Exhibit 10.22
Patent License
THIS AGREEMENT, effective April 5, 2002 ("EFFECTIVE DATE"), is entered into
by Biophan Technologies, Inc., a Nevada corporation, having its principal
place of business at 000 Xxxxxx Xxxxxx Xxxxx -Suite 000, Xxxx Xxxxxxxxx, Xxx
Xxxx 00000, its successors, assigns and designees, and any of its present or
future subsidiaries, or organizations controlled by, controlling, or under
common control with it ("LICENSEE"), and Xxxxxxx X. X. Xxxxx of 000 Xxxxxxx
Xxxxxx, Xxxx Xxxxxxx, Xxx Xxxx and Xxxxxxxx Xxxx of 0 Xxxxxxxxx Xxx, Xxxxxxx,
Xxx Xxxx ("LICENSOR").
I. Background of Agreement
1.00 LICENSOR represents that it has certain patents and know-how pertaining
to metal filaments for electromagnetic interference shielding in respect
to which it is prepared to grant an exclusive license to LICENSEE.
1.01 LICENSOR also wishes to consult and otherwise share know-how and other
information relating to metal filaments for electromagnetic interference
shielding ("KNOW-HOW"), and is prepared to do so in accordance with the
terms set forth herein.
1.02 LICENSEE wishes to acquire a limited exclusive license under selected
patents and KNOW-HOW of LICENSOR, for purposes of investigating and
applying the technology to medical, medicinal and biomedical devices and
products, particularly for medical treatment and/or medical diagnoses or
treatments of medical conditions in animals (including humans), and the
research, development, repair and maintenance of such devices, products,
apparatus or treatments.
II. Definitions
As used herein, the following terms shall have the meanings set forth below:
2.00 PATENT(S) means the following listed patents and/or patent applications,
patents to be issued pursuant thereto, and all divisions, continuations,
reissues, substitutes, and extensions thereof:
U.S. Patent No. 5,827,997 Issued: Oct. 27, 1998
Title: METAL FILAMENTS FOR ELECTROMAGNETIC INTERFERENCE SHIELDING
2.01 LICENSED TERRITORY means worldwide relative to the know-how and the
United States of America, its territories, and its possessions with
respect to the PATENT(S).
2.02 IMPROVEMENT(S) means any modification of a device, method, or product
described in a PATENT, provided such a modification, if unlicensed, would
infringe one or more claims of issued PATENT(S).
2.03 LICENSED FIELD means, and is limited to, the practice of PATENTS,
IMPROVEMENTS and KNOW-HOW in relation to medical, medicinal and
biomedical devices, products, apparatus (for medical treatment and/or
medical diagnoses) or treatments of medical conditions in animals
(including humans), as well as the research, development, repair and
maintenance of such devices, products, apparatus or treatments.
2.04 LICENSED PRODUCTS means any and all materials and products that fall
within the LICENSED FIELD and that are covered by or are produced using a
process or method covered by a claim of a PATENT or an IMPROVEMENT.
2.06 NET SALES REVENUE, for the purpose of computing royalties, means
LICENSEE's accrued revenue for invoiced price, f.o.b. factory, after
deduction of regular trade and quantity discounts, but before deduction
of any other items, including but not limited to freight allowances, cash
discounts, and agents' commissions. .
In order to assure to LICENSOR the full royalty payments contemplated in
this Agreement, LICENSEE agrees that in the event any LICENSED PRODUCTS
shall be sold for purposes of resale either (1) to a corporation, firm,
or association that, or individual who, owns a controlling interest in
LICENSEE by stock ownership or otherwise, or (2) to a corporation, firm,
or association in which LICENSEE or its stockholders own a controlling
interest by stock ownership or otherwise, the royalties to be paid in
respect to such LICENSED PRODUCTS shall be computed on the net selling
price at which the purchaser for resale sells such PRODUCTS rather than
upon the net selling price of the LICENSEE.
2.07 NET SUBLICENSE REVENUE, for the purpose of computing royalties in the
event of a sublicense by LICENSEE, means gross sublicense revenue
received by LICENSEE less adjustments for LICENSEE's costs and reasonable
expenses of completing and administering such a sublicense.
2.08 KNOW-HOW is the information, notes, experimental results and other
experience, including information remaining in the minds of the
inventors, Xxxxxxx X. X. Xxxxx and Xxxxxxxx Xxxx, and pertaining to the
PATENT and IMPROVEMENT(S).
III. License Grant
3.00 LICENSOR hereby grants to LICENSEE, to the extent of the LICENSED FIELD
and LICENSED TERRITORY, an exclusive license under PATENTS, IMPROVEMENTS
and KNOW-HOW, to make, have-made, use, offer to sell, sell, lease and
import LICENSED PRODUCTS. LICENSEE acknowledges and agrees that no
license is granted or implied under, and agrees not to practice under,
PATENTS and IMPROVEMENTS outside the LICENSED FIELD and LICENSED
TERRITORY.
3.01 The license granted pursuant to Section 3.00 hereof shall be exclusive,
with the right to grant sublicenses.
IV. License Fee, Royalty & Know-How Transfer
4.00 LICENSEE shall, as reimbursement for expenses paid in acquisition of the
PATENT(S), pay to Dr. Xxxxxxx X.X. Xxxxx, within ten (10) days after the
EFFECTIVE DATE ten-thousand dollars ($10,000), which shall be
nonrefundable and not creditable against the royalty called for under
Section 4.01. Dr. Xxxxxxx X.X. Xxxxx is not obligated to provide any
proof of expenses reimbursed under this Section 4.00, and further agrees
that the amount set forth herein shall be reimbursement for all of her
expenses through the EFFECTIVE DATE and that she shall not seek
contribution or reimbursement from other parties to this agreement.
4.01 LICENSEE shall pay to LICENSOR a royalty of five percent (5%) of the NET
SALES REVENUE of all LICENSED PRODUCTS sold or otherwise disposed of
under the license granted under Section 3.00 of this Agreement.
Furthermore, LICENSOR agrees to negotiate a reduced royalty rate in the
event other patents licensed by LICENSEE cover the same materials or
products.
4.02 As compensation for services rendered during the transfer of KNOW-HOW,
Xxxxxxx X. X. Xxxxx and Xxxxxxxx Xxxx shall receive two-hundred and fifty
dollars $250 per hour for pre-approved consultation with LICENSEE on such
matters. Such sums shall be payable by LICENSEE in care of Xxxxxxx X. X.
Xxxxx, within thirty (30) days of the receipt of an invoice for such
work. The initial term of this obligation shall be one year from the
EFFECTIVE DATE and shall be automatically renewed for one-year periods
thereafter with an annual increase in the compensation rate of five
percent (5%). At all times subject to the right of either Xxxxxxx X. X.
Xxxxx and Xxxxxxxx Xxxx or the LICENSEE to terminate the consultation for
any reason on thirty (30) days, notice thereafter. The LICENSEE shall
have the right to terminate such transfer of KNOW-HOW at any time, and
without prior notice if the either Xxxxxxx X. X. Xxxxx or Xxxxxxxx Xxxx:
(1) default in or fail to perform any of the provisions of this Section
4.02 for whatever reason, including death, disability, or incapacity; or
(2) engage in conduct materially injurious to the LICENSEE.
V. Minimum Royalties
5.00 LICENSEE shall pay to LICENSOR royalties as stated in Sections 4.01 and
6.01, but in no event shall royalties for a license year for practice or
sublicense of the PATENTS and IMPROVEMENTS in the LICENSED FIELD and
LICENSED TERRITORY be less than ten-thousand dollars ($10,000) per year,
paid in equal quarterly installments as provided in Section 7.00, with
the initial installment for the second quarter of 2002 being due upon the
EFFECTIVE DATE of this agreement.
5.01 LICENSOR acknowledges that the minimum royalty specified herein is in
lieu of any obligation by LICENSEE to promote or guarantee performance
under this agreement.
VI. Sublicensing
6.00 Sublicensing in the LICENSED FIELD and LICENSED TERRITORY shall be the
sole responsibility of LICENSEE so long as this license remains
exclusive. Sublicenses shall be transferable only from LICENSEE to
LICENSOR. LICENSEE shall supply LICENSOR with a copy of each such
sublicense agreement within thirty (30) days after the execution of the
sublicense agreement.
6.01 LICENSEE shall pay to LICENSOR a sublicense royalty of fifty percent
(50%) of any and all NET SUBLICENSE REVENUE received by LICENSEE from
sublicensing. Payment of LICENSOR's share of sublicensing income shall
also be reported and made quarterly as provided in Section 7.00.
6.02 If this Agreement is terminated for any reason, LICENSEE shall
immediately assign all of its right, title, and interest to all
sublicenses to LICENSOR, including the right to receive all income from
sublicensees. LICENSEE shall, prior to execution of each sublicense, make
the sublicensee aware of this contingency.
VII Payments
7.00 Not later than the last day of each January, April, July and October,
LICENSEE shall furnish to LICENSOR (collectively) a written statement in
such detail as LICENSOR may reasonably require of all amounts due
pursuant to Sections 4.01 and 6.01, for the preceding quarterly calendar
periods ending the last days of the December, March, June and September,
respectively, and shall pay to LICENSOR, all amounts due to LICENSOR in
U.S. Dollars. In the event that the amounts due at the end of any license
year do not equal the minimum royalties specified in Section 5.00 for
said license year, LICENSEE shall pay to LICENSOR, on the last day of the
following April, the amount required to satisfy the minimum royalty
obligation for the preceding license year. Such amounts are due at the
dates the statements are due. If no amount is accrued during any
quarterly period, a written statement to that effect shall be furnished
along with the quarterly installment of the minimum royalty as set forth
in Section 5.00, such sums being credited against any subsequent royalty
accruing during the license year.
7.01 All payments set forth herein, including license fees and royalties but
expressly excluding the reimbursement to Dr. Xxxxxxx X.X. Xxxxx as set
forth in Section 4.00, shall be paid to LICENSOR in the following
proportions:
(i) fifty percent (50%) to Xxxxxxx X. X. Xxxxx; and the remaining
(ii) fifty percent (50%) to Xxxxxxxx Xxxx; .
7.02 If this Agreement is for any reason terminated before all of the payments
herein provided for have been made (including minimum royalties for the
year in which the Agreement is terminated), LICENSEE shall immediately
submit a terminal report and pay to LICENSOR any remaining unpaid balance
even though the due date as above provided has not been reached.
7.03 LICENSEE shall, during the term of this agreement and at its sole cost,
maintain all of the PATENTS that are licensed hereunder.
VIII. Representations and Disclaimer of Warranties
8.00 NOTHING IN THIS AGREEMENT SHALL BE DEEMED TO BE A REPRESENTATION OR
WARRANTY BY LICENSOR OF THE VALIDITY OF ANY OF THE PATENTS OR
IMPROVEMENTS, LICENSOR SHALL HAVE NO LIABILITY WHATSOEVER TO LICENSEE OR
ANY OTHER PERSON FOR OR .- ON ACCOUNT OF ANY INJURY, LOSS, OR DAMAGE, OF
ANY KIND OR NATURE SUSTAINED BY, OR ANY DAMAGE ASSESSED OR ASSERTED
AGAINST, OR ANY OTHER LIABILITY INCURRED BY OR IMPOSED UPON LICENSEE OR
ANY OTHER PERSON, ARISING OUT OF OR IN CONNECTION WITH OR RESULTING FROM
(A) THE PRODUCTION, USE, OR SALE OF ANY APPARATUS OR PRODUCT, OR THE
PRACTICE OF THE PATENTS OR IMPROVEMENTS; OR (B) ANY ADVERTISING OR OTHER
PROMOTIONAL ACTIVITIES WITH RESPECT TO ANY OF THE FOREGOING, AND LICENSEE
SHALL HOLD LICENSOR, AND ITS OFFICERS, AGENTS, OR EMPLOYEES, HARMLESS IN
THE EVENT LICENSOR, OR ITS OFFICERS, AGENTS, OR EMPLOYEES, IS HELD LIABLE.
8.01 LICENSOR represents and warrants that: (i) the PATENT is owned and
controlled by LICENSOR; (ii) LICENSOR has the right to grant the license
set forth herein and shall be solely responsible for the further
distribution of revenues pursuant to any prior agreement(s) (including
the Letter Agreement referenced in Section 8.03 below); (iii) there are
no prior assignees or other interests in the PATENT, with the exception
of the rights retained by DARPA; and (iv) any government institutions
for which funding was received in the development of the PATENT
technology (including the DARPA and NY State) have waived their
respective rights to the patent. Furthermore, in the event of a breach of
the latter warranty, LICENSOR agrees to undertake at LICENSEE's expense,
any actions necessary to establish clear title in the PATENT, and to
defend challenges to such title.
8.02 Notwithstanding the limitations of Section 8.00, LIENSOR further agrees
that in the event one or more LICENSED PRODUCTS are found to infringe
another valid patent, either by a court of competent jurisdiction or an
opinion rendered by independent patent counsel selected by the parties,
LICENSEE shall have no further obligation to pay the minimum royalty set
forth in Section 5.00.
8.03 LICENSOR further agrees to indemnify and defend LICENSEE, and any
sublicensees, against any and all claims by The Research Foundation of
the State of New York for proceeds due it under the terms of the Formal
Waiver of Patent Rights Concerning Invention Number R-5229, Submicron
Diameter Nickel Filaments, a Letter Agreement dated October 6, 1994.
IX. Termination
9.00 This Agreement shall terminate upon the expiration of the last to expire
of the PATENTS included herein unless the Agreement is sooner terminated
by LICENSEE.
9.01 LICENSEE may terminate this Agreement at any time upon sixty (60) days
written notice in advance to LICENSOR.
9.02 If either party shall be in default of any obligation hereunder, or shall
be adjudged bankrupt, or become insolvent, or make an assignment for the
benefit of creditors, or be placed in the hands of a receiver or a
trustee in bankruptcy, the other party may terminate this Agreement by
giving sixty (60) days notice by Registered Mail to the other party,
specifying the basis for termination. If within sixty (60) days after the
receipt of such notice, the party receiving notice shall remedy the
condition forming the basis for termination, such notice shall cease to
be operative, and this Agreement shall continue in full force.
9.03 The word "termination" and cognate words, such as "term" and "terminate,"
used in this Article IX and elsewhere in this Agreement are to be read,
except where the contrary is specifically indicated, as omitting from
their effect the following rights and obligations, all of which survive
any termination to the degree necessary to permit their complete
fulfillment or discharge:
i. LICENSEE's obligation to supply a terminal report as specified in
Section 7.02 of this Agreement
ii. LICENSOR's right to receive or recover and LICENSEE's obligation to
pay royalties (including minimum royalties) accrued or accruable for
payment at the time of any termination
iii. LICENSEE's obligation to maintain records under Section 11.00 of
this Agreement
iv. Licenses, releases, and agreements of nonassertion running in favor
of customers or transferees of LICENSEE in respect to products sold
or transferred by LICENSEE prior to any termination and on which
royalties shall have been paid as provided in Section 4.01 of this
Agreement
v. Any cause of action or claim of LICENSOR accrued, or to accrue,
because of any breach or default by LICENSEE
vi. The representation and disclaimer of warranties of Sections 8.00 and
8.01.
X. Litigation
10.00 Each party shall notify the other party in writing of any suspected
infringement(s) of the PATENTS and IMPROVEMENTS in the LICENSED
TERRITORY and shall inform the other party of any evidence of such
infringement(s).
10.01 LICENSEE shall have the first right to institute suit for
infringement(s) in the LICENSED FIELD and the LICENSED TERRITORY.
LICENSOR agrees to join as a party plaintiff in any such lawsuit
initiated by LICENSEE, if requested by LICENSEE, with all costs,
attorneys' fees, and expenses to be paid by LICENSEE. However, if
LICENSEE does not institute suit for infringement(s) within a
reasonable period after receipt of written notice from LICENSOR of
LICENSOR's desire to bring suit for infringement in its own name and on
its own behalf, then LICENSOR may, at its own expense, bring suit or
take any other appropriate action.
10.02 In the event LICENSEE initiates legal action for enforcement of the
PATENT, LICENSEE shall be entitled to any recovery of damages resulting
from a lawsuit brought by it pursuant to Section 10.01. LICENSOR shall
be entitled to recovery of damages resulting from any lawsuit brought by
LICENSOR to enforce any PATENT or IMPROVEMENT, pursuant to Section
10.01. Unless otherwise agreed, in the event either party collects
damages resulting from a lawsuit pursuant to Section 10.01, such party
shall pay twenty-five percent (25%) of the collected funds, after
deducting reasonable costs and attorneys fees, to the other party.
10.04 Neither party may settle with an infringer without the prior approval of
the other party if such settlement would affect the rights of the other
party under the PATENTS and IMPROVEMENTS.
XI, Records
11.00 LICENSEE shall keep accurate records of all operations affecting
payments hereunder, and shall permit LICENSOR or its duly authorized
agent to annually inspect all such records, upon ten (10) days written
notice, and to make copies of or extracts from such records during
regular business hours throughout the term of this Agreement and for a
reasonable period of not less than three (3) years thereafter.
XII. Assignability
12.00 The parties agree this Agreement may be assigned by LICENSEE to its
successors, assigns and designees, and any of its present or future
subsidiaries, or organizations controlled by, controlling, or under
common control with LICENSEE.
XIII. Severability
13.00 The parties agree that if any part, term, or provision of this Agreement
shall be found illegal or in conflict with any valid controlling law,
the validity of the remaining provisions shall not be affected thereby.
13.01 In the event the legality of any provision of this Agreement is brought
into question because of a decision by a court of competent
jurisdiction, LICENSOR, by written notice to LICENSEE, may revise the
provision in question or may delete it entirely so as to comply with the
decision of said court.
XIV. Waiver, Integration, Alteration
14.00 The waiver of a breach hereunder may be effected only by a writing
signed by the waiving party and shall not constitute a waiver of any
other breach.
14.01 This Agreement represents the entire understanding between the parties,
and supersedes all other agreements, express or implied, between the
parties concerning PATENTS and IMPROVEMENTS.
14.02 A provision of this Agreement may be altered only by a writing signed by
both parties, except as provided in Sections 13.00 and 13.01, above.
XV. Applicable Law
15.00 This Agreement shall be construed in accordance with the substantive
laws of the State of New York of the United States of America.
XVI. Notice, Merger and Arbitration
16.00 For the purpose of all written communications and notices between the
parties, their addresses shall be:
LICENSOR: Dr. Xxxxxxx X.X. Xxxxx
000 Xxxxxxx Xxxxxx Xxxx, Xxxx Xxxxxxx, Xxx Xxxx 00000
and
LICENSEE: Attn: Xxxxxxx Xxxxxx, CEO, Biophan Technologies, Inc.
000 Xxxxxx Xxxxxx Xxxxx -Xxxxx 000, Xxxx Xxxxxxxxx, Xxx Xxxx 00000.
or any other addresses of which either party shall notify the other
party in writing.
16.01 This instrument contains the entire and only agreement between the
parties and supersedes all preexisting agreements between them
respecting its subject matter. Any representation, promise, or condition
in connection with such subject matter that is not incorporated in this
Agreement shall not be binding on either party.
16.02 Any controversy or dispute arising out of or in connection with this
Agreement, its interpretation, performance, or termination, and validity
or infringement of PATENTS, that the parties are unable to resolve
within ninety (90) days after written notice by one party to the other
of the existence of such controversy or dispute, shall be submitted to
arbitration. The dispute or controversy shall be finally settled by
arbitration in accordance with the rules of the American Arbitration
Association, as modified in this Article. Such arbitration shall take
place in a venue in western New York, before a single arbitrator
appointed by the American Arbitration Association. The arbitrator shall
apply the laws as set forth in Section 15.00 and shall render a written
decision with the reasons therefor within six (6) months from the date
the matter is submitted to arbitration.
The institution of any arbitration hereunder shall not relieve LICENSEE
of its obligations to make payments to LICENSOR required by the terms of
this Agreement during the continuance of the arbitration proceeding.
The decision of the arbitrator shall be binding and conclusive on the
parties, and they shall comply with such decision in good faith. Each
party hereby submits itself to the jurisdiction of the courts of the
State of New York, but only for the entry or enforcement of judgment
with respect to the decision of the arbitrator hereunder, including
injunctive relief if appropriate to render effective the arbitrator's
decision. Notwithstanding the foregoing, judgment on the award by the
arbitrator may be entered in any court of the State of New York or any
court having jurisdiction. If judicial enforcement or review of the
arbitrator's decision is sought, the prevailing party shall be entitled
to its costs and reasonable attorneys' fees in addition to any amount of
recovery ordered by the court.
IN WITNESS WHEREOF the parties have caused this Agreement to be executed by
their duly authorized officers on the respective dates and at the respective
places hereinafter set forth.
LICENSEE -Biophan Technologies, Inc.
ATTEST: Xxxxx Xxxxxx
By: Xxxxx Xxxxxx By: Xxxxxxx Xxxxxx
Title: CEO
Signed at: Biophan Technologies, Inc. Date: May 13, 2002
LICENSOR
Xxxxxxx X. X. Xxxxx
ATTEST: Xxxxx X. Xxxxxxx
By: Xxxxx X. Xxxxxxx By: Xxxxxxx X.X. Xxxxx
Title: Inventor/Owner
Signed at: University of Buffalo Date: April 10, 2002
Xxxxxxxx Xxxx
ATTEST: Xxxxx X. Xxxxxxx
By: Xxxxx X. Xxxxxxx By: Xxxxxxxx Xxxx
Title: Inventor/Owner
Signed at: University of Buffalo Date: April 10, 2002
