EXHIBIT 10.14
UNIVERSITY OF ILLINOIS
AT URBANA - CHAMPAIGN
Office of Technology Management
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July 23, 2003
UTEK Corporation
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Circle Group Holdings, Inc.
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Re: Exclusive Software License Agreement
Agreement No. A03394 and A03436
Technology No. T96129 and 96129
Dear Sirs:
Please find enclosed, for your files, copies of the above-referenced agreement
that has been fully executed.
Sincerely,
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇▇▇▇
Technology Manager
Enclosure
cc: ▇▇▇ ▇▇▇▇▇▇▇
UNIVERSITY OF ILLINOIS
EXCLUSIVE SOFTWARE LICENSE AGREEMENT
WITH EQUITY
License Agreement ("AGREEMENT"), dated as of June 25, 2003, between THE BOARD OF
TRUSTEES OF THE UNIVERSITY OF ILLINOIS, a body corporate and politic of the
State of Illinois (the "UNIVERSITY"), and UTEK Corporation, a(n) Delaware
Corporation with the address of ▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇. ("LICENSEE").
PRELIMINARY STATEMENT
UNIVERSITY holds certain rights to the Technology described below, and
desires to have the Technology perfected and exploited for commercial purposes.
Licensee wishes to obtain the exclusive right to exploit the Technology in
commercial settings through a third party entity known as Circle Group Holdings,
Inc. ("Company"). It is agreed to by the parties that upon execution of this
Agreement this license shall be automatically assigned to Company and Company by
signing below agrees to accept such assignment with all corresponding rights and
obligations of Licensee as described hereunder. University approves of such
assignment. Therefore, in consideration of the mutual obligations set forth
below and other valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, University and Licensee agree as follows.
ARTICLE 1
DEFINITIONS
The following capitalized terms are used in this Agreement with the
following meanings:
"AFFILIATE" means, as to any person or entity, any other person or
entity that directly or indirectly controls, is controlled by, or is under
common control with such person or entity. For purposes of the preceding
sentence, "control" means the right to control, or actual control of, the
management of such other entity, whether by ownership of securities, by voting
rights, by agreement or otherwise.
"EQUITY RIGHTS" means the capital stock and related rights granted to
the University by Licensee and its Affiliates and other parties as set forth in
Section 3.13 and on Schedule 3 attached to this Agreement.
"COPIES" means any copy of a work, made by any method now known or
later developed and fixed in any medium now known or later developed, and from
which the work can be perceived, reproduced or otherwise communicated, either
directly or with the aid of a machine or device.
"DERIVATIVE WORK" means any translation (including translation into
other computer languages), modification, correction, addition, extension,
upgrade, improvement, compilation, abridgment or other form in which an existing
work may be recast, transformed or adapted.
"DOCUMENTATION" means the End User Documentation and the System
Documentation.
"END USER" means any person who licenses, purchases, or otherwise
obtains the Licensee Product or has access to or use of the Licensee Products
(including, but not limited to, by means of online access) directly or
indirectly from Licensee (excepting either party to this Agreement or its
Affiliates).
"END USER AGREEMENT" means the written agreement between Licensee and
an End User that includes the Mandatory Terms and governs End User's use, access
to, or receipt of the Licensee Product.
"END USER DOCUMENTATION" means any user manuals, handbooks and other
written or electronic material relating to the Licensed Software or Licensee
Product that are intended for use by End Users.
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"EVALUATION AGREEMENT" means the written agreement between Licensee and
an End User that includes the Mandatory Terms and governs End User's evaluatory
use, access to, or receipt of the Licensee Product, which will not, in any event
permit the End User to use the product for longer than thirty (30) days without
entering into an End User Agreement.
"INTELLECTUAL PROPERTY" means worldwide rights arising under contract,
statute or common law, whether or not perfected, and associated with: (a) works
of authorship, including copyrights, mask works and moral rights; (b) the
protection of trade and industrial secrets and confidential information; (c) any
rights analogous to those set forth herein and any other proprietary rights
relating to intangible or intellectual property now existing or later recognized
in any jurisdiction (excluding trademarks, service marks, trade names, and trade
dress); and (d) divisions, continuations, renewals, reissuances, reexaminations,
applications, registrations, and any extensions of the foregoing, now existing
or hereafter filed, issued or acquired.
"LICENSED FIELD" means the field of use described on Schedule 1.
"LICENSEE PRODUCT" means (i) any and all Licensee computer programs
that incorporate, integrate, or include part or all of the Licensed Software,
(ii) all Derivative Works based on the Licensed Software, (iii) all Upgrades;
and (iv) all Documentation related to the foregoing and all Derivative Works
based on the Documentation.
"LICENSED SOFTWARE" means the computer program and database that is
described in Schedule 1, in Source Code and/or Object Code as specified in
Schedule 1.
"LICENSEE SERVICES" means services provided by Licensee to its
customers that require use of or are based on the Licensed Software or Licensee
Products, including (a) access fees; (b) customer support services; (c) the
creation and distribution of Upgrades (including both basic and major software
maintenance services, such as error corrections, incidental or substantial
structural, functional, or performance improvements; and additions); (d)
consulting and design services to model and simulate particular designs for
customers; (e) customization, modification, and/or integration of Licensee
Products for specific customers; (f) direct training; and workshops and/or
seminars; and (g) collection of advertising revenues and product sales.
"LICENSEE TECHNOLOGY" means the software, hardware, works, inventions,
technology, data, materials, concepts or techniques created or procured by
Licensee independently from and without reference to the Licensed Software or
Intellectual Property owned by University.
"MANDATORY TERMS" means the: (i) terms set forth in Schedule 4 that
Licensee must include in all End User Agreements and Evaluation Agreements; and
(ii) any mandatory terms for third party products incorporated into the Licensed
Software, which terms University may provide to Licensee.
"NET SALES" means:
(a) with respect to licensee Products and Licensee Services, in either
case sold or transferred to any third party, the gross sales price actually
charged in the sale of such Licensee Product or Licensee Service (if Licensee or
any Sublicensee sells to an Affiliate, the normal non-discounted invoice price
to non-Affiliates shall be deemed the invoice price for purposes of this
Agreement), less:
(i) customary trade, quantity or cash discounts, rebates, and
non-affiliated brokers' or agents' commissions actually allowed and taken;
(ii) amounts repaid or credited to customers on account of rejections
or returns of specified products for which a Royalty was paid or payable under
this Agreement; and
(iii) freight and other transportation costs, including insurance
charges, and duties, tariffs, sales and excise taxes and other governmental
charges based directly on sales, turnover or delivery of the specified products
and actually paid or allowed; and
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(b) with respect to all Licensee Products and Licensee Services used or
consumed by Licensee or an Affiliate or Sublicensee of Licensee in the
manufacture or creation of another product, an amount equal to the gross list
sales price normally charged in the sale of such Licensee Product or Licensee
Service (if Licensee or any Sublicensee sells to an Affiliate, the normal
non-discounted invoice price to non-Affiliates shall be deemed the invoice price
for purposes of this Agreement), less the deductions, if any, as described in
subparts (a)(i) and (ii) above.
For purposes of this Agreement, a "sale" shall be deemed to occur upon the
earliest of (i) the date on which an End User Agreement or contract for the
provision of Licensee Services is executed, (ii) the date of an invoice for a
Licensee Product or Licensee Service sold or transferred to a third party,
(iii) the date on which a Licensee Product or Licensee Service is shipped for
delivery to, or first performed for, a third party, or (iv) the date on which a
Licensee Product or Licensee Service is used or consumed by Licensee, or an
Affiliate or Sublicensee of Licensee. If Licensee or any Affiliate or
Sublicensee transfers or sells any Licensee Product to any third party for
non-cash consideration, or for no consideration, except pursuant to a valid
Evaluation Agreement, the sale price shall be deemed to be (i) the gross list
sales price normally charged in the sale of such Licensee Product, or (ii) if
no such gross list sales price has been established, a commercially reasonable
price acceptable to the University.
"OBJECT CODE" means the machine-readable, compiled code for the
Licensed Software that is ready to run on a computer.
"ROYALTIES" means all amounts payable under Sections 3.1 and 3.2 of
this Agreement.
"SOURCE CODE" means the human-readable program commands for the
Licensed Software that are compiled to form the Object Code.
"SUBLICENSE" means any grant by Licensee of any rights to a Sublicensee
in accordance with Article 2 of this Agreement.
"SUBLICENSEE" means any person or entity to which a Sublicense is
granted in accordance with Article 2 of this Agreement.
"SYSTEM DOCUMENTATION" means any literature, programmer's notes and
other materials that specify or describe the functions, characteristics,
performance, structure, sequence, organization, and operation of the Licensed
Software or Licensee Product, and any updates, enhancements, extensions, or
revisions thereto.
"TERRITORY" means the territory set forth in Schedule 1.
"TECHNOLOGY" means the Licensed Software and all Intellectual Property
therein.
"UPGRADE" shall mean (i) any modification, correction, fix,
enhancement, new version, or change made in or to the original Licensee Product
created by or on behalf of Licensee, whether sold separately or provided to End
Users subscribing the Licensee Services, or (ii) any options, upgrades, new
functionality or any functionality not previously licensed by an End User that
is related to the Licensee Product, whether sold separately or provided to End
Users subscribing to the Licensee Services.
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ARTICLE 2
GRANT OF LICENSE
2.1 GRANT. Subject to Licensee's compliance with the terms and
conditions of this Agreement, University hereby grants to Licensee an exclusive
(unless terminated or modified as specified herein), royalty-bearing license,
within the Licensed Field and within the Territory, expressly limited to the
uses specifically set forth below:
(a) to promote, distribute, resell, install, maintain, support and
otherwise market the Object Code version of the Licensed Software as part of or
bundled with the Licensee Products to End Users in the Territory.
(b) to create Derivative Works based on the Licensed Software and
Documentation and/or to bundle or integrate the Licensed Software with other
software in order to create the Licensee Products.
(c) to copy the Licensed Software and Documentation as necessary to
exercise its rights pursuant to this Agreement. All such Copies of Licensed
Software shall contain the copyright notices and any other proprietary legends
(if applicable) that appear on Licensed Software or System Documentation.
(d) to directly or indirectly, either itself or through an authorized
intermediary, provide Licensee Services to third parties.
(e) only if rights to Source Code are specified in Schedule 1, to use,
copy, and create Derivative Works based on the Source Code version of the
Licensed Software solely for Licensee's own internal business purposes in order
to create the Licensee Products.
2.2 RESERVATIONS.
(a) Notwithstanding, anything set forth in this Agreement, University,
and its employees, agents, contractors, researchers, and students may use,
study, install, maintain, support, prepare Derivative Works based upon, copy,
distribute, and transmit the Licensed Software and Documentation for non-profit
purposes only (including, but not limited to, education and research (including
sponsored research)), and may sublicense, redistribute, or otherwise allow third
parties to use, study, install, maintain, support, prepare Derivative Works
based upon, copy, distribute, and transmit the Licensed Software and
Documentation for non-profit purposes only. University also reserves for itself
and for all other persons or entities to whom University from time to time grant
such rights all rights not expressly granted in this Agreement, including, but
not limited to the right to license, use, study, install, maintain, support,
prepare Derivative Works based upon, copy, distribute, and transmit the Licensed
Software and Documentation for non-profit and commercial purposes outside the
Licensed Field and outside the Territory. No right or license to the Licensee
shall be implied by estoppel or otherwise, other than the rights and licenses
expressly granted in this Agreement.
(b) U.S. Government. The Technology may have been conceived with the
use of United States government funds under a grant from an agency or department
of the United States Government. Therefore, there is reserved from the rights
granted hereunder the rights, if any, of the United States government to use the
Technology for its own purposes in such manner to which it is entitled.
University further reserves for itself the right to grant to the United States
Government a royalty-free license or licenses, with the right to sublicense, to
the Technology to the extent that such grant or license(s) is or may be required
by funding agreements between the University and the United States Government
relating to the Licensed Software.
(c) All rights to any Technology or other Intellectual Property not
expressly and specifically granted to Licensee hereunder or reserved to third
parties are hereby expressly reserved to the University, and such Technology is
licensed under this Agreement only to the extent owned by, or assigned to,
University. No title in or to the Technology is transferred to Licensee pursuant
to this Agreement. The
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University does not and shall not have any obligation to pay Licensee a royalty
or any other fee for any of the rights reserved to the University in this
Section 2.2, or granted to the University pursuant to Sections 2.9 and 5.3.
(d) Future University-owned Software. University, and its employees,
agents, contractors, researchers or students, may create (i) Derivative Works of
the Licensed Software and (ii) new software programs that may be related to,
or use ideas, concepts, inventions, or techniques that are discovered or first
reduced to practice in connection with the Licensed Software ((i) and (ii) are,
collectively, "New University Works"). Nothing in this Agreement will be
construed to restrict University's right to use, license, and/or commercially
exploit the New University Works, internally or externally, directly or
indirectly through third parties. At any time, University may, in its sole
discretion, which shall not be contested by Licensee, determine what, if any,
New University Works it will make available for licensing to Licensee or to any
other third party. University developed Derivative Works will be made available
under this agreement. University is not obligated to create such Derivative
Works.
(e) Licensee's intended use of Software. Licensee will continue
to provide access to the NAT website for educational and research purposes, at
no cost to these users. Licensee will develop, host and maintain the commercial
version of NAT with features not included in the educational version of NAT.
Upon accessing the current site (▇▇▇.▇▇▇.▇▇▇▇.▇▇▇), users will be notified that
they are being redirected to the commercial site developed by Licensee under
license from the Board of Trustees of the University of Illinois. Credit and
Attribution of Licensed Software will be handled according to the stipulations
as defined in Section 8.2 below.
(f) Restrictions on Use. Notwithstanding LICENSEE agrees not to use the
Licensee website, in (i) a manner that would be likely to offend the general
public or reflect unfavorably on the good name, goodwill, reputation, and image
of UNIVERSITY or would be contrary to applicable laws; and/or (ii) conjunction
with alcohol, drug abuse, tobacco, gambling or sexually-oriented marks, logos,
products, or services.
2.3 OTHER RIGHTS. University previously granted the licenses and other
rights with respect to the Technology specified on Schedule 2 attached, and the
rights granted in Section 2.1 above are subject to all of the terms and
conditions of those licenses and other rights.
2.4 SUBLICENSES.
(a) Subject to and conditioned on Licensee's compliance with the
restrictions and obligations contained in this Agreement, Licensee may
distribute and Sublicense the Object Code version of the Licensee Products and
the End User Documentation to End Users. Licensee will provide the Licensee
Products in its own name and on its own behalf.
(b) Licensee may not Sublicense or otherwise distribute the Licensed
Software on a "stand alone" basis, but only as an integral component of Licensee
Products.
(c) Licensee shall not grant any Sublicenses in, or otherwise
distribute or provide any third party access to the Source Code Version of the
Licensed Software without University's prior written consent. If Licensee
desires to Sublicense the Source Code (including pursuant to a standard source
code escrow agreement), Licensee will notify University, and the parties will
negotiate in good faith terms consistent with the terms and conditions of this
Agreement and royalty rate for such Sublicense.
(d) End User Agreements. Licensee shall not grant any Sublicenses in,
or otherwise distribute or provide any third party access to the Licensee
Products except pursuant to the terms and conditions of: (i) a valid End User
Agreement; or (ii) a valid Evaluation Agreement in the event that the Licensee
Products is provided to the Customer solely for evaluation purposes. Licensee
may use either the Mandatory terms provided by University, or Licensee's own
terms provided that such terms protect University's rights to the same extent as
this Agreement in general and the relevant Mandatory Terms in particular,
including substantially the same limitations on the scope of the license,
confidentiality protections, and limitations on warranty and liability. If
Licensee modifies the Mandatory Terms without
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University's written permission, or substitutes Licensee's own terms for the
Mandatory Terms, Licensee will defend, indemnify and hold harmless University,
its Affiliates and its and their licensors against any damage, loss, liability
or expense, including its reasonable attorneys' fees, that University, its
Affiliates or its and their licensors may incur as a result of such
modification or substitution (provided that such damage, loss, liability, or
expense would have been avoided by use of the Mandatory Terms without
modification or substitution). Licensee will effectively enforce against all
End Users within the Territory the provisions of any End User Agreement or
Evaluation Agreement to the extent that such provisions affect University's
rights or interests.
2.5 DELIVERY. University will deliver to Licensee one (1) copy of the
Licensed Software and any Documentation that University has in its possession
and control, in the best form available as of the Effective Date, on a schedule
and in a format to be mutually agreed between University and Licensee, in Source
Code and/or Object Code form as specified in Schedule 1.
2.8 LICENSE FROM LICENSEE TO UNIVERSITY FOR LICENSEE PRODUCTS.
(a) Grant of License to University for Licensee Products: Licensee
hereby grants to University, and its employees, agents, contractors,
researchers, and students a nontransferable, royalty-free, non-exclusive,
worldwide, irrevocable (except that such license may be terminated for default
in accordance with Section 7.2) license to use, study, install, maintain,
support, prepare Derivative Works based upon, and copy the Licensed Software for
its own non-profit internal purposes only (including, but not limited to
education and research (including sponsored research)), provided that it does
not sublicense, redistribute, or otherwise allow third parties to use them
directly or indirectly for commercial purposes, whether on a time sharing,
remote job entry or service bureau arrangement, such Licensee Products thereof
as may be created by or on behalf of Licensee. University has no right to
sublicense or otherwise market, distribute, or commercially exploit any such
Licensee Products in any manner without the prior written consent of Licensee.
(b) Delivery: Within thirty (30) days after Licensee's first commercial
sale, lease, or license of any Licensee Product(s) (including each Upgrade),
Licensee will deliver to University, to the attention of the Head of the [insert
name of Department or Unit], one (1) copy of such Licensee Product(s), in a form
that enables University to make copies as permitted by Section 3.1 of this
Agreement, but otherwise in the same form as provided to Licensee's End User
customers. Licensee will provide the same level of technical support to
University that Licensee provides to its other End User customers who do not
purchase a separate contract for support services for such Licensee Product(s)
or Upgrades.
2.9 NO SUPPORT SERVICES. University shall have no obligation to offer
support services to Licensee, and nothing contained herein shall be interpreted
so as to require University to provide any developer support, maintenance,
installation services, debugging, consultation, technical support or end-user
support of any kind.
ARTICLE 3
PAYMENTS
3.1. ROYALTIES. For the licenses granted in Section 2.1 of this
Agreement, Licensee shall:
(a) within three (3) business days of the execution of this Agreement,
pay University a licensing fee in the amount set forth on Schedule 3 (the
"LICENSING FEE");
(b) pay University a Royalty on Net Sales of Licensee Products sold by
Licensee or any of its Affiliates in the percentage set forth on Schedule 3;
(c) pay University a Royalty on Net Sales of Licensee Services sold by
Licensee or any of its Affiliates in the percentage set forth on Schedule 3; and
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(d) pay University a Royalty on Sublicenses equal to the percentage set
forth on Schedule 3 Royalty on Sublicenses which is the Net Sales of Licensee
Products and Licensee Services sold by any Sublicensee (in addition to the
Royalty due pursuant to Sections 3.1(b) and (c)).
3.2 MINIMUM ROYALTIES. If total Royalties actually paid to University
for the period set forth on Schedule 3 (a "ROYALTY PERIOD") beginning on or
after the date set forth in Schedule 3 are less than the amount set forth on
Schedule 3. Licensee shall pay University an amount (the "MINIMUM ROYALTY") for
that Royalty Period equal to the difference between the Royalty actually paid
for such Royalty Period and the Minimum Royalty owing for that Royalty Period.
If this License terminates for any reason during any Royalty Period for which a
Minimum Royalty is owing, the Minimum Royalty will be pro rated for the number
of days actually elapsed during such Royalty Period and will be due and owing
upon termination.
3.3 RESEARCH AND DEVELOPMENT EXPENDITURE. Licensee agrees to spend an
amount not less than the amount set forth on Schedule 3 for the periods
indicated on such Schedule in performing research and development with respect
to the Technology.
3.4 MILESTONE PAYMENTS. Licensee agrees to make the payments to
University set forth on Schedule 3 (the "MILESTONE PAYMENTS") within thirty (30)
days after the occurrence of each event set forth on such Schedule.
3.5 CALCULATION AND PAYMENT ON ROYALTIES.
(a) Royalties shall be calculated for each Royalty Period as of the
last day of each such Period. Payment of Royalties (and, if applicable, Minimum
Royalties) with respect to each calendar quarter shall be due within forty-five
(45) days after the end of Royalty Period, beginning with the earlier of (i) the
Royalty Period in which the first sale of a Licensee Product or Licensee Service
occurs, or (ii) the Royalty Period for which Minimum Royalties are due.
(b) At the same time that it makes payment of Royalties (and, if
applicable, Minimum Royalties) due with respect to a Royalty Period, Licensee
shall deliver to University a true and complete accounting of sales of any
Licensee Product or Licensee Service and receipts from those sales by Licensee,
its Affiliates and its Sublicensees during such Royalty Period, with a separate
accounting for each Licensee Product of sales and receipts by country and a
detailed calculation of the Royalty payment due University for such calendar
quarter, in each case in form and substance reasonably satisfactory to
University. If no sales of Licensee Products, Licensee Services, or Sublicense
payments were made in such Royalty Period, then Licensee's statement shall so
state.
(c) Licensee will immediately notify University of the occurrence of
any event giving rise to Licensee's obligations to make payments pursuant to
Section 3.4 above.
3.6 RECORDS. Licensee shall keep, and shall cause its Affiliates and
Sublicensees to keep, accurate records in sufficient detail to permit the
Royalties and Minimum Royalties payable under this Agreement to be determined.
During the terms of this Agreement and for a period of five (5) years following
termination of this Agreement (or such longer period as required by applicable
law), Licensee shall permit, and shall cause each of its Affiliates and
Sublicensees to permit, upon reasonable notice to Licensee, its books and
records regarding the sale of Licensee Products and Licensee Services to be
copied and audited or otherwise examined from time to time, as the request of
University, during normal business hours by University or any representative of
University. Such examination shall be made at University's expense, except that
if such examination discloses a discrepancy of three percent (3%) or more in the
amount of Royalties due University, then Licensee shall reimburse University for
the cost of such examination, including any professional fees incurred by
University. In connection with any such examination or copying of books or
records University or such representative of University shall examine only such
information as is required to verify Licensee's compliance under this Agreement.
3.7 PAYMENTS. All amounts owing to University under this Agreement
shall be paid in currency which is legal tender in the United States of America,
by check or other instrument representing
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immediately available funds payable to The University of Illinois. If Licensee,
any of its Affiliates or any Sublicensee receives payment in a currency other
than currency which is legal tender in the United States of America in
connection with a transaction giving rise to a payment obligation under this
Agreement, then the payment required to be made by Licensee under this
Agreement shall be converted, prior to payment, into the United States dollars
at the applicable rate of exchange of Citibank, N.A., in New York, New York, on
the last day of the calendar quarter in which such transaction occurred.
3.8. OVERDUE PAYMENTS. Payments due to the University under this
Agreement shall if not paid when due bear simple interest at the lower of the
annual rate of 18% or the highest rate permitted by law, calculated on the basis
of the number of days actually elapsed in a 365 day year, beginning on the due
date and ending on the day prior to the day on which payment is made in full.
Interest accruing under this Section shall be due University on demand. The
accrual or receipt by University of interest under this Section shall not
constitute a waiver by University of any right it may otherwise have to declare
a breach of or default under this Agreement and to terminate this Agreement.
3.9. TERMINATION REPORT AND PAYMENT. Within sixty (60) days after the
date of termination of this Agreement, Licensee shall make a written report to
University which report shall state the number, description, and amount of
Licensee Products and Licensee Services sold by Licensee, its Affiliates or any
Sublicensee upon which Royalties are payable hereunder but which were not
previously reported to University, a calculation of the Net Sales of such
Licensee Products and Licensee Services, and a calculation of the Royalty,
payment due University for such Licensee Products and Licensee Services, all in
such form and containing such substance as may have previously been provided to
University pursuant to Section 3.5(b) above. Concurrent with the making of such
report, Licensee shall make the Royalty payment due University for such period.
3.10. COMMERCIALIZATION; PROGRESS REPORT. Licensee, its Affiliates and
its Sublicensees shall use their best efforts to bring one or more Licensee
Products to market and to develop such markets through a thorough, vigorous and
diligent program for the commercial exploitation of the Technology. In addition,
Licensee shall deliver to University:
(a) by the dates set forth on Schedule 3, a detailed research and
development business plan with respect to Licensee's proposed exploitation of
the Technology for at least the first three (3) years of the term of this
Agreement, which plan shall include, at a minimum, (i) proposed timetable(s)
with respect to achieving the milestones and government approvals that are
required or necessary to develop, manufacture, sell, market or otherwise exploit
the Licensee Products and Technology, and (ii) an analysis of the capital
investment needed to implement such plan, including financing, equipment,
facilities, number and type of personnel and timetable for each phase of
research, development and exploitation of the Technology.
(b) promptly as made available by Licensee to any third party, any
updates, revisions, supplements, redrafts or new editions of such research and
development business plan or any other business plan or analysis prepared by,
for or at the request of Licensee at any time or from time to time during the
term of this Agreement; and
(c) on or before January 30 of each year during the term of this
Agreement, a written report (in the same detail required by Section 3.10(a)
above) that updates the information contained in the most recent written report
delivered to University under this Agreement and projects activity toward
commercialization of Licensee Products anticipated for the next reporting year.
3.11 LEGAL AND CONSULTING FEES. Licensee agrees, within thirty (30)
days following receipt of appropriate documentation and invoices therefore from
University, to reimburse University for all reasonable legal and/or consulting
fees and expenses incurred by the University in connection with the negotiation
and execution of this Agreement, which amount is set forth on Schedule 3.
3.12. NO REFUNDS OR CREDITS. Except as otherwise expressly and
specifically set forth in this Agreement, (i) any amount paid to the University
pursuant to this Agreement shall be non-refundable under all circumstances, and
(ii) any amount paid with respect to an obligation of Licensee under this
8
Agreement shall not be credited against any other amount paid with respect to
any other obligation of Licensee under this Agreement.
3.13 EQUITY RIGHTS. As further consideration for the grant of the
license rights set forth in this Agreement, Licensee hereby agrees to issue and
sell to University, on the price and terms, for the number and type of equity
securities of Licensee, and rights to acquire equity securities of Licensee, and
with such other related rights, preferences and privileges with respect to such
equity securities, all as set forth on Schedule 3.
ARTICLE 4
WARRANTIES; INDEMNIFICATION
4.1 LIMITED REPRESENTATION. University represents that it has the
requisite power and authority to execute and deliver this Agreement and to
perform its obligations hereunder.
4.2 DISCLAIMER OF WARRANTIES. Licensee acknowledges that: (i) the
Licensed Software may not satisfy all of Licensee's or its customers'
requirements; and (ii) the use or receipt of the Licensed Software may not be
uninterrupted or error-free. Licensee further acknowledges that: (i) the
royalties and other charges contemplated under this Agreement are based on the
limited warranty, limited remedy, disclaimer and liability limitation provisions
specified in this Article 4; and (ii) such royalties and other charges would be
substantially higher if any of these provisions were unenforceable. EXCEPT AS
SPECIFICALLY SET FORTH IN SECTION 4.1 ABOVE, UNIVERSITY DISCLAIMS ANY AND ALL
WARRANTIES OF ANY KIND OR NATURE, WHETHER EXPRESS OR IMPLIED, RELATING TO
PERFORMANCE, MARKETABILITY, TITLE OR OTHERWISE IN ANY RESPECT RELATED TO THE
TECHNOLOGY, LICENSEE PRODUCTS, OR LICENSEE SERVICES. UNIVERSITY FURTHER
DISCLAIMS ANY EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, AND DISCLAIMS ANY EXPRESS OR IMPLIED WARRANTY REGARDING
INFRINGEMENT OF ANY PATENT, COPYRIGHT, TRADEMARK OR OTHER RIGHTS OF THIRD
PARTIES IN CONNECTION WITH THE PRACTICE OF THE TECHNOLOGY, OR THE MAKING, USING
OR SELLING OR OTHER DISTRIBUTION OF LICENSEE PRODUCTS OR LICENSEE SERVICES BY
ANY PERSON OR ENTITY. LICENSEE, AND ITS AFFILIATES AND SUBLICENSEES, ASSUME THE
ENTIRE RISK AND RESPONSIBILITY FOR THE SAFETY, EFFICACY PERFORMANCE, DESIGN,
MARKETABILITY, TITLE AND QUALITY OF ALL LICENSEE PRODUCTS. Without limiting the
generality of the foregoing, University does not warrant (a) the accuracy of any
information with respect to any Technology, and (b) the accuracy, safety, or
usefulness for any purpose of the Technology, Licensee Products, or Licensee
Services. Nothing contained in this Agreement shall be construed as either a
warranty or representation by University as to the validity or scope of any
Intellectual Property Right in the Technology.
4.3. LIMITATION OF LIABILITY. UNIVERSITY ASSUMES NO LIABILITY IN
RESPECT OF ANY INFRINGEMENT OF ANY PATENT OR OTHER RIGHT OF THIRD PARTIES DUE TO
THE ACTIVITIES OF LICENSEE, ANY OF ITS AFFILIATES OR ANY SUBLICENSEE UNDER THIS
AGREEMENT. IN NO EVENT SHALL UNIVERSITY OR ITS AFFILIATES, INCLUDING ITS
TRUSTEES, DIRECTORS, OFFICERS, FACULTY, STAFF, STUDENTS, EMPLOYEES, CONSULTANTS
AND AGENTS (COLLECTIVELY, THE "AGENTS"), BE LIABLE FOR CONSEQUENTIAL, INDIRECT,
SPECIAL PUNITIVE OR INCIDENTAL DAMAGES OR LOST PROFITS, WHETHER FORESEEABLE OR
UNFORSEEABLE, BASED ON CLAIMS OF LICENSEE, ITS CUSTOMERS, OR ANY OTHER PARTY
ARISING OUT OF BREACH OR FAILURE OF EXPRESS OR IMPLIED WARRANTY, BREACH OF
CONTRACT, MISREPRESENTATION, NEGLIGENCE, STRICT LIABILITY IN TORT, FAILURE OF
ANY REMEDY TO ACHIEVE ITS ESSENTIAL PURPOSE OR OTHERWISE. The above limitations
on liability apply even though University of its Affiliates, or any of their
Agents, may have been advised of the possibility of such damage Licensee shall
not, and shall require that its Affiliates and Sublicensees do not, make any
statements, representations or warranties or accept any liabilities or
responsibilities
9
whatsoever with regard to any person or entity that are inconsistent with any
disclaimer or limitation included in this Article 4.4. Indemnification.
(a) None of the University, any of its Affiliates, or any of their
respective Agents (each an "INDEMNIFIED PERSON") shall have any liability or
responsibility whatsoever to Licensee, any of its Affiliates, any Sublicensee or
any other person or entity for or on account of (and Licensee agrees and
covenants, and agrees to cause each of its Affiliates and Sublicensees to agree
and covenant not to ▇▇▇ any Indemnified Person in connection with) any injury,
loss, or damage of any kind or nature, sustained by, or any damage assessed or
asserted against, or any other liability incurred by or imposed upon, Licensee,
any of its Affiliates or Sublicensees or any other person or entity, whether
direct, indirect, special, punitive, incidental, consequential or otherwise
arising under any legal theory (and further excluding without limitation any
existing or anticipated profits or opportunities for profits lost by Licensee,
any of its Affiliates or any Sublicensee), arising out of or in connection with
or resulting from (i) the production, use or sale of the Licensee Products or
provision of Licensee Services by Licensee, any of its Affiliates or its
Sublicensees, (ii) the use of any Technology by Licensee, any of its Affiliates
or any Sublicensee, (iii) any advertising or other promotional activities with
respect to either of the foregoing, or (iv) the production, use or sale of any
product, process or service identified, characterized or otherwise developed by
Licensee or any Affiliate or Sublicensee with the aid of the Technology.
Licensee shall indemnify and hold each Indemnified Person harmless against all
claims, demands, losses, damages or penalties (including but not limited to
reasonable attorney's fees and expenses at the pretrial, trial or appellate
level) made against any Indemnified Person with respect to items (i) through
(iv) above, whether or not such claims are groundless or without merit or basis.
(b) Licensee, for itself and each of its Affiliates and Sublicensees,
agrees at all times to maintain casualty, liability, professional liability and
product liability insurance at such times and in such amounts as are reasonably
adequate to ensure that Licensee can meet its obligations to University pursuant
to this Article 4, the nature and extent of which insurance shall be
commensurate with usual and customary industry practices for similarly situated
companies. At University's request, Licensee will supply University from time to
time with certificates of insurance for each such policy, and will notify
University in writing at least thirty (30) days prior to any termination of or
change in coverage under any such policies. Licensee agrees to obtain the
foregoing required insurance from reputable and financially secure insurance
carriers.
(c) Licensee's obligations under this Article 4 shall survive the
expiration or earlier termination of all or any part of this Agreement.
ARTICLE 5
CONFIDENTIALITY AND PROPRIETARY RIGHTS
5.1 CONFIDENTIALITY.
(a) Subject to Section 5.5(b) below, Licensee shall protect (and agrees
to cause its Affiliates and Sublicensees to protect) the confidentiality of all
proprietary information with respect to the Technology, the Licensed Software in
Source Code form, and System Documentation ("Confidential Information").
Licensee further agrees to treat (and agrees to cause its Affiliates and
Sublicensees to treat) Schedule 3 to this Agreement as Confidential Information.
Licensee shall take, and shall cause its Affiliates and Sublicensees to
safeguard the confidentiality of the Confidential Information with at least the
same degree of care that it protects its own similar proprietary and
confidential information, but no less than a reasonable standard of care, and to
take such actions to protect the Confidential Information as the University may
reasonably request from time to time. Licensee will not disclose, de-compile,
disassemble nor otherwise reverse engineer the Licensed Software. University
acknowledges that Licensee may find it beneficial to disclose information
provided by University during the conduct of Licensee's business. Under such
circumstances, Licensee may make such information available to third parties,
provided that Licensee shall first obtain from the recipient(s) a fully-executed
confidentiality agreement which is at least as restrictive as the
confidentiality agreement Licensee employs to protect its own most valuable
trade secrets. Licensee shall notify University promptly in writing of the
10
circumstances surrounding any reasonably suspected possession, use or knowledge
of the Source Code and/or System Documentation, or any part thereof, by any
person or entity other than those authorized by this Agreement.
(b) Licensee shall not be bound by the provisions of Section 5.1(a)
with respect to information which Licensee can demonstrate through documentary
evidence (i) was previously known to the recipient at the time of disclosure,
(ii) is in the public domain at the time of disclosure, (iii) becomes a part of
the public domain after the time of disclosure, other than through disclosure by
Licensee, or any Affiliate or Sublicensee or a third party who is under an
agreement of confidentiality with respect to the subject information, (iv) is
independently developed without utilization of or reference to the Confidential
Information, or (v) is required to be disclosed by law or court order, provided
that Licensee promptly notifies University and provides University an
opportunity to seek a protective order or otherwise limit such disclosure.
(c) The obligations of Licensee and University under Sections 5.1(a),
(b) and (c) shall survive the expiration or earlier termination of all or any
part of this Agreement.
(d) Licensee and University acknowledge that they may have previously
entered into one or more confidentiality and non-use agreements with respect to
some or all of the Technology (collectively, the "CONFIDENTIALITY AGREEMENTS").
The parties agree that, to the extent this Agreement conflicts with the terms of
any of the Confidentiality Agreements, this Agreement shall supersede the
Confidentiality Agreements and be binding on University and Licensee with
respect to the information covered under the terms of this Article 5, without
otherwise limiting the binding nature and effect of the Confidentiality
Agreements.
5.2 University shall retain ownership of all Intellectual Property in
the Technology, Licensed Software, and Derivative Works of the Licensed Software
created by University, subject only to the rights and licenses specifically
granted herein. Licensee shall retain ownership of all Intellectual Property in
any Derivative Works of Licensed Software created by Licensee, subject to
University's underlying rights in the Technology and the rights and licenses
specifically granted herein.
5.3 Licensee and its licensors will retain exclusive ownership of the
Licensee Technology and all Intellectual Property therein. Any Intellectual
Property in the ideas, concepts, inventions or techniques that Licensee may use,
conceive or first reduce to practice in connection with developing the Licensee
Products ("Product Concepts"), are and will be the exclusive property of
Licensee (except to the extent that they consist of, include, or embody the
Licensed Software or University's Intellectual Property therein). Licensee
hereby grants University a transferable, sub-licensable, perpetual, world-wide,
royalty-free license to make, use, sell, practice, and offer for sale and import
any process, technology, software, article, kit, equipment, system, unit,
product or component part covered by the Product Concepts or a claim of any
patent in any part of the Product Concepts. At University's request, Licensee
will provide all documentation and information necessary for University to enjoy
its rights under this Section.
ARTICLE 6
INFRINGEMENT
6.1 NOTIFICATION. If either party becomes aware of the infringement of
any copyright in the Licensed Software granted to Licensee pursuant to Schedule
5 (if any), it shall immediately notify the other in writing of all details
available. University and Licensee shall then use good faith efforts to
determine within sixty (60) days of the notice referred to above, whether and in
what manner to proceed against such infringer in accordance with this Section 6,
and a mutually acceptable allocation of any costs and recoveries resulting from
such action. If the parties are unable to so agree, the University shall have
the first right to determine how to proceed against such infringer in accordance
with this Section 6.
6.2 UNIVERSITY RIGHT TO PROSECUTE. Subject to Section 6.1 above, if a
third party infringes or allegedly infringes any copyright in the Licensed
Software granted to Licensee pursuant to Schedule 5 (if any), University may, at
University's discretion, proceed against the infringer in the name of University
11
circumstances surrounding any reasonably suspected possession, use or knowledge
of the Source Code and/or System Documentation, or any part thereof, by any
person or entity other than those authorized by this Agreement.
(b) Licensee shall not be bound by the provisions of Section 5.1(a)
with respect to information which Licensee can demonstrate through documentary
evidence (i) was previously known to the recipient at the time of disclosure,
(ii) is in the public domain at the time of disclosure, (iii) becomes a part of
the public domain after the time of disclosure, other than through disclosure by
Licensee, or any Affiliate or Sublicensee or a third party who is under an
agreement of confidentiality with respect to the subject information, (iv) is
independently developed without utilization of or reference to the Confidential
Information, or (v) is required to be disclosed by law or court order, provided
that Licensee promptly notifies University and provides University an
opportunity to seek a protective order or otherwise limit such disclosure.
(c) The obligations of Licensee and University under Sections 5.1(a),
(b) and (c) shall survive the expiration or earlier termination of all or any
part of this Agreement.
(d) Licensee and University acknowledge that they may have previously
entered into one or more confidentiality and non-use agreements with respect to
some or all of the Technology (collectively, the "CONFIDENTIALITY AGREEMENTS").
The parties agree that, to the extent this Agreement conflicts with the terms of
any of the Confidentiality Agreements, this Agreement shall supersede the
Confidentiality Agreements and be binding on University and Licensee with
respect to the information covered under the terms of this Article 5, without
otherwise limiting the binding nature and effect of the Confidentiality
Agreements.
5.2 University shall retain ownership of all Intellectual Property in
the Technology, Licensed Software, and Derivative Works of the Licensed Software
created by University, subject only to the rights and licenses specifically
granted herein. Licensee shall retain ownership of all Intellectual Property in
any Derivative Works of Licensed Software created by Licensee, subject to
University's underlying rights in the Technology and the rights and licenses
specifically granted herein.
5.3 Licensee and its licensors will retain exclusive ownership of the
Licensee Technology and all Intellectual Property therein. Any Intellectual
Property in the ideas, concepts, inventions or techniques that Licensee may use,
conceive or first reduce to practice in connection with developing the Licensee
Products ("Product Concepts"), are and will be the exclusive property of
Licensee (except to the extent that they consist of, include, or embody the
Licensed Software or University's Intellectual Property therein). Licensee
hereby grants University a transferable, sub-licensable, perpetual, world-wide,
royalty-free license to make, use, sell, practice, and offer for sale and import
any process, technology, software, article, kit, equipment, system, unit,
product or component part covered by the Product Concepts or a claim of any
patent in any part of the Product Concepts. At University's request, Licensee
will provide all documentation and information necessary for University to enjoy
its rights under this Section.
ARTICLE 6
INFRINGEMENT
6.1 NOTIFICATION. If either party becomes aware of the infringement of
any copyright in the Licensed Software granted to Licensee pursuant to Schedule
5 (if any), it shall immediately notify the other in writing of all details
available. University and Licensee shall then use good faith efforts to
determine within sixty (60) days of the notice referred to above, whether and in
what manner to proceed against such infringer in accordance with this Section 6,
and a mutually acceptable allocation of any costs and recoveries resulting from
such action. If the parties are unable to so agree, the University shall have
the first right to determine how to proceed against such infringer in accordance
with this Section 6.
6.2 UNIVERSITY RIGHT TO PROSECUTE. Subject to Section 6.1 above, if a
third party infringes or allegedly infringes any copyright in the Licensed
Software granted to Licensee pursuant to Schedule 5 (if any), University may, at
University's discretion, proceed against the infringer in the name of University
11
or Licensee, and will notify Licensee of its determination in this regard
within forty five (45) days of the end of the negotiation period set forth in
Section 6.1 above. Licensee will cooperate in all reasonable respects with
University and execute any documents and instruments necessary or appropriate
for University to exercise its rights under this Section 6.2. Any actions by
University pursuant to this clause shall be at University's own expense.
Recoveries collected by University shall be paid (i) first, to University in
the amount of all reasonable out of pocket costs and expenses incurred by
University in such action, (ii) then to Licensee to reimburse Licensee for its
documented and reasonable out of pocket costs and expenses incurred in
cooperating with University in such action as requested by University, and
(iii) the remainder, if any, shall be paid sixty percent (60%) to University
and forty percent (40%) to Licensee.
6.3. LICENSEE RIGHT TO PROSECUTE. Subject to Sections 6.1 and 6.2
above, if a third party infringes or allegedly infringes any copyright in the
Licensed Software granted to Licensee pursuant to Schedule 5 (if any), Licensee
may prosecute the infringer by appropriate legal proceedings, provided that
Licensee shall employ counsel reasonably satisfactory to University, shall
inform University of all material developments in such proceedings, and shall
provide University with all correspondence and pleadings related to any such
action. Licensee shall be responsible for all costs and expenses of any
enforcement activities, including legal proceedings, against infringers which
Licensee initiates. University agrees to cooperate in all reasonable respects
with any enforcement proceedings at the request of Licensee, and at Licensee's
expense. University may be represented by University's counsel in any such legal
proceedings, at University's own expense (subject to reimbursement under this
Section 6.3), acting in any advisory but not controlling capacity. The
prosecution, settlement, or abandonment of any proceedings under this Section
shall be at Licensee's reasonable discretion, provided that Licensee shall not
have any right to surrender any of University's rights to the Technology or to
grant any infringer any rights to the Technology other than a Sublicense subject
to the conditions which would apply to the grant of any other Sublicense.
Recoveries collected by Licensee shall be paid (i) first, to Licensee in the
amount of all reasonable out of pocket costs and expenses incurred by Licensee
in such action, (ii) then to University to reimburse University for its
documented and reasonable out of pocket costs and expenses incurred in
cooperating with Licensee in such action as requested by Licensee, and for
counsel to University if University elects to be represented by counsel in such
action pursuant to this Section 6.3, and (iii) the remainder, if any, shall be
paid sixty percent (60%) to Licensee and forty percent (40%) to University.
ARTICLE 7
TERMINATION
7.1. TERM. This Agreement and the license rights granted herein shall
become effective as of the Effective Date and shall remain in effect for the
term set forth in Schedule 3, unless earlier terminated as specified herein.
7.2 UNIVERSITY RIGHT TO TERMINATE. University shall have the right
(without prejudice to any of its other rights conferred on it by this Agreement
or otherwise) to terminate this Agreement if Licensee or any of its Affiliates:
(a) is in default in payment of any amount or other consideration or
reimbursement required under this Agreement, or the making any reports required
to be made by Licensee, its Affiliates or Sublicensees pursuant to this
Agreement, and Licensee fails to remedy any such default within ten (10) days
after written notice thereof by University;
(b) is in breach of or defaults with respect to any other provision of
this Agreement and Licensee fails to remedy any such breach or default within
thirty (30) days after written notice thereof by University;
(c) makes any materially false report; or
12
(d) commences a voluntary case as a debtor under the Bankruptcy Code of
the United States or any successor statute (the "BANKRUPTCY CODE"), or if an
involuntary case is commenced against Licensee under the Bankruptcy Code and the
petition in such case is not dismissed within forty-five (45) days of the
commencement of the case, or if an order for relief shall be entered in such
case, or if the same or any similar circumstance shall occur under the laws of
any foreign jurisdiction.
At the election of University exercised in its sole discretion by
written notice to Licensee, and in lieu of terminating this Agreement,
University may either (i) declare the license rights granted under this
Agreement to Licensee and its Affiliates to be non-exclusive, and grant to such
third parties determines any and all additional non-exclusive rights to the
Technology as the University shall determine in its sole discretion, or (ii)
otherwise continue the rights of Licensee under this Agreement on such other
terms and conditions as University shall determine in its sole discretion.
7.3 LICENSEE RIGHT TO TERMINATE. Licensee may terminate this Agreement
at any time by written notice to University at least ninety (90) days prior to
the termination date specified in the notice.
7.4 EFFECT OF TERMINATION.
(a) If this Agreement terminates for any reason, on the effective date
of termination Licensee shall immediately cease and shall cause each of its
Affiliates and, to the extent required hereunder its Sublicensees, to
immediately cease using, making, having made and selling the Technology,
Licensee Products, Licensee Services and shall return to University, or deliver
or destroy as University directs, the Technology then in its possession.
(b) Notwithstanding the termination or expiration of this Agreement or
any portion of this Agreement, the following provisions of this Agreement shall
survive such termination:
(i) Licensee's obligation to pay any amount due pursuant to this
Agreement that is accrued and remaining unpaid under the terms of this
Agreement prior to such termination (including without limitation the
delivery and continuing benefits, if any, of any Equity Rights);
(ii) Section 3.9, Article 4, Article 5, Section 6.2 (to the extent
proceedings have been initiated), this Section 7.4 and Article 9 below;
(iii) any cause of action or claim of Licensee or University,
accrued or to accrue, because of any breach or default of this
Agreement by the other party.
(c) Effect of Termination on Licensee's End Users. Upon termination of
this Agreement for any reason, and provided that an End User is in compliance in
all material respects with the terms of its End User Agreement as in effect on
the date of termination, such End User Agreement shall continue in full force
and effect in accordance with its terms, provided that in no event shall
University have any obligations of any nature whatsoever with respect to any
past, current or future obligations that Licensee may have had, or may in the
future have, for the payment or performance of any obligations owing to End User
pursuant to such End User Agreement. Licensee agrees not to enter into any new
agreements or renew old agreements with respect to the Licensed Software after
the date of termination. Licensee will cease use of the Trademarks and will not
publish or use in any manner any further advertisements or promotional materials
after termination. Termination of this Agreement shall not terminate Licensee's
obligation to pay University accrued royalties due under the terms of this
Agreement, even though such royalties may be received by Licensee after the
termination of this Agreement.
13
ARTICLE 8
ADVERTISING AND CONFLICTS
8.1 ADVERTISING. Except as provided in Section 8.2 below, Licensee
shall not use (and shall prohibit its Affiliates and Sublicensees from using)
the names of University or any of its Affiliates or Agents, or any adaptation
thereof, in any commercial activity, marketing, advertising or sales brochures
without the prior written consent of University, which consent may be granted or
withheld in such party's sole and complete discretion. Notwithstanding the
foregoing, Licensee may use the name of University in a non-misleading fashion
in any securities reports required to be filed with the Securities and Exchange
Commission, or to the extent legally required or permitted in offering memoranda
or other documentation in connection with the sale of securities, financial
reports and information provided to Licensee's directors, stockholders,
prospective investors, members and their respective Affiliates, provided that
University is given advance notice of such use.
8.2 CREDIT AND ATTRIBUTION. University believes it is important that
users of Licensee Products recognize that the Licensed Software originated at
the University of Illinois at Urbana-Champaign. University requires, and
Licensee agrees to include the statement of identification and attribution (or
such alternate statement that provides
similar identification) as set forth in
Schedule 3. Licensee agrees to use reasonable efforts to incorporate the above
statement into its Licensee Product(s) either in (i) a splash screen that
automatically comes on-line when End Users access Licensee Products; or (ii) a
computer screen display (such as an "about" screen, "copyright notice" screen,
or "help" screen) that can be accessed voluntarily by End Users when using
Licensee Products. Licensee agrees to use reasonable efforts to provide to
University one (1) example of such "splash screens", "about boxes", and other
reproductions of all notices, copyrights and logos prior to distribution of the
Licensee Products for approval, to the address specified for Notices set forth
in Schedule 3, the first time Licensee reproduces such items and any time
Licensee substantially changes such items. If any errors exist in any such
notice, Licensee shall correct such error no later than the release of the next
version of Licensee Products.
8.3 CONFLICTS. Licensee acknowledges and agrees that it will use
reasonable efforts to avoid potential conflicts of interest between the
University employees who may also be employees, consultants, shareholders or
directors of Licensee. Licensee agrees to cooperate with University with respect
to the University of Illinois Policy on Conflicts of Commitment and Interest,
which is available at ▇▇▇▇://▇▇▇.▇▇▇▇▇▇▇▇.▇▇▇▇.▇▇▇/▇▇▇/▇▇▇▇▇.▇▇▇, and to work
constructively with University to manage and mitigate any conflicts that may
arise in the course of this and related agreements between it and University.
ARTICLE 9
MISCELLANEOUS
9.1 ASSIGNMENT.
(a) This Agreement may, at any time and upon notice to Licensee, be
assigned by University without such assignment operating to terminate, impair or
in any way change the obligations or rights which University would have had, or
any of the obligations or rights which Licensee would have had, if such
assignment had not occurred. From and after the making of such assignment the
assignee shall be substituted for University as a party to this Agreement and
University shall have no obligations under this Agreement.
(b) Upon execution of this license, Licensee shall immediately assign
this license to Circle Group Holdings, Inc. Following this assignment, no
subsequent assignments of this Agreement shall be assigned by Licensee, by
operation of law or otherwise, without the prior written consent of University
granted or withheld in the discretion of the University. Prior to any such
assignment becoming effective, a permitted assignee must agree in writing to
become bound by and subject to, and agree to the full and faithful performance
of, all of the terms and conditions of this Agreement, such agreement to be in
form and substance satisfactory to the University.
14
9.2. ENTIRE AGREEMENT, AMENDMENT AND WAIVER. This Agreement (including
any attached schedules) contains the entire understanding of the parties with
respect to the subject matter of this Agreement, and supersedes any and all
prior written or oral discussions, arrangements, courses of conduct or
agreements. This Agreement may be amended only by an instrument in writing duly
executed by the parties. The waiver of a breach hereunder may be effected only
by a writing signed by the waiving party and shall not constitute a waiver of
any other breach.
9.3. NOTICES. All notices required or desired to be given under this
Agreement, and all payments to be made to University under this Agreement, shall
be delivered to the parties at the addresses set forth on Schedule 3. Notices
may be given (i) by hand, (ii) by a nationally recognized overnight delivery
service, or (iii) by U.S. first class registered or certified mail, postage
prepaid, return receipt requested. The date of personal delivery, the date of
deposit with the overnight delivery service for next business day delivery, or
three (3) days following the date of deposit for mailing, as the case may be,
shall be the date such notice is deemed delivered under this Agreement.
9.4. SEVERABILITY. If any one or more of the provisions of this
Agreement should for any reason be held by any court of competent jurisdiction
to be invalid, illegal or unenforceable, such provision or provisions shall be
reformed to approximate as nearly as possible to intent of the parties, and the
validity of the remaining provisions shall not be affected.
9.5. GOVERNING LAW; JURISDICTION. This agreement is governed and
interpreted under the laws of Illinois applicable to contracts made and to be
performed entirely within Illinois by Illinois residents. In consideration of
the performance by University of this Agreement, Licensee agrees that unless
otherwise agreed by University in writing all actions or proceedings related to
this Agreement shall be litigated in courts located within the State of
Illinois. Licensee (i) consents and submits to the jurisdiction of any local,
state or federal court located within said state, (ii) consents to delivery and
service of process by means of the notice provisions established in this
Agreement, and (iii) agrees that neither it nor any of its Affiliates or
Sublicensees shall bring any action or claim against University in any other
jurisdiction without the prior written consent of University granted in
University's sole discretion.
9.8. EXPORT CONTROLS. To the extent that the United States Export
Control Regulations are applicable, neither Licensee nor University shall,
without having first fully complied with such regulations, (i) knowingly
transfer, directly or indirectly, any unpublished technical data obtained or to
be obtained from the other party hereto, or (ii) knowingly ship, directly or
indirectly, any product produced using such unpublished technical data.
9.8. IMPLEMENTATION. Each party shall, at the request of the other
party, execute any document reasonably necessary to implement the provisions of
this Agreement.
9.9. COUNTERPARTS. This agreement may be executed in multiple
counterparts, each of which when taken together shall constitute one and the
same instrument.
9.10. REMEDIES. Due to the proprietary nature of the subject matter of
this Agreement, the parties agree that their respective rights and obligations
under this Agreement may be enforced by injunction, specific performance, or
other equitable relief, without prejudice to any other rights and remedies the
parties may have.
9.11. RELATIONSHIP OF PARTIES. The parties to this Agreement are
independent contractors. There is no relationship of principal to agent, master
to servant, employer to employee, or franchiser to franchisee between the
parties. Neither party has the authority to bind the other or incur any
obligation on its behalf.
9.12 HEADINGS. The headings of the sections, subsections, and
paragraphs of this Agreement have been added for convenience only and shall not
be deemed to be a part of this Agreement, nor shall they affect the
interpretation or construction of this Agreement in any manner.
15
IN WITNESS WHEREOF, the parties hereto have caused this Exclusive
License Agreement to be executed by their respective duly authorized officers or
representatives on the date indicated below.
UNIVERSITY: THE BOARD OF TRUSTEES OF THE UNIVERSITY OF
ILLINOIS
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Vice president for Administration
Attest:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Secretary
Approvals to form: MCR Rotundee
Licensee: UTEK Corporation
By: /s/ ▇▇▇ ▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇ ▇▇▇▇▇▇
Title: Vice President
Date: July 9, 2003
---------------------------
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SCHEDULE 1 TO EXCLUSIVE LICENSE AGREEMENT
-----------------------------------------
A. DEFINITIONS
"Licensed Field" means and includes: All
"Territory" means and includes: Worldwide
B. LICENSED SOFTWARE
Name: NAT Tool Version 2.0 MyNAT; Energy Calculator
OTM Technology Number: T96129 (NAT); TF02023 (Energy Calculator)
Technology Title: Nutrition Analysis Tool (NAT); The Energy Calculator
Creators ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Version Number/Release Date: 2.0
Brief description (programming language, approximate lines of code,
functionality, hardware requirements if applicable): NAT is a fully functional
nutrient analysis program. It utilizes the USDA nutrient database, including
over 6000 foods. The user enters the foods consumed, and can then select which
nutrients should be analyzed. NAT is software that runs within standard internet
browsers and is developed with standard CGI and HTML programming languages.
Funding source(s) for research and development: CFAR
Copyright Year 1996-2003 The Board of Trustees of the University of Illinois
Source Code provided? /X/ Yes /_/ No
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UNIVERSITY CONFIDENTIAL AND PROPRIETARY INFORMATION
---------------------------------------------------
SCHEDULE 3 TO EXCLUSIVE LICENSE AGREEMENT
-----------------------------------------
ROYALTIES -- SECTION 3.0:
------------------------
Licensing Fee: Section 3.1(a): $75,000 in equity of Circle Group Holdings, Inc.
(OTCBB: CRGQ) unregistered shares of common stock.
Royalty on Net Sales of Licensee Products - Section 3.1(b): 10%
Royalty on Net Sales of Licensee Services - Section 3.1(c): 10%
Royalty on Sublicenses - Section 3.1(d): 50
MINIMUM ROYALTIES - SECTION 3.2:
-------------------------------
Royalty Period Annually, Beginning July 1, 2005 for 14 Years.
--------------
Minimum Royalty Owing - $5,000/Year
-----------------------------------
RESEARCH AND DEVELOPMENT EXPENDITURES - SECTION 3.3:
---------------------------------------------------
Licensee will use reasonable efforts to further develop the licensed
technology.
REPORTS - SECTION 3.10(a):
-------------------------
Progress: Six Months
Annual: Anniversary of Agreement
TERM OF AGREEMENT - SECTION 7.1: Fifteen (15) years from Effective Date
------------------------------- (last party to sign Agreement)
STATEMENT OF IDENTIFICATION AND ATTRIBUTION - SECTION 8.2:
---------------------------------------------------------
The NAT Tool Version 2.0 Version 2.0, NAT 2.0 Help; and Mobile NAT software was
created on behalf of the Department of Food Science and Human Nutrition at the
University of Illinois at Urbana-Champaign.
NOTICES - SECTION 9.3:
---------------------
Addresses For All Notices Other Than Payments To University:
Office of Technology Management
Attention: Director
University of Illinois
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇-▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
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Address For Payments To University:
Office of Technology Management
Attention: Director
University of Illinois
319 Ceramios Building, MG-243
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Addresses For Notices to Licensee:
UTEK Corporation
Attention: ▇▇▇ ▇▇▇▇▇▇
Vice President
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Upon Assignment of License, send notices to:
Circle Group Holdings, Inc.
▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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SCHEDULE 4
MANDATORY TERMS FOR END USERS OF UNIVERSITY OF ILLINOIS SOFTWARE
These terms will apply if you ("End User") are licensing, using, or are
provided access to software or services ("Sublicensor Product") that
incorporate, or are based on, certain software ("University Software") under a
sublicense granted by a licensee ("Sublicensor") of The Board of Trustees of
the University of Illinois ("University").
1. Rights. End User may (1) use the University Software only as an integral
component of the Sublicensor Product; (2) make one (1) copy of the Sublicensor
Product for back-up or
archival purposes only (provided that all notices are
included as specified in Section 4 below); and (3) End User may use the
Sublicensor Products for its internal business purposes only, and will not
sublicense, redistribute, or otherwise allow third parties to use them directly
or indirectly, whether on a time sharing, remote job entry or service bureau
arrangement. End User will not copy, modify, or prepare derivative works of the
Sublicensor Products. Any use of the Sublicensor Products beyond these
limitations will be subject to Sublicensor's prior written consent and payment
of the applicable fees.
2. Ownership. All trademarks, service marks, patents, copyrights, trade secrets
and other proprietary rights in or related to the University Software are and
will remain the exclusive property of University of its licensors, whether or
not specifically recognized or perfected under applicable law. End User will
not take any action that jeopardizes University's proprietary rights. End User
acknowledges and agrees that it acquires no right in the University Software,
except the limited use license specified in Section 1. University will own all
rights in any copy of the University Software or any derivative work thereof,
including any improvement or development of the University Software.
3. Source Code. The End User is not entitled to receive the source code version
of the University Software, and under no circumstances may the End User
recipient reverse-compile, reverse-assemble, decompile, disassemble, decrypt,
extract, or otherwise reverse-engineer or modify the object code version of the
Sublicensor Product.
4. Notices. The End User must reproduce and include the copyright notice(s) and
proprietary legend(s) of University, as applicable, as they appear in the
Sublicensor Product and on any media containing the Sublicensor Product and on
all copies of the Sublicensor Product prepared by the End User.
5. Third Party Beneficiary. End User acknowledges that the provisions of its
agreement with Sublicensor, including, but not limited to these Terms
("Agreement"), are intended to inure to the benefit of University as a third
party beneficiary of this Agreement, and University will be entitled to enforce
such provisions against End User. End User further acknowledges that University
accepts its third party beneficiary rights hereunder and that such rights will
be deemed irrevocable.
6. All warranties, maintenance, and support (if any) with respect to the
University Software and Sublicensor Products will be provided solely by
Sublicensor and not by University. UNIVERSITY MAKES NO WARRANTIES OR
REPRESENTATIONS CONCERNING THE SUBLICENSOR PRODUCTS OR ANY OTHER MATERIALS,
SERVICES, INFORMATION, OR TECHNOLOGY, AND UNIVERSITY EXPRESSLY DISCLAIMS ALL
SUCH WARRANTIES AND REPRESENTATIONS, EXPRESS OR IMPLIED, INCLUDING, BUT NOT
LIMITED TO, ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, TITLE AND NON-INFRINGEMENT.
7. UNDER NO CIRCUMSTANCES WILL UNIVERSITY BE LIABLE FOR CONSEQUENTIAL,
INDIRECT, SPECIAL, PUNITIVE OR INCIDENTAL DAMAGES OR LOST PROFITS, WHETHER
FORESEEABLE OR UNFORESEEABLE, BASED ON CLAIMS OF END USER OR ANY OTHER PARTY
ARISING OUT OF BREACH OR FAILURE OF EXPRESS OR IMPLIED WARRANTY, BREACH OF
CONTRACT, MISREPRESENTATION, NEGLIGENCE, STRICT LIABILITY IN TORT, FAILURE OF
ANY
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REMEDY TO ACHIEVE ITS ESSENTIAL PURPOSE, OR OTHERWISE, NOTWITHSTANDING THE FORM
(E.G., CONTRACT, TORT, OR OTHERWISE) IN WHICH ANY LEGAL OR EQUITABLE ACTION MAY
BE BROUGHT. IN NO EVENT WILL UNIVERSITY BE LIABLE FOR DAMAGES OR LOSSES THAT
EXCEED, IN THE AGGREGATE, THE AMOUNT OF FEES PAID BY END USER FOR THE PRODUCTS
THAT GAVE RISE TO SUCH DAMAGES OR LOSSES FOR EACH RESPECTIVE BREACH OR SERIES OF
RELATED BREACHES, AND END USER AGREES THAT IT MUST FIRST PURSUE AND EXHAUST ALL
REMEDIES AGAINST SUBLICENSOR BEFORE PURSUING ANY REMEDY (IF ANY) AGAINST
UNIVERSITY.
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