EXHIBIT 10.24
LICENSE AND SUPPLY AGREEMENT
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This Agreement is made and entered into as of this 30th day of September,
1994 (the "Effective Date") by and between HOLOGIC, INC. ("HOLOGIC"), a Delaware
corporation with a principal place of business at 590 Lincoln Street, Waltham,
Massachusetts 02154, and SEREX, INC. ("SEREX"), a New Jersey corporation with a
principal place of business at 230 West Passaic Street, Maywood, New Jersey
07607.
WHEREAS, SEREX has developed a proprietary technology that has applications
for diagnostic test strip markers; and
WHEREAS, HOLOGIC is in the business of developing and marketing diagnostic
products applicable to osteoporosis and bone metabolism; and
WHEREAS, HOLOGIC and SEREX wish to cooperate in the development and
production of a product that uses SEREX's proprietary technology to assess and
quantify bone turnover and
WHEREAS, SEREX is willing to grant, and HOLOGIC desires to obtain, exclusive
rights and licenses in the product resulting from their cooperation;
NOW, THEREFORE, in consideration of the mutual promises made herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
1. DEFINITIONS
The following terms as used in this Agreement shall have the meanings
specified below:
(a) The term "TEST" shall mean a urine-activated test strip marker that
uses the proprietary Serex Antibody Release Assay (SARA) immuno-diagnostic
technology to assess bone turnover, and any IMPROVEMENT thereof.
(b) The term "READER" shall mean one or more reader devices that are
capable of analyzing and displaying the result produced by the use of a TEST and
any IMPROVEMENT thereof.
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(c) The term "PRODUCT" shall mean the TEST and the READER.
(d) The term "IMPROVEMENT" shall mean any modification or addition to
the TEST or READER that improves the cost, accuracy, precision, or processing
speed of such TEST or READER.
(e) The term "PROJECT" shall mean the joint undertaking of HOLOGIC and
SEREX to develop, conduct clinical trials of, gain regulatory approval for,
manufacture, market and sell the PRODUCT.
(f) The term "PATENTS" shall mean the patent, if any, issued in
connection with U.S. Patent Application # 08192778, and any patent application
filed in the United States or elsewhere with respect to the PRODUCT and any
patent issued thereon.
(g) The term "INTELLECTUAL PROPERTY" shall mean the PATENTS and all
trade secrets and other know-how relating to the design, development, and
manufacture of the PRODUCT.
2. ROLE OF THE PARTIES IN COOPERATION
2.1 The parties jointly will devise specifications for the function,
application, utilization, accuracy, and cost of the PRODUCT.
2.2 SEREX will conduct the development of the TEST and supervise the
development of the READER to satisfy the agreed specifications.
2.3 HOLOGIC will design, negotiate, and conduct clinical trials of the
PRODUCT and will bear the cost of such clinical trials. SEREX will cooperate
with HOLOGIC and provide technical assistance to effect clinical trials of the
PRODUCT.
2.4 HOLOGIC will file for and use diligent efforts to obtain approval from
the Food and Drug Administration ("FDA") and any other relevant regulatory
authority in the United States and elsewhere in the world where HOLOGIC intends
to market and sell the PRODUCT. Regulatory approvals will be issued in the name
of HOLOGIC, which will bear the cost of obtaining such approvals. SEREX will
cooperate with HOLOGIC and provide technical assistance to secure regulatory
approvals of the TEST.
2.5 On or before October 1st of each year following FDA approval, HOLOGIC
shall deliver to SEREX a marketing forecast for the following calendar year,
including the estimated number of TESTS HOLOGIC anticipates purchasing during
such period and any delivery requirements HOLOGIC anticipates imposing. Within
thirty (30) days following receipt of such forecast, SEREX shall notify
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HOLOGIC whether it has the capacity to manufacture and deliver the estimated
number of TESTS.
2.6 At HOLOGIC's request from time to time, SEREX will manufacture the
TESTS and design and procure the packaging for the PRODUCT. While HOLOGIC has a
present intention to have SEREX manufacture the TESTS provided SEREX can meet
the quality, quantity and delivery requirements of HOLOGIC, HOLOGIC, subject to
the provisions of Section 8 hereof, reserves to itself, in its sole and absolute
discretion, the right to purchase TESTS from third party manufacturers.
2.7 HOLOGIC will market, distribute and sell the PRODUCT worldwide.
3. CONDUCT OF THE DEVELOPMENT
3.1 It is agreed by both parties hereto that the development of the PRODUCT
under this Agreement will be conducted through mutually agreed steps and
according to a mutually agreed schedule. Within sixty (60) days after the
Effective Date, SEREX will deliver to HOLOGIC a detailed development plan based
on the proposal set forth in HOLOGIC's letter to SEREX dated June 24, 1994, a
copy of which is attached hereto as Appendix A. The proposed plan shall include
estimated costs, performance targets, a monthly budget and a schedule for
development of the PRODUCT. In the event that HOLOGIC does not agree with the
plan as proposed, the parties shall use their best efforts to develop a
development plan with mutually agreeable terms. The development plan, as finally
agreed to by the parties, shall be referred to in this Agreement as the "Plan."
3.2 SEREX will use its best efforts to complete the development of each
step as scheduled in the Plan. In the event that SEREX does not complete a step
as set forth in the Plan or according to the schedule in the Plan, SEREX may
propose a revised Plan, provided that SEREX shall agree to bear all costs and
expenses arising from delays or deviance from the original Plan. HOLOGIC may
accept or reject a proposed revised Plan at its sole discretion.
3.3 SEREX will assign [ * ] persons to work full-time in the development
of the PRODUCT, and will provide all necessary materials, facilities, equipment
and other resources to support such personnel. The persons assigned to the
PROJECT may change from time to time, provided that the persons assigned at any
one time shall have the knowledge and skills appropriate to the portion of the
PROJECT on which they are working.
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3.4 Judith Fitzpatrick, Ph.D., founder and Chief Science Officer of SEREX,
shall serve as PROJECT Manager and agrees to devote whatever portion of her
professional efforts are necessary to ensure that the PROJECT proceeds according
to the Plan. In the event that Dr. Fitzpatrick fails to devote adequate time and
attention to the PROJECT, as determined by HOLOGIC in the reasonable exercise of
its discretion, or if Dr. Fitzpatrick ceases to be actively involved in the
PROJECT or in SEREX's business generally, HOLOGIC, in the sole exercise of its
discretion and at its own expense, may select and appoint a manager to oversee
the conduct and completion of the PROJECT.
3.5 Not less than sixty (60) days prior to the projected date of completion
of SEREX's development of the PRODUCT, as estimated by the parties from time to
time, HOLOGIC shall deliver to SEREX a plan for the clinical trials of the
PRODUCT. The proposed plan shall include a description of the manner in which
the trials will be conducted, as well as an estimated schedule for such trials.
HOLOGIC agrees to use its best efforts to conduct the clinical trials
substantially in accordance with the proposed plan.
3.6 At least fifteen (15) days prior to submitting any filing to the FDA or
any other regulatory authority pursuant to Section 2.4, above, HOLOGIC shall,
prior to submission to the FDA, provide copies of the proposed filings (together
with English translations thereof, where necessary) to SEREX for review and
comment. The final form and contents of any such filing shall be determined by
HOLOGIC in the sole exercise of its discretion.
4. COSTS AND EXPENSES
4.1 HOLOGIC shall reimburse SEREX for the expenses incurred by SEREX to
develop the PRODUCT, not to exceed the sum of [ * ] for any one month;
provided, however, that the maximum amount of expenses for which reimbursement
is required shall be reduced to [ * ] per month upon the commencement of
clinical trials of the TEST (as confirmed by first patient enrollment) and shall
be reduced to [ * ] upon the first commercial sale of the PRODUCT. As used
herein, the term "expenses" shall mean expenses incurred in connection with this
Agreement (even if incurred prior to the Effective Date), salaries and benefits
allocable to the portion of any employee's time spent on the PROJECT, costs of
materials, travel costs specifically related to the PROJECT, and costs of
maintaining and operating laboratory and other facilities used for the PROJECT.
The term "expenses" shall not include any attorneys fees or
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other legal expenses incurred by SEREX in connection with the negotiation,
execution, or enforcement of this Agreement.
4.2 Reimbursement required pursuant to Section 4.1 shall be provided as
follows:
a. HOLOGIC shall pay SEREX the sum of [ * ] upon the execution of
this Agreement;
b. HOLOGIC shall pay SEREX the sum of [ * ] ninety (90) days
after the Effective Date;
c. HOLOGIC shall pay SEREX the lesser of SEREX's projected expenses
for the then-current calendar quarter or [ * ] ([ * ],
after the commencement of clinical trials of the TEST) on or
before the one hundred eightieth day following the Effective Date
and on or before the same day of each third month thereafter, but
in no event sooner than five (5) days after HOLOGIC's receipt of
SEREX's most recent monthly report due pursuant to Section 6.1,
below, in each case minus any amount by which the previous payment
exceeded the actual expenses incurred by SEREX.
5. OPTION TO ADD THIRD PARTY
For a period of ninety (90) days after the Effective Date, HOLOGIC reserves
the right, and SEREX grants HOLOGIC the option, to identify a third party to
assist in and expedite biochemical research for development of the TESTS. If
HOLOGIC identifies such a third party and the identified party is acceptable to
SEREX (such acceptance not to be unreasonably withheld or delayed), then
HOLOGIC, SEREX, and the third party shall use their best efforts to negotiate
their respective rights and obligations in the development of the PRODUCT, which
negotiation may result in the execution of an agreement mutually acceptable to
both parties that modifies or supersedes this Agreement.
6. REPORTS AND MEETINGS
6.1 The PROJECT Manager shall conduct a formal PROJECT review not less
frequently than once per month. On or before the 15th of each month, SEREX will
furnish a written report to HOLOGIC that describes the progress of the
development effort as of the end of the preceding calendar month, including the
status of the PRODUCT, the actual costs incurred to date, the proposed
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work for the next one- and three-month periods, the projected costs of the next
one- and three-month periods, and any other information reasonably requested by
HOLOGIC.
6.2 SEREX shall keep true and accurate records, files, and books of account
containing all the data reasonably required for the full computation and
verification of costs and expenses to be reimbursed under this Agreement or of
income on which reimbursement of amounts due under Section 13.8, if applicable,
are to be computed. Such materials shall be retained for a period of at least 5
years following the end of the fiscal year to which they relate. SEREX's books
of account shall be maintained in accordance with generally accepted accounting
principles consistently applied. SEREX shall permit the reasonable inspection
and copying of such records, files, and books of account by HOLOGIC or its
representatives during regular business hours at SEREX's regular place of
business, provided that HOLOGIC shall give SEREX at least 7 days prior written
notice of its election to inspect such records, files, and books of account.
Fees and expenses incurred in connection with such inspections (including, but
not limited to, professional fees and expenses paid to accountants or other
examiners retained by HOLOGIC and the cost of copying records, files, and books
of account) shall be borne by HOLOGIC, unless such inspection shall reveal that
an error in the amount of five percent (5%) or more of the aggregate amount of
expenses for any month was made, in which case the fees and expenses incurred in
connection with the inspection during which such error was discovered shall be
borne by SEREX.
6.3 HOLOGIC and SEREX shall meet at least once every three months, or more
frequently as the need may arise, at such times and places as mutually agreed in
order to render the technical cooperation most effective and desirable to both
parties.
7. LICENSING AND DISTRIBUTION
7.1 SEREX hereby grants HOLOGIC the exclusive right and license, with the
right to grant sublicenses to others, to use the INTELLECTUAL PROPERTY to
manufacture, market, sell, and distribute the PRODUCT worldwide, in all markets
and for all applications, directly or through such contractors, agents,
distributors, licensees, sublicenses or representatives as HOLOGIC may appoint.
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7.2 In the event that SEREX conceives a new product (not including an
IMPROVEMENT) with applications in bone metabolism, SEREX shall provide HOLOGIC
with a description of such product and with all information available to SEREX
regarding the design, development, application of, or market for such product.
If HOLOGIC notifies SEREX of its interest in such product within thirty (30)
days following receipt of such information, the parties shall negotiate in good
faith the terms of an agreement governing the development and distribution of
such product. In the event that SEREX and HOLOGIC do not agree to the terms of
such an agreement within ninety (90) days following HOLOGIC's notice of its
interest to SEREX, SEREX may, at its option, negotiate a development and
distribution agreement with another party, provided that SEREX may not enter
into an agreement with any third party on more favorable terms to such third
party than SEREX has offered to HOLOGIC.
7.3 To maintain its exclusive rights pursuant to Section 7.1, HOLOGIC is
required to purchase from SEREX or any third party manufacturer, in the
aggregate, at least the minimum number of TESTS specified below in the [ * ]
commencing 90 days after the issuance of a patent on the application filed
pursuant to Section 10.2, below:
(a) [ * ] - [ * ] TESTS
(b) [ * ] - [ * ] TESTS
(c) [ * ] - [ * ] TESTS
(d) [ * ] - [ * ] TESTS
(e) [ * ] - [ * ] TESTS
If HOLOGIC fails to purchase the minimum number of TESTS for any year, then
SEREX may elect, upon sixty (60) days advance notice to HOLOGIC (which notice
must be given within ninety (90) days following the end of such year), to make
HOLOGIC's license and distribution rights nonexclusive, unless HOLOGIC, within
such 60-day period, agrees to pay SEREX an amount equal to the difference
between the amount actually paid pursuant to Section 8 and the amount that would
have been payable if HOLOGIC had purchased the minimum number of TESTS.
8. PAYMENTS
8.1 In consideration of the rights granted to HOLOGIC under this Agreement,
HOLOGIC shall pay SEREX for each TEST purchased, whether from SEREX or a third
party manufacturer, according to the following schedule:
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(a) [ * ] TESTS purchased, [ * ] per TEST
(b) [ * ] TESTS purchased, [ * ] per TEST;
(c) [ * ] or more TESTS purchased, the lesser of [ * ] per
TEST or manufacturing cost plus [ * ] [ * ] per TEST,
provided that, for any year in which HOLOGIC purchases [ * ] TESTS or
more, the price of all TESTS purchased shall be computed in accordance with
subparagraph (c), above.
8.2 In the event that HOLOGIC exercises its right to purchase the TESTS
from a third party manufacturer, as set forth in Section 2.6 hereof, the payment
due to SEREX shall be reduced by the amount paid to the third party, provided
that, in the event that SEREX had the capacity to produce at least the number of
TESTS HOLOGIC notified SEREX it planned to purchase during the year (as provided
in Section 2.5 of this Agreement), the amount due to SEREX shall not be reduced
pursuant to this paragraph below the following amounts:
(a) [ * ] on the first [ * ] TESTS, provided subparagraph
(b) does not apply;
(b) [ * ] on all TESTS in excess of [ * ] and on all TESTS
purchased in a year in which HOLOGIC purchases [ * ] TESTS
or more.
Payments, if any, required to be made by HOLOGIC to SEREX pursuant to this
Section 8.2 shall be made quarterly together with the report to be submitted to
SEREX under Section 8.6 hereof.
8.3 In the event that HOLOGIC is entitled to a refund as a result of the
recalculation of the payments pursuant to Section 8.1 or 8.2(b) in a year in
which more than [ * ] TESTS are purchased, such refund shall be credited
against payments next due from HOLOGIC, provided that, at HOLOGIC's option,
SEREX shall make a cash payment to HOLOGIC with respect to
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any refund not applied within six (6) months from the date first due to HOLOGIC.
8.4 The payments specified in Section 8.1(a) and (b) and the [ * ] maximum
payment specified in Section 8.1(c) may be adjusted one year after FDA approval
for marketing of the PRODUCT is obtained, to reflect the change between the
value of the Consumer Price Index at the time FDA approval was granted and the
value of said Index one year later, provided that that the above-referenced
payments shall not be increased or decreased by more that [ * ] of the
original prices.
8.5 The "manufacturing cost" of the TESTS, for purposes of determining the
price due to SEREX pursuant to Section 8.1(c), shall be SEREX's direct costs of
materials and personnel expended on the fabrication, quality control, and FDA
documentation of the TESTS, plus a pro rata portion of SEREX's manufacturing
overhead based on the portion of SEREX's manufacturing resources allocated to
the manufacture of the TESTS, as confirmed by independent audit.
8.6 HOLOGIC shall keep true and accurate records, files, and books of
account containing all the data reasonably required for the determination and
verification of the number of TESTS purchased by it, on which the amount due to
SEREX under Section 8.2 hereof is to be computed, and shall submit a report to
SEREX within 45 days after the end of any calendar quarter in which HOLOGIC
purchases TESTS from a third party manufacturer, which report shall set forth
the number of TESTS purchased and a calculation of payments due SEREX under
Section 8.2. Such materials shall be retained for a period of at least 5 years
following the end of the fiscal year to which they relate. HOLOGIC's books of
account shall be maintained in accordance with generally accepted accounting
principles consistently applied. HOLOGIC shall permit the reasonable inspection
and copying of such records, files, and books of account by SEREX or its
representatives during regular business hours at HOLOGIC's regular place of
business, provided that SEREX shall give HOLOGIC at least 7 days prior written
notice of its election to inspect such records, files, and books of account.
Fees and expenses incurred in connection with such inspections (including, but
not limited to, professional fees and expenses paid to accountants or other
examiners retained by SEREX and the cost of copying records, files, and books of
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account) shall be borne by SEREX, unless such inspection shall reveal that an
error in the amount of five percent (5%) or more of the aggregate amount paid to
SEREX in any quarter was made, in which case the fees and expenses incurred in
connection with the inspection during which such error was discovered shall be
borne by HOLOGIC.
9. CONFIDENTIALITY
9.1 Each party shall hold in strict confidence and shall cause each of its
officers, directors, employees, and agents to hold in strict confidence any and
all proprietary information that may be disclosed to such party by the other
party, which information shall be identified by the disclosing party as being
confidential, in writing, at the time of the disclosure or, in the event the
disclosure is made orally, within thirty (30) days thereafter.
9.2 Each party understands that the obligation of nondisclosure set forth
in Section 9.1 above shall not apply to any information that:
(a) at the time of the disclosure, is freely available to the general
public or that has been identically disclosed in published
literature or patents, provided that no combination of features
shall be deemed to be within this exception merely because its
component features are freely available to the general public or
have been disclosed in published literature or patents, but only
if the combination itself and its principles of operation are
freely available to the general public or disclosed in published
literature or patents;
(b) is or has become generally known to the public through no fault of
the receiving party,
(c) the receiving party can reasonably show is already known to it or
independently developed by it,
(d) is received by the receiving party without restriction from a
third party who has a right to disclose the same,
(e) is required to be disclosed by a government authority or by order
of a court of competent jurisdiction, provided that such
disclosure is subject to all applicable governmental and judicial
protection available for like material, or
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(f) is approved for release to a third party by the prior written
authorization of the disclosing party.
9.3 Each party will take whatever action is necessary or appropriate to
ensure that its employees, officers, and directors comply with the provisions of
this Section 9 both during and after the time they serve in such capacities. In
the event that any such individual makes an unpermitted disclosure of any
confidential information hereunder, the party with which such individual is
affiliated shall promptly take whatever action is necessary or appropriate to
minimize the adverse effect of such disclosure.
9.4 The parties understand and agree that any breach of the obligation of
confidentiality expressed in this Section 9 may cause irreparable damage to the
business and property of the nondisclosing party. In the event of any such
breach or of the substantial likelihood that such a breach will occur, the
disclosing party understands that the other party may take legal action,
including seeking injunctive relief, to protect its interests and property. The
disclosing party hereby consents to the entry of an injunction in such
circumstances to enjoin the disclosure.
9.5 Notwithstanding the foregoing provisions of this Section 9, each party
may disclose to a third party to be engaged in the PROJECT for such party any
information of the other party to the extent that such information is necessary
for such third party's involvement, provided, however, that prior to any such
disclosure, the third party shall have executed a confidentiality agreement,
substantially in the form attached hereto in Appendix B, agreeing to maintain
the confidentiality of such information.
10. INTELLECTUAL PROPERTY RIGHTS
10.1 Ownership of the INTELLECTUAL PROPERTY shall reside with the party
employing the employee or agent who creates or invents the property in
connection with the development contemplated hereunder; provided however, that
if an invention or device shall have been jointly made by the employees or
agents of both HOLOGIC and SEREX, then HOLOGIC and SEREX shall jointly own any
INTELLECTUAL PROPERTY associated with such joint invention or device.
10.2 SEREX agrees to file an application for a United States patent on the
Serex Antibody Release Assay immuno-diagnostic technology as it applies to
osteoporosis within six (6) months following the Effective Date.
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10.3 All expenses and charges necessary for filing applications for
registration and maintenance fees of any intellectual property right shall be
borne by the party that owns such intellectual property right. All such expenses
and charges arising in connection with any intellectual property right to be
jointly owned by HOLOGIC and SEREX shall be equally borne by HOLOGIC and SEREX.
Notwithstanding the preceding sentence and except as agreed by SEREX pursuant to
Section 10.2, above, neither party shall be obligated to apply for registration
of any intellectual property right owned, in whole or in part, by it if such
party determines, in the reasonable exercise of its business judgment, that such
registration is not necessary or would not be cost effective. If the party
owning such rights (the "OWNER") elects not to register an intellectual property
right, and the other party (the "ASSIGNEE") would have exclusive or nonexclusive
license to exercise the inventions or devices to which such rights pertain, the
ASSIGNEE, at its own expense, may register such intellectual property rights in
the OWNER's name in such countries as it deems necessary or appropriate and the
OWNER will assign its rights in such registration to the ASSIGNEE. No assignment
pursuant to this provision shall negate or otherwise limit the ASSIGNEE's
obligation, if any otherwise exists, to pay royalties to the OWNER with respect
to the intellectual property rights that are the subject of the assigned
registration nor shall any such assignment negate or otherwise limit the OWNER's
rights to use such intellectual property rights.
10.4 The name "Hologic" or HOLOGIC's trademark may be used in connection
with the PRODUCT only with advance written consent of HOLOGIC and, if so used,
creates and confers no right in such name or trademark upon SEREX.
11. INDEMNIFICATION
11.1 HOLOGIC agrees to indemnify and hold SEREX and its officers, directors,
employees, licensees, and agents harmless from and against any liabilities,
costs, or other damages (including reasonable attorneys fees and litigation
costs, regardless of outcome) arising out of a breach of one or more of
HOLOGIC's representations or warranties expressed in Section 15 of this
Agreement, provided SEREX shall have taken reasonable actions to minimize such
liabilities, costs, or other damages and provided, further, that SEREX has
complied with the procedures set forth in subsection 11.4, below. HOLOGIC shall
use its best efforts to have SEREX identified as a third party
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beneficiary of any contractual right to indemnification that HOLOGIC secures
from a third party manufacturer of the PRODUCT.
11.2 SEREX agrees to indemnify and hold HOLOGIC and its officers, directors,
employees, licensees, and agents harmless from and against any liabilities,
costs, or other damages (including reasonable attorneys fees and litigation
costs, regardless of outcome) arising out of the design, manufacture by SEREX,
use, or sale of the PRODUCT or of any improvements or alterations thereto,
provided that no such damages are the result of a use, application, or written
warranty authorized by HOLOGIC without the knowledge of SEREX, or from a breach
of any one or more of SEREX's representations or warranties expressed in Section
15 of this Agreement, provided HOLOGIC shall have taken reasonable actions to
minimize such liabilities, costs, or other damages and provided, further, that
HOLOGIC has complied with the procedures set forth in subsection 11.4, below.
11.3 Each party (the "Indemnifying Party") agrees to indemnify and hold the
other party (the "Indemnified Party") and such other party's officers,
directors, employees, licensees, and agents harmless from and against any
liabilities, costs, or other damages (including reasonable attorneys fees and
litigation costs, regardless of outcome) arising out of the infringement of any
third party's intellectual property rights by the intellectual property owned by
the Indemnifying Party, provided the Indemnified Party shall have taken
reasonable actions to minimize such liabilities, costs, and other damages and
provided, further, that the Indemnified Party has complied with the procedures
set forth in subsection 11.4, below.
11.4 If any claim, action, or other legal proceeding is asserted against a
party for which such party may have a right to indemnification pursuant to this
Section 11, such party (the "Indemnified Party") shall give the other party (the
"Indemnifying Party") prompt written notice of such claim or proceeding and the
Indemnifying Party may elect to control the defense to or settlement of such
dispute. In the event that the Indemnified Party cannot reasonably anticipate
that the Indemnifying Party will receive notice of such claim or proceeding at
least 20 days prior to the date by which any action needs to be taken to
preserve and protect the parties' rights, the Indemnified Party shall take such
action on behalf of the Indemnifying Party. The Indemnified Party shall
cooperate with the Indemnifying Party in any defense
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or settlement made by the Indemnifying Party. The Indemnified Party shall not
enter into any settlement agreement or other voluntary resolution of any such
claim or proceeding without obtaining the Indemnifying Party's prior written
consent thereto.
12. INFRINGEMENT
12.1 If HOLOGIC or SEREX becomes aware that any INTELLECTUAL PROPERTY is
being or may be infringed by a third party, the party who learns of or suspects
such infringement shall promptly notify the other party thereof. SEREX may at
its own expense prosecute any action it deems necessary to protect the rights of
each of the parties to the PRODUCT under this Agreement. If, upon inquiry by
HOLOGIC, SEREX does not initiate any such action or confirm that it intends to
do so promptly and in a timely fashion, HOLOGIC may initiate such an action in
its own behalf. If either party initiates an action pursuant to this Section 12
and recovers damages or lost profits or both as a result thereof, the recovering
party may retain the entire amount of such recovery.
12.2 In any action prosecuted, defended, or resolved by either party
pursuant to this Section 12, the other party shall provide such assistance as
may be reasonably necessary or appropriate and shall be entitled to
noncontrolling participation at its own expense, through counsel of its own
selection.
13. TERM AND TERMINATION
13.1 This Agreement shall remain in effect from the date first written
above until the first anniversary of the Effective Date that occurs after the
expiration of all PATENTS or until terminated by mutual agreement of the parties
or otherwise as provided by law or as permitted in this Section 13.
13.2 This Agreement may be terminated by HOLOGIC, without cause, effective
on a date stated in a notice of termination given to SEREX by HOLOGIC. If
HOLOGIC terminates this Agreement pursuant to this Section 13.2 and such
termination takes place after the expiration of the 90-day option period
specified in Section 5 of this Agreement, HOLOGIC shall pay SEREX's development
expenses for the PROJECT for the three (3) months following the date of
HOLOGIC's notice of termination. If HOLOGIC terminates the Agreement pursuant to
this Section 13.2 after the first commercial sale of the PRODUCT
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in the United States, the effective date of termination shall be at least ninety
(90) days after the date on which notice of termination is given.
13.3 This Agreement may be terminated by either party for material defaults
of the other party, effective immediately upon giving notice of such termination
to the other party, provided that (i) the terminating party shall have given the
defaulting party notice of the occurrence and nature of the default at least
thirty (30) days prior to the notice of termination and (ii) the defaulting
party shall have failed to cure the default during such 30-day period and shall
have failed to initiate action during such 30-day period that is reasonably
calculated to cure the default as promptly as practical.
13.4 This Agreement may be terminated by either party, effective immediately
upon giving notice to the other party, in the event that (i) proceedings are
instituted by such other party in bankruptcy, reorganization, receivership, or
dissolution; or (ii) proceedings are instituted against such other party in
bankruptcy, reorganization, receivership, or dissolution and such proceedings
have not been dismissed or otherwise terminated within sixty (60) days following
the date they were initiated; or (iii) such other party is generally unable to
pay its debts as they come due in the ordinary course of business or makes an
assignment for the benefit of creditors.
13.5 This Agreement may be terminated by HOLOGIC, effective immediately upon
giving notice to SEREX, in the event that (i) the PROJECT deviates materially
and adversely from the Plan, provided that HOLOGIC has given SEREX at least 30
days' prior notice of its intention to terminate hereunder and SEREX has not,
during such 30 days, either satisfied HOLOGIC that the PROJECT is proceeding in
accordance with the Plan or proposed a revised Plan that is acceptable to
HOLOGIC; or (ii) a United States patent is not issued to SEREX pursuant to U.S.
Patent Application # 08192778 within one (1) year following the Effective Date.
13.6 In the event of termination by HOLOGIC pursuant to Section 13.4,
HOLOGIC may, in the sole exercise of its discretion, elect to purchase all of
SEREX's rights in the PRODUCT, including all intellectual property rights
relating to processes, devices, know-how, technology, formulae, or other
components of the PRODUCT (but not including the Serex Antibody Release Assay
technology or other technology developed by SEREX and documented prior to the
Effective Date ("Existing Technology")) and to purchase a perpetual,
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nonexclusive license to use the Existing Technology to complete the development
and commercialization of the PRODUCT (including manufacturing, marketing,
distributing, selling, and using the PRODUCT). In the event that HOLOGIC
exercises its rights pursuant to this Section 13.6, HOLOGIC shall pay SEREX the
amount of [ * ] in cash or, at HOLOGIC's option, in unregistered shares of
HOLOGIC's common stock, which shares shall be subject to a limited right of
registration under the same terms as are set forth in Section 7.12 of the
"Preferred Stock Purchase Agreement" dated as of September 30, 1994 between
HOLOGIC and SEREX. SEREX shall execute such bills of sale, assignments,
representations regarding compliance with state and federal securities laws, and
other documents as HOLOGIC shall reasonably request.
13.7 In the event that HOLOGIC terminates this Agreement pursuant to Section
13.3, 13.4 (provided HOLOGIC does not elect to exercise its rights pursuant to
Section 13.6), or 13.5, SEREX shall reimburse HOLOGIC for [ * ] of the
amounts paid by HOLOGIC pursuant to Section 4 of this Agreement by remitting to
HOLOGIC, at the end of each calendar quarter, [ * ]of the net sales,
royalties, license fees, and other income derived from the PRODUCT or any
device, process, know-how, technology, or other item developed in the course of
the PROJECT.
13.8 Notwithstanding anything to the contrary contained in this Agreement,
HOLOGIC may continue to market, distribute, and sell PRODUCT then in inventory
or for which purchase orders have been issued, for a period of ninety (90) days
following the effective date of termination of this Agreement.
13.9 Sections 9, 10, 11, 13, 16, and 17 shall survive termination of this
Agreement. In the event that HOLOGIC terminates this Agreement and is entitled
to reimbursement from SEREX pursuant to Section 13.7, Section 6.2 shall also
survive termination of this Agreement.
14. INVOLVEMENT OF THIRD PARTIES
Following the option period set forth in Section 5, either party may retain
the services of one or more third parties to assist it in the performance of its
obligations under this Agreement, provided that the party to this Agreement
retains ultimate responsibility for the full and satisfactory performance of its
obligations hereunder.
15. WARRANTIES AND REPRESENTATIONS
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15.1 SEREX hereby represents and warrants to HOLOGIC that:
(a) it is the sole owner of all right, title, and interest in and to
the Serex Antibody Release Assay technology and any other Existing
Technology to be used in connection with the PROJECT, free and
clear of any liens or encumbrances, and has no actual knowledge of
any conflicting patents, patent applications, or proprietary
rights of any third parties;
(b) it has the full authority to enter into this Agreement without the
prior consent, concurrence, or other authorization of any court,
agency, or other third party;
(c) the undersigned officer has the full authority and approval of the
Board of Directors of SEREX to enter into this Agreement; and
(d) this Agreement does not violate the terms of any agreement, order,
stipulation, understanding, or other arrangement to which it is
subject or by which it is bound.
SEREX gives no warranty or representation, express or implied, except as
specifically stated herein.
15.2 HOLOGIC hereby represents and warrants to SEREX that:
(a) it has the full authority to enter into this Agreement without the
prior consent, concurrence, or other authorization of any court,
agency, or other third party;
(b) the undersigned officer has the full authority and approval of the
Board of Directors of HOLOGIC to enter into this Agreement; and
(c) this Agreement does not violate the terms of any agreement, order,
stipulation, understanding, or other arrangement to which it is
subject or by which it is bound.
HOLOGIC gives no warranty or representation, express or implied, except as
specifically stated herein.
16. LIMITATIONS ON LIABILITY
Except as expressly provided in Section 11, neither party shall be liable to
the other party under any theory of liability (including negligence) for any
indirect, special or consequential damages of any kind, or for any lost
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profits or opportunities, even if the party that might be liable was advised of
the possibility of such damage.
17. INSURANCE
SEREX shall procure and maintain, at its sole cost and expense, liability
insurance with a reputable and financially sound insurance carrier or carriers
against liability and claims for injuries to persons (including injuries
resulting in death) and property damage in a combined single limit of not less
than $1,000,000.00 per occurrence, and any additional insurance as may be
required by applicable laws or regulations, and shall furnish to HOLOGIC written
certificates obtained from each insurance carrier showing that insurance has
been procured and is properly maintained, that the premiums therefor are paid,
and specifying the name of the insurance carrier, the policy number or numbers,
and the expiration date or dates. At least thirty (30) days prior written notice
of any cancellation or modification of any such policy shall be given to
HOLOGIC.
18. SERIOUS INJURIES; PRODUCT RECALL; CORRECTIVE ACTION
18.1 Each party shall advise the other, by confirmed facsimile, within
twenty-four (24) hours after the notifying party becomes aware of any serious
injury from the use or malfunction of the PRODUCT. The notifying party shall
include in the notification all information known to it, including (but not
limited to) the name, address, and telephone number of the person or entity that
purchased the PRODUCT in question, the name, address, and telephone number of
the patient (if different), and the lot or serial number of the TEST or READER
involved in the incident, as appropriate.
18.2 If either party believes that a recall of any PRODUCT is necessary or
appropriate, it will promptly notify the other party. The parties will then
discuss reasonably and in good faith whether such recall is necessary or
appropriate (unless such recall is required by law) and the manner in which any
agreed or required recall shall be conducted. If a recall is not required by law
and the parties cannot agree whether or not the recall is necessary or
appropriate, either party may elect to conduct the recall in question. The
parties shall cooperate with each other in conducting any recall pursuant to
this Section. All out-of-pocket costs of a required or agreed recall, except the
printing and mailing costs incurred to notify customers of such recall, shall be
borne by SEREX. All costs of a recall to which the parties have not
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agreed shall be borne by the party that elects to conduct the recall, provided
that, if a court of competent jurisdiction determines that any PRODUCTS recalled
by HOLOGIC were defective or in violation of any applicable law, SEREX shall
reimburse HOLOGIC for all reasonable out-of-pocket costs and expenses of such
recall (except for the mailing and printing costs incurred to notify customers
of such recall). HOLOGIC shall maintain complete and accurate records of all
PRODUCTS sold by it, for such periods as are required by law. Nothing contained
in this Section 18 shall be construed to modify or limit the legal obligations
of either party with respect to any recall that is required by law.
18.3 In the event that any governmental agency having jurisdiction shall
request or order any corrective action with respect to any PRODUCTS, including
(but not limited to) any recall, customer notice, restriction, change, market
action, or any modification of the PRODUCT, and the cause or basis of such
corrective action is primarily attributable to a condition, fact, or action that
constitutes a breach by SEREX of any of its warranties, representations,
obligations, or covenants contained herein or that SEREX knew or should have
known would require such corrective action, then SEREX shall be liable for, and
shall pay or reimburse HOLOGIC for, all costs incurred by HOLOGIC as a result of
such action, including the replacement cost of any PRODUCT affected thereby.
19. FORCE MAJEURE
Neither party shall be responsible for failure or delay to comply with this
Agreement, if such failure or delay is caused by fire, flood, strikes, labor
disputes or other industrial disturbances, unavoidable accidents, war, riots,
civil commotion, embargoes, prohibition of exportation, governmental direction,
intervention of civil, naval, or military authorities, or any other causes
beyond the control of the party. In such case, performance by such party of this
Agreement, other than the obligation to make payments, shall be suspended
without liability to the extent performance is affected and for the period of
delay reasonably attributable to such causes, including, without limitation,
time for recovery from such causes.
20. ASSIGNMENT
Prior to the first commercial sale of the PRODUCT in the United States,
neither party may assign its rights (through contractual assignment, merger,
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consolidation, sale of assets, stock or otherwise), or delegate its obligations
under this Agreement to a third party, unless the assigning or delegating party
obtains the prior written consent of the other party to this Agreement (which
consent shall not be unreasonably withheld or delayed). Notwithstanding the
foregoing and without the consent of SEREX, HOLOGIC may assign any and all
rights and delegate any and all duties under this Agreement at any time during
the term of this Agreement to (a) an entity that is owned or controlled by
HOLOGIC or by the person or persons who own or control HOLOGIC or that owns or
controls HOLOGIC or (b) the purchaser of all or substantially all of HOLOGIC's
business relating to bone metabolism diagnostic products. SEREX shall be
provided with prompt written notice of any such permitted assignment or
delegation by HOLOGIC. Any assignment, delegation, sale, or other transfer by
either party other than as expressly permitted in this Section 20 shall be null
and void.
21. DISPUTE RESOLUTION
21.1 The parties shall attempt in good faith to resolve all disputes that
may arise during the term of this Agreement or thereafter promptly by
negotiation between executives who possess the authority to settle such dispute.
Either party may give the other written notice of any dispute not resolved in
the ordinary course of business. Within fifteen (15) days after delivery of the
notice, the receiving party shall forward a written response to the disputing
party. The notice and the response shall include (a) a brief statement of each
party's position, and (b) the name and title of the executive who will represent
that party in negotiations. Within thirty (30) days after delivery of the
disputing party's notice, the executives of both parties shall meet at a
mutually acceptable time and place, and again thereafter as they reasonably deem
necessary, to exchange relevant information and to attempt to resolve the
dispute. All reasonable requests for information by one party to the other will
be honored. All negotiations pursuant to this Section are confidential and shall
be treated as compromise and settlement negotiations for evidentiary purposes.
21.2 If the dispute has not been resolved within sixty (60) days after
delivery of the disputing party's notice, the dispute shall be submitted to
arbitration under the then prevailing rules of the American Arbitration
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Association for commercial arbitration. The place of arbitration shall be
Boston, Massachusetts. The award of arbitration shall be final and binding.
22. COMPLIANCE WITH LAWS; GOVERNING LAW
22.1 The parties agree to conduct their efforts pursuant to this Agreement
in compliance with all applicable statutory and regulatory requirements,
including making information available to each other that is required in order
to comply with the parties' respective regulatory reporting requirements. The
parties agree to comply with all health registration laws, regulations, and
orders applicable to the development, manufacture, marketing, distribution, and
sale of the PRODUCT.
22.2 This agreement shall be governed by and construed in accordance with
the laws of the Commonwealth of Massachusetts, without reference to any
conflicts of laws provisions.
23. NOTICE
Any notice or other communication required or permitted under this Agreement
shall be sufficiently given, unless specifically required to be given in some
other manner pursuant to the terms of this Agreement, if (a) delivered by hand;
or (b) sent by Federal Express or other overnight carrier; or (c) sent by
telecopier, subject to confirmation of receipt; or (d) sent postage pre-paid by
first class registered or certified mail, return receipt requested, addressed to
the intended recipient as follows:
If to HOLOGIC, to: HOLOGIC, Inc.
590 Lincoln Street
Waltham, Massachusetts 02154
Fax # (617) 890-8031
Attention: Mr. Joel B. Weinstein
Vice President, New Business
Development
If to SEREX, to: Serex, Inc.
230 West Passaic Street
Maywood, New Jersey 07607
Fax # (201) 368-7850
Attention: Sam A. Martin
Chief Executive Officer
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or to other such address as shall be furnished in writing and received by the
other party prior to the giving of applicable notice or communication. All
notices shall be deemed to have been received on the actual date of receipt or
three days after given as provided above, whichever is sooner.
24. PUBLIC ANNOUNCEMENTS; ADVERTISEMENTS
Public announcements of the execution of this Agreement, the development or
commercialization of the PRODUCT, or any other aspect of the PROJECT or of the
parties' collaboration pursuant to this Agreement may be made by either party,
subject to the approval of the other party (which approval shall not be
unreasonably withheld or delayed). Advertisements of the PRODUCT may be made
only by HOLOGIC, subject to the approval of SEREX (which approval shall not be
unreasonably withheld or delayed). The party seeking to publish an announcement
or advertisement shall provide a copy of the text of such announcement or
advertisement to the other party at least five days prior to the scheduled
publication thereof; if the receiving party does not deliver to the publishing
party, within said five-day period, written notice of its objections thereto,
the receiving party shall be deemed to have approved such advertisement or
announcement.
25. PARTIAL INVALIDITY
Both parties hereto agree that invalidity or unenforceability of any of the
provisions, in part or in whole, of this Agreement shall not in any way affect
the validity or enforceability of any other parts or provisions hereof except
those which are an integral part of or are otherwise clearly inseparable from
such invalid or unenforceable part or provision.
26. ENTIRE AGREEMENT AND MODIFICATION
This Agreement is the final expression of the entire and only agreement of
both parties with respect to the subject matter covered in this Agreement and
supersedes all prior oral and written agreements, negotiations, commitments and
representations with respect thereto.
This Agreement cannot be modified except in writing by mutual agreement
signed by duly authorized representatives of both parties hereto.
27. COUNTERPARTS
This Agreement may be executed in separate counterparts, each of which shall
be deemed an original and, when executed, separately or together, shall
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constitute a single original instrument, effective in the same manner as if the
parties hereto had executed one and the same instrument.
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IN WITNESS WHEREOF, both parties hereto have caused this Agreement to be
executed under seal as of the date first written above.
HOLOGIC, INC. SEREX, INC.
By: ___________________________ By: ____________________________
Print Name: ___________________ Print Name: ____________________
Title: ________________________ Title: _________________________
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