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EXHIBIT 10.18C
SECOND AMENDMENT TO LICENSE AGREEMENT
This Second Amendment to License Agreement (the "Second Amendment") is
entered into as of the 26th day of March 1997, by and between Xxxxxx X.
Xxxxxxxx, Ph.D., an individual having an address of 00000 Xxx Xxx Xxxx, Xxxxxxxx
Xxxx, Xxxxxxxx 00000 ("XX. XXXXXXXX") and SpectRx, Inc., a Delaware corporation
having its principal office at 0000X Xxxxx Xxxxx, Xxxxxxxx, Xxxxxxx 00000
("SRX").
WHEREAS, XX. XXXXXXXX and SRX entered into a License Agreement (the
"Agreement") executed November 22, 1995, as amended by an Amendment of License
Agreement dated November 28, 1995;
WHEREAS, XX. XXXXXXXX and SRX desire to amend further the Agreement
pursuant to paragraph 12.7 of its terms;
NOW, THEREFORE, for and in consideration of $1.00 and other good and
valuable consideration and the covenants and agreements contained herein, the
parties hereto agree to amend the Agreement as follows:
A. By adding the following subparagraph (z) to paragraph 1.1:
(z) the patents, applications for patent, and invention
disclosures listed in the Appendix A attached hereto and incorporated
herein in its entirety by this reference, all patents which issue from
the applications and invention disclosures listed in Appendix A, and
all divisionals, continuations, reissues, extensions, and foreign
counterparts of these applications and patents, and all utility models,
design registrations or similar rights corresponding thereto.
B. By deleting paragraph 1.2 in its entirety and substituting
the following therefor:
1.2 "Licensed Technology" means the Licensed Patents and all
designs, technical information, know-how, knowledge, data,
specifications, test results and other information (including designs,
technical information, know-how, knowledge, data, specifications, test
results and other information previously disclosed to SRX) relating to
medical applications and to DNA Diagnostics (as hereinafter defined)
under the Licensed Patents.
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C. By deleting paragraph 1.6 in its entirety and substituting
the following therefor:
1.6 "Affiliate" means an entity of which SRX has at least
twenty (20) percent ownership, or an entity having at least twenty (20)
percent ownership of SRX; provided, however, that FluoRx, Inc. ("FRX")
shall at all times be an Affiliate of SRX.
D. By adding the following paragraph 1.10:
1.10 "Up-Front License Payment" means any payment actually
made to SRX or an Affiliate by a non-Affiliate sublicensee of Licensed
Technology in consideration of the grant of the sublicense and whose
value is not determined with reference to any manufacture, sale, or use
of any Licensed Product; the amount of any such Up-Front License
Payment shall exclude (a) any funds paid to SRX or an Affiliate by such
non-Affiliate sublicensee for development of the Licensed Technology,
provided such funds are actually used by SRX or an Affiliate for such
development or as reimbursement of funds previously used for such
development, and (b) any payment by such non-Affiliate sublicensee for
purchase of equity in SRX or any Affiliate, except to the extent such
payment exceeds the fair market value of such equity, such fair market
value for any publicly held company to be determined by reference to
the published share price of such company at the time specified in the
purchase agreement and for any privately held company to be not less
than the value of the equivalent shares for the then most recent equity
financing of such company.
E. By adding the following paragraph 1.11:
1.11 "DNA Diagnostics" means any diagnostic system that
involves genetic codes, including (but not limited to) diagnostic
systems that measure some property of material or tissue related to any
genetic code (such as DNA, RNA, etc.) or use some part of a genetic
code to measure some property of material or tissue.
F. By deleting paragraph 2.2 in its entirety and substituting
the following therefor:
2.2 Sublicenses. SRX and its Affiliates, at its or
their discretion, shall have the right to grant sublicenses under this
Agreement.
G. By deleting paragraph 3.3 in its entirety and substituting
the following therefor:
3.3 Calculation of Royalty Payments. For a particular
calendar quarter, the royalty payment due pursuant to paragraph 3.2
shall be the sum of (a) three (3)
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percent of the Net Sales of Licensed Products sold by SRX and its
Affiliates during such quarter in each country in the Licensed
Territory in which a patent of the Licensed Patents exists or a patent
application of the Licensed Patents is pending, and (b) one and
one-half (1-1/2) percent of the Net Sales of Licensed Products sold by
SRX and its Affiliates during such quarter in each country in the
Licensed Territory in which no patent of the Licensed Patents exists or
no application of the Licensed Patents is pending.
H. By deleting paragraph 3.7 in its entirety and substituting
the following therefor:
3.7 Royalties Paid by Sublicensees for Licensed Technology. If
SRX or an Affiliate sublicenses the right to sell licensed Products
pursuant to paragraph 2.2 to an entity other than an Affiliate, SRX
shall pay to XX. XXXXXXXX, at the appropriate time under paragraph 3.2
and in lieu of any royalties calculated under paragraph 3.3, ten (10)
percent of any Up-Front License Payment actually received by SRX or
such Affiliate from the non-Affiliate sublicensee and, for sales under
such sublicense of Licensed Products, fifty (50) percent of the
royalties actually received by SRX or such Affiliate from the
non-Affiliate sublicensee; provided, however, that if SRX or an
Affiliate makes a substantial effort to develop the Licensed
Technology, the amount of the royalties to be paid to XX. XXXXXXXX
shall not exceed three (3) percent of the Net Sales of Licensed
Products by the non-Affiliate sublicensee. For purposes of this
paragraph, "substantial effort" shall be satisfied by SRX or an
Affiliate engaging in any of the following: good-faith license
negotiations involving the Licensed Technology, extensive marketing of
the Licensed Technology, litigation involving use of the Licensed
Technology and intended to produce royalties or other monetary
consideration as a possible outcome; or performance or funding of
activities resulting in demonstrable progress in the evolution of the
Licensed Technology.
I. By adding the following paragraph 3.8:
3.8 Additional Payment. In partial consideration of the
extension of the right and license granted in the Agreement to include
DNA Diagnostics technology, and regardless of any obligation to pay
royalties, SRX shall pay to XX. XXXXXXXX the sum of fifteen thousand
dollars (US$15,000) no later than ten (10) days after XX. XXXXXXXX
provides to SRX a legally binding release of all rights of the
University of Maryland to the Licensed Patents of paragraph 1.1 (z) and
to the Licensed Technology associated therewith, signed by an
authorized official of the University of Maryland, and a written
statement acknowledging that the warranties of paragraph 11.1 apply to
such Licensed Patents and Licensed Technology.
J. By deleting paragraph 10.2(c) in its entirety.
K. By deleting paragraph 12.13 in its entirety and substituting
the following therefor:
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12.13 Research Agreement. Until the amount paid to XX.
XXXXXXXX in any calendar year pursuant to Article 3 of this Agreement
exceeds two hundred fifty thousand dollars (US$250,000), SRX (either
itself or through an Affiliate) agrees to fund a research program under
the direction of XX. XXXXXXXX at the University of Maryland, a future
employer of XX. XXXXXXXX, or any other organization designated by XX.
XXXXXXXX, at a level not less than two hundred fifty thousand dollars
(US$250,000) per year. Notwithstanding the foregoing, for the second
year following the Effective Date (i.e., the year commencing November
22, 1996), XX. XXXXXXXX agrees that any funding requested by XX.
XXXXXXXX to be made by SRX (either itself or through an Affiliate)
pursuant to this paragraph shall not exceed one hundred thousand
dollars (US$100,000).
IN WITNESS WHEREOF, XX. XXXXXXXX has executed this Second Amendment and
SRX has caused this Second Amendment to be executed by its duly authorized
representative as of the day and year first above written.
XXXXXX X. XXXXXXXX, Ph.D.
/s/ Xxxxxx X. Xxxxxxxx
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SPECTRX, INC.
By: /s/ Xxxx X. Xxxxxxx
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President and Chief Executive Officer
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