Portions of this document
indicated by an ++ have been
omitted and filed separately
with the Securities and
Exchange Commission pursuant to
a request for confidential
treatment of such information.
EXHIBIT 10.1
EXCLUSIVE LICENSE AGREEMENT
This Exclusive License Agreement, dated April 22, 2003, ("Agreement") is entered
into by and between Scanis, Inc., a corporation organized and existing under the
laws of the State of California, having its principal place of business and
chief executive office at 0000 Xxxxxx Xxxxx, Xxxxx 000, Xxxxxx Xxxx, XX 00000
(hereinafter referred to as "SCANIS") and iCAD, Inc., a corporation organized
and existing under the laws of the State of Delaware, having its principal place
of business and chief executive office at 0 Xxxxxxxx Xxxx, Xxxxx 00, Xxxxxx, XX
00000 (hereinafter referred to as "ICAD").
STATEMENT
SCANIS is the owner of all right, title and interest in and to U.S. Patent No.
5,212,637 issued on May 18, 1993, entitled "Method Of Investigating Mammograms
For Masses And Calcifications, And Apparatus For Practicing Such Method". By
License Agreement dated February 18, 2003 ("Non-Exclusive License"), SCANIS has
granted certain non-exclusive rights to the Licensed Patent to ICAD. SCANIS now
desires to grant and ICAD desires to receive an exclusive license under such
patent and any related patents to manufacture, market, and sell products
incorporating the invention claimed in such patent and any related patents.
Now, therefore, in consideration of the mutual promises herein contained, the
parties agree as follows:
1. DEFINITIONS. As used in this Agreement, the following terms shall have
the meaning indicated below:
a. "Licensed Patent" shall mean U.S. Patent No. 5,212,637 issued on
May 18, 1993, entitled "Method Of Investigating Mammograms For
Masses And Calcifications, And Apparatus For Practicing Such
Method", along with any and all parents, divisions,
continuations, continuations-in-part, reissues, and
reexaminations of that patent.
b. "Licensed Patent Rights" shall mean the rights which are held or
which come to be held by SCANIS and its successors and assigns by
virtue of its ownership of the Licensed Patent.
c. "Licensed Products" shall include equipment, software, firmware
and methods for medical imaging and/or analysis, whether those
products presently exist or are developed in the future, that
contain, reduce to practice or otherwise incorporate some or all
inventions that are subject to the Licensed Patent or the
Licensed Patent Rights.
d. "Effective Date" shall mean the date on which the last party to
this Agreement executes this Agreement.
2. WARRANTIES.
a. SCANIS warrants and represents as follows:
i. that it is the sole and exclusive owner of the entire right,
title, and interest in and to the Licensed Patent and the
Licensed Patent Rights and to the invention disclosed and
claimed therein;
ii. that it has the right to enter into this Exclusive License
Agreement with ICAD;
iii. that there are no liens, conveyances, mortgages,
assignments, encumbrances or other interests or agreements
which would prevent or impair the full and complete exercise
by ICAD (including its sub-licensees) of all rights and
licenses granted by SCANIS in this Agreement;
iv. that it has not entered into, and shall not enter into, any
agreements or licenses which would interfere with the rights
and licenses granted pursuant to this Exclusive License
Agreement for the full term of this Agreement;
v. that as of the Effective Date of this License Agreement, it
does not own or control any other patent or patent
application relating to software or methods for medical
imaging, except as otherwise disclosed to ICAD.
vi. that as of the Effective Date of this License Agreement, it
has not received an assertion from any third party, nor an
opinion from its counsel, that the Licensed Patent or the
Licensed Patent Rights are invalid or unenforceable for any
reason.
vii. that its entry into this License Agreement and the
performance of its obligations under this Agreement will not
constitute a breach of or default of any agreement to which
it is bound or a violation of any court or administrative
order or decree to which it is subject, nor require any
consent, application, or grant of authority from any person
or entity; and
viii. that it knows of no claim, proceeding, or litigation that
could materially and adversely affect its ability to execute
or perform its obligations under this Agreement.
ix. that the Board of Directors of Scanis, Inc. has approved
this License Agreement.
b. ICAD warrants and represents as follows:
i. that it has the right to enter into this Agreement with
SCANIS;
ii. that ICAD's entry into this Agreement and the performance of
ICAD's obligations under this Agreement will not constitute
a breach of or default of any agreement to which it is bound
or a violation of any court or administrative order or
decree to which it is subject ;
3. LICENSE, RELEASE AND COVENANT.
a. SCANIS, on behalf of itself and its successors and assigns in the
Licensed Patent and Licensed Patent Rights, hereby grants to ICAD
an exclusive world-wide, irrevocable, assignable and
sublicensable license to and with respect to the Licensed Patent
and the Licensed Patent Rights, and to Manufacture/Sale the
Licensed Products.
b. SCANIS further grants to ICAD the right at its expense to cause
SCANIS to file for reexamination or re-issue of the Licensed
Patent, to permit ICAD to file for reexamination or re-issue of
the Licensed Patent in SCANIS' name, as well as the right to
defend/prosecute any reexamination or re-issue of the Licensed
Patent in SCANIS' name. SCANIS shall Cooperate with ICAD in any
of these events.
c. ICAD agrees for itself and its successors and assigns that it
will not at any time or in any capacity assert any claim or
commence or prosecute any action, suit, or proceeding against
SCANIS or against any direct or indirect, immediate or remote,
end user, distributor, customer, dealer, or supplier of SCANIS,
for infringement of the Licensed Patent Rights by the direct
and/or contributory infringement or by inducement arising out of
the manufacture, use, sale, offer for sale, lease, import,
export, or other disposition ("Manufacture/Sale") of Licensed
Products made, used, sold, offered for sale, leased, imported,
exported, or otherwise disposed of by or on behalf of SCANIS.
(the "Non-Assertion Agreement"). The Non-Assertion Agreement
shall be applicable only to Computer Aided Detection Systems (as
that term is generally understood in the industry) incorporating
Scans' proprietary computer aided detection software,
manufactured and sold by Scans, its subsidiaries, distributors
and resellers.
d. In the event of the acquisition of substantially all of SCANIS'
assets or business by any third party, SCANIS may assign its
entire right, title, and interest (expressly subject to this
Agreement and the Non-Exclusive License) in the Licensed Patent
and the Licensed Patent Rights to such purchaser and the
Non-Assertion Agreement shall be thereafter be applicable to
manufacture and sales with respect to the purchaser but only to
the extent of the number of units of Computer Aided Detection
Systems sold by SCANIS at the time of such acquisition, plus
annual increases thereafter equal to the greater of (1) SCANIS'
growth rate in the number of units of Computer Aided Detection
Systems sold by SCANIS
during the twelve (12) months prior to the acquisition in the US,
and (2) the rate in the number of units of Computer Aided
Detection Systems sold by the overall market during the twelve
(12) months prior to the acquisition. Otherwise, the
Non-Assertion Agreement shall not be assignable, acquirable or
assumable.
e. SCANIS shall have no right to license or sub-license the Licensed
Patent or the Licensed Patent Rights.
4. CONSIDERATION. In consideration of the license granted under this
Agreement, SCANIS shall be entitled to receive the following
consideration:
a. An initial License Fee of ++, paid to SCANIS by ICAD upon
execution of this Exclusive License Agreement, and refundable by
SCANIS to ICAD within thirty (30) days after cancellation of this
Exclusive License Agreement as set forth herein at section 5(b).
b. An additional and final license fee of ++ payable upon completion
of those conditions set forth at section 5(a), ++ within five (5)
days after satisfaction of such conditions and the balance
payable within thirty (30) days thereafter.
c. ICAD agrees to pays to SCANIS an additional royalty equal to ++.
5. CONDITIONS PRECEDENT TO COMPLETION; CANCELATION
a. ICAD's obligation to make payments as set forth at section 4(b)
are contingent on satisfaction of the following within fourteen
(14) days after the Effective Date, which such conditions may be
waived by ICAD:
i. Patent Office and UCC checks confirming that no security
interests exist with respect to the Licensed Patent;
ii. Opinion of SCANIS' counsel in a form reasonably satisfactory
to ICAD with respect to the due authorization,
enforceability, binding effect and validity in accordance
with its terms of this Exclusive License Agreement.
b. In the event that the conditions set forth at section 5(a) are
not satisfied as aforesaid, ICAD may cancel this Exclusive
License Agreement without further obligation by written notice to
SCANIS, and SCANIS shall be obligated to repay the initial
License Fee as set forth at section 4(a), within thirty (30) days
after such written notice. At the written election of SCANIS,
such License Fee payment obligation may be converted to a
12-month term loan at an interest rate of 5% per annum,
compounded monthly and payable in equal monthly installments.
6. TERM. The term of this Agreement, the licenses, and Non-Assertion
Agreement granted herein shall exist from and including the Effective
Date to and including the expiration date of the Licensed Patent and
until all claims for alleged infringement of all the Licensed Patent
and Licensed Patent Rights are barred by U.S. laws and the U.S. patent
statute.
7. PATENT ENFORCEMENT.
a. If SCANIS becomes aware that any third party is infringing or may
be infringing upon the Licensed Patent or Licensed Patent Rights,
SCANIS agrees that it will provide ICAD with written notice of
such infringement. SCANIS agrees that it will provide ICAD with
such a notice of infringement promptly, but in any event by no
later than ten (10) days after it becomes aware of such
infringement.
b. ICAD shall have the sole right at its expense to enforce and
defend the Licensed Patent and Licensed Patent Rights within the
United States related to past, present, or future infringement.
In this regard, ICAD shall have the sole right to take any action
in response to actual or possible past, present, or future
infringement of the Licensed Patent or Licensed Patent Rights,
including but not limited to the right to make, in its sole
discretion, all decisions as to: (i) whether to commence an
action, suit, or proceeding against any infringer of these rights
and/or defend against an action, suit, or proceeding brought by a
third party; (ii) the manner in which it conducts this action,
suit, or proceeding; (iii) whether to resolve such action, suit,
or proceeding through settlement; and (iv) the terms under which
it may settle such action, suit, or proceeding. ICAD reserves the
right, in its sole discretion, to resolve any threatened or
pending legal action pertaining to the Licensed
Patent and the Licensed Patent Rights by granting a license to
such third party on terms ICAD deems to be acceptable.
c. SCANIS shall cooperate with ICAD in any action, suit, or
proceeding, including permitting ICAD to prosecute and/or defend
in SCANIS' name, add SCANIS as an indispensable party, provide
ICAD with access and copies of any relevant documents, witnesses,
or other materials that are reasonably required to prosecute
and/or defend ("Cooperate").
8. RELATIONSHIP OF THE PARTIES.
a. Nothing contained in this Agreement shall be deemed to (i) make
either party or any employee of such party the agent, employee,
joint venture or partner of the other party; (ii) provide either
party or any employee of such party with the power or authority
to act on behalf of the other party or to bind the other party to
any contract, agreement or arrangement with any other person.
b. All personnel employed or otherwise engaged by either party shall
be the agents, servants, and employees of such party only, and
the other party shall incur no obligations or liabilities,
express or implied, by reason of the conduct of such personnel.
9. WAIVER. Waiver by either party hereto of any breach or default by the
other party of any of the terms and conditions of this Agreement shall
not operate as a waiver of any other breach or default, whether
similar to or different from the breach or default waived. A party may
only be deemed to have waived any breach or default by the other party
if that waiver is in writing and is signed by that party.
10. COSTS AND EXPENSES. Except as otherwise provided in this Agreement,
each party hereto shall be responsible for its own expenses incurred
in connection with the performance of its obligations under this
Agreement.
11. ENTIRE AGREEMENT. This Agreement and the Non-Exclusive License
represents the entire understanding and agreement between the parties
hereto with respect to the subject matter of this Agreement and
supersedes all prior or contemporaneous negotiations, representations,
and agreements made by and between the parties concerning that subject
matter. No alteration, amendment or modification of any of the terms
or provisions of this Agreement shall be valid unless made pursuant to
an instrument in writing signed by each of the parties hereto;
provided, however, that the waiver by either party hereto of
compliance by the other party with any provision hereof or of any
breach or default of such other party need be signed only by the party
waiving such provision, breach or default. In the event of a conflict
between the Non-Exclusive License and this Agreement, this Agreement
shall control, provided that consideration and royalties provided for
from ICAD to SCANIS in the Exclusive License Agreement shall be in
addition to consideration of any kind provided for from ICAD to SCANIS
in the Non-Exclusive Agreement.
12. GOVERNING LAW. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of New York, excluding that
state's conflict of laws principles.
13. NON-ASSIGNMENT. Except as expressly provided herein, or at section
3(d), SCANIS may not assign, transfer, encumber, or sub-license its
rights under this Agreement to any other person or entity, whether by
operation of law or otherwise, without the prior written consent of
ICAD, which may be withheld in ICAD's sole discretion. Any assignment
or purported assignment by SCANIS in violation of this paragraph shall
be null and void. ICAD may freely share, assign, or transfer its
interests or this Agreement.
14. NOTICES. All notices provided for in this Agreement shall be in
writing and effective when they are served either by personal
delivery, or sent by letter by overnight courier service with
acknowledgment of receipt required and simultaneously sent by
facsimile to the receiving party as of the date of the signing or
first refusal to sign the return receipt, to the following people at
the following address:
If to ICAD:
Chief Executive Officer
iCAD, Inc.
0 Xxxxxxxx Xxxx, Xxxxx 00, Xxxxxx, XX 00000
Fax: (000) 000-0000
With a required copy to:
Xxxxxx Xxxxxxx
Blank Rome LLP
The Chrysler Building
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
If to SCANIS:
Chief Executive Officer
SCANIS, INC.
0000 Xxxxxx Xxxxx, Xxxxx 000, Xxxxxx Xxxx, XX 00000
Fax: (000) 000-0000
or such other addresses either party shall hereinafter designate in
writing to the other party.
15. INVALIDITY OF PROVISIONS. If a court or other body of competent
jurisdiction determines that any provision of this Agreement is
unenforceable, it is agreed that such unenforceability shall not
invalidate the whole agreement, but this Agreement shall be construed
as to that situation as if it did not contain such provisions and the
rights and obligations of the parties hereto shall be construed and
enforced accordingly, but such provisions and the rights and
obligations of the parties hereto shall not be affected as to other
situations where the provision is not unenforceable.
16. BANKRUPTCY. The parties understand that all rights and licenses
granted hereunder are licenses to rights to intellectual property
under Section 365(n) of the Bankruptcy Act and, therefore, if SCANIS
becomes subject to bankruptcy proceedings, ICAD shall retain and may
fully exercise all of their rights and elections under the Bankruptcy
Code as licensees of that intellectual property.
17. RIGHT OF FIRST REFUSAL/OPTION TO PURCHASE LICENSED PATENT. In the
event that SCANIS proposes to sell, transfer, or assign the Licensed
Patent or the Licensed Patent Rights, it shall give written notice of
the potential sale, transfer, or assignment to ICAD. ICAD shall have
thirty (30) days from receipt to give written notice to SCANIS that it
will purchase the Licensed Patent or the Licensed Patent Rights on the
same price terms as the proposed sale, transfer, or assignment. If
ICAD declines the offer by written notice to SCANIS or fails to
respond within thirty (30) days, SCANIS may complete its proposed
transaction with that proposed buyer or assignee on substantially the
same terms as contained in the notice to ICAD of the proposed sale,
transfer, or assignment. In the event that SCANIS ceases to do
business, if a petition in bankruptcy has been filed by or against it
(if it is an involuntary petition, it is not dismissed within 60 days)
or it has made an assignment for the benefit of creditors, or a
receiver has been appointed for the other party or any substantial
portion of other party's property, then ICAD shall have an option, in
its sole discretion, for 60 days after written notice of such event to
purchase the Licensed Patent and the Licensed Patent Rights for the
fair market value of the Licensed Patent and the Licensed Patent
Rights at that time, based on a fair appraised value.
18. ATTORNEYS' FEES. If any action is commenced to enforce or construe
this Agreement, the Party who substantially prevails in that action
shall be entitled to recover all costs and expenses that Party incurs
in the prosecution or defense of that action, including but not
limited to reasonable attorneys' fees, in addition to any other relief
to which that Party is entitled.
19. LATE PAYMENTS. Amounts owing under this Agreement that are not made
when due shall accrue interest at a rate of one percent (1.0%) per
month or the maximum amount of interest allowed under applicable law
(whichever is less) until such amounts are paid in full.
20. TITLES. All titles used in this Agreement herein are for the
convenience of reference only and shall not affect the construction of
this Agreement.
21. DUPLICATE ORIGINALS. This Agreement shall be executed in duplicate
originals and may first be delivered by facsimile. Execution of this
Agreement by the parties and delivery thereof by facsimile shall be
valid and binding as of the Effective Date, which will be inserted in
the preamble. This Agreement may be executed separately by each of the
parties and exchanged by facsimile to establish the Effective Date.
Within thirty (30) days of facsimile execution, the parties shall
deliver and exchange fully executed originals of the Agreement.
22. INDEPENDENT RIGHT OF ENFORCEMENT. In the event that Scanis identifies
what it deems to be an infringement of the Licensed Patent, and
provides iCAD with written notice thereof, iCAD shall inform Scanis in
writing as to whether iCAD will seek to enforce such Licensed Patent
with respect to such alleged infringer, whether by litigation or
negotiation or otherwise. In the event that iCAD so informs Scanis
that iCAD will not seek to so enforce such Licensed Patent with
respect to such alleged Infringer, Scanis shall have all rights
permitted by applicable law to seek, at its own expense, to enforce
such Licensed Patent against such alleged Infringer. In the event
Scanis so enforces the Licensed Patent and secures any damages, or
royalties with respect thereto, Scanis shall retain such damages or
royalties.
++
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed, in duplicate, by their duly authorized officers or representatives.
SCANIS, INC.
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx, Chairman and Chief Executive Officer
Witness: /s/ Xxxxxxxx Xxxxxx
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iCAD, Inc.
By: /s/ W. Xxxxx Xxxx
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W. Xxxxx Xxxx, President & CEO
Witness: /s/ Xxxxxxxx X. X. Xxxx
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