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License Agreement
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This agreement is entered into and effective as of the 16th day of
February, 1999 by and between R&D Systems, Inc., a Minnesota
corporation with principal offices at 000 XxXxxxxx Xxxxx X.X.,
Xxxxxxxxxxx, XX 00000 [RDS], and Cistron Biotechnology Inc., a New
Jersey Corporation with principal offices at 00 Xxxxxxxxxx Xxxxxx,
Xxxx Xxxxx, XX 00000 [CBI].
1. Recitals
1.1. Whereas CBI has an exclusive, worldwide license from the
New England Medical Center Hospitals, Inc., Tufts
University, Massachusetts Institute of Technology, and
Wellesley College [the INSTITUTIONS] to make, use, sell,
and to sublicense to others, products utilizing human
interleukin 1 beta [IL-1B], which is the subject of
patents owned by the INSTITUTIONS, as set forth in
Schedule A.
1.2. Whereas CBI has patents which describe the production and
use of antibodies to IL-1B and immunoassays selective
for IL-1B,as set forth in Schedule A.
1.3. Whereas CBI has been granted license from Merck, & Co.
Inc. for the research use of Interleukin 1 beta
converting enzyme [ICE],
1.4. Whereas RDS wishes to obtain assignment of the ICE
LICENSE defined herein,
1.5. Whereas RDS wishes to obtain an exclusive sub-license to
the INTELLECTUAL PROPERTY defined herein for the purpose
of commercializing products for the research market
worldwide, and CBI is willing to grant RDS such license
under the terms defined herein, and
1.6. In consideration of the mutual promises and undertakings
of the parties as herein set forth, it is hereby agreed
as follows:
2. Definitions
2.1. INTELLECTUAL PROPERTY means the licenses, United States
and foreign patents and patent applications and any
divisions, continuations, continuations in part,
reissues, reexaminations, renewals, and extensions
thereof, and all pending applications therefor (a) are
described in paragraphs 1.1, and 1.2 and (b) are set
forth in Schedule A.
2.2. ICE LICENSE means the license granted to CBI by Merck &
Co. Inc.
2.3. LICENSED PRODUCT(S) means any product(s) that contain(s)
or is made employing the INTELLECTUAL PROPERTY. LICENSED
PRODUCTS shall include:
2.3.1. REAGENT(S) means any stand-alone product(s),
e.g., proteins or antibodies, that contain(s) or is
made employing the INTELLECTUAL PROPERTY.
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2.3.2. COMBINATION PRODUCT(S) means any product(s)
that contain(s) more than a single reagent, e.g.,
immunoassays or matched reagents for immunoassays,
where at least one of the components of this
product contain(s) or is a REAGENT or is made
employing the INTELLECTUAL PROPERTY.
2.4. NET SALES means the invoiced amount of sales of the
LICENSED PRODUCT(S) by RDS to third parties less the
following items: (a) Customary trade, quantity and cash
discounts, sales rebates allowed and taken; (b) Credits
actually given for rejected or returned products; (c)
Freight and insurance if separately itemized on the
invoice and paid by the customer; and (d) Value-added,
sales, use or turnover taxes, excise taxes and customs
duties included in the invoice amount.
2.5. AFFILIATES means any organization controlling,
controlled by, or under the common control with RDS. For
this purpose the term control means ownership, directly
or indirectly, of at least fifty percent (50%) of the
equity capital or a right to at least fifty- percent
(50%) of the profits.
2.6. FIELD means the research market.
2.7. TERRITORY means countries where patent protection exists.
3. Grant and Assignment
3.1. CBI grants to RDS, including its AFFILIATES, and RDS
accepts an exclusive, sub-license to make, have made,
use, sell, and sub-license the INTELLECTUAL PROPERTY in
the FIELD in the TERRITORY.
3.1.1. RDS shall use reasonable efforts to market
LICENSED PRODUCTS in the FIELD and will manufacture
its LICENSED PRODUCTS within the United States
3.2. CBI will seek assignment of the ICE LICENSE to RDS.
3.3. CBI will provide to RDS its customer list and sales
history for the past two (2) fiscal years.
3.4. CBI will cease its business as a provider of research
products relating to the INTELLECTUAL PROPERTY and ICE
LICENSE as defined herein.
3.5. CBI may continue to produce REAGENTS and COMBINATiON
PRODUCTS, using the INTELLECTUAL PROPERTY, for its own
research use and may also provide REAGENTS and/or
COMBINATION PRODUCTS to their collaborators, at no
charge, for use in CBI-sponsored research directed
toward the development of applications of the
INTELLECTUAL PROPERTY outside of the FIELD.
3.6. Should CBI dissolve, file for bankruptcy, has filed
against it an involuntary petition of bankruptcy which
is not dismissed within thirty (30) days after the date
of filing, or otherwise cease to actively conduct its
business, all rights to the INTELLECTUAL PROPERTY for
use in the FIELD in the TERRITORY shall be assigned to RDS.
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4. Payments, Reports, and Accounting
4.1. RDS agrees to pay CBI a one-time license initiation fee
of seven hundred fifty thousand dollars (US $750,000)
for the INTELLECTUAL PROPERTY within thirty (30) days of
the full execution of this Agreement.
4.2. RDS agrees to pay CBI a royalty equal to four percent
(4%) of NET SALES of REAGENT(S) and eight percent (8%)
of NET SALES of COMBINATION PRODUCT(S) in the TERRITORY.
4.3. RDS agrees to share equally any fees or royalties with
CBI derived from RDS sub-licensing activities of the
INTELLECTUAL PROPERTY.
4.4. CBI agrees to share equally any fees or royalties, net
of contractually defined payments made to the
INSTITUTIONS, with RDS derived from CBI's license
agreement with Peprotech Inc. (located at 0 Xxxxxxxx
Xxxxxx, Xxxxx Xxxx, Xxx Xxxxxx 08553).
4.5. RDS shall submit semi-annual written reports and royalty
payments, due within sixty (60) days following December
31 and June 30 of each year. This report shall include
the number, description, and aggregate NET SALES of
LICENSED PRODUCT(S) made during the reporting period,
and the resulting calculation of the royalty due.
Concurrent with the report, RDS shall include the
payment due to CBI of royalties for the period covered
by the report. All royalty payments shall be paid in US
Dollars.
4.6. RDS agrees to keep records for a period of three (3)
years showing the manufacture, sales, use, and other
disposition of the LICENSED PRODUCT(S) under the license
granted herein in sufficient detail to enable royalties
payable hereunder by RDS to be determined.
4.7. RDS further agrees to permit its books and records to be
examined by CBI to the extent necessary to verify
reports provided for in paragraph 4.5. Such examination
is to be made by CBI, at CBI's expense, and shall be on
a confidential basis no more frequently than once yearly.
5. Representations
5.1. Each party represents to the other party that to the
best of its knowledge it has full right and authority to
enter into this Agreement without the consent or
approval of any third party.
5.2. CBI represents and warrants that it is the owner of the
INTELLECTUAL PROPERTY and is unaware of any liens,
encumbrances, restrictions or other legal claims, to the
best of its knowledge and belief without having done any
due diligence.
5.3. CBI makes no representations and extends no warranties
of any kind, either express or implied. There are no
express or implied warranties of merchantability or
fitness for a particular purpose, or that the use of the
INTELLECTUAL PROPERTY will or does not infringe any
patent, trademark, or copyright of third parties.
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6. Patent Maintenance, Infringement and Enforcement
6.1. CBI will maintain any and all patents included hereinand
set forth in Schedule A, including but not exclusive of
maintenance fees and filings.
6.2. RDS shall have the right, at its discretion and its
expense, to enforce its patent rights granted herein.
6.2.1. Recoveries, damage awards or settlements, net
of reimbursement of all expenses incurred by RDS to
enforce the patent rights, shall be considered NET
SALES when received by RDS and such net amounts
shall be included in the determination of royalties
due CBI.
6.3. CBI shall make available, at RDS' expense, any records
or documents that may be needed for any legal proceedings.
7. Indemnification
7.1. RDS will indemnify, defend, and hold harmless CBl from
any and all damages, costs, expenses, suits, claims and
judgments (including reasonable attorney's fees and
cost) arising from the conduct of RDS or its officers or
employees or arising from the production or use of the
INTELLECTUAL PROPERTY or the production, use or sale of
LICENSED PRODUCT(S) by RDS, except for any claims,
liability, damage, loss, cost, or expense caused by
CBI's negligence or willful misconduct in connection
with its supply of the INTELLECTUAL PROPERTY to RDS.
8. Amendments
8.1. The Agreement constitutes the entire understanding
between the parties with respect to the subject matter
herein, and no modification or amendment shall be valid
or binding upon the parties unless made in writing and
duly executed on behalf of each party.
9. Confidentiality
9.1. All information submitted by one party to the other
concerning the INTELLECTUAL PROPERTY and designated in
writing, shall be considered as confidential information
and shall be utilized only pursuant to the license
granted hereunder. During the term of this Agreement and
a period of five (5) years thereafter, neither party
shall disclose to any third party any information
received from the other party without the specific
written consent of that party. The foregoing shall not
apply where such information (a) was or becomes public
through no fault of the receiving party, (b) was at the
time of receipt, already in the possession of the
receiving party as evidenced by its written records, or
(c) was obtained from a third party legally entitled to
use and disclose the same.
10. Term and termination
10.1. Unless earlier terminated pursuant to paragraph 10.2 the
provisions of this Agreement will expire upon
the expiration of the last of the INTELLECTUAL PROPERTY.
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10.2. CBI may terminate this Agreement if RDS is in
default in payment of royalty or providing reports
provided that RDS fails to remedy any such default,
breach or false report within thirty (30) days of
written notice thereof by CBI.
10.3. Surviving any termination are (a) the obligation of
RDS to pay royalties accrued or accruable, (b) any cause
of action or claim of RDS or CBI, accrued or to accrue,
because of any breach or default by the other party, and
(c) the provisions of paragraphs 4, 7, and 9.
10.4. Upon termination by either party, RDS shall have
the right for one (1) year to dispose of all LICENSED
PRODUCT(S) then on hand or in process of manufacture,
and to complete all orders for such LICENSED PRODUCT(S)
then on hand or in process of manufacture, and royalties
shall be paid to CBI with respect to such LICENSED
PRODUCT(S) as though this Agreement had not terminated.
10.5. Upon termination by either party, any Agreement by
RDS granting sub-licensee rights shall be assigned to
CBI for the term of those agreements.
11. Miscellaneous Provisions
11.1. Any notice or other communication required or
permitted under this Agreement shall be in writing and
shall be deemed to have been given, when received, if
personally delivered or delivered by telegram, telex, or
facsimile, or when deposited, if placed in the US Mails
for delivery by registered or certified mail, return
receipt requested, postage prepaid and addressed to the
appropriate party at the address set forth below:
To RDS: President
R&D Systems, Inc.
000 XxXxxxxx Xxxxx, X.X.
Xxxxxxxxxxx, XX 00000
To CBI: President
Cistron Biotechnology Inc.
X.X. Xxx 0000
00 Xxxxxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
11.2. This Agreement constitutes the entire agreement of
the parties with respect to the subject matter described
in this Agreement and shall supersede all previous
negotiations, commitments, writings, or agreements with
respect to such subject matter, including the License
and Supply Agreement between the parties effective as of
March 21, 1995 and the Research and Development
Agreement between the parties effect as of April 10, 1995.
11.3. This Agreement may not be released, discharged,
abandoned, changed, or modified in any manner, except by
an instrument in writing signed on behalf of both
parties to this Agreement by their duly authorized
representatives. The failure of either party to enforce
at any time any of the provisions of this Agreement
shall in no way be construed to be a waiver of any such
provision, nor in any way to effect the validity of this
Agreement or any part of it or the right of either party
after any such failure to enforce each and every such
provision. No waiver of any breach of this Agreement
shall be held to be a waiver of any other or subsequent
breach.
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11.4. This agreement shall be governed by, and construed
in accordance with the law of the State of Minnesota
(other than its law with respect to conflicts of laws),
including all matters of construction, validity, and
performance.
11.5. This Agreement shall be binding upon and inure to
the benefit of the parties to this Agreement and their
successors or assigns, provided that, except as
otherwise noted, the rights and obligations of either
party under this Agreement may not be assigned without
the written consent of the other party. Such consent
will not be unreasonable withheld.
11.6. The validity of any portion of this Agreement shall
not affect the validity, force or effect of the
remaining portions of this Agreement.
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In witness whereof, the parties have caused this Agreement to be executed in
the manner appropriate for each.
Research and Diagnostic Systems Inc.
By /s/ XXXXXX X. XXXXX
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Xxxxxx X. Xxxxx, President
Date Feb. 18, 1999
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Cistron Biotechnology, Inc
By /s/ XXXXX X. XXXXXX
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Xxxxx X. Xxxxxx, President
Date 2-17-99
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SCHEDULE A
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IL-1B PATENTS
