[Portions of this document are subject to requests of confidential treatment
filed with the Securities and Exchange Commission]
MASSACHUSETTS INSTITUTE OF TECHNOLOGY
and
XXXXXX LABORATORIES, INC.
PATENT LICENSE AGREEMENT
M.I.T.'S OFFER TO XXXXXX LABORATORIES, INC. TO
ENTER INTO THIS LICENSE AGREEMENT SHALL EXTEND UNTIL
NO LATER THAN JUNE 1, 1996.
(EXCLUSIVE)
319999.001(B&F) 2
TABLE OF CONTENTS
WITNESSETH............................................................... 1
1. DEFINITIONS.......................................................... 2
2. GRANT................................................................ 5
3. DUE DILIGENCE........................................................ 7
4. ROYALTIES............................................................ 8
5. REPORTS AND RECORDS.................................................. 10
6. PATENT PROSECUTION................................................... 12
7. INFRINGEMENT......................................................... 12
8. PRODUCT LIABILITY.................................................... 14
9. EXPORT CONTROLS...................................................... 15
10. NON-USE OF NAMES.................................................... 15
11. ASSIGNMENT.......................................................... 15
12. DISPUTE RESOLUTION.................................................. 16
13. TERMINATION......................................................... 16
14. PAYMENTS, NOTICES
AND OTHER COMMUNICATIONS................................................. 18
15. MISCELLANEOUS PROVISIONS............................................ 18
APPENDIX A............................................................... 20
APPENDIX B............................................................... 21
APPENDIX C............................................................... 22
ii
MASSACHUSETTS INSTITUTE OF TECHNOLOGY
and
XXXXXX LABORATORIES, INC.
PATENT LICENSE AGREEMENT
This Agreement is made and entered into this ____ day of __________,
1996, (the "Effective Date") by and between MASSACHUSETTS INSTITUTE OF
TECHNOLOGY, a corporation duly organized and existing under the laws of the
Commonwealth of Massachusetts and having its principal office at 00
Xxxxxxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000 (hereinafter referred to as
"M.I.T."), and XXXXXX LABORATORIES, INC., a corporation duly organized under the
laws of Maryland and having its principal office at 00000-X Xxx Xxxxxxxx Xxxx,
Xxxxxxxx, XX 00000-0000 (hereinafter referred to as "Licensee").
W I T N E S S E T H
WHEREAS, M.I.T. is the owner of certain Intellectual Property Rights (as
later defined herein) relating to M.I.T. Case No. 5493L, U.S. Patent No.
5,251-645, "Adaptive Hyperthermia System" by Xxxx Xxxx, and M.I.T. Case No.
5672L, "Non- Invasive Monopole Hyperthermia Array for Brain Tumor Heating" by
Xxxx Xxxx, and M.I.T. Case No. 6512L "Minimally Invasive Monopole Phased Array
Hyperthermia Applicators for Treating Carcinoma" by Xxxx Xxxx and has the right
to grant licenses under said Patent Rights (as later defined herein), subject
only to a royalty-free, nonexclusive license heretofore granted to the United
States Government;
WHEREAS, M.I.T. desires to have the Patent Rights developed and
commercialized to benefit the public and is willing to grant a license
thereunder;
WHEREAS, M.I.T. is the owner of certain rights, title and interest in the
Program (as later defined herein) relating to X.X.X. Xxxx Xx. 0000XX, "XXXXXXX,"
by Xxxx X. Xxxx and M.I.T. Case No. 7928LS, "FOCUSGSC," by Xxxx X. Xxxx subject
only to the royalty-free, nonexclusive license rights of the United States
301650.001(BF) 1
Government pursuant to 48 CFR 52.227-14 (Civilian Agencies) or DFARS
252.227-7013 (Defense Agencies), and has the right to grant licenses thereunder;
WHEREAS, M.I.T. desires to have the Program developed and commercialized to
benefit the public and is willing to grant a license thereunder;
WHEREAS, Licensee has represented to M.I.T., to induce M.I.T. to enter
into this Agreement, that Licensee is experienced in the development,
production, manufacture, marketing and sale of products similar to the Licensed
Product(s) (as later defined herein) and/or the use of the Licenses Process(es)
(as later defined herein) and that it shall commit itself to a thorough,
vigorous and diligent program of exploiting the Patent Rights, and to a
thorough, vigorous and diligent program of exploiting the Patent Rights, and to
a thorough, vigorous and diligent program of exploiting the Program, so that
public utilization shall result therefrom, all in the manner provided herein;
and
WHEREAS, Licensee desires to obtain a license under the Patent Rights
and also desires to obtain a license to the Program, upon the terms and
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the mutual terms,
conditions and covenants contained herein, the parties hereto agree as follows:
1. DEFINITIONS
For purposes of this Agreement, the following words and phrases shall
have the following meanings:
1.1. "Licensee" shall include a related company of Xxxxxx Laboratories,
Inc., the voting stock of which is directly or indirectly at least fifty percent
(50%) owned or controlled by Xxxxxx Laboratories, Inc., an organization which
directly or indirectly controls more than fifty percent (50%) of the voting
stock of Xxxxxx Laboratories, Inc. and an organization, the majority ownership
of which is directly or indirectly common to the ownership of Xxxxxx
Laboratories, Inc.
1.2. "Patent Rights" shall mean all of the following M.I.T.
intellectual property:
301650.001(BF) 2
(a) the United States patents listed in Appendix A;
(b) the United States patent applications listed in
Appendix A, and divisionals, continuations and claims
of continuation-in-part applications which shall be
directed to subject matter specifically described in
such patent applications, and the resulting patents;
(c) any patents resulting from reissues or reexaminations
of the United States patents described in (a) and (b)
above;
(d) the Foreign patents listed in Appendix A;
(e) the Foreign patent applications listed in Appendix A,
and divisionals, continuations and claims of
continuation-in-part applications which shall be
directed to subject matter specifically described in
such Foreign patent applications, and the resulting
patents;
(f) Foreign patent applications filed after the Effective
Date in the countries listed in Appendix B and
divisionals, continuations and claims of
continuation-in-part applications which shall be
directed to subject matter specifically described in
such patent applications, and the resulting patents;
and
(g) any Foreign patents, resulting from equivalent
Foreign procedures to United States reissues and
reexaminations, of the Foreign patents described in
(d), (e) and (f) above.
1.3. "Copyright" shall mean M.I.T.'s copyrights in the Program.
1.4. "Program" shall mean the computer program(s), "NULLGSC" and
"FOCUSGSC" and related documentation, if any described in Appendix C
(hereinafter the "M.I.T. Copyrighted Program"), and shall also include
Adaptations, Derivative Works and Translations. Program shall also include any
additional computer programs, including but not limited to acceleration
software, developed for use with any of the Intellectual Property Rights.
Program may be protected by both Patent Rights and Copyrights.
301650.001(BF) 3
1.5. "Adaptations" shall mean the Program as it may be adapted by
Licensee for hardware other than the original M.I.T. Cray computer.
1.6. "Derivative Works" shall mean a program that uses the M.I.T.
Copyrighted Program and/or Adaptation, but which has enhanced and new features
or fewer features. Licensee shall be entitled to establish all proprietary
rights for itself in the intellectual property represented by Licensee-created
enhancements and new features, whether in the nature of trade secrets,
copyrights or patent rights or other rights. M.I.T. shall be entitled to
establish all proprietary rights for itself in the intellectual property
represented by M.I.T.-created enhancements and new features, whether in the
nature of copyrights or patent rights or other rights.
1.7. "Translation" shall mean a translation of the Program into another
language.
1.8. "Intellectual Property Rights" shall mean all of the Patent Rights
and Copyright.
1.9. A "Licensed Product" shall mean Licensee's hyperthermia machine
and accessories, or part thereof which:
(a) is covered in whole or in part by an issued,
unexpired claim or a pending claim contained in the
Patent Rights in the country in which any such
Licensed Product or part thereof is made, used or
sold; or
(b) is manufactured by using a process or is employed to
practice a process which is covered in whole or in
part by an issued, unexpired claim or a pending claim
contained in the Patent Rights in the county in which
any Licensed Process is used or in which such product
or part thereof is used or sold.
(c) is covered by the Copyright.
1.10. A "Licensed Process" shall mean any process which is covered in
whole or in part by an issued, unexpired claim or a pending claim contained in
the Patent Rights, or is covered by the Copyright.
301650.001(BF) 4
1.11. "Net Sales" shall mean Licensee's and its sublicensees' xxxxxxxx,
including Treatment Revenue, for Licensed Products and Licensed Processes less
the sum of the following items, providing that these items are payable by
Licensee or deductible from Licensee's xxxxxxxx within sixty (60) days of
receiving payments from Licensee's customer(s):
(a) discounts allowed in amounts customary in the trade
for quantity purchases, cash payments, prompt
payments, wholesalers and distributors;
(b) sales, tariff duties and/or use taxes directly
imposed and with reference to particular sales;
(c) outbound transportation prepaid or allowed;
(d) amounts allowed or credited on returns; and
(e) allowance for bad debt, not to exceed Five Percent
(5%) of Net Sales per calendar year.
No other deductions shall be made for commissions paid to individuals
whether they be with independent sales agencies or regularly employed by
Licensee and on its payroll, or for the cost of collections. Licensed Products
shall be considered "sold" ninety (90) days after billing or invoicing, or upon
receipt of payment, whichever comes first, provided, however, that Licensed
Products are actually shipped to customers. If a Licensed Product or Licensed
Process shall be distributed or invoiced for a discounted price substantially
lower than customary in the trade or distributed at no cost to affiliates or
otherwise, Net Sales shall be based on the customary amount billed for such
Licensed Products or Licensed Processes.
1.12. "Field of Use One" shall mean Breast Hyperthermia.
1.13. "Field of Use Two" shall mean Head and Neck Hyperthermia.
1.14. "Field of Use Three" shall mean Deep Seated Hyperthermia of
other organs, including, but not limited to, liver, lung and prostate.
301650.001(BF) 5
1.15. On the Effective Date, "Exclusive Fields of Use" shall mean,
Field of Use One, Field of Use Two, and Field of Use Three. This definition may
be modified according to paragraphs 3.3(b), 3.4(b) and 3.5(b).
1.16. "Other Revenue" shall mean Licensee's gross revenues from the
sale of services, including but not limited to, fees for consulting, research
and development, and training in connection with:
a. the sublicensing of the Intellectual Property Rights
and/or;
b. the use of sale, lease or other transfer of Licensed
Products or Licensed Processes.
1.17. "End User" shall mean a customer authorized to use a single
copy of the Licensed Product for internal purposes only and not for further
distribution.
2. GRANT
2.1. M.I.T. hereby grants to Licensee the right and license for Field
of Use One, Field of Use Two, and Field of Use Three to practice under the
Patent Rights and, to the extent not prohibited by other patents, to make, have
made, use, lease, sell and import Licenses Products and to practice the Licensed
Processes, until the expiration of the last to expire of the Patent Rights,
unless this Agreement shall be sooner terminated according to the terms hereof.
2.2. M.I.T. hereby grants to Licensee the following rights and
licenses for the Exclusive Fields of Use to the end of the term for which the
Copyright shall be granted, unless this Agreement shall be sooner terminated:
(a) to use and reproduce the Program;
(b) to create Derivatives;
(c) to lease, transfer and sublicense Licensed Products
to End-Users through the normal channels of
distribution; and
301650.001(BF) 6
(d) to grant any or all of the above rights and licenses
to Sublicensees.
2.3. In order to establish a period of exclusivity for Licensee, M.I.T.
hereby agrees that it shall not grant any other license to the Patent Rights for
the Exclusive Fields of Use, and also that it shall not grant any other license
to the Copyright for the Exclusive Fields of Use, subject only to Paragraph 2.6
and to the royalty-free, nonexclusive license rights of the United States
Government pursuant to 48 CFR 52.227- 14 (Civilian Agencies) or DFARS
252.227-7013 (Defense Agencies) during the period of time commencing with the
Effective Date and terminating with the first to occur of:
(a) the expiration of ten (10) years after the first
commercial sale of a Licensed Product or first
commercial use of a Licensed Process; or
(b) the expiration of twelve (12) years after the
Effective Date of this Agreement.
2.4. At the end of the exclusive period, the license granted hereunder
shall become nonexclusive and shall extend to the end of the term or terms for
which any Patent Rights are issued, unless sooner terminated as hereinafter
provided. The period of exclusivity may be extended with the written consent of
M.I.T., on a field of use basis, which consent shall not unreasonably be
withheld, provided that Licensee is a licensee in good standing, owing no fees,
royalties or any other monies to M.I.T., and having met all the diligence
milestones pertaining to the particular field of use in which an extension of
the period of exclusivity is under consideration.
2.5. M.I.T. reserves the right to practice under the Patent Rights
for its own noncommercial research purposes.
2.6. M.I.T. reserves the right to use the Program, to use and
create derivatives of the Program and to distribute the Program and M.I.T.-
created derivatives to third parties for noncommercial research purposes.
2.7. Licensee agrees that Licensed Products leased or sold in the
United States shall be manufactured substantially in the United States.
301650.001(BF) 7
2.8. In order to encourage and facilitate the development of
Licensed Products, M.I.T. agrees to perform the work described in the Technology
Transfer Agreement attached to this license as Addendum A.
2.9. Licensee shall have the right to enter into sublicensing
agreements for the rights, privileges and licenses granted hereunder only during
the exclusive period of this Agreement. Such sublicenses may extend past the
expiration date of the exclusive period of this Agreement, but any exclusivity
of such sublicenses shall expire upon the expiration of Licensee's exclusivity.
Upon any termination of this Agreement, sublicensees' rights shall also
terminate, subject to Paragraph 13.6 hereof.
2.10. Licensee agrees that any sublicenses granted by it shall provide
that the obligations to M.I.T. of Articles 2, 5, 7, 8, 9, 10, 12, 13, and 15 of
this Agreement shall be binding upon the sublicensee as if it were a party to
this Agreement. Licensee further agrees to attach copies of these Articles to
sublicense agreements.
2.11. Licensee agrees to forward to M.I.T. a copy of any and all
sublicense agreements promptly upon execution by the parties.
2.12. Licensee shall not receive from sublicensees anything of value in
lieu of cash payments in consideration for any sublicense under this Agreement,
without the express prior written permission of M.I.T.
2.13. The license granted hereunder shall not be construed to confer
any rights upon Licensee by implication, estoppel or otherwise as to any
technology not specifically set forth in Appendix A hereof.
3. DUE DILIGENCE
3.1. Licensee shall use its best efforts to bring one or more Licensed
Products or Licenses Processes to market through a thorough, vigorous and
diligent program for exploitation of the Intellectual Property Rights and to
continue active, diligent marketing efforts for one or more Licensed Products or
Licensed Processes throughout the life of this Agreement.
301650.001(BF) 8
3.2. (a) In addition, pertaining to Field of Use One, Licensee
shall adhere to the following milestones.
(i) On or before December 31, 1996, Licensee
shall deliver a Licensed Product to one site
suitable for clinical testing in Field of
Use One.
(ii) On or before June 30, 1997, Licensee shall
deliver to M.I.T. clinical data obtained
from at least ten (10) patients enrolled in
the clinical trials referred to in 3.2(a)(i)
above.
(iii) As soon as possible, but in all events on or
before June 30, 1999, Licensee shall apply
for FDA approval for commercial sales of a
Licensed Product in Field of Use One.
(iv) Licensee shall make sales of Licensed
Products in Field of Use One according to
the following schedule:
1998 at least 1 unit
1999 at least 5 units
2000 at least 10 units
2001 and each year thereafter at least 25
units
(b) In addition, pertaining to Field of Use Two, Licensee
shall develop a business plan for commercialization
of the Intellectual Property Rights in Field of Use
Two and submit it to M.I.T. on or before June 30,
1997.
(c) In addition, pertaining to Field of Use Three,
Licensee shall seek to include in the protocols for
the clinical trials to be conducted pursuant to
Section 3.2(a), clinical testing directed toward the
commercialization of the Intellectual Property Rights
in Field of Use Three. On or before September 30,
1996, Licensee shall provide M.I.T. a definitive
business plan for such commercialization of the
Intellectual Property Rights in Field of Use Three.
301650.001(BF) 9
3.3. (a) Failure to comply with paragraphs 3.2(a)(i), (ii), or
(iii), shall be grounds for M.I.T. to terminate this
license pursuant to paragraph 13.3 hereof.
(b) Failure to comply with paragraph 3.2(a)(iv) shall be
grounds to remove Field of Use One from the
definition of "Exclusive Fields of Use", thereby
terminating Licensee's exclusive rights to Field of
Use One.
3.4. Failure to comply with paragraphs 3.2(b) shall be grounds for
M.I.T. to terminate the grant in paragraph 2.1 of rights to Field of Use Two
pursuant to paragraph 13.3 hereof.
3.5. Failure to comply with paragraphs 3.2(c) shall be grounds for
M.I.T. to terminate the grant in paragraph 2.1 of rights to Field of Use Three
pursuant to paragraph 13.3 hereof.
4. ROYALTIES
4.1. For the rights, privileges and license granted hereunder,
Licensee shall pay royalties to M.I.T. in the manner hereinafter provided to the
end of the term of the Patent Rights or until this Agreement shall be
terminated:
(a) License Issue Fee of [Confidential Treatment
Requested], which said License Issue Fee shall be
deemed earned and due according to the following
schedule:
(i) [Confidential Treatment Requested] shall be
due on the Effective Date.
(ii) [Confidential Treatment Requested] shall be
due June 15, 1996.
(iii) [Confidential Treatment Requested] shall be
due upon Licensee's raising the first One
Hundred Thousand Dollars
301650.001(BF) 10
of investment capital directly related to
the commercialization of the Intellectual
Property Rights.
(b) License Maintenance Fees of [Confidential Treatment
Requested] per year payable on January 1, 1997,
January 1, 1998 and on January 1, 1999; provided,
however, that Running Royalties subsequently due on
Net Sales for each paid year, if any, shall be
creditable against the License Maintenance Fee for
said year. License Maintenance Fees paid in excess of
Running Royalties shall not be creditable to Running
Royalties for future years.
(c) License Maintenance Fees of [Confidential Treatment
Requested] per year payable on January 1, 2000 and on
January 1, 2001 provided, however, that Running
Royalties subsequently due on Net Sales for each said
year, if any, shall be creditable against the License
Maintenance Fee for said year. License Maintenance
Fees paid in excess of Running Royalties shall not be
creditable to Running Royalties for future years.
(d) License Maintenance Fees of [Confidential Treatment
Requested] per year payable on January 1, 2002 and on
January 1 of each year thereafter; provided, however,
License Maintenance Fees may be credited to Running
Royalties subsequently due on Net Sales for each said
year, if any. License Maintenance Fees paid in excess
of Running Royalties shall not be creditable to
Running Royalties for future years.
(e) Running Royalties in an amount equal to [Confidential
Treatment Requested] percent (__%) of Net Sales of
the Licensed Products and Licenses Processes used,
leased or sold by and/or for Licensee and/or its
sublicensees for Licensed Products which are both
made and leased or sold and for Licensed Processes
which are both used and leased or sold in a country
in which there is a valid, issued claim of a patent
described in either Appendices A or B.
301650.001(BF) 11
(f) Running Royalties in an amount equal to [Confidential
Treatment Requested] percent (__%) of Net Sales of
the Licensed Products and Licensed Processes used,
leased or sold by and/or for Licensee and/or its
sublicensees for Licensed Products which are either
made or leased or sold and for Licensed Processes
which are either used or leased or sold in a country
in which there is a valid, issued claim of a patent
described in either Appendices A or B, or in a
country in which there is a pending claim pertaining
to M.I.T. Case 6521L, providing that such country is
Canada.
(g) Running Royalties in an amount equal to [Confidential
Treatment Requested] percent (__%) of Net Sales of
the Licensed Products and Licensed Processes used,
leased or sold by and/or for Licensee and/or
its sublicensees for Licensed Products which are
neither made nor leased nor sold in a country in
which there is a valid, issued claim of a patent
described in either Appendices A or B, but which
utilize the Copyright and/or practice of run the
Program, as described in Appendix C and for Licensed
Processes which are neither used nor leased nor sold
in a country in which, but which utilize the
Copyright and/or practice or run the Program as
described in Appendix C.
(h) Running Royalties in an amount equal to [Confidential
Treatment Requested] percent (__%) of Net Sales of
the Program delivered to End-Users if the Program is
sold separately from the Licensed Products.
(i) If Other Revenue is greater than Net Sales, then
Running Royalties in an amount equal to [Confidential
Treatment Requested] (__%) of Other Revenue;
(j) If Other Revenue is less than Net Sales, then Running
Royalties in an amount equal to [Confidential
Treatment Requested] (__%) of Other Revenue.
301650.001(BF) 12
4.2. All payments due hereunder shall be paid in full, without
deduction of taxes or other fees which may be imposed by any government and
which shall be paid by Licensee.
4.3. No multiple royalties shall be payable because any Licensed
Product, its manufacture, use, lease or sale are or shall be covered by more
than one Intellectual Property Rights patent application of Intellectual
Property Rights patent licensed under this Agreement.
4.4. Royalty payments shall be paid in United States dollars in
Cambridge, Massachusetts, or at such other place as M.I.T. may reasonably
designate consistent with the laws and regulations controlling in any foreign
country. If any currency conversion shall be required in connection with the
payment of royalties hereunder, such conversion shall be made by using the
exchange rate prevailing at the Chase Manhattan Bank (N.A.) on the last business
day of the calendar quarterly reporting period to which such royalty payments
relate.
5. REPORTS AND RECORDS
5.1. Licensee shall keep full, true and accurate books of account
containing all particulars that may be necessary for the purpose of showing the
amounts payable to M.I.T. hereunder. Said books of account shall be left at
Licensee's principal place of business or the principal place of business of the
appropriate division of Licensee to which this Agreement relates. Said books and
the supporting data shall be open at all reasonable times for five (5) years
following the end of the calendar year to which they pertain, to the inspection
of M.I.T. or its agents for the purpose of verifying Licensee's royalty
statement or compliance in other respects with this Agreement. Should such
inspection lead to the discovery of a greater than Ten Percent (10%) discrepancy
in reporting to M.I.T.'s detriment, Licensee agrees to pay the reasonable cost
of such inspection.
5.2. Licensee shall deliver to M.I.T. true and accurate reports, giving
such particulars of the business conducted by Licensee and its sublicensees
under this Agreement as shall be pertinent to diligence under Article 3 and
royalty accounting hereunder:
301650.001(BF) 13
(a) before the first commercial sale of a Licensed
Product or Licensed Process, annually, on January 31
or each year; and
(b) after the first commercial sale of a Licensed Product
or Licensed Process, quarterly, within sixty (60)
days after March 31, June 30, September 30 and
December 31, of each year.
These reports shall include at least the following:
(a) number of Licensed Products manufactured, leased and
sold by and/or for Licensee and all sublicensees;
(b) accounting for all Licensed Processes used or sold by
and/or for Licensee and all sublicensees;
(c) accounting for Net Sales, noting the deductions and
credits applicable as provided in Paragraphs 1.11 and
6.3, accounting for Other Revenue;
(d) Running Royalties due under Paragraph 4.1(e) and (f);
(e) Running Royalties due under Paragraph 4.1(g) and (h);
(f) total royalties due; and
(g) names and addresses of all sublicensees of Licensee.
5.3. With each such report submitted, Licensee shall pay to M.I.T.
the royalties due and payable under this Agreement. If no royalties shall be
due, Licensee shall so report.
5.4. On or before the ninetieth (90th) day following the close of
Licensee's fiscal year, Licensee shall provide M.I.T. with Licensee's certified
financial statements for the preceding fiscal year including, at a minimum, a
Balance Sheet and an Operating Statement.
301650.001(BF) 14
5.5. The royalty payments set forth in this Agreement and amounts due
under Article 6 shall, if overdue, bear interest until payment at a per annum
rate two percent (2%) above the prime rate in effect at the Chase Manhattan Bank
(N.A.) on the due date. The payment of such interest shall not foreclose M.I.T.
from exercising any other rights it may have as a consequence of the lateness of
any payment.
6. PATENT PROSECUTION
6.1. M.I.T. shall have the administrative responsibility to apply for,
see, prompt issuance of, and maintain during the term of this Agreement the
Patent Rights in the United States and in the foreign countries listed in
Appendices A and B hereto. Appendix B may be amended by verbal agreement of both
parties, such agreement to be confirmed in writing within ten (10) days. The
prosecution, filing and maintenance of all Patent Rights patens and applications
shall be the primary responsibility of M.I.T.; provided, however, Licensee shall
have reasonable opportunities to advise M.I.T. and shall cooperate with M.I.T.
ion such prosecution, filing and maintenance.
6.2. Payment of all fees and costs relating to the filing,
prosecution, and maintenance of the Patent Rights incurred after the date of
this Agreement shall be the responsibility of Licensee. M.I.T. is not
financially obliged to maintain and prosecute patents.
6.3. M.I.T. agrees that Licensee may take a cumulative life
of license credit for expenditures on the Patent Rights, such credit not to
exceed [Confidential Treatment Requested] and to be taken according to the
following schedule:
(a) Licensee may credit their above referenced patent
prosecution and maintenance expenditures incurred in
a given calendar year against up to one half of
License Maintenance Fees due the following January 1
under paragraphs 4.1(b), (c), and (d).
(b) In the event that Running Royalties exceed the
License Maintenance Fee for a given year, and
Licensee owes M.I.T. Running Royalties in addition to
the License Maintenance Fee already paid, then
Licensee may use their patent prosecution and
301650.001(BF) 15
maintenance credit against up to one half of the
Running Royalties due paragraphs 4.1(e), (f) and (g).
7. INFRINGEMENT
7.1. Licensee shall inform M.I.T. promptly in writing of any alleged
infringement of the Intellectual Property Rights by a third party of which it
becomes aware and of any available evidence thereof. M.I.T. shall inform
Licensee promptly in writing of any alleged infringement of the Intellectual
Property Rights by a third party of which it becomes aware and of any available
evidence thereof. Within ten (10) business days of such notice the parties shall
confer to determine how best to proceed.
7.2. During the term of this Agreement, M.I.T. shall have the right, but
shall not be obligated, to prosecute at its own expense all infringements of the
Intellectual Property Rights and, in furtherance of such right, Licensee hereby
agrees that M.I.T. may include Licensee as a party plaintiff in any such suit,
without expense to Licensee. The total cost of any such infringement action
commenced or defended solely by M.I.T. shall be borne by M.I.T. and M.I.T. shall
keep any recovery or damages for past infringement derived therefrom.
7.3. If within six (6) months after having been notified of any alleged
infringement, M.I.T. shall have been unsuccessful in persuading the alleged
infringer to desist and shall not have brought and shall not be diligently
prosecuting an infringement action, or if M.I.T. shall notify Licensee at any
time prior thereto of its intention not to bring suit against any alleged
infringer for the Field of Use, then, and in those events only, Licensee shall
have the right, but shall not be obligated, to prosecute at its own expense any
infringement of the Intellectual Property Rights for the Field of Use, and
Licensee may, for such purposes, use the name of M.I.T. as party plaintiff;
provided, however, that such right to bring such an infringement action shall
remain in effect only for so long as the license granted herein remains
exclusive. No settlement, consent judgment or other voluntary final disposition
of the suit may be entered into without the consent of M.I.T., which consent
shall not unreasonably be withheld. Licensee shall indemnify M.I.T. against any
order for costs that may be made against M.I.T. in such proceedings.
301650.001(BF) 16
7.4. In the event that Licensee shall undertake the enforcement and/or
defense of the Intellectual Property Rights by litigation, Licensee may withhold
up to fifty percent (50%) of the payments otherwise thereafter due M.I.T. under
Article 4 hereunder and apply the same toward reimbursement of up to half of
Licensee's expenses, including reasonable attorneys' fees, in connection
therewith. Any recovery of damages by Licensee for each such suit shall be
applied first in satisfaction of any unreimbursed expenses and legal fees of
Licensee relating to such suit, and next toward reimbursement of M.I.T. for any
payments under Article 4 past due or withheld and applied pursuant to this
Article 7. The balance remaining from any such recovery shall be divided so that
the percentage of the recovery due M.I.T. is calculated by creating a fraction,
the numerator of which is the amount of royalties withheld, and denominator of
which is the cost of litigation paid by Licensee, but in no event shall such sum
be less than Ten Percent (10%) of the net recovery.
7.5. In the event that a declaratory judgment action alleging
invalidity or noninfringement of any of the Intellectual Property Rights shall
be brought against Licensee, M.I.T., at its option, shall have the right, within
thirty (30) days after commencement of such action, to intervene and take over
the sole defense of the action at its own expense.
7.6. In any infringement suit as either party may institute to enforce
the Patent Rights pursuant to this Agreement, the other party hereto shall, at
the request and expense of the party initiating such suit, cooperate in all
respects and, to the extent possible, have its employees testify when requested
and make available relevant records, papers, information, samples, specimens,
and the like.
7.7. Licensee, during the exclusive period of this Agreement, shall
have the sole right in accordance with the terms and conditions herein to
sublicense any alleged infringer for the Field of Use for future use of the
Intellectual Property Rights. Any upfront fees as part of such a sublicense
shall be shared equally between Licensee and M.I.T.; other royalties shall be
treated per Article 4.
8. PRODUCT LIABILITY
8.1. Licensee shall at all times during the term of this Agreement and
thereafter, indemnify, defend and hold M.I.T., its trustees, directors,
officers, employees
301650.001(BF) 17
and affiliates, harmless against all claims, proceedings, demands and
liabilities of any kind whatsoever, including legal expenses and reasonable
attorneys' fees, arising out of the death of or injury to any person or persons
or out of any damage to property, resulting from the production, manufacture,
sale, use, lease, consumption or advertisement of the Licensed Product(s) and/or
Licensed Process(es) or arising from any obligation of Licensee hereunder.
8.2. Licensee shall obtain and carry in full force and effect
commercial, general liability insurance which shall protect Licensee and M.I.T.
with respect to events covered by Paragraph 8.1 above. Such insurance shall be
written by a reputable insurance company authorized to do business in the
Commonwealth of Massachusetts, shall list M.I.T. as an additional named insured
thereunder, shall be endorsed to include product liability coverage and shall
require thirty (30) days written notice to be given to M.I.T. prior to any
cancellation or material change thereof. The limits of such insurance shall not
be less than One Million Dollars ($1,000,000) per occurrence with an aggregate
of Three Million Dollars ($3,000,000) for personal injury or death, and One
Million Dollars ($1,000,000) per occurrence with an aggregate of Three Million
Dollars ($3,000,000) for property damage. Licensee shall provide M.I.T. with
Certificates of Insurance evidencing the same.
8.3. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, M.I.T.,
ITS TRUSTEES, DIRECTORS, OFFICERS, EMPLOYEES, AND AFFILIATES MAKE NO
REPRESENTATIONS AND EXTENT NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED,
INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, VALIDITY OF PATENT RIGHTS CLAIMS, ISSUED OR PENDING, AND TO
THE COPYRIGHT AND THE ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT
DISCOVERABLE. NOTHING IN THIS AGREEMENT SHALL BE CONSTRUED AS A REPRESENTATION
MADE OR WARRANTY GIVEN BY M.I.T. THAT THE PRACTICE BY LICENSEE OF THE LICENSE
GRANTED HEREUNDER SHALL NOT INFRINGE THE PATENT RIGHTS OR THE COPYRIGHT OF ANY
THIRD PARTY. IN NO EVENT SHALL M.I.T., ITS TRUSTEES, DIRECTORS, OFFICERS,
EMPLOYEES AND AFFILIATES BE LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF
ANY KIND, INCLUDING ECONOMIC DAMAGE OR INJURY TO PROPERTY AND LOST PROFITS,
REGARDLESS OF WHETHER M.I.T. SHALL BE ADVISED, SHALL
301650.001(BF) 18
HAVE OTHER REASON TO KNOW, OR IN FACT SHALL KNOW OF THE POSSIBILITY OF THE
FOREGOING.
9. EXPORT CONTROLS
Licensee acknowledges that it is subject to United States laws and
regulations controlling the export of technical data, computer software,
laboratory prototypes and other commodities (including the Arms Export Control
Act, as amended and the United States Department of Commerce Export
Administration Regulations). The transfer of such items may require a license
from the cognizant agency of the United States Government and/or written
assurances by Licensee that Licensee shall not export data or commodities to
certain foreign countries without prior approval of such agency. M.I.T. neither
represents that a license shall not be required nor that, if required, it shall
be issued.
10. NON-USE OF NAMES
Licensee shall not use the names or trademarks of the Massachusetts
Institute of Technology or Lincoln Laboratory, nor any adaption thereof, nor the
names of any of their employees, in any advertising, promotional or sales
literature without prior written consent obtained from M.I.T., or said employee,
in each case, except that Licensee may state that it is licensed by M.I.T. under
one or more of the patents and/or applications comprising the Patent Rights, and
that it has a license to the Copyright.
11. ASSIGNMENT
This Agreement is not assignable and any attempt to do so shall be
void.
12. DISPUTE RESOLUTION
12.1. Except for the right of either party to apply to a court of
competent jurisdiction for a temporary restraining order, a preliminary
injunction, or other equitable relief to preserve the status quo or prevent
irreparable harm, any and all claims, disputes
301650.001(BF) 19
or controversies arising under, out of, on in connection with the Agreement,
including any dispute relating to patent validity or infringement, which the
parties shall be unable to resolve within sixty (60) days shall be mediated in
good faith. The party raising such dispute shall promptly advise the other party
of such claim, dispute or controversy in a writing which describes in reasonable
detail the nature of such dispute. By not later than five (5) business days
after the recipient has received such notice of dispute, each party shall have
selected for itself a representative who shall have the authority to bind such
party, and shall additionally have advised the other party in writing of the
name and title of such representative. By not later than ten (10) business days
after the date of such notice of dispute, the party against whom the dispute
shall be raised shall select a mediation firm in the Boston area and such
representatives shall schedule a date with such firm for a mediation hearing.
The parties shall enter into good faith mediation and shall share the costs
equally. If the representatives of the parties have not been able to resolve the
dispute within fifteen (15) business days after such mediation hearing, then any
and all claims, disputes or controversies arising under, out of, or in
connection with this Agreement, including any dispute relating to patent
validity or infringement, shall be resolved by final and binding arbitration in
Boston, Massachusetts under the rules of the American Arbitration Association,
or the Patent Arbitration Rules if applicable, then obtaining. The arbitrators
shall have no power to add to, subtract from or modify any of the terms or
conditions of this Agreement, not to award punitive damages. Any award rendered
in such arbitration may be enforced by either party in either the courts of the
Commonwealth of Massachusetts or in the United States District Court for the
District of Massachusetts, to whose jurisdiction for such purposes M.I.T. and
Licensee each hereby irrevocably consents and submits.
12.2. Notwithstanding the foregoing, nothing in this Article shall be
construed to waive any rights or timely performance of any obligations existing
under this Agreement.
13. TERMINATION
13.1. If Licensee shall cease to carry on its business, this Agreement
shall terminate upon notice by M.I.T.
13.2. Should Licensee fail to make any payment whatsoever due and
payable to M.I.T. hereunder, M.I.T. shall have the right to terminate this
301650.001(BF) 20
Agreement effective on thirty (30) days' notice, unless Licensee shall make all
such payments to M.I.T. within said thirty (30) day period. Upon the expiration
of the thirty (30) day period, if Licensee shall not have made all such payments
to M.I.T., the rights, privileges and license granted hereunder shall
automatically terminate.
13.3. Upon any material breach or default of this Agreement by Licensee
(including, but not limited to, breach or default under Paragraph 3.3), other
than those occurrences set out in Paragraphs 13.1 and 13.2 hereinabove, which
shall always take precedence in that order over any material breach or default
referred to in this Paragraph 13.3, M.I.T. shall have the right to terminate
this Agreement and the rights, privileges and license granted hereunder
effective on ninety (90) days' notice to Licensee. Such termination shall become
automatically effective unless Licensee shall have cured any such material
breach or default prior to the expiration of the ninety (90) days period.
13.4. Licensee shall have the right to terminate this Agreement at
any time on six (6) months' notice to M.I.T., and upon payment of all amounts
due M.I.T. through the effective date of the termination.
13.5. Upon termination of this Agreement for any reason, nothing herein
shall be construed to release either party from any obligation that matured
prior to the effective date of such termination; and Articles 1, 8, 9, 10, 12,
13.5, 13.6, and 15 shall survive any such termination. Licensee and any
sublicensee thereof may, however, after the effective date of such termination,
sell all Licensed Products, and complete Licensed Products in the process of
manufacture at the time of such termination and sell the same, provided that
Licensee shall make the payments to M.I.T. as required by Article 4 of this
Agreement and shall submit the reports required by Article 5 hereof.
13.6. Upon termination of this Agreement for any reason:
(a) Licensee shall provide M.I.T. with written assurance
that the original and all copies of the Program and
Derivatives, have been destroyed, except that, upon
prior written authorization from M.I.T. Licensee may
retain a copy for archival purposes; and
(b) the rights of End-Users to the use and enjoyment of
the Licensed Products shall not be abridged or
diminished in any way, except that any End-User
leasing or sublicensing the Licensed Products and not
301650.001(BF) 21
then in default shall have the right to obtain a
lease or sublicense directly from M.I.T. under
reasonable terms and conditions.
13.7. Upon termination of this Agreement for any reason, any sublicensee
not then in default shall have the right to seek a license from M.I.T. M.I.T.
agrees to negotiate such licenses in good faith under reasonable terms and
conditions.
14. PAYMENTS, NOTICES
AND OTHER COMMUNICATIONS
Any payment, notice or other communication pursuant to this Agreement
shall be sufficiently made or given on the date of mailing if sent to such party
by certified first class mail, return receipt requested, postage prepaid,
addressed to it at its address below or as it shall designate by written notice
given to the other party:
In the case of M.I.T.:
Director
Technology Licensing Office
Massachusetts Institute of Technology
Xxxx X00-000
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
In the case of Licensee:
Xxxxxxxxx X. Xxxxxx
Chairman and CEO
Xxxxxx Laboratories, Inc.
00000-X Xxx Xxxxxxxx Xxxx
Xxxxxxxx, XX 00000-0000
15. MISCELLANEOUS PROVISIONS
301650.001(BF) 22
15.1. All disputes arising out of or related to this Agreement, or the
performance, enforcement, breach or termination hereof, and any remedies
relating thereto, shall be construed, governed, interpreted and applied in
accordance with the laws of the Commonwealth of Massachusetts, U.S.A., except
that questions affecting the construction and effect of any patent shall be
determined by the law of the country in which the patent shall have been
granted.
15.2. The parties hereto acknowledge that this Agreement sets forth the
entire Agreement and understanding of the parties hereto as to the subject
matter hereof, and shall not be subject to any change or modification except by
the execution of a written instrument signed by the parties.
15.3. The provisions of this Agreement are severable, and in the event
that any provisions of this Agreement shall be determined to be invalid or
unenforceable under any controlling body of the law, such invalidity or
unenforceability shall not in any way affect the validity of enforceability of
the remaining provisions hereof.
15.4. Licensee agrees to xxxx the Licensed Products sold in the United
States with all applicable United States patent numbers. All Licensed Products
shipped to or sold in other countries shall be marked in such a manner as to
conform with the patent laws and practice of the country of manufacture or sale.
15.5. The failure of either party to assert a right hereunder or to
insist upon compliance with any term or condition of this Agreement shall not
constitute a waiver of that right or excuse a similar subsequent failure to
perform any such term or condition by the other party.
IN WITNESS WHEREOF, the parties have duly executed this Agreement the
day and year set forth below.
MASSACHUSETTS INSTITUTE OF XXXXXX LABORATORIES, INC.
TECHNOLOGY
By:/s/______________________________
By:/s/_______________________________
Name:_______________________________ Name:______________________________
Title:_______________________________ Title:_____________________________
Date: Date:
APPENDIX A
301650.001(BF) 23
PATENT RIGHTS ON THE EFFECTIVE DATE
UNITED STATES PATENT RIGHTS
M.I.T. Case No. 5493L
U.S. Patent No. 5,251,645
"Adaptive Nulling Hyperthermia Array:
By Xxxx Xxxx
M.I.T. Case No. 6512L
U.S. Serial Number 157,928
"Minimally Invasive Monopole Phased Array Hyperthermia Applicators
For Treating Breast Carcinomas"
By Xxxx Xxxx
FOREIGN PATENT RIGHTS
M.I.T. Case No. 6512L
PCT Application designating EPO, Canada and Japan
"Minimally Invasive Monopole Phased Hyperthermia Applicators
For Treating Breast Carcinomas"
By Xxxx Xxxx
301650.001(BF) 00
XXXXXXXX X
1. Foreign patent applications and patents within the Patent Rights as of
Effective Date:
M.I.T. Case No. 6512L
PCT Application designating EPO, Canada and Japan
"Minimally Invasive Monopole Phased Hyperthermia Applicators
For Treating Breast Carcinomas"
By Xxxx Xxxx
2. Foreign countries in which Patent Rights shall be filed, prosecuted and
maintained in accordance with Article 6.
No additional instructions as of February 23, 1996.
301650.001(BF) 25
APPENDIX C
M.I.T. COPYRIGHTED SOFTWARE
M.I.T. Case No. 7299LS
"NULLGSC"
By Xxxx Xxxx
M.I.T. Case No. 7298LS
"FOCUSGSC"
By Xxxx Xxxx
301650.001(BF) 26
