EXHIBIT 10.39
PATENT LICENSE AGREEMENT
BETWEEN
TELCORDIA TECHNOLOGIES, INC.
RUTGERS, THE STATE UNIVERSITY OF NEW JERSEY
AND
SUPERCONDUCTOR TECHNOLOGIES INC.
This Agreement, effective on the date the last party signs it (the
"EFFECTIVE DATE"), is by and between TELCORDIA TECHNOLOGIES, INC., a Delaware
corporation , having an office at 000 Xxxxx Xxxxxx, Xxxxxxxxxx, Xxx Xxxxxx
00000, X.X.X. ("TELCORDIA"), RUTGERS, THE STATE UNIVERSITY OF NEW JERSEY, an
academic institution organized under the laws of the State of New Jersey, having
an office at 0 Xxxxxxx Xxxxx, Xxx Xxxxxxxxx, XX 00000 ("Rutgers") and
SUPERCONDUCTOR TECHNOLOGIES INC., a Delaware corporation, having an office at
000 Xxxx Xxxxx, Xxxxx Xxxxxxx, XX 00000 U.S.A ("STI").
RECITALS
Whereas, TELCORDIA is co-owner of U.S. Patent No. 5,015,492 entitled
"Method and Apparatus for Pulsed Energy Induced Vapor Deposition of Thin Films"
("Licensed Patent");
Whereas, Rutgers is the other co-owner of the Licensed Patent and has
made Telcordia the licensing agent with respect to the Licensed Patent;
Whereas, TELCORDIA has offered STI a license to practice certain claims
of the Licensed Patent and a covenant not to be sued with respect to other
claims of the Licensed Patent; and,
Whereas, STI, after evaluating its needs, has elected to accept a
license to practice certain claims of the Licensed Patent and a covenant not to
be sued with respect to other claims of the Licensed Patent.
Now, therefore, in consideration of the mutual covenants and premises
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
ARTICLE I - DEFINITIONS
1.1 Terms in this Agreement (other than the names of parties, Article
headings, and the warranty clauses) that are set forth in all uppercase
letters have the meanings established for them in the succeeding
paragraphs of this Article I.
1.2 An "AFFILIATE" of a party shall mean any entity that is owned or
controlled by the party, or owns or controls the party (such entity
being hereinafter called the "Parent"), or any entity owned or
controlled by the Parent of the entity at the time in question. In the
case of a corporation or similar entity, ownership, direct or indirect,
of capital stock or other ownership interest representing more than
fifty percent (50%) of the voting power for the election or appointment
of directors, or person performing similar functions, shall constitute
ownership or control thereof.
1.3 "LICENSED PATENT" shall mean (i) U.S. Patent No. 5,015,492 titled
"Method and Apparatus for Pulsed Energy Induced Vapor Deposition"; (ii)
any continuation, continuation-in-part, division, reissue,
reexamination, extension, renewal or substitute of the `492 patent;
(iii) any patent or application claiming priority to the application
from which the `492 patent issued; and (iv) any foreign (non-U.S.)
counterpart patent or patent that claims priority to or from any of the
patents or patent applications specified in subsections (i)-(iii)
above.
1.4 "NET SALES PRICE" shall mean:
1.4.1 for a LICENSED PRODUCT that is sold or leased, the sales price
agreed to between STI and the third party buyer in a bona
fide, arm's length transaction, net of returns, allowances,
trade discounts, bad debts and any other amounts included in
the calculation of "net sales" under generally accepted
accounting principles. Such NET SALES PRICE shall not include
packing, shipping, insurance charges, import, export, excise,
sales and value added taxes, and customs duties.
1.4.2 for a LICENSED PRODUCT OTHERWISE DISPOSED OF, the average
sales price, agreed to between STI and third party buyers in
bona fide, arm's length transactions (net of returns,
allowances, trade discounts, bad debts and any other amounts
included in the calculation of "net sales" under generally
accepted accounting principles) for similar LICENSED PRODUCTS
sold within ninety (90) days prior to the date of such OTHER
DISPOSITION OF. Such NET SALES PRICE shall not include
packing, shipping, insurance charges, import, export, excise,
sales and value added taxes, and customs duties.
1.4.3 for LICENSED PRODUCTS made by or on behalf of STI, but not
sold, leased or OTHERWISE DISPOSED OF in the event of
expiration or termination of this Agreement, shall be the
average NET SALES PRICE as defined in Section 1.4.1 for
similar LICENSED PRODUCTS sold within ninety (90) days prior
to the date of such expiration or termination.
1.5 "LICENSED PRODUCT" shall mean a cryogenic receiver front-end device for
wireless communications networks which contains a thin film radio
frequency filter manufactured using high-temperature superconducting
materials and either pulsed energy deposition or pulsed laser
deposition. A list of the current LICENSED PRODUCTS of STI, is set
forth as Exhibit 1. Additional LICENSED PRODUCTS may be added to this
list by STI upon written notice to TELCORDIA.
1.6 "LICENSED EQUIPMENT" shall mean an apparatus performing pulsed energy
deposition and/or pulsed laser deposition claimed in the LICENSED
PATENT.
1.7 "OTHERWISE DISPOSE OF," "OTHERWISE DISPOSED OF", "OTHERWISE DISPOSES
OF" and "OTHER DISPOSITION OF" as used in conjunction with LICENSED
PRODUCT shall mean any transaction that is not an arms length sale,
lease or disposition to a third party of a LICENSED PRODUCT in
consideration for products and/or services from such third party. These
phrases shall not include any LICENSED PRODUCTS which are (a)
destroyed, damaged or defective or (b) on loan to third parties for
testing, evaluation or field trials.
1.8 "STI" shall mean SUPERCONDUCTOR TECHNOLOGIES INC. and any other company
or entity that is currently an AFFILIATE but only for so long as it
remains an AFFILIATE. "STI" shall also include AFFILIATES subsequently
acquired by STI, but the licenses and covenants not to xxx granted
herein with respect to such subsequently acquired AFFILIATES shall only
be with respect to LICENSED PRODUCTS made by or on behalf of, sold,
offered for sale, leased, imported used or OTHERWISE DISPOSED OF by
such subsequently acquired AFFILIATES after such acquisition. The
release granted to STI herein is only with respect to SUPERCONDUCTOR
TECHNOLOGIES INC. and current AFFILIATES of SUPERCONDUCTOR
TECHNOLOGIES, INC. as of the EFFECTIVE DATE.
1.9 "LICENSOR" shall mean either Telcordia Technologies, Inc. or Rutgers
University, The State University of New Jersey.
1.10 "LICENSORS" shall mean Telcordia Technologies, Inc. and Rutgers
University as joint owners of the Licensed Patent.
ARTICLE II - GRANT OF LICENSE AND RELEASE
2.1 LICENSORS hereby grant to STI, for the term of this Agreement, a
worldwide and nonexclusive license under the method claims of the
LICENSED PATENT to make, have made, use, lease, offer to sell, sell,
distribute, import or OTHERWISE DISPOSE OF LICENSED PRODUCTS and to use
LICENSED EQUIPMENT to manufacture LICENSED PRODUCTS.
2.2 The license granted in Section 2.1 hereof does not include: any right
to grant sublicenses to others provided, however, that nothing herein
will prevent STI from (a) using resellers, distributors, or AFFILIATES
for distribution of LICENSED PRODUCTS made by STI or its contract
manufacturers pursuant to STI's have made rights and bearing an STI
brand and (b) to grant sublicenses to third party suppliers in exercise
of STI's have made rights.
2.3 LICENSORS covenant not to xxx STI for infringement of the apparatus
claims of the LICENSED PATENT based on the manufacture by or on behalf
of STI of LICENSED EQUIPMENT or STI'S use of LICENSED EQUIPMENT to
manufacture LICENSED PRODUCTS; provided that STI has made all payments
in a timely manner as required by Article III of this Agreement.
2.4 STI acknowledges and agrees that nothing in this Agreement shall be
construed as granting to STI any right or license, express or implied,
under any patent owned or controlled by LICENSORS, except for the
LICENSED PATENT, and that nothing in this Agreement shall restrict
either LICENSOR from asserting any of its patents, except for the
LICENSED PATENT, against STI and STI's customers, mediate and immediate
(including resellers, distributors, and end users) in the event any
product of STI, including the LICENSED PRODUCT or LICENSED EQUIPMENT,
should infringe any such patent. STI acknowledges and agrees that
nothing in this Agreement shall be construed as granting to STI any
right to sell, lease or OTHERWISE DISPOSE OF any LICENSED EQUIPMENT.
2.5 STI represents that, prior to the EFFECTIVE DATE, it has not, sold,
leased, or OTHERWISE DISPOSED OF any LICENSED PRODUCTS, including but
not limited to LICENSED PRODUCTS, other than to the extent disclosed in
Exhibit 2. Such disclosure shall include the identity and quantity of
all LICENSED PRODUCTS sold, leased or OTHERWISE DISPOSED OF prior to
the EFFECTIVE DATE. Subject to the forgoing representation and upon
payment to LICENSORS of the amount specified in Section 3.3, each
LICENSOR, for itself, its successors, and assigns, hereby releases and
forever discharges STI (defined in this Section 2.5 as Superconductor
Technologies Inc. and its current AFFILIATES as of the EFFECTIVE DATE),
from any and all causes of action, claims, and demands whatsoever in
law or in equity arising or claimed to arise out of any infringement or
asserted infringement of the LICENSED PATENT by any LICENSED PRODUCTS
sold, leased, or OTHERWISE DISPOSED OF by STI at any time prior to the
EFFECTIVE DATE of this Agreement. This release shall not apply to any
infringement of any
patent owned or controlled by either LICENSOR except for the LICENSED
PATENT. The release provided by this paragraph does not provide a
release for infringement of the LICENSED PATENT by any entity that
becomes an AFFILIATE of STI after the EFFECTIVE DATE of this Agreement.
ARTICLE III - CONSIDERATION, REPORTS AND RECORDS
3.1 STI shall pay LICENSORS within ten (10) days of the EFFECTIVE DATE of
this Agreement a non-refundable initial license fee of ________________
________________.
3.2 STI shall also pay LICENSORS within ten (10) days of the EFFECTIVE DATE
of this Agreement a non-refundable initial covenant fee of
__________________________________.
3.3 STI shall also pay LICENSORS within ten (10) days of the EFFECTIVE DATE
of this Agreement a non-refundable fee of _____________________________
for the release provided in Section 2.5.
3.4 STI shall pay to LICENSORS a royalty payment of _______________________
of the aggregate NET SALES of LICENSED PRODUCTS manufactured, sold,
leased or OTHERWISE DISPOSED OF in the United States by STI after the
EFFECTIVE DATE. STI shall pay LICENSORS a minimum annual royalty of
_______________________, which will be deemed advance payment of (and
credited towards) royalties owing for LICENSED PRODUCTS sold, leased or
OTHERWISE DISPOSED OF by STI during such year. The first minimum annual
royalty of _________________________ shall be due and payable within
thirty (30) days of the EFFECTIVE DATE. Subsequent minimum annual
royalties of ______________________ are due January 1st for each year
thereafter. LICENSORS shall not be obligated to refund any portion of
the minimum annual royalty even if the actual royalty due is less than
the annual minimum royalty.
3.5 STI shall pay LICENSORS an annual covenant fee of _____________________
which will be deemed payment for the covenant not to xxx provided
pursuant to Section 2.3 of this Agreement for LICENSED EQUIPMENT
manufactured by or on behalf of STI during such year. The first annual
covenant fee of _____________________________ shall be due and payable
within thirty (30) days of the EFFECTIVE DATE. Subsequent annual
covenant fees of ____________________________ are due January 1st for
each year thereafter. LICENSORS shall not be obligated to refund any
portion of the covenant fee.
3.6 A LICENSED PRODUCT shall not be subject to royalty under Section 3.4 if
the LICENSED PRODUCT is sold, leased or OTHERWISE DISPOSED OF to a
third party, if and to the extent that (i) such third party is licensed
by either LICENSOR under the LICENSED PATENT to have such
LICENSED PRODUCT made, (ii) such third party advises STI, in writing
prior to or promptly after the time of such sale, lease or OTHER
DISPOSITION OF such LICENSED PRODUCTS, that it is exercising its own
have made license from a LICENSOR under the LICENSED PATENT, and (iii)
STI promptly provides written notice to LICENSORS of the exercise of
such have made license. LICENSORS shall include a substantially similar
clause to this Section 3.6 in all other licenses LICENSORS provide to
others under the LINCENSED PATENT.
3.7 STI shall furnish LICENSORS within forty-five (45) days following the
end of each calendar quarter thereafter, a report in writing and signed
by an executive level officer of the company specifying separately by
model and type of LICENSED PRODUCT the total quantity and NET SALES of
all LICENSED PRODUCTS manufactured, sold, leased or OTHERWISE DISPOSED
OF in the United States by STI, the amount of royalties payable
thereon, all exclusions from royalties pursuant to Section 3.6 and the
total royalties due LICENSORS during the preceding three calendar
months. In addition, each report shall also include the total aggregate
royalties paid to LICENSORS and cumulative total of the NET SALES of
all LICENSED PRODUCTS made by STI and sold, leased or OTHERWISE
DISPOSED OF. Each such report shall be accompanied by payment in full
of the royalties due pursuant to Section 3.4 of this Agreement.
3.8 LICENSED PRODUCTS shall be considered sold, leased or OTHERWISE
DISPOSED OF when such transaction is recognizable in accordance with
STI's revenue recognition policy then in effect provided such policy is
in accordance with generally accepted accounting policies. LICENSED
PRODUCTS placed into field trials with potential customers shall not be
considered sold, leased or OTHERWISE DISPOSED OF unless and until the
potential customer agrees to purchase or lease or otherwise acquire
such LICENSED PRODUCTS. Any LICENSED PRODUCTS made but not sold, leased
or OTHERWISE DISPOSED OF, as of the date of termination of this
Agreement shall be subject to royalty under Section 3.4 on the date of
termination of this Agreement unless STI certifies in writing that it
has destroyed such LICENSED PRODUCTS. Conversion to United States
dollars of the NET SALES PRICE on sales, lease or OTHER DISPOSITION
made in currencies other than United States dollars shall be at the
prevailing rate for bank cable transfers, as quoted by STI's bank on
the date of such sale, lease of OTHER DISPOSITION OF LICENSED PRODUCTS.
3.9 STI shall keep full, clear and accurate records with respect to all
LICENSED PRODUCTS and LICENSED EQUIPMENT for four (4) years from the
date such product is sold, leased, used or OTHERWISE DISPOSED OF.
LICENSORS shall have the right to appoint a third party auditor(s)
reasonably acceptable to STI to make an examination, during normal
business hours, no more than once annually of all technical
information, records and accounts bearing upon the selection of
LICENSED PRODUCTS and LICENSED EQUIPMENT, sales, lease, use or OTHER
DISPOSITION OF LICENSED PRODUCTS and LICENSED EQUIPMENT, the amount of
royalty payable to LICENSORS hereunder and the basis of the reports
required in Section 3.7. STI shall use
reasonable efforts to provide facilities and assistance to the third
party auditor during normal business hours subject to their prior
execution of a confidentiality agreement reasonably acceptable in form
and substance to STI. LICENSORS shall complete the audit within a
reasonable time and without undue interference or burden of STI. Within
thirty (30) days of receiving an invoice STI shall pay any unpaid
royalties due unless the subject of a bona fide dispute. STI shall then
have 90 days to present supporting information to the auditor(s) who
shall review and consider such information. STI shall pay LICENSORS
their reasonable expenses in retaining such third party auditor for
such examination which discloses an underpayment of royalties of five
percent (5.0%) or more due LICENSORS for the audited period. All
materials reviewed or produced in connection with such audit, together
with all reports or other information relating to the manufacture, sale
or distribution of LICENSED PRODUCTS, shall be deemed to be the
Confidential Information of STI.
3.10 All payments pursuant to this Agreement shall be payable to Telcordia
Technologies, Inc. and wire transferred to:
Chase Manhattan Bank
New York, New York
The above payment instructions may be modified at any time by TELCORDIA
upon reasonable written notice to STI. All royalty reports shall be
sent to TELCORDIA at the address set forth in Section 8.3.
3.11 Past due payments hereunder shall be subject to a late payment charge,
compounded daily, and calculated at an annual rate of seven percent
(7.0%)over the lowest prime rate available in New York City, as
published by The Wall Street Journal on the first Monday (or next
business day if such Monday is a holiday) following the payment due
date. If the amount of such charge exceeds the maximum permitted by law
for such charge, such charge shall be reduced to such maximum amount.
If STI fails to make any payment set forth herein (except any amounts
that are the subject of a bona fide dispute), STI shall pay LICENSORS
all reasonable expenses, including attorney fees, incurred by LICENSORS
in collecting such payment.
3.12 A final report and payment shall be sent to LICENSORS within thirty
(30) days after termination or expiration of this Agreement. In
addition to the requirements of Section 3.7, the final report shall
report on all LICENSED PRODUCTS made but not sold, leased or OTHERWISE
DISPOSED OF as of the date of termination or expiration of this
Agreement and shall pay the balance of the license fee required
pursuant to Section 3.4 on all such LICENSED PRODUCTS.
ARTICLE IV - DISCLAIMER, LIMITED WARRANTY, LIMITATION OF LIABILITY AND
INDEMNIFICATION
4.1 Nothing contained in this Agreement shall be construed as:
a) a requirement to maintain the LICENSED PATENT or any other
patent owned by LICENSORS.
b) a warranty or representation as to the validity,
enforceability or scope of the LICENSED PATENT or any other
LICENSOR patent;
c) a warranty or representation that any manufacture, offer for
sale, sale, lease, use or importation of a LICENSED PRODUCT
will be free from infringement of patents or other
intellectual property rights, other than the LICENSED PATENT
under the conditions set forth herein;
d) an agreement to bring or prosecute actions or suits against
third parties for infringement of the LICENSED PATENT;
e) conferring any right to use, in advertising, publicity or
otherwise, any name, trade name, trademark, service xxxx, or
any contraction, abbreviation or simulation thereof except as
specifically set forth in Section 8.2;
f) an obligation to furnish any information or services;
g) conferring by implication, estoppel or otherwise any license
or other right under any patent or other intellectual property
rights, except as expressly granted herein; or
h) any arrangement or understanding that either Party will make
any purchase, lease, examination or test of, or give any
approval with respect to, any product.
4.2 (a) Each LICENSOR warrants that it has the right to grant the license
granted herein and to enter into this Agreement and that it owns a
one-half undivided interest in and to the LICENSED PATENT. Each
LICENSOR further warrants that it has not made and will not make any
commitments to third parties that are inconsistent with or in
derogation of the rights licensed to STI hereunder and that the
LICENSORS together own all right, title and interest in and to the
LICENSED PATENT. STI warrants that it has the right to enter into this
Agreement.
(b) Each LICENSOR makes no representations, extends no warranties of
any kind other than those set forth in Section 4.2(a), and assumes no
responsibility or liability whatsoever with respect to the manufacture,
offer for sale, sale, lease, use or importation of any LICENSED
PRODUCT, LICENSED EQUIPMENT or any portion thereof.
(c) THE FOREGOING WARRANTIES ARE IN LIEU OF ALL OTHER WARRANTIES,
EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR ANY PARTICULAR PURPOSE,
EVEN IF EITHER LICENSOR HAS BEEN MADE AWARE OF SUCH PURPOSE, AND THE
WARRANTY AGAINST INFRINGEMENT OF PATENTS OR OTHER INTELLECTUAL PROPERTY
RIGHTS.
(d) OTHER THAN FOR A BREACH OF A LICENSOR'S WARRANTIES AND COVENANTS
EXPLICITLY SET FORTH HEREIN, LICENSOR SHALL NOT BE LIABLE FOR ANY
DAMAGES, NOR SHALL EITHER PARTY BE LIABLE FOR ANY INDIRECT DAMAGES,
INCLUDING ANY LOST PROFITS OR OTHER INCIDENTAL OR CONSEQUENTIAL
DAMAGES, ARISING OUT OF THIS AGREEMENT, INCLUDING THE USE OR INABILITY
TO USE ANY LICENSED PRODUCT OR ANY TECHNOLOGY DESCRIBED IN THE LICENSOR
PATENT. LICENSOR'S LIABILITY HEREUNDER, IF ANY, SHALL NOT EXCEED THE
PAYMENTS RECEIVED HEREUNDER.
(e) STI acknowledges that its decision to enter into this Agreement is
with the full knowledge of the foregoing.
4.3 STI shall indemnify, hold harmless and defend each LICENSOR and its
AFFILIATES, (at STI's own expense), from and against any and all direct
losses, damages, fines, claims, suits, actions or proceedings, and any
judgment, settlement, compromise or resolution for damages or any other
relief resulting therefrom, to the extent based on any allegation of
any direct losses or damages, arising out of or in connection with the
manufacture, use, lease, sale, offer for sale, distribution,
importation or possession of any LICENSED PRODUCT or LICENSED EQUIPMENT
made by STI or made on behalf of STI in exercise of its have made
rights, regardless of the legal, equitable or factual basis thereof;
provided, however, that STI shall not have any indemnification
obligations under this Section 4.3 if and to the extent such losses,
damages, fines, claims suits, actions or proceedings result from or
arise out of (a) any material breach by a LICENSOR of any of its
warranties set forth in Section 4.2 herein or (b) the validity or
enforceability of the LICENSED PATENT. STI shall have no obligations
under this Section 4.3, unless a LICENSOR provides STI with prompt
written notification of any claim not independently received by STI;
(ii) provides STI with all reasonable
information and assistance to defend or settle the claim; and (iii)
grants STI authority and sole control of the defense or settlement of
such claim, provided that STI shall consult with LICENSOR and LICENSOR
shall have a right to reasonably object to any defense or settlement
that affects the interpretation, validity or enforceability of the
LICENSED PATENT.
ARTICLE V - PATENT MARKING; CONFIDENTIALITY
5.1 STI shall xxxx or have marked with the number of the LICENSED PATENT
all LICENSED EQUIPMENT made by or on behalf of STI.
5.2 Each party acknowledges that it will acquire information and materials
from the other party and knowledge about the business, products,
customers, clients and suppliers of the other party and that all such
knowledge, information and materials (collectively "Confidential
Information") constitute the confidential information and/or trade
secrets of the disclosing party. Confidential Information further
includes the existence, terms and conditions of this Agreement.
Confidential Information will not include any information that: (i) is
received by the receiving party from a third party without restriction
on use or disclosure; (ii) the disclosing party gives to third parties
without restriction on use or disclosure; (iii) is previously known to
the receiving party as evidenced in writing; or (iv) is independently
developed by employees of the receiving party without access to the
Confidential Information. Each party agrees to use reasonable efforts
to (i) hold all such Confidential Information in confidence; (ii) not
disclose such Confidential Information to any third party other than
AFFILIATES; and, (iii) use such Confidential Information for any
purpose other than for purposes set forth in this Agreement.
Confidential Information may be disclosed: (i) to either party's
attorneys, financial institutions, accountants or other professional
advisors in the course of seeking professional advice provided an
obligation of confidence exists; (ii) to the extent required by a court
or government agency, or by applicable law, order, rule or regulation
provided reasonable notice is provided to the disclosing party prior to
such disclosure to such court or governmental agency; and, (iii) to
entities with which either party is discussing a proposed sale of its
stock, sale of all or substantially all of its assets, assignment of
the Licensed Patent, obtaining financing or entering into a partnering
arrangement, provided that an entity to whom the terms of this
Agreement is to be disclosed under this clause (iii) has entered into a
confidentiality agreement sufficient in scope to protect the parties'
rights and interests hereunder.
ARTICLE VI - TERM AND TERMINATION/CANCELLATION
6.1 The term of this Agreement is from the EFFECTIVE DATE until the
expiration of the LICENSED PATENT (including any divisional,
continuation or continuation-in-part, reissue, renewal or extension
thereof or substitute thereof).
6.2 The license granted under Article II shall apply to all LICENSED
PRODUCTS sold, distributed, leased, used, imported, offered for sale,
or made, prior to the termination or expiration of this Agreement
provided STI has paid royalties pursuant to Section 3.4 of this
Agreement on all such LICENSED PRODUCTS, within thirty (30) days of the
termination or expiration of this Agreement.
6.3 STI may terminate this Agreement on sixty (60) days prior written
notice to LICENSORS, provided however that upon such
termination/cancellation, STI pays LICENSORS: (i) any amount owed
LICENSORS pursuant to Sections 3.1, 3.2, 3.3, 3.4 and 3.5 of this
Agreement; and (ii) any late fees due pursuant to Section 3.11.
6.4 Except to the extent prohibited by law under Section 365(n) of the
Bankruptcy Code, should STI become bankrupt or insolvent, or file a
petition in bankruptcy, or if the business of STI should be placed in
the hands of a receiver, assignee or trustee for the benefit of
creditors, whether by voluntary act of STI or otherwise, and such
petition or placement with a receiver, assignee or trustee shall not
have been dismissed within sixty (60) days the licenses granted herein
to STI shall terminate automatically.
6.5 Should STI fail to make any payment set forth herein when due or upon
any other material breach of, or default under, this Agreement by STI,
LICENSORS shall have the right to terminate this Agreement and the
licenses granted herein to STI on sixty (60) days prior written notice,
unless STI pays LICENSORS such payments, or otherwise cures the
material breach, within such sixty (60) days.
6.6 No waiver of any breach of, or default under, this Agreement shall
constitute a waiver of any prior, concurrent or subsequent breach of,
or default under, this Agreement, and no waiver shall be effective
unless made in writing and signed by an authorized representative of
each LICENSOR.
6.7 No expiration or termination of this Agreement or of the licenses
granted herein to STI shall relieve STI from any obligations that
should have been performed under the terms hereof prior to such
expiration or termination. STI's obligation to pay LICENSORS any unpaid
royalties that have accrued prior to the expiration or termination of
this Agreement and both parties' rights and obligations under Section
2.3 (with respect to sale, lease or OTHER DISPOSITION prior to
termination), Section 2.5, Section 4.2, Section 4.3, Section 5.2, and
Article VIII shall survive any expiration or termination of this
Agreement. Section 5.2 shall survive five (5) years after such
termination or expiration. The termination rights of the parties
provided herein are in addition to all other rights and remedies
available to either of the parties. Notwithstanding any other provision
of this Agreement to the contrary, any obligation of STI, including
payment obligations, shall immediately cease upon the final judgment of
any court of the United States that all claims of the LICENSED PATENT
are invalid or unenforceable, where such final judgment is unappealed
or unappealable unless LICENSORS fail to diligently pursue an appeal.
ARTICLE VII - ASSIGNMENT
7.1 This Agreement has been entered into by LICENSORS in reliance upon the
particular representations and qualifications of STI and is personal to
STI. Neither this Agreement, nor any rights or obligations hereunder,
may be assigned, pledged, or encumbered by STI without the express
prior written approval of LICENSORS, which approval shall not be
unreasonably withheld. Notwithstanding the foregoing, STI may assign
this Agreement to any successor to substantially all of its business
assets to which this Agreement relates, whether by merger, sale of
assets, sale of stock or reorganization or otherwise; provided that any
successor assignee agrees in writing to assume all obligations of STI
under this Agreement.
7.2 LICENSORS may assign, pledge, or encumber its monetary rights under
this Agreement and may assign this Agreement and all rights and
obligations hereunder in conjunction with the sale of the LICENSED
PATENT.
ARTICLE VIII - GENERAL PROVISIONS
8.1 This Agreement is predicated on the understanding by both Parties that
under the Telecommunications Act of 1996 ("the Act"), TELCORDIA is
permitted to grant the license granted herein to STI under the terms
and conditions of this Agreement. In the event of any court or
administrative order, with regard to which all reasonable appeals have
been exhausted, that TELCORDIA is not permitted to perform under this
Agreement or agreements of this type, then TELCORDIA shall have the
right to immediately terminate or modify this Agreement by written
notice to STI. This Agreement may also be terminated or modified, as
required, by any state or federal law or regulation, or by judicial
decree. Any such termination or modification shall not relieve STI from
any obligations that accrued on or prior to such termination or
modification, nor obligate TELCORDIA to refund any monies paid by STI
hereunder unless and to the extent that such termination results in STI
owing royalties to any other party for any period during which STI paid
royalties under this Agreement (but in no event shall any refund exceed
the amount previously paid to each LICENSOR). As of the EFFECTIVE DATE
of this Agreement, TELCORDIA believes that this Agreement and
performance thereunder are consistent with the terms of the Act.
8.2 No party may, without written permission of the other party, use in
advertising, publicity, packaging, labeling or otherwise any trade
name, trademark, trade device, service xxxx, symbol or other
identification, abbreviation, contraction or simulation thereof
associated with the other party to identify its products or services.
8.3 Any notice or other communication hereunder shall be in writing and
shall be sufficiently given and effective when received by certified
mail: by TELCORDIA at the address specified herein (Attention: Vice
President and General Manager, Intellectual Capital Products, NVC
3X-387A, 000 Xxxxxx Xxxxxxx Xxxx, Xxx Xxxx, XX 07701-5699), or by STI
at the address specified herein (Attention: Xxxxxx X. Xxxxxxx, Chief
Technology Officer, Superconductor Technologies Inc., 000 Xxxx Xxxxxx,
Xxxxx Xxxxxxx, XX 00000-0000 ) or RUTGERS at the address specified
above (Attention: Xxxxxxx X. Xxxxx, Office of Corporate Liaison &
Technology Transfer, Room 335, Administrative Services Building III,
Xxxx Campus). Any party may change its address for receipt of notices
by written notice to the other.
8.4 There may be countries in which STI may have, as a consequence of this
Agreement, rights against infringers for infringement of the LICENSED
PATENT. STI hereby expressly waives any such right it may have by
reason of the infringement or alleged infringement of the LICENSED
PATENT.
8.5 If any provision or portion of a provision of this Agreement shall be
held invalid or unenforceable, the remainder of this Agreement shall
not be affected thereby and the remaining terms shall continue in
effect and be binding on the parties, provided such invalid provision
or portion is not a material right or obligation under this Agreement.
If such invalid provision or portion is a material right or obligation
under this Agreement, then the parties shall negotiate in good faith to
replace the invalid or unenforceable provision by a mutually
acceptable, valid and enforceable provision that is consistent with and
fulfills the stated intention of the parties.
8.6 This Agreement (i) is binding upon the parties only when it is duly
authorized, executed and delivered by each party, and (ii) sets forth
the entire agreement and understanding between the parties as to the
subject matter hereof and merges all prior discussions between them.
Neither of the parties shall be bound by any warranties, understanding
or representations with respect to such subject matter, other than as
expressly provided herein or as set forth on or subsequent to the
execution hereof in writing signed by an authorized representative of
the party to be bound thereby.
8.7 Nothing herein shall be deemed to create an agency, joint venture, or
partnership relation between the parties hereto.
8.8 The construction and performance of this Agreement shall be in
accordance with the law of the State of New Jersey, without regard to
its conflict of laws principles.
8.9 This Agreement may be amended only by a written document signed by
authorized representatives of each party.
8.10 This Agreement and the Exhibits hereto shall not be construed as an
admission of any liability, wrongdoing or infringement by STI. Without
limiting the foregoing, the parties acknowledge that the definition of
"LICENSED PRODUCTS" in Section 1.5 does not make reference to the
claims of the LICENSED PATENT. This definition was formulated without
such a reference for the convenience of the parties at the request of
the LICENSORS based on their assertion that it would be unduly
difficult for the LICENSORS to successfully audit STI's royalty reports
if the definition of LICENSED PRODUCTS was limited to products
manufactured using methods covered by the claims of the LICENSED
PATENT. STI has agreed to this broad definition of "LICENSED PRODUCT"
in reliance on its absolute right under Section 6.3 to terminate this
Agreement, and STI may elect to do so if it concludes that it can
manufacture the LICENSED PRODUCTS without infringing any claims of the
LICENSED PATENT. Accordingly, no inferences regarding infringement
shall be drawn from the use of this broad definition of a "LICENSED
PRODUCT" or the existence of this Agreement, and the parties each
reserve their respective rights and positions concerning the scope of
the claims of the LICENSED PATENT and any alleged infringement of the
LICENSED PATENT.
Signatories
TELCORDIA TECHNOLOGIES, INC. SUPERCONDUCTOR TECHNOLOGIES, INC.
By: /s/ By: /s/
--------------------------------- -----------------------------
Name: Xxxxxx Xxxxxxxx Name: Xxxxxx X. Xxxxxxx
Title: Deputy General Counsel Intellectual Title: Senior VP, Chief
Property Technology Officer
Date: ____________________________________ Date: 7/13/02
RUTGERS, THE STATE UNIVERSITY OF
NEW JERSEY
By: /s/
--------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Director, Office of Corporate Liaison & Technology Transfer
Date:________________________________
EXHIBIT 1 - LICENSED PRODUCTS
SuperFilter(R)
SuperFilter(R) II
SuperFilter(R) PCS
EXHIBIT 2 - PRIOR SALES
Introductory Note -- This Exhibit shall not be construed as an
admission of any liability, wrongdoing or infringement by STI.
