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EXHIBIT 10.23
LICENSE
AGREEMENT made this 12th day of April 1996 (the "Effective Date") by and
between Cambridge Biotech Corporation ("Cambridge"), a corporation organized
and existing under the laws of the State of Delaware, debtor and debtor in
possession, Case No. 94-43054-JFQ, United States Bankruptcy Court for the
District of Massachusetts, Western Division, and having a place of business at
365 Plantation Street, Biotechnology Research Park, Worcester, MA 01605, U.S.A.,
and Calypte Biomedical Corporation ("Calypte"), a corporation organized and
existing under the laws of the State of California, and having a place of
business at 1440 Fourth Street, Berkeley, CA 94710, U.S.A.
BACKGROUND
In the course of research at New York University ("NYU"), certain
inventions were made relating to the ability to detect antibodies to Human
Immunodeficiency Virus in urine samples. NYU is the owner of these inventions,
and has been granted two United States patents, numbered 4,885,966 and
5,122,446, entitled "Method for Detecting Antibodies to Human Immunodeficiency
Virus". The patents were granted September 12, 1989, and June 16, 1992,
respectively.
Calypte is the exclusive, worldwide licensee of these inventions and the
issued patent and pending patent applications by way of an exclusive license
agreement from NYU and has the right to grant sublicenses thereunder, subject to
the limitations set forth in the NYU agreement attached hereto as Exhibit A, for
the making, using or selling of the inventions which have been disclosed and
claimed in the issued patent and pending patent applications. This Agreement is
subject and subordinate to the NYU Agreement attached hereto as Exhibit A and
any conflicts between this Agreement and the NYU Agreement shall be resolved in
favor of the interpretation and meaning set forth in the NYU Agreement.
RECITALS
WHEREAS, Calypte is the exclusive worldwide licensee of patents
4,865,966 and 5,122,446 and any reissues, renewals, divisions, continuations,
continuations-in-part, substitutes, divisions or extensions thereof, related to
the detection of antibodies to Human Immunodeficiency Virus ("HIV") using
urine samples;
WHEREAS, Cambridge manufactures and distributes a Western Blot
Assay (as hereinafter defined) for the detection of human
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antibodies to a variety of HIV proteins and glycoproteins on nitrocellulose
strips using serum and plasma; and
WHEREAS, Cambridge desires to adapt its Western Blot Assay for use with
urine samples, and to license Calypte's Licensed Processes (as hereinafter
defined) and Licensed Patent Rights (as hereinafter defined) to enable it to
manufacture and distribute the resulting Western Blot Assay in the Field of Use
(as hereinafter defined) and to enable its customers to practice the Licensed
Processes in the Field of Use.
NOW, THEREFORE, and in consideration of the mutual covenants and
undertaking set forth herein, the parties agree as follows:
1. DEFINITIONS
1.1 LICENSED PATENT RIGHTS shall mean U.S. Patents No.
4,865,966 and 5,122,446 issued September 12, 1989, and June 6, 1992,
respectively, and any divisions, continuations, or continuations-in-part based
thereon, and any patents which may issue therefrom and any reissues,
re-examinations, or extensions thereof; and any and all foreign patents and
patent applications corresponding to any of the foregoing patents and
applications, as well as such other patents or patent applications listed in
Exhibit B effective as of the date said patents or patent applications are
granted or filed, as the case may be, and the inventions described or claimed
therein.
1.2 FIELD OF USE shall mean only use in diagnostic
applications and use for research purposes utilizing urine samples. The
diagnostic field of use is limited to methods for detecting antibodies to HIV
utilizing HIV lysates immobilized on nitrocellulose strips in a Western Blot
format.
1.3 LICENSED PRODUCT(S) shall mean HIV diagnostic Western Blot
finished goods covered by or made in accordance with LICENSED PATENT RIGHTS OR
finished goods on which LICENSED PROCESSES are practiced. The term "finished
goods" as used herein shall mean any and all products in any form for use by an
end user.
1.4 LICENSED PROCESSES shall mean processes claimed or
otherwise included in the LICENSED PATENT RIGHTS or using Calypte's proprietary
know-how or other technical information and techniques disclosed by Calypte to
Cambridge. For purposes of example only, and not by way of limitation LICENSED
PROCESSES may include (1) services for providing a test result utilizing the
methods of assay covered under the LICENSED PATENT RIGHTS, or (2) services for
providing test results utilizing the LICENSED PRODUCTS.
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1.5 NET SALES shall mean the amount invoiced by Cambridge on
sales of LICENSED PRODUCTS and/or on sales of services utilizing LICENSED
PROCESSES which amount shall not include:
(a) Amounts repaid or credited by reason of rejection or
return;
(b) Shipping and handling charges, to the extent separately
invoiced; and
(c) Taxes levied on either the Licensed Products or Licensed
Processes, or other governmental charges assessed on the production, sale,
transportation, delivery or use; provided, however, such taxes or charges are
separately stated on purchase orders, invoices or other documents of sale and
are clearly identifiable, and provided further that such taxes and charges are
actually paid by or on behalf of Cambridge.
1.6 FIRST USE shall mean the date of the initial transfer by
Cambridge of any LICENSED PRODUCTS to any third party or date of the first
commercial application of the LICENSED PROCESSES, in each case in the Field of
Use, whichever is earlier, in exchange for consideration of any kind to which
value can reasonably be assigned for purposes of determining Net Sales.
1.7 EARNED ROYALTIES shall mean royalties paid or payable by
Cambridge to Calypte calculated on the basis of NET SALES.
1.8 EFFECTIVE DATE shall mean the date first set forth above.
1.9 PRIME LICENSE shall mean the exclusive license agreement
between NYU and Calypte, as amended, dated August 12, 1993.
1.10 CAMBRIDGE shall mean Cambridge Biotech Corporation, the
Delaware corporation. An AFFILIATE of Cambridge shall mean any corporation or
other business entity controlled by, controlling, or under common control with
Cambridge. For this purpose, "control" shall mean direct or indirect beneficial
or legal ownership of at least fifty percent (50%) interest in such corporation
or business entity.
1.11 WESTERN BLOT OR WESTERN BLOT ASSAY shall mean the
Cambridge HIV Western Blot which is FDA licensed as of the date of execution of
this Agreement, and/or replacements or improved versions thereof. The Western
Blot kit currently consists of nitrocellulose strips onto which HIV I lysate has
been
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electrophoretically separated and immobilized plus the ancillary buffers,
conjugates, chromagens and other materials customarily provided in the FDA
licensed kit.
1.12 MASTER AGREEMENT shall mean that certain agreement dated
April 12, 1996, by and between Cambridge and Calypte with respect to the
development of a protocol and reagents for use or modification of the Serum
Blot for purposes of confirming the results of the Screening Test using urine
samples.
1.13 DISTRIBUTION AGREEMENT shall mean the distribution
agreement which is Appendix 4 to the Master Agreement.
2. GRANT OF LICENSE
2.1 Subject to the terms and conditions of this Agreement and
the Prime License, Calypte hereby grants to Cambridge an exclusive royalty
bearing license, with no right to sublicense, to make, use, and sell LICENSED
PRODUCTS and to practice the LICENSED PROCESSES under LICENSED PATENT RIGHTS in
the FIELD OF USE throughout the patent and non-patent countries as listed in
Exhibit C.
2.2 If and to the extent there are divisionals, continuations
or continuation-in-part based on or relating to the LICENSED PATENT RIGHTS, and
any patents which may issue therefrom and any reissues, re-examinations or
extensions thereof, as well as any and all foreign patents and patent
applications corresponding thereto or to the LICENSED PATENT RIGHTS, Calypte
shall notify Cambridge of such developments and shall deliver an amended Exhibit
B to Cambridge to reflect any such changes or additions to the LICENSED PATENT
RIGHTS.
2.3 Notwithstanding any provisions to the contrary, end users
of the Licensed Product shall have an implied license to practice the Licensed
Processes in conjunction with their rendering of testing services related to the
detection of antibodies to HIV using urine samples.
3. ROYALTIES. In consideration of the rights granted
hereunder, Cambridge shall make the following payments to Calypte
when the same are due:
3.1 Cambridge shall pay to Calypte EARNED ROYALTIES of
on the NET SALES of all LICENSED PRODUCTS sold by
Cambridge for use in the FIELD OF USE to its customers and distributors within
the patent countries (Exhibit B) and within
non-patent countries.
Confidential portion has been omitted and filed separately with the Commission
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3.2 Cambridge shall pay to Calypte EARNED ROYALTIES of
calculated on NET SALES of all services utilizing
LICENSED PROCESSES sold by Cambridge.
3.3 Calypte and Cambridge recognize that the Western Blot
Assay may be used by customers for use with samples other than urine, and agree
that royalties shall be payable hereunder only with respect to sales of Western
Blots used with urine samples. In view of the difficulty of determining the
quantity of Western Blot Assays used with urine samples in any given royalty
reporting period, the parties hereby agree to calculate quantities subject to
royalties as follows:
(i) Calypte plans to sell a Urine Control Kit, as
defined in the Master Agreement, containing three 10 ml
vials each of high positive, low positive and negative
control. The parties estimate that, for each Urine Control
Kit sold, approximately 270 Western Blot Assays (10
27-strip kits) will be run by customers. Calypte agrees to
promptly report to Cambridge after the end of each
calendar quarter, the number of Urine Control Kits sold,
and for each Urine Control Kit sold, Cambridge shall pay a
royalty on 10 Western Blot Assay kits (based on an average
net selling price of all of its Western Blot Assays,
calculated in accordance with Net Sales); provided,
however, that (a) no royalty shall be due with respect to
sales attributable to the first 50 Urine Control Kits sold
by Calypte each calendar year; and (b) a royalty
adjustment shall be made with respect to expired
Urine Control Kits with respect to which a royalty was
previously paid. Calypte shall report to Cambridge, within
30 days after the end of each calendar year, the number of
such expired Urine Control Kits in the inventory of its
distributors and if known, its customers.
(ii) Either party may request a review of the above
method of calculating royalties by delivering notice on or
before December 1 of any year. In such event, the parties
shall negotiate in good faith a method or methods which
adequately and reasonably approximate the number of
Western Blot Assays used with urine samples. Such new
method, if any, shall be effective for the following
calendar year and
Confidential portion has been omitted and filed separately with the Commission
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thereafter unless changed in accordance with this section.
4. PAYMENTS AND REPORTS
4.1 Cambridge agrees to notify Calypte in writing within three
(3) business days after the date of the FIRST USE.
4.2 Beginning with the date of FIRST USE, Cambridge shall
remit to Calypte EARNED ROYALTIES within thirty (30) days after the close of
each calendar quarter, which is commonly known as the last day of March, June,
September, and December or within thirty (30) days following receipt of
Calypte's Urine Control Kit report, whichever is later. Any EARNED ROYALTIES not
paid within the thirty (30) day time period shall be deemed past due royalties.
Past due royalties shall bear interest at the rate of the lesser of
per annum or the maximum rate permitted by applicable law, which interest
shall accrue commencing on the date the payment was originally scheduled to be
paid and shall continue to accrue until paid in full.
4.3 Cambridge shall also prepare for each calendar quarter
after the date of FIRST USE, a written report in form and substance acceptable
to Calypte setting forth, among other things (1) the NET SALES and the EARNED
ROYALTIES payable thereon, including a detailed listing of all LICENSED PRODUCTS
sold and all deductions or exclusions from NET SALES, if any and (2) the NET
SALES and the EARNED ROYALTIES payable thereon, including a detailed listing of
the services provided utilizing LICENSED PROCESSES and of all deductions or
exclusions from NET SALES. The reports required by this Agreement shall be
certified by an officer of Cambridge to be correct to the best of Cambridge's
knowledge and information.
4.4 All amounts payable to Calypte shall be in United States
Dollars. In the event that any LICENSED PRODUCT or services utilizing LICENSED
PROCESSES shall be sold for funds other than in United States Dollars the NET
SALES of such product shall first be determined in the foreign funds and then
converted into the equivalent United States Dollars at:
(a) The rate applicable to the transfer of funds arising
from royalty payments as established by the exchange control authorities of the
country of which such funds are the national currency, for the last business day
of the accounting period for which payment is thus made; or
(b) If there is no rate so applicable, that the buying
rate for such foreign funds as published by the Wall
Confidential portion has been omitted and filed separately with the Commission
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Street Journal on the last business day of such calendar accounting period.
5. BOOKS AND RECORDS
5.1 Cambridge shall keep complete and accurate books and
records of all business activities relating to the subject matter of this
Agreement including records of EARNED ROYALTIES on LICENSED PROCESSES and
LICENSED PRODUCTS made, used, and sold under this Agreement for a period of at
least three (3) years following a given reporting period. These books and
records shall be available during normal business hours for inspection at the
expense of Calypte by a representative selected by Calypte and reasonably
acceptable to Cambridge, after providing ten days' prior written notice to
Cambridge, for the sole purpose of verifying and authenticating reports and
payments hereunder. The representative of Calypte shall disclose to Calypte only
such financial information of Cambridge as necessary for Calypte to be assured
of the accuracy of the reports submitted and payments made under this Agreement.
6. NOTICE
6.1 Any notice required by this Agreement shall be sent by
registered or certified mail, postage prepaid, telex, facsimile, courier service
or personal delivery at the addresses designated below or to another address as
may be designated by written notice. Unless otherwise so specified, any notices
given hereunder shall be effective as of the date of the date of dispatch.
For Calypte: For Cambridge:
Calypte Biomedical Corporation Cambridge Biotech Corporation
1440 Fourth Street 365 Plantation Street
Berkeley, CA 94710 Worcester, MA 01605
Attn: President Attn: President
7. TERM AND TERMINATION
7.1 The term of this Agreement, unless sooner terminated as
provided herein, shall extend from the EFFECTIVE DATE until the expiration of
the last of the patents included in LICENSED PATENT RIGHTS.
7.2 Upon any breach of, or default under, this Agreement,
Calypte may terminate this Agreement by giving ninety (90) days' written notice
to Cambridge of such termination and identifying the nature of the breach or
default; such termination shall take effect at the end of the ninety-day period,
unless
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during such ninety-day period Cambridge cures such breach or default to
Calypte's reasonable satisfaction. If the Master Agreement or the Distribution
Agreement is terminated by Calypte for cause pursuant to the terms set forth
therein, this Agreement shall automatically terminate concurrently with the
termination of such other agreements. In the event the Distribution Agreement
is terminated for any other reason (other than for cause by Calypte) or expires
without renewal, the license granted under this Agreement shall become
non-exclusive for the duration of the remaining term of this Agreement, subject
to early termination as provided for hereunder. Furthermore, in the event this
Agreement becomes non-exclusive as provided above, Calypte shall have no
obligation to support or share in the cost of insurance as set forth in Section
12.14 nor shall it have any obligations whatsoever to share in the costs set
forth in Section 4.3.5 of the Master Agreement relative to testing of Serum
Blot. Upon notice of termination of this Agreement, Cambridge will immediately
undertake such actions as may be required by the United States Food and Drug
Administration to remove the urine application from Product labeling and report
to Calypte a timeline for completion of same.
7.3 Cambridge has the right to terminate this Agreement by
giving twenty-four (24) months, prior written notice to Calypte.
7.4 Termination of this Agreement shall not affect any rights
or obligations accrued prior to the date of termination, including Cambridge's
obligation to pay all EARNED ROYALTIES and Cambridge's obligation to indemnify
Calypte, provided however, that Cambridge's obligation to indemnify Calypte
shall extend for a period of ten (10) years after such termination. Upon
termination of this Agreement, all unpaid EARNED ROYALTIES due to Calypte shall
become due and payable upon delivery of the next quarterly report pursuant to
section 4.3 hereof.
7.5 Waiver by Calypte of a single default or breach or a
succession of defaults or breaches shall not deprive Calypte of any right to
terminate this Agreement pursuant to the terms hereof upon the occurrence of
any subsequent default or breach.
7.6 This Agreement shall automatically expire or terminate on
the termination or expiration of the PRIME LICENSE, notwithstanding the fact
that Calypte shall exert its best efforts to avoid termination of the Prime
License for cause. In the event that the PRIME LICENSE is converted from an
exclusive to a nonexclusive license, Cambridge may at its option extend the
duration of this Agreement with Calypte on terms and conditions mutually
agreeable to both parties.
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8. NEGATION OF WARRANTIES AND INDEMNITY
8.1 Calypte makes no representations or warranties as to the
validity or scope of any LICENSED PATENT RIGHTS.
8.2 Calypte makes no representations or warranties that the
manufacture, use, sale or other disposal of the LICENSED PRODUCTS or the
practice of the LICENSED PROCESSES is or will be free from infringement of
patents of third parties.
8.3 Calypte's liability for any claim or demand by Cambridge
shall be limited to and based solely on any material breach of representation or
warranty as set forth therein. EXCEPT AS OTHERWISE SET FORTH HEREIN CALYPTE
HEREBY DISCLAIMS ANY AND ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT
LIMITATION ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE. THE SOLE AND ENTIRE MAXIMUM LIABILITY FOR ANY AND ALL LOSS CLAIM,
DAMAGE OR LIABILITY OF ANY KIND SHALL CONSIST OF REPLACEMENT OF THE LICENSED
PRODUCT. IN NO EVENT SHALL CALYPTE BE LIABLE FOR ANY INCIDENTAL OR CONSEQUENTIAL
DAMAGES. Cambridge shall make no statements, representations or warranties
whatsoever to any third parties which are inconsistent with the above
disclaimer.
8.4 Cambridge shall defend indemnity, and hold harmless
Calypte and NYU, their directors, officers, employees and agents from and
against any and all claims, demands, damages, losses and expenses of any nature,
including attorney's fees, for but not limited to death, personal injury,
illness, property damage or product liability arising from or in connection with
any one or more of the following;
(a) the use by Cambridge of any method or process related
to the LICENSED PATENT RIGHTS; or
(b) any use, sale or other disposition of any of the
LICENSED PRODUCTS by Cambridge, or any statement. representation or warranty
made by Cambridge with respect thereto; or
(C) the use of the LICENSED PRODUCTS or LICENSED PROCESSES
by any person.
Calypte shall reasonably cooperate with Cambridge in defending any such
claim, provided Cambridge and/or its insurance carrier shall reimburse Calypte
for all out of pocket expenses incurred in connection therewith. Calypte shall
be entitled to receive information regarding the status of any such matter upon
reasonable notice and shall be entitled to retain counsel on its
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own behalf and at its own expense to monitor the litigation or if Calypte is not
satisfied with the defense provided by Cambridge for any reason. The rights and
obligations of this paragraph shall survive termination or expiration of this
Agreement. Cambridge shall have the exclusive right to control the defense of
any such claim; provided, however, that Cambridge shall not settle any such
claim without first consulting with Calypte.
9. LAWS AND REGULATIONS.
9.1 Cambridge shall comply with all foreign and United States
federal, state, and local laws regulations, rules and orders applicable to the
testing, production, transportation, packaging, labeling, sale and use of the
LICENSED PRODUCTS and services utilizing LICENSED PROCESSES.
10. USE OF NAMES.
10.1 Cambridge shall not use the names "NYU," "New York
University," the names of the inventors, or the name "Calypte Biomedical
Corporation" or any other name or mark by which NYU or Calypte may be identified
for any purpose without prior written consent obtained from the respective
parties.
11. PATENT NOTICE.
11.1 Cambridge shall apply the patent marking notices required
by the laws of the United States and relevant countries or as reasonably
requested by Calypte.
12. MISCELLANEOUS PROVISIONS.
12.1 This Agreement constitutes the entire understanding
between the parties with respect to the subject matter hereof and supersedes and
replaces all prior agreements, understandings, writings and discussions between
the parties related to said subject matter.
12.2 This Agreement may be amended only by a written
instrument executed by the parties.
12.3 Except as otherwise set forth herein, without prior
written approval of Calypte, which approval shall not be unreasonably withheld,
this Agreement may not be assigned or transferred, in whole or in part, by
Cambridge to any other party However on a one-time-only basis, Cambridge
shall be entitled to assign this license, but only under and pursuant to the
following terms and conditions: (i) such assignment shall be made only to a
business entity that acquires from Cambridge its entire diagnostics division and
business; and (ii) Cambridge and
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Cambridge's assignee shall execute an "Assignment Agreement" in the form
satisfactory to NYU and a copy thereof shall be provided to NYU for review. In
the event Cambridge only divests the Western Blot part but not all of its
diagnostics division and business then Cambridge's right to assign shall be
subject to Calypte's and NYU's approval, which approval shall not be
unreasonably withheld.
12.4 This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors and permitted assigns.
12.5 This Agreement shall be governed and construed and
interpreted in accordance the laws of the State of California.
12.6 If any provision(s) of this Agreement are or become
invalid, or ruled illegal by any court of competent jurisdiction, or are deemed
unenforceable under then current applicable from time to time in effect during
the term hereof, it is the intention of the parties that the remainder of this
Agreement shall not be affected thereby. It is further the intention of the
parties that, in lieu of each such provision which is invalid, illegal or
unenforceable, there be substituted or added as part of this Agreement a
provision which shall be as similar as possible in economic and business
objectives as intended by the parties to such invalid, illegal or unenforceable
provision.
12.7 In no event shall either party be liable to the other for
any special, or incidental, or consequential, or indirect damages arising in
any way out of this Agreement, however caused, and on any theory of liability.
This limitation will apply even if the other party has been advised of the
possibility of such damage.
12.8 This Agreement may be executed in counterparts, each of
which shall be deemed an original, but both of which together shall constitute
one and the same instrument.
12.9 Cambridge agrees that immediately after the execution of
this Agreement, Calypte may provide a copy of this Agreement to NYU for their
review and consideration.
12.10 The parties hereto expressly agree that this Agreement
is subject and subordinate to the Prime License and to the extent there are
provisions set forth herein which are inconsistent or conflicting with the Prime
License, then such provisions shall be revised so as to be non-conflicting and
consistent with the proscription of the Prime License.
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12.11 Cambridge hereby unconditionally agrees that it will not
grant nor attempt to grant any sublicenses of any kind based on the rights
granted hereunder.
12.12 Cambridge agrees to obtain and maintain insurance and to
provide evidence thereof directly to NYU and Calypte and to indemnify NYU in the
manner described below. Cambridge agrees that NYU is an intended third party
beneficiary of this Agreement for the purpose of enforcing such indemnification
and insurance provisions. NYU shall also have the right to audit Cambridge's
records as they may relate to the subject matter of this Agreement at its own
expense.
12.13 Cambridge shall indemnify, defend and hold harmless NYU
and its trustees, officers, medical and professional staff, employees, students
and agents and their respective successors, heirs and assigns (the
"Indemnitees"), against any liability, damage, loss or expense (including
reasonable attorneys' fees and expenses of litigation) incurred by or imposed
upon the Indemnitees or any one of them in connection with any claims, suits,
actions, demands or judgments arising out of the design, production,
manufacture, sale, use in commerce or in human clinical trials, lease, or
promotion by Cambridge of any Licensed Product, Licensed Process or service
relating to or developed pursuant to this Agreement or the Prime License.
Cambridge agrees at its own expense, to provide attorneys reasonably acceptable
to NYU to defend against any actions brought or filed against any Indemnitee
with respect to the subject of indemnity to which such Indemnitee is entitled
under the Prime License, whether or not such actions are rightfully brought.
12.14 At such time as the Licensed Products or Licensed
Processes are distributed or practiced, as the case may be, Cambridge shall
procure and maintain policies of comprehensive general liability insurance in
amounts not less than five million dollars (US $5,000,000) per incident and five
million dollars (US $5,000,000) annual aggregate and naming the Indemnitees and
Calypte as additional insureds. Such comprehensive general liability insurance
shall provide (i) product liability coverage and (ii) broad form contractual
liability coverage for Cambridge's indemnification under the section above. The
minimum amounts of insurance coverage required under this section shall not be
construed to create a limit of Cambridge's liability with respect to its
indemnification of Indemnitees under the sections indicated above. Cambridge
shall provide Calypte and NYU with written evidence of such insurance upon
request. Cambridge shall provide NYU and Calypte with written notice at least
ninety (90) days prior to the cancellation, non-renewal or material change in
such insurance. If Cambridge does not obtain replacement
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insurance providing comparable coverage within ninety (90) days of such average
termination, Calypte may terminate this Agreement. Cambridge shall maintain such
comprehensive general liability insurance during the period that any product,
process or service is being commercially distributed or sold pursuant to this
Agreement, and for a period of seven (7) years after the termination or
expiration of this Agreement. Calypte and Cambridge shall share any additional
insurance premium cost on a 50/50 basis as a direct result of increasing the
coverage for the Licensed Products or Licensed Processes from Cambridge's
existing policy limit to the $5,000,000 limit set forth above.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed.
Calypte Biomedical Corporation Cambridge Biotech Corporation
By: /s/ Jack Davis By:
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Name: Jack Davis Name:
---------------------------- ---------------------------
Title: President & CEO Title: President & CEO
---------------------------- ---------------------------
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EXHIBIT A
NYU/CALYPTE
LICENSE AGREEMENT
This Agreement, effective as of Aug. 12th, 1993 (the "Effective Date"),
is by and between:
NEW YORK UNIVERSITY (hereinafter "NYU"), a corporation organized and
existing under the laws of the State of New York and having a place of business
at 70 Washington Square South, New York, New York 10012
AND
CALYPTE BIOMEDICAL CORPORATION (hereinafter "CORPORATION"), a
corporation organized and existing under the laws of the State of California
having its principal office at 1440 Fourth Street, Berkeley, California 94710.
RECITALS
WHEREAS, NYU is the owner of certain inventions relating to the
detection of antibodies to human immunodeficiency virus (HIV) in urine, all as
more particularly described in the NYU Patents (as hereinafter defined);
WHEREAS, CORPORATION is engaged in the research, development,
manufacture, sale, use and distribution of products for the detection of
antibodies to HIV in urine; and
WHEREAS, subject to the terms and conditions hereinafter set forth, NYU
is willing to grant to CORPORATION and CORPORATION is willing to accept from NYU
the License (as hereinafter defined).
NOW, THEREFORE, in consideration of the mutual promises and agreements
contained herein, the parties hereto hereby agree as follows:
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1. Definitions.
Whenever used in this Agreement, the following terms shall have the
following meanings:
a. "Calendar Year" shall mean any consecutive period of twelve months
commencing on the first day of January of any year.
b. "Combination Product" shall mean a product containing Licensed
Product(s) combined or bundled with other non-Licensed Product(s)
in a single package.
c. "Corporation Entity" shall mean any company or other legal entity
which controls, or is controlled by, or is under common control
with, CORPORATION; control means the holding of fifty and one tenth
percent (50.1%) or more of (i) the capital stock and/or (ii) the
voting rights and/or (iii) the right to elect or appoint directors.
d. "HORL" shall mean Home Office Reference Laboratory. Inc., a
corporation organized and existing under the laws of the State of
Delaware, having its principal offices at 10310 West 84th Terrace,
Lenexa, Kansas 66214, and shall include HORL Corporation Entities
(as such term is defined in the NYU-HORL Agreement). The "NYU-HORL
Agreement" shall mean the agreement between NYU and HORL dated
November 15, 1989 and amended in April 1992 with respect to the
practice of NYU Patents for use in testing for insurance purposes,
a copy of which agreement and amendment, with financial terms
redacted, is annexed hereto as Appendix III.
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e. "License" shall mean the exclusive worldwide license under the NYU
Patents (as hereinafter defined) to make, have made, use, sell or
otherwise distribute the Licensed Products (as hereinafter
defined), during the term of this Agreement.
f. "Licensed Product(s)" shall mean any product for the analysis of a
human urine sample of an individual to assay HIV antibodies in
urine covered by one or more Valid Claims (as hereinafter defined)
of the NYU Patents.
g. "Net Sales" shall mean the total amount received in connection with
sales of the Licensed Products and/or performance of Tests and/or
Confirmatory Tests (as hereinafter defined), after deduction of all
the following to the extent applicable:
i) all trade, case and quantity credits, discounts,
refunds or rebates;
ii) allowances or credits for returns;
iii) sales commissions; and
iv) sales taxes (including value-added tax).
h. "NYU Patents" shall mean U.S. patents and patent applications
(including U.S. Patent No. 4,865,966, issued on September 12, 1989,
and U.S. Patent No. 5,122,446, issued on June 16, 1992), and
foreign counterpart patent applications and patents thereto; owned,
assigned or assignable to NYU, and any reissues, renewals,
divisions, continuations, continuations-in-part, substitutes,
divisions or extensions thereof, and
- 3 -
17
pending applications therefor, including those identified in
annexed Appendix I and forming an integral part hereof. which are
related to the detection of antibodies to HIV in urine.
i. "NYU Scientist" shall mean Dr. Alvin Friedman-Kien of NYU.
j. "Sublicensee" shall mean any third party to whom a sublicense is
granted by CORPORATION as described in Section 5.c. below.
k. "Test" shall mean a test of a human urine sample to assay HIV
antibodies and which is covered by one or more Valid Claims (as
hereinafter defined) of the NYU Patents. "Confirmatory Test" shall
mean a Test (as defined in this subsection) used to verify a result
obtained by using a Licensed Product.
1. "Valid Claim" shall mean a claim of an issued NYU Patent which has
not expired, lapsed, become abandoned or dedicated to the public or
been declared or rendered invalid or unenforceable by reason of
reissue, reexamination, disclaimer or final judgment by a court of
competent jurisdiction or administrative agency from which no
appeal can be or is taken.
2. Effective Date.
This Agreement shall be effective as of the Effective Date and shall
remain in full force and effect until it expires or is terminated in
accordance with its provisions.
3. Title.
Subject to the terms and conditions of this Agreement, it is hereby agreed
that all right, title and interest, in and to the NYU Patents, vests
solely in NYU.
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18
4. Patents and Patent Applications.
a. CORPORATION shall, simultaneously with the signing of this
Agreement pay NYU the sum of
, being the amount of all costs and fees incurred
by NYU up to the Effective Date in connection with the NYU Patents.
b. All applications and proceedings with respect to the NYU Patents
after the Effective Date shall be prosecuted and maintained by NYU
at the expense of CORPORATION. Against the submission of detailed
quarterly invoices, CORPORATION shall reimburse NYU for all
reasonable out of pocket costs and fees incurred by NYU during the
term of this Agreement, in connection with the drafting, filing,
maintenance, prosecution, and issuance of the NYU Patents. Such
reimbursable costs and fees shall not include NYU overhead charges
and/or internal costs. NYU shall not be entitled to reimbursement
for patent filing, prosecution and maintenance expenses in excess
of ten thousand dollars. (U.S. $10,000) per year with respect to
the NYU Patents unless NYU has obtained the prior written consent
of CORPORATION to such expenses. In the event CORPORATION refuses
to consent to such expenditures on a particular patent or patent
application, NYU shall be free to pursue patent protection with
respect to that particular patent or application at NYU's expense
and all rights to that patent or application shall revert to NYU
and CORPORATION shall have no right to make, use, sell, manufacture
or have manufactured products which are covered by a Valid Claim
Confidential portion has been omitted and filed separately with the Commission
- 5 -
19
of such patent or application. However, CORPORATION's License under
this Agreement shall continue with respect to all other NYU
Patents.
c. CORPORATION shall have the right to approve and comment on the
strategy and prosecution of the NYU Patents. NYU shall not abandon
any NYU Patents without first consulting with CORPORATION and
obtaining CORPORATION's consent for such abandonment unless
abandonment is in favor of a subsequent patent application claiming
the subject matter of the proposed abandoned application and the
patentability of the subject matter is not negatively affected.
Both parties agree to cooperate with each other regarding the NYU
Patents, and NYU agrees to use its best efforts to obtain and
maintain the NYU Patents.
d. Nothing herein contained shall be deemed to be a warranty by NYU
that
i) NYU can or will be able to obtain any patent or
patents on any patent application or applications in
the NYU Patents or any portion thereof, or that any
of the NYU Patents will afford adequate or
commercially worthwhile protection, or
ii) that the manufacture, use, or sale of any Licensed
Product will not infringe any patent(s) of a third
party.
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20
5. Grant of License.
a. Subject to the terms and conditions hereinafter set forth, NYU
hereby grants to CORPORATION and CORPORATION hereby accepts from
NYU the License as defined in Section 1.e.
b. The License granted to CORPORATION in Section 5.a. hereto shall
remain in force, if not previously terminated under the terms of
this Agreement, until the expiration date of the last to expire of
the NYU Patents.
c. CORPORATION shall be entitled to grant sublicenses under the
License to a Corporation Entity or to other third parties. All
sublicenses shall only be granted by CORPORATION under a written
agreement, copies of which shall be provided by CORPORATION to NYU
and HORL as soon as practicable after the signing thereof. Each
sublicense granted by CORPORATION hereunder shall be subject and
subordinate to the terms and conditions of this Agreement and shall
contain (inter-alia) the following provisions:
(1) the sublicense shall expire automatically on the termination
of the License;
(2) the sublicense shall not be assignable, in whole or in part:
(3) the Sublicensee shall not grant further sublicenses;
(4) the sublicense agreement shall include i) an obligation by
the Sublicensee to obtain and maintain insurance and to
provide evidence thereof to NYU and to indemnify NYU as
described in Sections 12 and 13 of this Agreement and the
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21
sublicense agreement shall state that NYU is an intended third
party beneficiary of such sublicense agreement for the
purposes of enforcing such indemnification and insurance
provisions, and ii) the text of Section 15.b. and 15.d. of
this Agreement, applicable to Sublicensee, and shall state
that HORL is an intended third party beneficiary of such
sublicense agreement for the purpose of enforcing such
provisions for so long as Section 15 is applicable to this
Agreement.
(5) the breach by any Sublicensee of its obligations to
CORPORATION shall not be deemed a breach by CORPORATION and
such breach shall not, in any way, affect CORPORATION's rights
and obligations under this Agreement. However, in the event of
a material breach (including without limitation, a failure to
pay royalties due) by a Sublicensee, CORPORATION shall
promptly notify NYU of the breach and either promptly
terminate the sublicense agreement or shall continue to be
obligated for payment to NYU of all royalties due from the
Sublicensee.
(6) the right of NYU to audit Sublicensee's records at its own
expense.
6. Payments for License.
a. In consideration for the grant and during the term of the License,
CORPORATION shall pay to NYU:
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22
(1) on the Effective Date, a non-refundable, non-creditable
(except as provided in Section 11.j.) license issue fee of
five hundred twenty-five thousand dollars (U.S. $525,000.00);
and
(2) a royalty of five percent (5%) of the Net Sales of Licensed
Product(s) by CORPORATION, Corporation Entity and Sublicensees
in any country in which the Licensed Product is covered by a
Valid Claim(s); and
(3) a royalty of five percent (5%) of the Net Sales for each Test
and Confirmatory Test by CORPORATION, Corporation Entity, and
Sublicensees in any country in which the Test or Confirmatory
Test is covered by a Valid Claim; and
(4) a royalty of two and one-half percent (2-1/2%) of Net Sales of
Licensed Products by CORPORATION, Corporation Entity or
Sublicensees in any country in which an NYU Patent has not
issued if such Licensed Product was manufactured in a country
in which the Licensed Product is covered by a Valid Claim(s).
(5) If more than one of the royalty rates should be applicable to
any transaction or to any Licensed Product, only a single
royalty shall be due and that royalty shall be computed at the
highest applicable rate. No royalties shall be due upon sales
of Licensed Products to and between Corporation Entities or
Sublicensee(s) for further sale; provided, however, that
royalties with respect to such sales shall be payable upon a
sale of such Licensed Products to any person or entity that is
not either a Corporation Entity or a Sublicensee.
- 9 -
23
(6) If Licensed Product is sold as a Combination Product, then the
Net Sales attributable to such Licensed Product shall be based
upon the ratio of the list price for the Licensed Product to
the combined list prices of the Licensed Product and the other
non-Licensed Product(s); provided that where there is no list
price for a component of the Combination Product, the parties
agree to negotiate the appropriate ratio in good faith. If
CORPORATION desires to sell a Combination Product for which
there is no list price for components, CORPORATION shall
notify NYU and commence such negotiations in good faith. In
such case, CORPORATION shall have no right to sell such
Combination Product until and unless NYU and CORPORATION shall
have concluded a written agreement with respect to the ratio
of royalties to be paid by CORPORATION with respect to such
Combination Product(s).
b. For the purpose of computing the royalties due to NYU hereunder,
the year shall be divided into four quarters ending on March 31,
June 30, September 30 and December 31. Not later than sixty (60)
days after the end of each quarter in each Calendar Year during the
term of the License, CORPORATION shall submit to NYU a full and
detailed report of payments due NYU under the terms of this
Agreement for the preceding quarter year (hereinafter "the
Quarterly Report"), setting forth the Net Sales and all royalties
or other consideration upon which such payments are computed and
including at least
i) total sales of Licensed Products;
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24
ii) the deductions permitted under subsection 1.g. to
arrive at Net Sales of Licensed Products;
iii) total amount received with respect to Tests and
Confirmatory Tests;
iv) the deductions permitted under subsection 1.g. to
arrive at Net Sales of Tests and Confirmatory Tests;
and
v) the royalty computations on Licensed Products, Tests
and Confirmatory Tests.
The Quarterly Report shall separately state the total Net Sales, Tests and
Confirmatory Tests of CORPORATION, Corporation Entity and Sublicensees
with respect to Net Sales, Tests and Confirmatory Tests to persons or
entities engaged in testing for insurance purposes.
If no royalties or other payments are due, a statement shall be sent to
NYU stating such fact. Payment of the full amount of any royalties or
other payments due to NYU for the preceding quarter year shall accompany
each Quarterly Report. CORPORATION shall keep for a period of at least
three (3) years after the date of entry, full, accurate and complete books
and records consistent with sound business and accounting practices and in
such form and in such detail as to enable the determination of the amounts
due to NYU from CORPORATION pursuant to the terms of this Agreement.
- 11 -
25
As part of CORPORATION's normal annual audit or a special audit if sooner,
the payments and Quarterly Reports will be verified for accuracy. In the
event a correction needs to be made regarding the payment and/or Report,
CORPORATION will make the appropriate payment and send NYU a new Report
within sixty (60) days.
c. On reasonable notice and during regular business hours, NYU or the
authorized representative of NYU shall each have the right to inspect the
books of accounts, records and other relevant documentation of CORPORATION
or of Corporation Entity and of Sublicensees insofar as they relate to the
production, marketing and sale of the Licensed Products or Tests, in order
to ascertain or verify the amount of royalties and other payments due to
NYU hereunder, and the accuracy of the information provided to NYU in the
aforementioned reports. This inspection shall be at NYU's expense,
provided, however, that all information received as a result of the
inspection shall be maintained in confidence by NYU and its
representatives; provided, however, that NYU shall have the right to use
such information to enforce the terms of this Agreement. NYU's right to
inspect must be exercised within three (3) years of NYU's receipt of the
Report which NYU desires to verify. In the event an audit conducted by NYU
demonstrates amounts due to NYU in excess of ten percent (10%) of the
total amount paid to NYU with respect to any Calendar Year, CORPORATION
shall reimburse NYU for the expenses of NYU's audit.
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26
d. Beginning on January 1, 1994 and continuing thereafter until this
Agreement shall terminate or expire. CORPORATION agrees that if the
total amounts paid to NYU under subsection 6.a. hereof do not amount
to in the 1994 Calendar
Year, in the 1995
Calendar Year in the
1996 Calendar Year and
in the 1997 Calendar Year and each Calendar Year
thereafter, CORPORATION will pay to NYU within ninety (90) days
after the end of each such Calendar Year, as additional royalty, the
difference between the amount of the total royalties paid to NYU by
CORPORATION in such Calendar Year and the amount stated herein with
respect to such Calendar Year (hereinafter Minimum Annual Royalty),
failing which NYU shall have the right, upon written notice to
CORPORATION, to convert the License to a non-exclusive license,
having the same royalty rates as in Section 6.a. In the event the
License has been converted to a non-exclusive license, CORPORATION
shall no longer be obligated to pay the Minimum Annual Royalty of
this subsection.
7. Method of Payment.
Royalties and any other payments due to NYU hereunder shall be paid to NYU
in United States dollars. Any such royalties on or other payments relating
to transactions in a foreign currency shall be
Confidential portion has been omitted and filed separately with the Commission
- 13 -
27
converted into United States dollars based on the conversion rate for the
particular currency as listed In the Wall Street Journal on the last
business day of the quarter for which such royalty or other payment is
due. If restrictions on the transfer of currency exist in any country such
as to prevent CORPORATION from making payments in the United States or in
U.S. dollars, CORPORATION shall make payments due in such country In local
currency and/or deposit such payments in a local bank designated by NYU.
8. Development and Commercialization
a. CORPORATION agrees that It is developing at least one Licensed
Product(s), and will pursue reasonable activities necessary in order
to attempt to obtain the approval of the Food and Drug
Administration (FDA) or other appropriate authority, for the
production, use and sale of the Licensed Product(s) by CORPORATION
or its Corporate Entity.
b. CORPORATION undertakes to begin the regular commercial production,
use and sale of the Licensed Products In good faith and as soon as
practicable, subject to FDA or other governmental agency license or
approval.
9. NYU's "March-in" Rights and Obligations.
a. During the period commencing upon the Effective Date and continuing
for forty (40) months thereafter, CORPORATION shall
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28
have no obligation to grant sublicenses under the License. Following such
initial 40-month period, CORPORATION undertakes to negotiate and grant a
sublicense under the License to any interested party and in the event
CORPORATION has not granted a sublicense to said interested party after a
six-month period of good faith negotiations with such party, NYU shall
have "march-in" rights to grant a non-exclusive license in and to the NYU
Patents directly to such third party. In the event NYU grants a
non-exclusive license with the interested party which contains terms more
favorable than those under Section 6.a.(2)-(4) of this Agreement, NYU
agrees that this Agreement shall be deemed appropriately amended to
provide such terms to CORPORATION and its Sublicensees, effective
immediately upon execution of the non-exclusive license. Therefore,
CORPORATION and its Sublicensees shall have most favored licensee status.
b. In the event NYU grants a non-exclusive license pursuant to this Section
9, NYU shall provide CORPORATION with a copy of the license agreement and
pay to CORPORATION of any
monetary consideration (including royalties on Net Sales) received by NYU
under the terms of, or as a consideration for the grant of, a
non-exclusive license of any rights in and to the NYU Patents. Such
non-exclusive license shall be in writing, shall not be assignable in
whole or in part and shall not include the right to grant sublicenses
under the non-exclusive license. Such non-exclusive license shall contain
terms substantially identical to Section 15 of this Agreement, for so long
as
Confidential portion has been omitted and filed separately with the Commission
- 15 -
29
Section 15 is applicable to this Agreement. A breach by the non-exclusive
licensee of its obligations shall not be deemed a breach by NYU and such
breach shall not, in any way, affect NYU's rights and obligations under
this Agreement. However, in the event the non-exclusive licensee fails to
pay royalties due to NYU, and in which CORPORATION shares pursuant to this
Section, NYU shall notify CORPORATION and if requested by CORPORATION, NYU
shall promptly terminate the non-exclusive license agreement. In the event
the non-exclusive licensee grants sublicenses in breach of the
non-exclusive license with NYU and CORPORATION demonstrates conclusively
to NYU that such sublicensing has occurred, NYU shall promptly terminate
the nonexclusive license agreement.
c. For the purpose of computing the payments due to CORPORATION under this
Section 9, the year shall be divided into four quarters ending on March
31, June 30, September 30 and December 31. Not later than sixty (60) days
after the end of each quarter in each Calendar Year during the term of the
non-exclusive license, NYU shall submit to CORPORATION a full and
detailed report of payments due CORPORATION under the terms of the
non-exclusive license for the preceding quarter year, setting forth the
payments due to CORPORATION, setting forth the net sales and/or lump sum
payments and all other royalties or consideration upon which such payments
are computed and including at least the total sales of product, the
deductions permitted to arrive at the net sales and the royalty
computations.
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30
If no royalties or other payments are due, a statement shall be sent to
CORPORATION stating such fact. Payment of the full amount due to
CORPORATION for the preceding quarter year shall accompany each report.
NYU shall keep for a period of at least three (3) years after the date of
entry, full, accurate and complete books and records consistent with sound
business and accounting practices and in such form and in such detail as
to enable the determination of the amounts due to CORPORATION from NYU
pursuant to the terms of this Agreement. As part of NYU's normal annual
audit, the payments and reports will be verified for accuracy. In the
event a correction needs to be made regarding the payment and/or report,
NYU will make the appropriate payment and send CORPORATION a new report
within sixty (60) days.
d. On reasonable notice and during regular business hours, CORPORATION or the
authorized representative of CORPORATION shall each have the right to
inspect the books of accounts, records and other relevant documentation of
NYU insofar as they relate to revenues from the non-exclusive license, in
order to ascertain or verify the amount of royalties and other payments
due to CORPORATION hereunder, and the accuracy of the information provided
to CORPORATION in the aforementioned reports. This inspection shall be at
CORPORATION's expense, provided, however, that all information received as
a result of the inspection shall be maintained in confidence by
CORPORATION and its representatives; provided, however that CORPORATION
- 17 -
31
shall have the right to use such information to enforce the terms of
this Agreement. CORPORATION's right to inspect must be exercised
within three (3) years of CORPORATION's receipt of the report which
CORPORATION desires to verify. In the event an audit conducted by
CORPORATION demonstrates amounts due to CORPORATION in excess of
five percent (5%) of the total amount paid to CORPORATION with
respect to any Calendar Year, NYU shall reimburse CORPORATION for
the expenses of CORPORATION'S audit.
e. Payments due to CORPORATION shall be paid to CORPORATION in United
States dollars. Any payments relating to transactions in a foreign
currency shall be converted into United States dollars based on the
conversion rate for the particular currency as listed in the Wall
Street Journal on the last business day of the quarter for which
payment is due. If restrictions on the transfer of currency exist in
any country such as to prevent NYU from making payments in the
United States or in U.S. dollars, NYU shall make payments due in
such country in local currency and/or deposit such payments in a
local bank designated by CORPORATION.
10. Defense of NYU Patent.
a. NYU has disclosed to CORPORATION that Abbott Laboratories, Inc.
(hereinafter "Abbott") has asserted a claim of ownership rights with
respect to the NYU Patents as contained in correspondence and
documents in Appendix II annexed hereto and made an integral part of
this Agreement. Throughout the term of this Agreement,
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32
NYU shall notify CORPORATION in writing within ten (10) business days
every time NYU and/or the NYU Scientist is contacted by or contacts
(orally or in writing) Abbott regarding the claim of ownership rights with
respect to the NYU Patent(s). NYU also shall provide copies to CORPORATION
of any correspondence it or the NYU Scientist receives or has received
from Abbott. or sends or has sent to Abbott in this regard within ten (10)
business days of receiving or sending.
b. Upon the Effective Date, CORPORATION shall pay to NYU the sum of
to be held by NYU
in a special interest-bearing account and expended only for out-of-pocket
legal defense fees and costs in the event that a third party asserts a
claim with respect to the ownership and/or validity of the NYU Patents
("the Legal Defense Fund"). NYU shall not expend the Legal Defense Fund
(including the accumulated interest) for any purpose except for reasonable
out-of-pocket legal defense fees and costs for six (6) years after the
first sale of Licensed Product or after the initiation of a lawsuit by the
third party, provided such lawsuit is initiated during such six-year
period, whichever is later. In the event that the Legal Defense Fund is
not expended during such period, the Legal Defense Fund shall be the
property of NYU without restriction; however, any accumulated interest
will be the property of CORPORATION without restriction. In the event the
Legal Defense Fund (including the accumulated interest) is exhausted, NYU
shall have no further obligation to CORPORATION
Confidential portion has been omitted and filed separately with the Commission
- 19 -
33
with respect to defense against such ownership and/or validity of lawsuit
except as provided under Section 11. NYU shall not settle such ownership
and/or validity lawsuit without providing CORPORATION with written notice
at least thirty (30) days in advance of the settlement. In the event NYU
decides to settle such lawsuit, it shall not assign its entire ownership
rights of NYU Patents to a third party as part of the settlement without
CORPORATION's prior written approval.
c. Any expenses incurred by CORPORATION or NYU in conjunction with the
prosecution of any suit or the settlement thereof relating to a third
party assertion of a claim with respect to the ownership and/or validity
of the NYU Patents shall be first paid for from the Legal Defense Fund
(including the accumulated interest), provided such lawsuit is initiated
during the six (6) year period described in Section 10.b.
11. Infringement of NYU Patent.
a. In the event a party to this Agreement acquires information that a third
party is infringing one or more of the NYU Patents, the party acquiring
such information shall promptly notify the other party to the Agreement in
writing of such infringement.
b. In the event of an infringement of an NYU Patent. CORPORATION shall have
an exclusive right (but not the obligation) to bring suit against the
infringer for a period of six (6) months after acquiring information that
a third party is infringing; provided,
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34
however, that CORPORATION shall not have the right to bring suit against
HORL or a HORL Corporation Entity or any third party which has been
granted immunity from claims of infringement of the NYU Patents for the
sole purpose of providing Test kits exclusively for HORL or for HORL
Corporation Entities during the term of the NYU-HORL Agreement. (This
protection against an infringement action shall not apply if the third
party, which has been granted immunity, itself sells Test kits or provides
Test kits to any entity other than to HORL and HORL Corporation Entities.)
Should CORPORATION elect to bring suit against an infringer and NYU is
joined as a party plaintiff in any such suit, NYU shall have the right to
approve the counsel selected by CORPORATION to represent CORPORATION and
NYU, which approval shall not be unreasonably withheld. The expenses of
such suit or suits that CORPORATION elects to bring, including any
reasonable out-of-pocket expenses of NYU incurred in conjunction with the
prosecution of such suit or the settlement thereof, shall be paid for
entirely by CORPORATION and CORPORATION shall hold NYU free, clear and
harmless from and against any and all costs of such litigation, including
attorneys' fees.
c. In the event CORPORATION exercises the right to sue herein conferred, it
shall have the right to first reimburse itself out of any sums recovered
in such suit or in settlement thereof for all costs and expenses of every
kind and character, including attorneys' fees, necessarily involved in the
prosecution of any
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35
such suit, and if after such reimbursement, any funds shall remain from
said recovery, CORPORATION shall promptly pay to NYU an amount equal to
five percent (5%) of such remainder and CORPORATION shall be entitled to
receive and retain the balance of the remainder of such recovery.
d. In the event CORPORATION does not bring suit by the end of the six (6)
month period described in b. above, NYU shall have the right (but not the
obligation) to bring suit, after written notice to CORPORATION of its
intention. If CORPORATION is joined as a party plaintiff in any such suit,
CORPORATION shall have the right to approve the counsel selected by NYU
to represent NYU and CORPORATION, which approval shall not be unreasonably
withheld. The expenses of such suit or suits that NYU elects to bring,
including any reasonable out-of-pocket expenses of CORPORATION incurred in
conjunction with the prosecution of such suit or the settlement thereof,
shall be paid for entirely by NYU and NYU shall hold CORPORATION free,
clear and harmless from and against any and all costs of such litigation,
including attorneys' fees.
e. In the event NYU exercises the right to sue herein conferred, it shall
have the right to first reimburse itself out of any sums recovered in such
suit or in settlement thereof for all costs and expenses of every kind and
character, including attorneys' fees, necessarily involved in the
prosecution of any such suit, and if after such reimbursement, any funds
shall remain from
- 22 -
36
said recovery, NYU shall pay CORPORATION an amount equal to five percent
(5%) of such remainder and NYU shall be entitled to receive and retain the
balance of the remainder of such recovery.
f. CORPORATION shall not have the right to grant cross-license(s) to a third
party in settlement of any infringement action, except with the consent of
NYU, and provided that the following conditions are satisfied:
1) NYU is consulted beforehand and is reasonably satisfied that the
third party has a legal position or right which does, or could,
limit CORPORATION's ability to market or to make, have made, sell or
distribute Licensed Products;
2) The rights received by CORPORATION under such agreement cover only
Licensed Products and are not directed to other products;
3) NYU incurs no financial or legal liabilities under such agreement,
and the terms of such agreement would not cause NYU to be subject to
a claim of breach under the NYU-HORL Agreement; and
4) NYU shall receive royalties in accordance with the provisions of
Section 6.a. with respect to Licensed Products, Tests and
Confirmatory Tests by such cross-licensee.
g. In any suit with respect to the NYU Patents, the parties shall cooperate
fully, and upon the request and at the expense of the party bringing suit,
the other party shall make available to the
- 23 -
37
party bringing suit all records, papers, information, samples, specimens,
individuals and the like which may be relevant.
h. Each party shall always have the right to be represented by counsel of its
own selection and at its own expense in any suit for infringement of the
NYU Patents instituted by the other party to this Agreement under the
terms hereof.
i. In the event a court of competent jurisdiction determines in a final
judgment from which no further appeal can or has been taken that a claim
of one or more NYU Patents is invalid or unenforceable, no further payment
with respect to Licensed Products covered by said NYU Patent(s) shall be
due or owing hereunder and CORPORATION and HORL shall have a paid-up
license as to the affected NYU Patent(s).
j. In the event a court of competent jurisdiction determines in a final
judgment from which no further appeal can or has been taken that NYU
co-owns one or more NYU Patents with a third party, or if there is a
settlement approved by NYU to such effect, this Agreement and the License
granted hereunder shall remain in effect; however, CORPORATION shall be
credited in the amount of eight hundred thousand dollars ($800,000) with
respect to future royalties as of the date of such final court
determination or settlement and shall be immediately relieved from
CORPORATION's obligation to pay NYU Minimum Annual Royalties.
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38
k. In the event a court of competent jurisdiction determines in a final
judgement that NYU does not own one or more NYU Patents, or if there
is a settlement approved by NYU to such effect, no further payment
with respect to Licensed Products covered by said patent(s) shall be
due or owing hereunder.
12. Liability and Indemnification.
a. CORPORATION shall indemnify, defend and hold harmless NYU and its
trustees, officers, medical and professional staff, employees,
students and agents and their respective successors, heirs and
assigns (the "Indemnitees"), against any liability, damage, loss or
expense (including reasonable attorneys' fees and expenses of
litigation) incurred by or imposed upon the Indemnitees or any one
of them in connection with any claims, suits, actions, demands or
judgments arising out of the design, production, manufacture, sale,
use in commerce or in human clinical trials, lease, or promotion by
CORPORATION or by a Sublicensee, Corporation Entity or agent of
CORPORATION of any Licensed Product, process or service relating to,
or developed pursuant to, this Agreement.
b. CORPORATION's indemnification obligation under this Section 12 shall
not apply to any liability, damage, loss or expense to the extent
that it is attributable to the negligent activities or willful
misconduct of any such Indemnitee.
c. CORPORATION agrees, at its own expense, to provide attorneys
reasonably acceptable to NYU to defend against any actions brought
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39
or filed against any Indemnitee with respect to the subject of
indemnity to which such Indemnitee is entitled hereunder, whether or
not such actions are rightfully brought.
13. Security for Indemnification.
a. At such time as any Licensed Product, process or service relating
to, or developed pursuant to, this Agreement is being commercially
distributed or sold (other than for the purpose of obtaining
regulatory approvals) by CORPORATION or by a Corporation Entity,
Sublicensee or agent of CORPORATION, CORPORATION shall at its sole
cost and expense, procure and maintain policies of comprehensive
general liability insurance in amounts not less than five million
dollars (U.S. $5,000,000.00) per incident and five million dollars
(U.S. $5,000,000.00) annual aggregate and naming the Indemnitees as
additional insureds. Such comprehensive general liability insurance
shall provide (i) product liability coverage and (ii) broad form
contractual liability coverage for CORPORATION's indemnification
under Section 12 of this Agreement. If CORPORATION elects to
self-insure all or part of the limits described above (including
deductibles or retentions which are in excess of two hundred fifty
thousand dollars (U.S. $250,000) annual aggregate) such
self-insurance program must be approved by NYU, which approval shall
not be unreasonably withheld. The minimum amounts of insurance
coverage required under this Section 13 shall not be
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40
construed to create a limit of CORPORATION's liability with respect to its
indemnification under Section 12 of this Agreement.
b. CORPORATION shall provide NYU with written evidence of such insurance upon
request of NYU. CORPORATION shall provide NYU with written notice at least
ninety (90) days prior to the cancellation, non-renewal or material change
in such insurance, where possible, or ten (10) business days after
CORPORATION receives notice of such from the insurance company; if
CORPORATION does not obtain replacement insurance providing comparable
coverage within ninety (90) days of notification, NYU shall have the right
to terminate this Agreement according to the provisions of this Agreement.
c. CORPORATION shall maintain such comprehensive general liability insurance
beyond the expiration or termination of this Agreement during (i) the
period that any product, process or service, relating to, or developed
pursuant to, this Agreement is being commercially distributed or sold
(other than for the purpose of obtaining regulatory approvals) by
CORPORATION, Corporation Entity, a Sublicensee or agent of CORPORATION and
(ii) a reasonable period after the period referred to in c.(i) above which
in no event shall be less than seven (7) years after the term of this
Agreement.
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41
14. Expiry and Termination.
a. Unless earlier terminated pursuant to this Section 14 hereof, this
Agreement shall expire on the expiration of the period of the
License as set forth in Section 5.b. above.
b. At any time prior to expiration of this Agreement, either party may
terminate this Agreement forthwith for cause, as "cause" is
described below, by giving written notice to the other party. Cause
for termination by one party of this Agreement shall be deemed to
exist if the other party materially breaches or defaults in the
performance or observance of any of the provisions of this Agreement
and such breach or default is not cured within ninety (90) days or,
in the case of failure to pay any amounts due hereunder, thirty (30)
days (unless otherwise specified herein) after the giving of notice
by the other party specifying such breach or default, or if either
NYU or CORPORATION or Corporation Entity discontinues its business.
c. Any amount payable hereunder by one of the parties to the other,
which has not been paid by the date on which such payment is due,
shall bear interest from such date until the date on which such
payment is made, at the rate of one percent (1%) per annum in excess
of the prime rate prevailing at the Citibank, N.A., in New York,
during the period of arrears and such amount and the interest
thereon may be set off against any amount due, whether in terms of
this Agreement or otherwise, to the party in default by any
non-defaulting party.
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42
d. CORPORATION may terminate this Agreement without cause upon thirty
(30) days' written notice to NYU. CORPORATION may, after the
effective date of such termination, sell some or all Licensed
Products CORPORATION has in inventory at the date of termination,
provided it pays royalty thereon under Section 6.a. of this
Agreement.
e. Upon termination of this Agreement for any reason and prior to
expiration as set forth in Section 14.a. hereof, all rights in and
to the NYU Patents shall revert to NYU, and CORPORATION shall not be
entitled to make any further use whatsoever of the NYU Patents.
f. Termination of this Agreement shall not relieve either party of any
obligation to the other party incurred prior to such termination. In
the event of termination during a Calendar Year for which Minimum
Annual Royalties would be due to NYU pursuant to Section 6.d.,
CORPORATION shall pay such Minimum Annual Royalties on a pro rata
basis for such year.
g. Sections 3, 10, 12, 13, 14, 19 and 20 hereof shall survive and
remain in full force and effect after any termination, cancellation
or expiration of this Agreement.
15. NYU's and CORPORATION's Agreements with respect to HORL.
a. The provisions of this Agreement are subject to the provisions of
the NYU-HORL Agreement, as defined in Section 1.d. hereof. The
provisions of this Section 15 shall be in effect until such time as
the NYU-HORL Agreement expires or is terminated. During the
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43
time the NYU-HORL Agreement is in effect, NYU agrees to provide to
CORPORATION with any further revisions or amendments (with financial terms
redacted) to the NYU-HORL Agreement within ten (10) business days of their
execution and to provide to CORPORATION any information regarding the NYU-
HORL Agreement or relationship which alters or affects CORPORATION's or
NYU's obligations under the present NYU-CORPORATION Agreement also within
ten (10) business days of NYU's knowledge of the information. If a
revision or amendment to the NYU-HORL Agreement would alter or affect
CORPORATION's or NYU's obligation under this Agreement, then CORPORATION
must provide its prior written consent to such revision or amendment which
consent shall not be unreasonably withheld.
b. CORPORATION, Corporation Entity and Sublicensees shall offer to HORL
Licensed Products to perform Tests on terms no less favorable than said
Licensed Products are supplied to any other person or entity performing
testing for insurance purposes; provided, however, HORL shall not be
obligated to purchase said Licensed Products from CORPORATION, Corporation
Entity or Sublicensee but shall be free to purchase said Licensed Products
from a third party.
c. NYU shall have the right to provide to HORL copies of Quarterly and Annual
Reports and other information which may be obtained by NYU pursuant to
Section 6.b-d., provided that HORL has agreed in writing to maintain such
Reports and information in confidence and
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44
not to disclose them to any third party except for the purposes of
enforcing HORL's rights pursuant to the NYU-HORL Agreement, this
Agreement, or both.
d. So long as the NYU-HORL Agreement is in effect, CORPORATION, Corporation
Entity and Sublicensees shall not bring any suit for infringement of the
NYU Patents against HORL or against a third party which has been granted
immunity from claims of infringement of the NYU Patents for the sole
purpose of providing Test kits exclusively for HORL and HORL Corporation
Entities pursuant to Section 5.c. of the NYU-HORL Agreement. CORPORATION,
Corporation Entity and Sublicensees shall be permitted to bring suit for
infringement of the NYU Patents against a third party which has been
granted immunity if the third party sells Test kits or provides Test kits
to any entity other than to HORL or HORL Corporation Entities.
e. In the event HORL purchases Test kits from a third party to which immunity
from claims of infringement of the NYU Patents is granted pursuant to
Section 5.c. of the NYU-HORL Agreement. NYU shall pay CORPORATION
of any royalties and
payments received by NYU pursuant to Section 6.a.(2) of the NYU-HORL
Agreement with respect to Tests performed using such Test kits. NYU shall
provide CORPORATION with the HORL Agreement payment schedule. The immunity
contract to the third party shall not grant further immunity to other
parties. A breach by the third party of its obligations shall not be
deemed a breach by NYU of this Agreement and such breach shall not, in any
way, affect NYU's rights and obligations under this Agreement. However,
Confidential portion has been omitted and filed separately with the Commission
- 31 -
45
in the event that such third party sells Test kits to any party except
HORL and/or HORL Corporation Entities in commercial quantities and
CORPORATION demonstrates conclusively to NYU that such sales have
occurred, NYU shall notify such third party that it is in breach of the
Immunity and shall demand cure, failing which, NYU shall promptly
terminate the immunity contract.
f. For the purpose of computing the payments due to CORPORATION under this
Section 15, the year shall be divided into four quarters ending on March
31, June 30, September 30 and December 31. Not later than sixty (60) days
after the end of each quarter in each Calendar Year during the term of the
third party immunity contract, NYU shall submit to CORPORATION a full and
detailed report of payments due CORPORATION under the terms of the
contract for the preceding quarter year, setting forth the payments due to
CORPORATION, setting forth the net sales and/or lump sum payments and all
other royalties or consideration upon which such payments are computed and
including at least the total sales of product, the deductions permitted to
arrive at the net sales and the royalty computations.
g. If no royalty or other payments are due, a statement shall be sent to
CORPORATION stating such fact. Payment of the full amount due to
CORPORATION for the preceding quarter year shall accompany each report.
NYU shall keep for a period of at least three (3) years after the date of
entry, full accurate and complete books and records consistent with sound
business and accounting practices and in such form and in such detail as
to enable the determination
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46
of the amount due to CORPORATION from NYU pursuant to the terms of this
Agreement. As part of NYU's normal annual audit, the payments and reports
will be verified for accuracy. In the event a correction needs to be made
regarding the payment and/or report, NYU will make the appropriate payment
and send CORPORATION a new Report within sixty (60) days.
h. On reasonable notice an during regular business hours, CORPORATION or the
authorized representative of CORPORATION shall each have the right to
inspect the books of accounts, records and other relevant documentation of
NYU insofar as they relate to revenues from the third party immunity
contract, in order to ascertain or verify the amount of royalties and
other payments due to CORPORATION hereunder, and the accuracy of the
information provided to CORPORATION in the aforementioned reports. This
inspection shall be at CORPORATION's expense, provided, however, that all
information received as a result of the inspection shall be maintained in
confidence by CORPORATION and its representatives; provided, however that
CORPORATION shall have the right to use such information to enforce the
terms of this Agreement. CORPORATION's right to inspect must be exercised
within three (3) years of CORPORATION's receipt of the report which
CORPORATION desires to verify. In the event an audit conducted by
CORPORATION demonstrates amounts due to CORPORATION in excess of ten
percent (10%) of the total amount paid to CORPORATION with respect to any
Calendar Year, NYU shall reimburse CORPORATION for the expenses of
CORPORATION's audit.
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47
Payments due to CORPORATION shall be paid to CORPORATION in United
States dollars. Any payments relating to transactions in a foreign
currency shall be converted into United States dollars based on the
conversion rate for the particular currency as listed in the Wall
Street Journal on the last business day of the quarter for which
payment is due. If restrictions on the transfer of currency exist in
any country such as to prevent NYU from making payments in the
United States or in U.S. dollars, NYU shall make payments due in
such country in local currency and/or deposit such payments in a
local bank designated by CORPORATION.
i. CORPORATION shall not perform Tests for insurance screening purposes
except that CORPORATION and/or Corporation Entity may perform
Confirmatory Tests.
j. HORL is an intended third party beneficiary of this Agreement for
the purpose of enforcing this Section 15.
16. Representations and Warranties by CORPORATION.
CORPORATION hereby represents and warrants to NYU as follows:
(1) CORPORATION is a corporation duly organized, validly existing and in
good standing under the laws of the State of California. CORPORATION
has been granted all requisite power and authority to carry on its
business and to own and operate its properties and assets. The
execution, delivery and performance of this Agreement have been duly
authorized by the Board of Directors of CORPORATION,
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48
(2) There is no pending or, to CORPORATION's knowledge, threatened
litigation involving CORPORATION which would have any effect on this
Agreement or on CORPORATION's ability to perform its obligations
hereunder; and
(3) There is no indenture, contract, or agreement to which CORPORATION
is a party or by which CORPORATION is bound which prohibits or would
prohibit the execution and delivery by CORPORATION of this Agreement
or the performance or observance by CORPORATION of any term or
condition of this Agreement.
17. Representations and Warranties by NYU.
NYU hereby represents and warrants to CORPORATION as follows:
(1) NYU is a corporation duly organized, validly existing and in good
standing under the laws of the State of New York. NYU has been
granted all requisite power and authority to carry on its business
and to own and operate its properties and assets. The execution,
delivery and performance of this Agreement have been duly authorized
by the Board of Trustees of NYU:
(2) There is no pending or, to NYU's knowledge, threatened litigation
involving NYU which would have any effect on this Agreement or on
NYU's ability to perform its obligations hereunder;
(3) There is no indenture, contract, or agreement to which NYU and/or
the NYU Scientist is a party or by which NYU and the NYU Scientist
is bound which prohibits or would prohibit the execution and
delivery by NYU of this Agreement or the
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49
performance or observance by NYU of any term or condition of this
Agreement; and
(4) Subject to the claim of ownership rights by Abbott as set forth in
Section 1O.a. hereof and subject to the rights of HORL as set forth
in Section 15. hereof, NYU is the owner of the entire right, title,
and interest in and to NYU Patents and has the sole right to grant
licenses under such NYU Patents; and NYU has not granted licenses
thereunder to any other person or entity except as set forth in
Section 15 of this Agreement.
18. No Assignment.
Neither CORPORATION nor NYU shall have the right to assign. delegate or
transfer at any time to any party, in whole or in part, any or all of the
rights, duties and interest herein granted without first obtaining the
written consent of the other to such assignment, which consent shall not
be unreasonably withheld. However, CORPORATION shall have the right to
assign, delegate or transfer at any time, in whole or in part, any or all
of the rights, duties and interest herein granted to a Corporation Entity
provided written notice is given promptly to NYU and Corporation Entity
undertakes in writing to perform all the obligations of CORPORATION
pursuant to this Agreement.
19. Use of Name.
Without the prior written consent of the other party which consent shall
not be unreasonably withheld in accordance with the business
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50
practices and policies of the party whose consent is sought, neither
CORPORATION nor NYU shall use the name of the other party or any
adaptation thereof or of any staff member, employee or student of the
other party, including without limitation, in any product labeling,
advertising or sales literature. However, in the event that disclosure is
in connection with any public or private offering, is in connection with a
lawsuit settlement involving NYU and/or Joint Inventions, is in
conjunction with any application for regulatory approval, or is required
by law, either party can make factual statements concerning this Agreement
or file copies of this Agreement so long as the other party has an
opportunity to review and comment on the statements. The comment period
shall be ten (10) working days from the receipt of the statements unless
the parties agree to an extension. Except as provided herein, neither NYU
nor CORPORATION will issue public announcements about this Agreement.
20. Confidentiality.
Except to the extent expressly authorized in this Agreement, the parties
agree that, for the term of this Agreement plus six (6) years thereafter.
the receiving party of written information marked confidential by the
providing party, shall keep it confidential and shall not publish, use, or
otherwise disclose it except to the extent the receiving party can
establish that such information:
1. was already known to the receiving party, other than under an
obligation of confidentiality, at the time of disclosure by the
providing party;
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51
2. was generally available to the public or otherwise part of the
public domain at the time of its disclosure to the receiving party;
3. became generally available to the public or otherwise part of the
public domain after its disclosure and other than through any act or
omission of the receiving party in breach of this Agreement; or
4. was subsequently lawfully disclosed to the receiving party by a
third party.
Each party may disclose the other's information to the extent such
disclosure is reasonably necessary in prosecuting or defending patents and
litigation, complying with applicable governmental regulations and laws,
conducting clinical trials, or negotiating with potential sublicensees.
21. Miscellaneous.
a. In carrying out this Agreement the parties shall comply with all
applicable local, state and federal laws and regulations.
b. If any provision of this Agreement is determined to be invalid or
void, the remaining provisions shall remain in effect.
c. This Agreement shall be deemed to have been made in the State of New
York and shall be governed and interpreted in all respects under the
laws of the State of New York.
d. Any dispute arising under this Agreement shall be resolved in an
action in the courts of New York State or the federal courts located
in New York State, and the parties hereby consent to personal
jurisdiction of such courts in any such action.
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52
e. All payments or notices required or permitted to be given under this
Agreement shall be given in writing and shall be effective when
either personally delivered or deposited, postage prepaid, in the
United States registered or certified mail, addressed as follows:
To NYU: New York University Medical Center
550 First Avenue
New York, NY 10016
Attention: Isaac T. Kohlberg
Vice President for
Industrial Liaison
and
Office of Legal Counsel
New York University
Bobst Library
70 Washington Square South
New York, NY 10012
Attention: Annette B. Johnson, Esq.
Associate General Counsel
To CORPORATION: Calypte Biomedical Corporation
1440 Fourth Street
Berkeley, California 94710
Attention: David J. Robison, Ph.D.
President and
Chief Executive Officer
or such other address or addresses as either party may hereafter
specify by written notice to the other. Such notices and
communications shall be deemed effective on the date of delivery or
fourteen (14) days after having been sent by registered or certified
mail, whichever is earlier.
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53
f. This Agreement (and the annexed Appendices) constitute the entire
Agreement between the parties with respect to the subject matter
contained herein and no variation, modification or waiver of any of
the terms or conditions hereof shall be deemed valid unless made in
writing and signed by both parties hereto. This Agreement supersedes
any and all prior agreements or understandings with respect to the
subject matter contained herein, whether oral or written, between
CORPORATION and NYU.
g. No waiver by either party of any non-performance or violation by the
other party of any of the covenants, obligations or agreements of
such other party hereunder shall be deemed to be a waiver of any
subsequent violation or non-performance of the same or any other
covenant, agreement or obligation, nor shall forbearance by any
party be deemed to be a waiver by such party of its rights or
remedies with respect to such violation or non-performance.
h. The descriptive headings contained in this Agreement are included
for convenience and reference only and shall not be held to expand,
modify or aid in the interpretation, construction or meaning of this
Agreement.
i. It is not the intent of the parties to create a partnership or joint
venture or to assume partnership responsibility or liability. The
obligations of the parties shall be limited to those set out herein
and such obligations shall be several and not joint.
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54
j. In the event of a delay caused by inclement weather, fire, flood,
strike, or other labor dispute, act of God, act of governmental
officials or agencies, or any other cause beyond the control of
either party, such party shall be excused from performance hereunder
for the period of time attributable to such delay.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the date and year first above written.
NEW YORK UNIVERSITY
By: /s/ Isaac T. Kohlberg
-------------------------------
Isaac T. Kohlberg
Vice President for
Title: Industrial Liaison
-------------------------------
Date: Aug. 10th, 1993
-------------------------------
CALYPTE BIOMEDICAL CORPORATION
By: /s/ David J. Robison
-------------------------------
Title: President and CEO
-------------------------------
Date: Aug. 12, 1993
-------------------------------
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APPENDIX I
U.S. PATENTS
Method for Detecting Antibodies to Human Immunodeficiency Virus
Patent No: 4,865,966
Granted: 9/12/89
Method for Detecting Antibodies to Human Immunodeficiency Virus
Patent No: 5,122,446
Granted: 6/16/92
FOREIGN PATENTS AND APPLICATIONS
COUNTRY SERIAL NO. STATUS PATENT NO.
- ------- ---------- ------ ----------
Australia 17182/88 Issued 617671
Canada 564,232 Pending
Japan 504037/88 Pending
Nigeria 59/88 Issued RP10207
South Korea 7016/88 Pending
Sri Lanka 9968 Issued 9968
56
EXHIBIT B
LICENSED PATENT RIGHTS
"Method for Detecting Antibodies to Human Immunodeficiency Virus" United States
Patent Nos. 4,865,966 and 5,122,446, and any divisions, continuations, or
continuations-in-part based thereon, and any patents which may issues therefrom
and any reissues, re-examinations or extensions therefor; and any and all
foreign patents and patent applications corresponding to any of the foregoing
patents and applications.
57
EXHIBIT C
PATENT AND NON-PATENT COUNTRIES
Patent Countries:
United States
Australia
Nigeria
Sri Lanka
Canada (if serial no. 564,232 issues)
Japan (if serial no. 504037/88 issues)
South Korea (if serial no. 7016/88 issues)
Non-Patent Countries:
All countries in the world which are not Patent Countries
Confidential portion has been omitted and filed separately with the Commission