which are owned or controlled by it
or them or by any of its or their Affiliates, are licensed to OGT and its
Affiliates on substantially the same licensing terms as the Inkjet
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
15
Patents are licensed to OGT under the OGT/Agilent Agreement for the Term,
except that no payment by OGT shall be due, except for royalties
rightfully due under Valid Claims of third party patent rights of amounts
not exceeding those payable by OGT hereunder.
12.5 On termination of the licences granted to Rosetta under this Agreement by
OGT pursuant to Clause 12.3:
(a) Rosetta will no longer be licensed to exploit in any way, either
directly or indirectly, any of the OGT Patent Rights;
(b) Rosetta will consent to the cancellation of any formal licence
granted to it, or of any registration of it in any register, in
relation to any of the OGTPatent Rights;
(c) subject as provided in this clause 12.5, and except in respect of
any accrued rights, OGT will be under any no further obligation to
Rosetta under this Agreement; and
(d) the provisions of clause 10 will survive termination of this
Agreement indefinitely.
13. GENERAL
13.1 This Agreement may only be amended in writing signed by duly authorized
representatives of the Parties.
13.2 The obligations of Rosetta hereunder will run in favor of the successors
and permitted assigns of OGT, and the obligations of OGT hereunder will
run in favor of the successors and permitted assigns of Rosetta. Neither
Party may assign, mortgage, charge or otherwise transfer its rights under
this Agreement in whole or part to any third party without the prior
written consent of the other, provided, however, either Party may assign
all of its rights and obligations under this Agreement to any party to
which it transfers all or substantially all of its assets and business
related to Nucleic Acid Arrays, provided that in either case the assignee
undertakes to be bound by and perform the obligations of the assignor
under this Agreement and provided further that where at the time of such
assignment the assignee or any Affiliates of the assignee own or control
patent rights in the field of Nucleic Acid Array technology the assignee
or relevant Affiliate agrees that such patent rights which cover
instrumentation and methods for making Nucleic Acid Arrays, but not
including any patent rights that cover instrumentation for the reading of
Nucleic Acid Arrays, the design of probes for use on Nucleic Acid Arrays,
particular sequences used on Nucleic Acid Arrays, software used in
instrumentation for reading Nucleic Acid Arrays or in probe design,
microfluidics or the control or assurance of the quality of Nucleic Acid
Arrays, will be licensed to the other Party hereunder on substantially the
same licensing terms as provided hereunder in the event of an assignment
by OGT or, in the event of an assignment by Rosetta, on substantially the
same terms as provided OGT under the OGT/Agilent Agreement, in each case
for the Term except that no
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
16
additional payment shall be due, except for royalties rightfully due under
Valid Claim(s) of third party patent rights of amounts no greater than
under this Agreement or the OGT/Agilent Agreement, as the case may be.
Neither Party will have the right to assign this Agreement or any rights
hereunder if it is insolvent or any other circumstances described in
clauses 12.2 or 12.3 applies to it. In no event will any Party's rights or
obligations hereunder be assigned or assignable by any bankruptcy
proceedings. Nothing in this clause affects the continued existence or
validity of this Agreement as a result of any change in the Entity or
Entities having Control of either Party. . 13.3 No failure or delay on the
part of either Party to exercise any right or remedy under this Agreement
will be construed or operate as a waiver thereof, nor will any single or
partial exercise of any right or remedy preclude the further exercise of
such right or remedy.
13.4 Neither Party will act or describe itself as the agent of the other, nor
will it make or represent that it has authority to make any commitments on
the other's behalf.
13.5 Any notice to be given under this Agreement will be given in writing and
will be sent by first class internal mail or air mail, or by fax
(confirmed by first class internal mail or air mail) to the address of the
relevant Party, or to the relevant fax number, set out below, or such
other address or fax number as that Party may from time to time notify to
the other Party in accordance with this clause 13.5:
OGT: Oxford Gene Technology IP Limited
▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇ ▇▇▇
Attn. Company Secretary
Fax: # ▇▇ (▇)▇▇▇▇ ▇▇▇▇▇▇
The Licensee: Rosetta Inpharmatics, Inc
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Notices sent as above shall be deemed to have been received three working
days after the date of posting (in the case of inland first class mail),
or seven working days after the date of posting (in the case of air mail),
or on the next working day after transmission (in the case of faxed
messages, but only if a transmission report is generated by the sender's
fax machine recording a message from the recipient's fax machine,
confirming that the fax was sent to the number indicated above and
confirming that all pages were successfully transmitted).
13.6 Each Party agrees to execute, acknowledge and deliver such further
instruments, and do all further similar acts, as may be necessary or
appropriate to carry out the purposes and intent of this Agreement.
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
17
13.7 Neither Party shall make any press or other public announcement concerning
any aspect of this Agreement, or make any use of the name of the other
Party in connection with or in consequence of this Agreement, without the
prior written consent of the other Party, except to the extent required by
applicable laws or regulations, in which case the Party obligated to make
the disclosure shall use reasonable efforts to notify the other Party
prior to such disclosure.
13.8 This Agreement sets out the entire agreement between the Parties or their
Affiliates relating to its subject matter and supersedes all prior oral or
written agreements, arrangements or understandings between them relating
to such subject matter. Save in the case of fraud, the Parties acknowledge
they are not relying on any representation, agreement, term or condition
which is not set out in this Agreement.
13.9 If any clause or part of any clause in this Agreement is declared invalid
or unenforceable by the judgement or decree by consent or otherwise of any
court or authority of competent jurisdiction from whose decision no appeal
is or can be taken, all other clauses or parts of clauses contained in
this Agreement will remain in full force and effect and will not be
affected thereby for the term of this Agreement, but the Parties will
negotiate appropriate amendments to this Agreement with a view to
restoring the balance of commercial interests as it stood prior to such
invalidity or unenforceability being declared.
13.10 This Agreement is made and will be construed in accordance with the laws
of England and Wales and, subject to Clause 13.11, the Parties submit to
the exclusive jurisdiction of the English courts.
13.11 All disputes, differences or questions arising out of this Agreement or as
to the rights or obligations of the Parties under it or in connection with
its construction, validity or subsistence, and any claim by either Party
that the other infringes its patent rights by exceeding the scope of the
licences granted hereunder or in respect to OGT, the OGT/Agilent
Agreement, may be referred to arbitration by a single arbitrator to be
agreed between the Parties, having the appropriate expertise to deal with
any technical, scientific or legal issues involved in the arbitration. If
the Parties are unable to agree on the arbitrator within a period of 60
days of a Party proposing arbitration to the other Party either Party may
request that an arbitrator is appointed by the President for the time
being of the Law Society of England and Wales having due regard to any
representations made to him as to the appropriate qualifications of such
arbitrator. The arbitration shall take place in Seattle, Washington, and
will be in accordance with rules and procedures agreed between the Parties
or in default of agreement determined by the arbitrator. Neither Party may
commence legal proceedings against the other (including seeking injunctive
relief) in relation to any matter the subject of possible arbitration
under this clause unless it has first served written notice on the other
Party and the other Party has not requested arbitration within a period of
60 days after service of such notice. There will be no right of appeal to
or review by the courts of any decision of the arbitrator in any
arbitration pursuant to this clause.
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
18
ATTESTATIONS
OXFORD GENE TECHNOLOGY IP LIMITED
Signature:______________________
Print Name:_____________________
Title:__________________________
ROSETTA INPHARMATICS, INC.
Signature:______________________
Print Name:_____________________
Title:__________________________
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
19
Dated 16 March, 2000
(1) OXFORD GENE TECHNOLOGY IP LIMITED
and
(2) ROSETTA INPHARMATICS, INC.
-----------------------------------------------
LICENSE AGREEMENT
------------------------------------------------