EXCLUSIVE LICENSE AGREEMENT
THIS LICENSE AGREEMENT (the "Agreement") is made and is effective as of the
15th day of May, 1997, by and between RUTGERS, THE STATE UNIVERSITY OF NEW
JERSEY, having its statewide office of Corporate Liaison and Technology Transfer
at X.X. Xxx 0000, ASB Xxxxx XX, Xxxxxx Xxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000-0000,
(hereinafter referred to as "Rutgers"), and Phytotech, Inc., a New Jersey
corporation having a principal place of business at Xxx Xxxx Xxxx Xxxxx, Xxxxx
0, Xxxxxxxx Xxxxxxxx, XX 00000 (hereinafter referred to as "Licensee").
RECITALS
WHEREAS, certain inventions relating to the development of phytoremediation
technology were made in the course of research sponsored by Licensee at Rutgers,
The State University of New Jersey, by Xx. Xxxx Xxxxxx, Xx. Xxxxxxx Xxxxxxxx,
Dr. Xxxx Xxxx, Xx. Xxxxxx Xxxxxxxxx, and Dr. Xxxxx Xxxx (hereinafter
"Inventors"); and
WHEREAS, Licensee entered into a research agreement relating to the
development of phytoremediation technology with Rutgers effective November 19,
1993 and amended by Modification No. 1 effective January 13, 1994 and
Modification No. 2 effective December 7, 1994 ("Research Agreement I") which
granted certain license option rights in the aforementioned inventions; and
WHEREAS, Licensee is a "small business firm" as defined in 15 U.S.C. 632;
and
WHEREAS, Licensee wishes to obtain certain rights from Rutgers for the
commercial development, manufacture, use, and sale of certain inventions
relating to phytoremediation, and Rutgers is willing to grant such rights on the
terms and conditions set forth in this Agreement; and
WHEREAS, Both parties recognize and agree that royalties due hereunder will
be paid on both pending patent applications and issued patents; and
WHEREAS, Rutgers is desirous that the licensed property be developed and
utilized to the fullest extent so that the benefits can be enjoyed by the
general public.
NOW, THEREFORE, for good and valuable consideration, the receipt, adequacy
and sufficiency of which is hereby acknowledged, and for and in consideration of
the mutual covenants and agreements herein contained, the parties agree as
follows:
1. DEFINITIONS
1.1 "Affiliate" means any corporation or business entity that directly
or indirectly controls, is controlled by, or is under
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common control with Licensee to the extent of at least fifty percent (50%) of
the outstanding stock or other voting rights entitled to elect directors.
1.2 "Data" means all information owned and/or controlled by Rutgers
which is acquired by Licensee, its Affiliates or its sublicensees directly or
indirectly from or through Rutgers, its units, its employees, the Inventors, or
its consultants relating to the Licensed Field, Rutgers Patent Rights, Licensed
Products, or this Agreement, including but not limited to all patent
prosecution documents and all information received from Inventors.
1.3 "Licensed Field" means the use for commercial phytoremediation.
1.4 "Licensed Method" means any process, method, or use that is covered
by Rutgers Patent Rights or whose use or practice would constitute, but for the
license granted to Licensee pursuant to this Agreement, an infringement of any
issued or pending claim within Rutgers Patent Rights.
1.5 "Licensed Product(s)" means any material or product or kit, or any
service, process, or procedure that (1) either is covered by Rutgers Patent
Rights or whose manufacture, use, or sale would constitute, but for the license
granted to Licensee pursuant to this Agreement, an infringement of any claim
within Rutgers
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Patent Rights or (2) is developed, made, sold, registered, or practiced using
Licensed Method or which may be used to practice the Licensed Method, in whole
or in part.
1.6 "Net Sales" means the total of the gross consideration received for
Licensed Products made, used, leased, transferred, sold or otherwise disposed of
by Licensee, its Affiliates, and its sublicensees at arm-length prices, less the
sum of the following actual and customary deductions (net of rebates or
allowances of such deductions received by Licensee, its Affiliates and
sublicensees) included on the invoice and actually paid: trade discounts; sales,
excise or use taxes imposed upon particular sales; import/export, customs or
duties or similar levies paid by Licensee; insurance; costs of packaging
materials, boxes, cartons and crates required for shipping; returns; and
shipping, transportation and delivery charges.
A Licensed Product shall be deemed made, used, leased, transferred, sold,
or otherwise disposed of at the time Licensee receives payment for such Licensed
Product.
1.7 "Proprietary and Confidential Information" means all confidential
information or trade secrets owned and/or controlled by License (other than by
license hereunder) relating to the development of phytoremediation technology or
the Licensed Products, including, but not limited to, all information of
Licensee in written, oral, graphic or tangible form relating to the
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design, manufacture, programming, operation, or service of the Licensed
Products, including, but not limited to, any inventions, intellectual property,
know-how, or trade secrets relating thereto, as such information exists as of
the date hereof or is developed by Licensee during the term of this Agreement.
1.8 "Research Agreement II" means Research Agreement I as further
amended as of the effective Data.
1.9 "Rutgers Patent Rights" means U.S. Patent Application Numbers
00-0000-0, 00-0000-0 and 00-0000-0, U.S. Patents resulting therefrom and foreign
patents and patent applications corresponding thereto owned by Rutgers,
including any reissues, extensions, substitutions, continuations (not including
continuations-in-part) and divisions thereof an well as any additional patents
and patent applications covered by Research Agreements I and II which are added
by operation of the terms of Article 4 of this Agreement.
1.10 "Territory" means all countries of the world in which Rutgers has
Rutgers Patent Rights, subject to any exclusions provided in this Agreement.
2. GRANT
2.1 Subject to the limitations set forth in this Agreement, Rutgers
hereby grants to Licensee an exclusive license (terminable
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only pursuant to the express terms of this Agreement) under Rutgers Patent
Rights in the Licensed Field to make, have made, use, and sell Licensed Products
and to practice Licensed Method in the Territory during the term of this
Agreement. It is mutually agreed that the preceding license includes the right
to use and/or sell Licensed Product outside of the Territory which is developed
and/or manufactured within the Territory. Licensee shall have the right to
extend such license to its Affiliates, provided Licensee is the primary
guarantor of all payment and other obligations hereunder of its Affiliates. The
license for which a royalty has been paid under this Agreement includes the
right of Licensee, its Affiliates or sublicensees to grant to the Purchaser
thereof the right to use and/or resell such Licensed Product without payment of
any other royalty hereunder.
2.2 If the licensed invention(s) were funded by the U.S. Government,
the license granted hereunder shall be subject to the overriding obligations to
the U.S. Government set forth in 35 U.S.C. 200-212 and applicable governmental
implementing regulations.
2.3 Rutgers is Permitted to use Rutgers Patent Rights, Licensed
Products, Licensed Methods, and associated information and technology (i) in the
Licensed Field for educational and research purposes and to publish the results
thereof (ii) and outside the Licensed Field for any purpose.
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3. SUBLICENSES
3.1 Rutgers grants to Licensee the right to grant sublicenses to third
parties under the license granted in Article 2. To the extent applicable, such
sublicenses shall include all of the rights of and obligations due to Rutgers
(and, if applicable, to the United States Government) that are contained in this
Agreement.
3.2 Within thirty (30) days after execution thereof, Licensee shall
provide Rutgers with a copy of each sublicense issued hereunder, and shall
thereafter collect and, upon receipt of payment from any such sublicensee(s),
guarantee payment of royalties due Rutgers from such sublicensees and summarize
and deliver all reports due Rutgers from sublicensees.
3.3 Upon termination of this Agreement for any reason, Rutgers, at its
sole discretion, shall determine whether any or all sublicenses shall be
canceled or assigned to Rutgers. Upon determination by Rutgers that a
sublicense shall be canceled, at the request of sublicensee and absent material
reasons not to continue the sublicense during a transition period, Rutgers will
provide the sublicensee the option to continue the sublicense under the terms of
this Agreement for a phase out period not to exceed one (1) year.
4. INCORPORATION OF FUTURE RESEARCH AGREEMENT DISCOVERIES
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INTO THIS AGREEMENT AND FIRST NEGOTIATION RIGHTS
4.1 If Licensee exercises its Research Agreement option rights to
patent and license any intellectual property rights discovered after the
effective date of this Agreement under Research Agreement I or Research
Agreement II, the subject patent rights shall automatically be added to the
definition of Rutgers Patent Rights hereunder and shall be thereafter deemed to
be part of this Agreement.
4.2 (a) Rutgers shall make a bonafide effort to give Licensee a
reasonable opportunity for a period not to exceed six (6) months to thereafter
negotiate for a royalty bearing license to new licensable inventions in the
Licensed Field owned by Rutgers which have been disclosed to Rutgers' Office of
Corporate Liaison and Technology Transfer after the Effective Date of this
Agreement, which have not been sponsored by Licensee or another commercial
entity, and which are otherwise available for licensing to Licensee. Licensee
must notify Rutgers of its desire to negotiate for license rights within three
(3) months of an applicable invention disclosure to Licensee hereunder in order
to retain negotiating rights to such invention.
(b) This paragraph is intended to include Licensee's right of
review relating to all inventions under Rutgers Patent Rights resulting from
non-Licensee research that is not sponsored by a
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commercial entity.
5. EQUITIES AND ROYALTIES
5.1 Within 30 days after the Effective Date, Licensee will issue to
Rutgers, at no cost to Rutgers, One Hundred Thousand (100,000) shares of its
Series A Convertible Preferred Stock. Licensee warrants and represents that when
the stock is delivered to Rutgers (i) it shall be free from any claims, security
interests or liens and (ii) that Licensee shall have full right and authority to
issue and deliver the stock to Rutgers. Rutgers shall have no less rights in
the stock than any other holders of Series A Convertible Preferred Stock.
5.2 Except as otherwise required by law, Licensee shall pay to Rutgers
a running royalty on sales by it, its Affiliates and its sublicensees of 2% of
annual Net Sales of Licensed Products up to $250,000,000, 3.5% of annual Net
Sales of Licensed Products greater than $250,000,000 and up to $500,000,000 and
5% of annual Net Sales of Licensed Products greater than $500,000,000 during the
term of this Agreement. Sales among Licensee, its Affiliates and its
sublicensees for ultimate third party use shall be disregarded for purposes of
computing royalties. Royalties shall be payable only upon receipts from sales
or transfers between unrelated third parties and shall be based on arms length
consideration.
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5.3 Royalties Payable to Rutgers shall be paid to Rutgers quarterly on
or before 35 days following the end of each calendar quarter. Each such payment
will be for royalty payments received within Licensee's most recently completed
calendar quarter.
5.4 All amounts due Rutgers shall be payable in United States Dollars
in New Brunswick, New Jersey. When Licensed Products are sold for monies other
than United States Dollars, the earned royalties will first be determined in the
foreign currency of the country in which such Licensed Products were sold and
then converted into equivalent United States Dollars. The exchange rate will be
the United States Dollar buying rate quoted in the Wall Street Journal on the
last day of the reporting period.
5.5 Licensee shall be responsible for any and all taxes, fees, or other
charges, where such taxes, fees or other charges are imposed by the government
of any country outside the United States on the remittance of royalty income for
sales occurring in any such country. Licensee shall also be responsible for all
bank transfer charges.
5.6 If at any time legal restrictions prevent the acquisition or prompt
remittance of United States Dollars by Licensee with respect to any country
where a Licensed Product is sold and payment is received, Licensee shall pay
royalties due to Rutgers from
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Licensee's other sources of United States Dollars.
5.7 In the event that any patent or any claim thereof included within
the Rutgers Patent Rights shall be held invalid in a final decision by a court
of competent jurisdiction and last resort in any country and from which no
appeal has or can be taken, all obligation to pay royalties based on such patent
or claim or any claim patentably indistinct therefrom shall cease as of the date
of such final decision with respect to such country. Licensee shall not,
however, be relieved from paying any royalties that accrued and were paid before
such decision or that are based on another patent or claim not involved in such
decision.
5.8 Royalties will be paid one time only even if a Licensed Product is
covered by more than one issued patent included in the Rutgers Patent Rights.
5.9 Rutgers shall not be entitled to share in any equity investment in
Licensee by a third party as part of a strategic alliance, nor is Rutgers
entitled to any share in revenues received as part of a sponsored research and
development agreement between Licensee and a third party.
6. DILIGENCE
6.1 Licensee, upon execution of this Agreement, shall use its
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reasonable and diligent efforts to develop, test, obtain regulatory approval,
manufacture, market and sell Licensed Products in all countries of the Territory
and shall earnestly and diligently endeavor to market the same within a
reasonable time after execution of this Agreement and in quantities sufficient
to meet the market demands therefor.
6.2 Licensee shall be entitled to exercise prudent and reasonable
business judgment in meeting its diligence obligations hereunder.
6.3 Licensee shall use all reasonable efforts to obtain all necessary
governmental approvals for the manufacture, use and sale of Licensed Products.
7. PROGRESS AND ROYALTY REPORTS
7.1 Beginning September 1, 1997, and annually thereafter, Licensee
shall submit to Rutgers a progress report covering Licensee's activities related
to the development and testing of all Licensed Products and the obtaining of the
governmental approvals necessary for marketing. These progress reports shall be
made for each Licensed Product in each country of the Territory.
7.2 The progress reports submitted under section 7.1, which may be
presented as a two (2) page report prior to commercial
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introduction of Licensed Product, shall include sufficient information (taking
into due consideration that a two (2) page report will contain significantly
less detail) to enable Rutgers to reasonably determine Licensee's progress in
fulfilling its obligations under Article 6, including, but not limited to, the
following topics:
- summary of work completed
- summary of work in progress, including product development and
testing and progress in obtaining government approvals
- current schedule of anticipated events or milestones
- summary of market plans for introduction of Licensed Products
in countries of the Territory in which Licensed Products have
not yet been introduced
- summary of resources (dollar value) spent in the reporting
period for research, development, and marketing of Licensed
Products
- summary of activities in obtaining sublicensees and activities
of sublicensees
- the most recent certified financial statements
7.3 Licensee shall have a continuing responsibility to keep Rutgers
informed of the large/small entity status (as defined by the United States
Patent and Trademark Office) of itself and its sublicensees.
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7.4 Licensee shall notify Rutgers of the date of first commercial sale
of each Licensed Product in each country in the first report due after such
commercial introduction.
7.5 After the first commercial sale of a Licensed Product anywhere in
the world, Licensee will make quarterly royalty reports to Rutgers on or before
the date 30 days after each calendar quarter.
7.6 Each such royalty report will show (a) the units and gross sales
and Net Sales of each type of Licensed Product sold by Licensee on which
royalties have not been paid, including a clear indication of how Net Sales were
calculated; (b) the royalties, in U.S. dollars, payable hereunder with respect
to such sales on which payment has been received; (c) the method used to
calculate the royalty; and (d) the exchange rates used, if any; and (e) any
other information reasonably requested by Rutgers.
7.7 If no sales of Licensed Products have been made during any
reporting period, a statement to this effect shall be made by Licensee.
8. BOOKS AND RECORDS
8.1 Licensee shall keep books and records in accordance with generally
accepted accounting principles accurately showing all
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transactions and information relating to this Agreement. Such books and records
shall be preserved for at least five (5) years from the date of the entry to
which they pertain and shall be open to inspection by representatives or agents
of Rutgers at reasonable times upon reasonable notice, but not more often than
once annually.
8.2 The fees and expenses of Rutgers' representatives performing such
an examination shall be borne by Rutgers. However, if an error in royalties of
more than seven and one-half (7 1/2%) percent of the total royalties due for any
year is discovered, or if as a result of the examination it is determined that
Licensee is in material breach of its other obligations under this Agreement,
then the fees and expenses of these representatives shall he borne by Licensee.
9. TERM OF THE AGREEMENT
9.1 Unless otherwise terminated by operation of law or by acts of the
parties in accordance with the provisions of this Agreement, this Agreement
shall be in force from its Effective Date and shall remain in effect in each
country of the Territory until the last day of the month of the expiration of
the last-to-expire Rutgers Patent Rights licensed under this Agreement in such
15
country.
9.2 Any expiration or termination of this Agreement shall not affect
the rights and obligations set forth in the following Articles:
Article 8 Books and Records
Article 11 Disposition of Licensed Products on Hand Upon
Termination
Article 12 Use of Names, Trademarks and Confidential Data
Article 17 Indemnification
Article 22 Failure to Perform
Article 27 Confidentiality
10. TERMINATION
10.1 If either party should breach or fail to perform any provision of
this Agreement, then the other party may give written notice of such default
(Notice of Default) to the defaulting party. If the defaulting party should
fail to cure such default within sixty (60) days of the effective date of such
notice, the other party shall have the right to terminate this Agreement and the
licenses herein by a second written notice (Notice of Termination)
16
to the defaulting party. If a Notice of Termination is sent to defaulting
party, this Agreement shall terminate on the date five (5) days following the
receipt of such notice (Effective Date of Termination). Termination shall not
relieve either party of its obligation to pay all amounts due hereunder as of
the Effective Date of Termination and shall not impair any accrued rights.
10.2 The Agreement shall terminate in accordance with the procedures
detailed in paragraph 10.1 hereof upon the filing by Licensee of a petition in
bankruptcy or insolvency, or upon any adjudication that the Licensee is bankrupt
or insolvent, or upon the filing by Licensee of any petition or answer seeking
judicial reorganization, readjustment or arrangement of the business of Licensee
under any law relating to bankruptcy or insolvency, or upon the appointment of a
receiver for all or substantially all the property of Licensee, or upon the
making of any assignment or attempted assignment for the benefit of the
creditors.
11. DISPOSITION OF LICENSED PRODUCTS AND INFORMATION
ON HAND UPON TERMINATION
11.1 Upon termination of this Agreement by either party (i) Licensee
shall have the privilege of disposing of all previously made or partially made
Licensed Products, but no more, within a period of one hundred and twenty (120)
days after the effective date of termination, provided, however, that the
disposition of
17
such Licensed Products shall be subject to the terms of this Agreement
including, but not limited to, the payment of royalties at the rate and at the
time provided herein and the rendering of reports thereon; (ii) Licensee shall
promptly return, and shall cause its sublicensees to return, to Rutgers all
property belonging to Rutgers, if any, that has been provided to Licensee or its
Affiliates or sublicensees hereunder, and all copies and facsimiles thereof and
derivatives therefrom (except that Licensee may retain one copy of written
material for record purposes only, provided such material is not used by
Licensee for any other purpose and is not disclosed to others).
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12. USE OF NAMES AND TRADEMARKS
12.1 Nothing contained in this Agreement shall be construed as granting
any right to Licensee or its Affiliates to use in advertising, publicity, or
other promotional activities any name, trade name, trademark, or other
designation of Rutgers or any of its units (including contraction, abbreviation
or simulation of any of the foregoing). Unless required by law or used in
connection with a private or public offering of Licensee's stock or used in any
of Licensee's business agreements, the use of the name, "Rutgers, The State
University of New Jersey" or any campus or unit of Rutgers is expressly
prohibited, and no use of such names may be made in any manner without Rutgers
prior written consent.
13. LIMITED WARRANTY
13.1 Rutgers warrants to Licensee that it has the lawful right to grant
this license.
13.2 This license and the associated Rutgers Patent Rights are provided
WITHOUT WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR ANY
OTHER WARRANTY, EXPRESS OR IMPLIED. RUTGERS MAKES NO REPRESENTATION OR WARRANTY
THAT THE LICENSED PRODUCTS OR LICENSED METHODS WILL NOT INFRINGE ANY THIRD PARTY
PATENT OR OTHER PROPRIETARY RIGHT.
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13.3 IN NO EVENT WILL RUTGERS BE LIABLE FOR ANY INCIDENTAL, SPECIAL OR
CONSEQUENTIAL DAMAGES RESULTING FROM EXERCISE OF THIS LICENSE OR MANUFACTURE,
SALE, OR USE OF THE RUTGERS PATENT RIGHTS OR LICENSED PRODUCTS OR LICENSED
METHODS OR RUTGERS DATA.
13.4 Nothing in this Agreement shall be construed as:
(13.4a) a warranty or representation by Rutgers regarding the
Rutgers Patent Rights other than the ownership interest
of Rutgers therein; or
(13.4b) a warranty or representation that anything made, used,
sold or otherwise disposed of under any license granted
in this Agreement is or will be free from infringement
of patents or other intellectual property of third
parties; or
(13.4c) an obligation to bring or prosecute actions or suits
against third parties except as provided in Article 16;
or
(13.4d) conferring by implication, estoppel or otherwise any
license or rights under any patents or other
intellectual property of Rutgers, other than Rutgers
Patent Rights as defined herein, regardless of whether
such patents are dominant or subordinate to Rutgers
Patent Rights; or
(13.4e) an obligation to furnish any know-how or Data
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not provided in Rutgers Patent Rights.
14. PATENT PROSECUTION AND MAINTENANCE
14.1 Rutgers shall diligently prosecute and maintain the United States
patents comprising Rutgers Patent Rights using counsel of its choice, or at
Licensee's option, an attorney selected by Licensee subject to Rutgers approval,
which approval shall not be unreasonably withheld. Rutgers counsel shall take
instructions only from Rutgers, provided that Rutgers will consult with Licensee
prior to instructing counsel on any significant issues which have been raised by
Licensee. Rutgers shall promptly provide Licensee with copies of all relevant
documentation so that Licensee may be informed and apprised of the continuing
prosecution and so that Licensee may provide input on such prosecution to assure
that Licensee's interests are covered. Licensee agrees to keep this
documentation confidential.
14.2 Rutgers shall amend any patent application to include claims
reasonably requested by Licensee to protect the Licensed Products contemplated
to be sold under this Agreement and Rutgers shall not unreasonably withhold
consent to any such request from License to amend any such patent application.
14.3 All past, present, and future costs of preparing,
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filing, prosecuting, defending, and maintaining all United States patent
applications and/or patents, including interferences and oppositions, and all
corresponding foreign patent applications and patents covered by Rutgers Patent
Rights shall be borne by Licensee. Current and future costs shall be payable by
Licensee within sixty (60) days of the billing date.
14.4 Rutgers shall, at the request of Licensee, file, prosecute, and
maintain patent applications and patents covered by Rutgers Patent Rights in
foreign countries if available. Licensee consents to the filing of all PCT and
foreign patent applications that have already been filed as of the Effective
Date of this Agreement. Licensee shall notify Rutgers within a reasonable
period of time before a bar date occurs of its decision of where it wishes to
file for foreign patents so that Rutgers has a reasonable amount of time to
prepare and make such filings. This notice shall be in writing and shall
identify the countries desired.
14.5 Licensee's obligation to underwrite and to pay patent costs shall
continue for so long as this Agreement remains in effect, provided, however,
that Licensee may terminate its obligations with respect to any given patent
application or issued patent upon 3 months' written notice to Rutgers. Rutgers
shall use reasonable efforts to curtail patent costs when such a notice is
received from Licensee. Licensee shall promptly pay patent costs
22
which cannot be so curtailed. Commencing on the effective date of such notice,
Rutgers may continue prosecution and/or maintenance of such application(s) or
patent(s) at its sole discretion and expense, and Licensee shall have no further
right or licenses thereunder.
14.6 Rutgers shall have the right to file patent applications at its own
expense in any country or countries in which Licensee has not elected to secure
patent rights or in which Licensee's patent license rights hereunder have
terminated, and such applications and resultant issued patents shall not be
subject to this Agreement and may be freely licensed by Rutgers to others.
14.7 With respect to any Rutgers Patent Rights, each patent application,
office action, response to office action, request for terminal disclaimer,
request for reissue or reexamination of any patent issuing from such application
shall be provided to Licensee by Rutgers, or at the direction of Rutgers by
Rutger's patent counsel, sufficiently prior to the filing of such application
response or request to allow for review and comments by Licensee.
15. PATENT MARKING
15.1 Licensee shall xxxx all Licensed Products made, used, sold or
otherwise disposed of under the terms of this Agreement, and/or their
containers, in accordance with the applicable patent marking laws.
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16. PATENT INFRINGEMENT
16.1 In the event that Licensee shall learn of the substantial
infringement of any patent licensed under this Agreement, Licensee shall call
Rutgers attention thereto in writing and shall provide Rutgers with reasonable
evidence of such infringement. Both parties to this Agreement agree that during
the period and in a jurisdiction where Licensee has exclusive rights under this
Agreement, neither will notify a third party of the infringement of any of
Rutgers Patent Rights without first obtaining consent of the other party, which
consent shall not be unreasonably withheld. Both parties shall use their best
efforts in cooperation with each other to terminate such infringement without
litigation.
16.2 Licensee may request that Rutgers take legal action against the
infringement of Rutgers Patent Rights. Such request shall be made in writing
and shall include reasonable evidence of such infringement and damages to
Licensee. if the infringing activity has not been abated within 90 days
following the effective date of such request, Rutgers shall have the right to
(16.2a) commence suit on its own account; or
(16.2b) refuse to commence such suit;
and Rutgers shall give notice of its election in writing to Licensee by the end
of the 100th day after receiving notice of such
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request from Licensee. If Rutgers commences suit on its own account, Licensee
may thereafter join such suit at its own expense. If Rutgers refuses to
commence suit, Licensee may thereafter bring suit for patent infringement if and
only if Rutgers elects not to commence suit and if the infringement occurred
during the period and in a jurisdiction where Licensee had exclusive rights
under this Agreement. However, if Licensee elects to bring suit in accordance
with this paragraph, Rutgers may thereafter join such suit at its own expense.
16.3 Such legal action as is decided upon shall be at the expense of the
party on account of whom suit is brought and all recoveries recovered thereby
shall belong to such party, provided, however, that recoveries from legal
actions brought jointly by Rutgers and Licensee shall be shared equally by them,
after paying the reasonable legal expenses of both parties.
16.4 Each Party agrees to cooperate with the other in litigation
proceedings instituted hereunder but at the expense of the party on account of
whom suit is brought. Such litigation shall be controlled by the party bringing
the suit. Each party may be represented by counsel of its choice.
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16.5 Rutgers will permit Licensee to bring suit in the name of Rutgers
where required by law.
17. INDEMNIFICATION AND INSURANCE
17.1 Licensee shall indemnify, hold harmless and defend Rutgers, its
governors, trustees, officers, employees, students, agents and the Inventors
against any and all claims, suits, losses, liabilities, damages, costs, fees and
expenses (including reasonable attorneys' fees) resulting from or arising out of
the exercise of this license or any sublicense. This indemnification shall
include, but is not limited to, any and all claims alleging products liability.
17.2 Licensee shall, throughout the term of this Agreement, at its sole
cost and expense, insure its activities in connection with this Agreement and
will maintain and keep in force the following types of insurance:
(a) Comprehensive or Commercial General Liability with minimum limits
as follows:
(i) $1,000,000 combined single limit as respects premises and
operations with an excess policy of $2,000,000 where
required;
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(ii) From and after the first commercial sale of a Licensed
Product, Licensee shall maintain appropriate levels of
comprehensive or commercial general liability coverage, as
agreed to by the parties, which shall include, but not be
limited to, products/completed operations liability. In the
determination of appropriate level of such insurance, the
parties shall take into consideration the nature of the
Licensed Product sold, the size of the market, the
availability of insurance at commercially reasonable rates
and the practices of comparable competitors of Licensee
using similar technology. Licensee will notify Rutgers at
least 120 days prior to first commercial sale of proposed
coverages and documentation on explaining its rationale.
The parties will thereafter discuss and agree upon final
coverages to be taken. Further, such appropriate levels of
insurance are subject to periodic review by the parties.
(b) Workers' Compensation and Employers Liability insurance, covering
each employee of the Licensee engaged in the performance of the
action required under the contract, with a limit of liability in
accordance with applicable law, in the case of workers'
compensation insurance, and
27
with the following limits of liability in the case of employers'
liability:
Bodily injury by accident - $100,000 each accident;
Bodily injury by disease - $500,000 policy limit;
Bodily injury by disease - $100,000 each employee.
(c) It is expressly understood and agreed, however, that the insurance
coverage and limits stated in A and B above shall not in any way
limit the liability of Licensee and that the required insurance
shall be primary coverage. Any insurance Rutgers may purchase will
be excess and noncontributory. Licensee's liability insurance will
be endorsed to specifically name Rutgers as an additional insured.
(d) Licensee shall furnish Rutgers with a certificate of insurance
evidencing the coverage and limits required pursuant to A and B
above. The liability certificate shall:
(i) Provide for thirty (30) day advance written notice to
Rutgers of cancellation or material alteration of the
policy;
(ii) Indicate that Rutgers has been endorsed as an
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additional insured under the coverages referred to above;
(iii) Include a provision that the insurance will be primary and
any valid and collectible insurance or program of
self-insurance carried or maintained by Rutgers shall be
excess and noncontributory.
17.3 Rutgers shall promptly notify Licensee in writing of any claim or
suit brought against Rutgers in respect of which Rutgers intends to invoke the
provisions of Article 17. Licensee shall keep Rutgers informed on a current
basis of its defense of any claims pursuant to Article 17.
18. NOTICES
18.1 Any notice or payment required to be given to either party shall be
deemed to have been properly given and to be effective (a) on the date of
delivery if delivered in person or (b) five (5) days after mailing if mailed by
first-class certified mail, postage paid and deposited in the United States
mail, to the respective addresses given below, or to such other address as it
shall designate by written notice given to the other party.
In the case of Licensee: Phytotech, Inc.
Xxx Xxxx Xxxx Xxxxx, Xxxxx 0
00
Xxxxxxxx Xxxxxxxx, XX 00000
Attn: President
In the case of Rutgers: Rutgers, The State University
of New Jersey
Office of Corporate Liaison &
Technology Transfer
X.X. Xxx 0000
ASB Annex II, Xxxxxx Road
Xxxxx Campus
Piscataway, NJ 08855-1179
Attn: Director
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19. ASSIGNABILITY
29.1 This Agreement is binding upon and shall inure to the benefit of
Rutgers and Licensee, and their successors and assigns. Any such successor or
assignee shall expressly assume in writing the terms and conditions and
obligations of this Agreement. This Agreement shall not be assignable by either
of the parties without the prior written consent of the other party (which
consent shall not be unreasonably withheld), except that Licensee, without the
consent of Rutgers, may assign this Agreement to an Affiliate, provided that
Licensee is the primary guarantor of all Agreement payment and other obligations
of the Affiliate related to an assignment of this Agreement to such Affiliate.
20. LATE PAYMENTS
20.1 In the event any amounts due Rutgers hereunder, including but not
limited to royalty payments, fees and patent costs reimbursements, are not
received when due, Licensee shall pay to Rutgers interest charges at a rate of
the greater of (i) 12 percent per annum or (ii) the highest rate permitted by
law, if less than the rate referred to in (i) above. Such interest shall be
calculated from the date payment was due until actually received by Rutgers.
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21. WAIVER
21.1 It is agreed that no waiver by either party hereto of any breach or
default of any of the covenants or agreements herein set forth shall be deemed a
waiver as to any subsequent and/or similar breach or default.
22. FAILURE TO PERFORM
22.1 In the event of a failure of performance due under the terms of
this Agreement and if it becomes necessary for either party to undertake legal
action against the other on account thereof, then the prevailing party shall be
entitled to reasonable attorney's fees in addition to costs and necessary
disbursements.
23. GOVERNING LAWS
23.1 THIS AGREEMENT SHALL BE INTERPRETED AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW JERSEY, but the scope and validity of any
patent or patent application shall be governed by the applicable laws of the
country of such patent or patent application.
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24. PREFERENCE FOR UNITED STATES INDUSTRY
24.1 If the U.S. Government sponsored an invention included in the
Rutgers Patent rights in whole or in part, Licensee agrees that any Licensed
Products sold in the United States embodying this invention or produced through
the use thereof will be manufactured substantially in the United States.
25. FOREIGN GOVERMENT APPROVAL OR REGISTRATION
25.1 If this Agreement or any associated transaction is required by the
law of any nation to be either approved or registered with any governmental
agency, Licensee shall assume all legal obligations to do so and the costs in
connection therewith.
26. EXPORT CONTROL LAWS
26.1 Licensee shall observe all applicable United States and foreign laws
with respect to the transfer of Licensed Products and related technical data to
foreign countries, including, without limitation, the International Traffic in
Arms Regulations (ITAR) and the Export Administration Regulations.
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27. CONFIDENTIALITY
27.1 Licensee shall safeguard and keep confidential Data against
disclosure to others with the same degree of care as it exercises with its own
data of a similar nature, and shall not disclose or permit the disclosure of
Data to others (except to its employees, agents or consultants who are bound to
Licensee and Rutgers by a like obligation of confidentiality) without the
express written permission of Rutgers, except that Licensee shall not be
prevented from using or disclosing any Data:
(27.1a) which Licensee can demonstrate by written records was
previously known to it; or
(27.1b) which is now, or becomes in the future, information
generally available to the public in the form supplied,
other than through acts or omissions of Licensee; or
(27.1c) which is lawfully obtained by Licensee from sources
independent of Rutgers who were entitled to provide
such information to Licensee.
27.2 Rutgers shall safeguard and keep confidential Proprietary and/or
Confidential Information relating to Licensed Products which is owned or
controlled by Licensee and disclosed to Rutgers hereunder in writing or if oral,
if confirmed in writing
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within a reasonable time after disclosure. Rutgers shall use the same degree of
care in safeguarding the information as it exercises with its own information of
a similar nature, and shall not disclose or permit the disclosure of such
information to others (except to its employees, agents or consultants who are
bound to Licensee and Rutgers by a like obligation of confidentiality) without
the express written permission of Licensee, except that Rutgers shall not be
prevented from using or disclosing any such information:
(27.2a) which Rutgers can demonstrate by written records was
previously known to it; or
(27.2b) which is now, or becomes in the future, information
generally available to the public in the form supplied,
other than through acts or omissions of Rutgers; or
(27.2c) which is lawfully obtained by Rutgers from sources
independent of Licensee who were entitled to provide
such information to Rutgers.
The obligations of the parties under this Article 27 shall remain in effect
during the term of this Agreement and for 5 years from the date of termination
or expiration of this Agreement.
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28. MISCELLANEOUS
28.1 The headings of the several articles are inserted for convenience
of reference only and are not intended to be a part of or to affect the meaning
or interpretation of this Agreement.
28.2 This Agreement will not be binding upon the parties until it has
been signed below on behalf of each party, in which event, it shall be effective
as of the Effective Date.
28.3 No amendment or modification hereof shall be valid or binding upon
the parties unless made in writing and signed on behalf of each party.
28.4 This Agreement embodies the entire understanding of the parties and
shall supersede all previous communications, representations or understandings,
either oral or written, between the parties relating to the subject matter
thereof.
28.5 In the case any of the provisions contained in this Agreement shall
be held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provisions hereof, but
this Agreement shall be construed as if such invalid or illegal or unenforceable
provisions had never been contained herein.
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IN WITNESS WHEREOF, both Rutgers and Licensee have executed this Agreement,
in duplicate originals, by their duly authorized representatives on the day and
year hereinafter written.
Phytotech Inc. Rutgers, The State University
of New Jersey
By /s/ Xxxx X. Xxxxxx By /s/ Xxxxxxx X. Xxxxx
---------------------------- ------------------------------
(Signature) (Signature)
Name Xxxx X. Xxxxxx Name Xxxxxxx X. Xxxxx
--------------------------
(Please Print)
Title CEO Director
-------------------------- Office of Corporate Liaison
and Technology Transfer
Date 9/9/97 Date 9/8/97
------------------------- ----------------------------
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