Exhibit 10.2
EXCLUSIVE LICENSING AGREEMENT
This Exclusive Licensing Agreement ("Agreement") is made as of July 12, 2005 by
and between Biowell Technology Inc., a company duly incorporated and organized
under the laws of Taiwan, Republic of China ("ROC"), having its principal office
at 18F, No. 959, Chung-Cheng Rd., Chung-Ho City, Taipei County, Taiwan, 235 ROC
(hereinafter referred to as "Biowell"), APDN (B.V.I.) Inc., a corporation duly
incorporated under the laws of the British Virgin Islands, with an office
located at Nemours Chambers, P.O. Box 3170, Road Town, Tortola, British Virgin
Islands ("Licensor") and Applied DNA Sciences, Inc., a corporation duly
incorporated under the laws of the State of Nevada, United States of America
having its principal office at 9229 West Sunset Blvd., Suite 830, Los Angeles,
California 90069, USA ("APDN"). RECITALS
A. Pursuant to that certain Asset Purchase Agreement, dated as of December
22, 2004, (the "Asset Purchase Agreement"), Biowell transferred certain of its
assets and liabilities to Rixflex Holdings Limited, a corporation formed under
the laws of the British Virgin Islands, the shares of which are owned by the
majority existing shareholders for the interests of all of the shareholders of
Biowell ("Rixflex").
B. Biowell and APDN are parties to a Stock Purchase Agreement, dated as of
January 28, 2005 (the "Purchase Agreement"), providing for, among other things,
the acquisition by APDN of all of Biowell's intellectual property used in,
useful to or relating to the Business.
C. The acquisition of Biowell's intellectual property as contemplated by
the Purchase Agreement was accomplished by a merger of Rixflex with and into
Licensor, a wholly owned subsidiary of APDN (the "Merger").
D. Licensor (i) has acquired the Intellectual Property and Intellectual
Property Rights from Biowell as a result of the Merger and/or (ii) owns various
technologies, proprietary knowledge, patents, patent applications, marketing
rights and expertise including, without limitation, various DNA based
anti-counterfeiting technologies, (all collectively hereafter referred to as the
"Technology"). Licensor desires to exclusively license the right to manufacture,
market, sell and sub-license the Technology, Product Materials, and Licensed
Products (all as hereinafter defined) to Biowell in the Biowell Territory, as
defined in Exhibit 1 attached.
E. APDN desires to have and Biowell hereby agrees to grant, the perpetual
option to purchase finished Licensed Products and other Product Materials from
Biowell for resale and other purposes. Biowell agrees to supply these finished
Licensed Products and other Product Materials to APDN in accordance with the
terms of this Agreement.
F. APDN may choose to build lab(s) at its own cost for the purpose of
manufacturing APDN Products and analyzing, selling and testing the APDN
Products, Technology and Product Materials. Biowell agrees during the term of
its license hereunder to fully support APDN, provided that it is reimbursed for
all reasonable costs incurred by it in providing these support activities.
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DEFINITIONS
Unless the context requires otherwise, whenever used in this Agreement the
following terms and expressions shall have the following meaning:
"APDN Products" means products incorporating the Technology or Product
Materials that are manufactured by APDN.
"Agreement" means this agreement including the Exhibits, as they may be
amended from time to time.
"Biowell Territory" means the territories specified as the Biowell
Territory in Exhibit 1.
"Business" means business of developing and manufacturing DNA markers to
protect corporate and intellectual property from counterfeiting, fraud, piracy,
product diversion or unauthorized intrusion
"Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in the city of Taipei or New York are authorized by law
to close.
"Business Methods" means business methods developed, licensed to, and/or
owned by Licensor or Biowell relating to the Technology and Products.
"Confidential Information" includes all information, whether written or
oral, in whatever form disclosed by the parties, concerning any technologies,
products, developments, business methods, business plans, marketing, investment,
management, financial and other business affairs in connection with all matters
relating to or arising out of this Agreement, including without limitation, its
contemplated methods of doing business in the future, its past and present, and
future research and development, test information, product information and
service information, as well as customer and sales information, the Technology,
the Business Methods and Know-How.
"Customers" means any natural or legal person(s) or entities primarily
solicited by Biowell under this Agreement in the Biowell Territory.
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"Delivery Date" means the date specified by APDN or Biowell, as the case
may be, in a Purchase Order on which a Licensed Product or Product Material is
required to be delivered by Biowell to APDN or by APDN to Biowell, as the case
may be.
"Intellectual Property" means the intellectual property (other than with
respect to "off-the-shelf" or other third party software which is generally
commercially available) of Licensor and is used in the conduct of the Business
as presently conducted or as presently proposed to be conducted, including,
computer programs and other computer software (including, without limitation,
all source and object code, algorithms, architecture, structure, display
screens, layouts and development tools), inventions, patents, patent
applications, designs, samples, specifications, schematics, Know-how,
Confidential Information, trade secrets, proprietary processes and formulae, and
development tools, promotional materials, databases, customer lists, supplier,
vendor and dealer lists and marketing research, and all documentation and media
constituting, describing or relating to the foregoing, including, without
limitation, processes, devices and facilities for manufacturing (including
sequencing, imprinting and incorporating DNA), stabilizing DNA, encapsulating
DNA, immobilizing DNA, purifying DNA, extracting DNA, detecting the presence of
DNA and any DNA sequence, or fragment thereof, the subject of any experiment,
test, work, or investigation undertaken by Licensor, and any DNA sequence
corresponding to a sample of DNA, isolated or otherwise, at any time stored,
secured or employed by Licensor, and all validation and testing procedures
related thereto
"Intellectual Property Rights" means all Patents, trademarks, trademark
applications, trade names, service marks, service mark applications, copyrights
(both registered and unregistered, the "Copyrights"), copyright applications and
trade secrets of Licensor with respect to Intellectual Property.
"Know-How" means all information and materials owned by, or licensed to,
Licensor in conducting its business, including any product specifications,
technical knowledge, expertise, skill, practice, inventions, procedures, trade
secrets, equipment arrangements, Confidential Information, and other data,
market studies and all other experience and know-how, in tangible or intangible
form, whether or not patented or patentable; provided, however, that except as
set forth above with respect to equipment arrangements, Know-how shall not
include (i) any plant, property, equipment or employees, and (ii) any items to
the extent that any applicable law prohibits their transfer.
"Licensed Products" means products, as described in Exhibit 3 (which may be
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amended from time to time), manufactured by Biowell incorporating the Technology
and/or Product Materials.
"Net Sales" means Licensee's or any sub-licensee's total gross billings for
sales, leases, licenses or other dispositions of Technology, Product Materials,
Licensed Products or APDN Products, as the case may be, to any party (including,
gross billings for sales or other dispositions thereof to Licensor, APDN and any
affiliate thereof notwithstanding the fact that such sale or disposition is
outside of the Biowell Territory) which is not an affiliate, less the following
deductions where factually applicable: (a) discounts (other than advertising
allowances, fees or commissions to salesmen or sales representatives), credits,
rebates and other allowances allowed and taken; (b) transportation and insurance
charges separately billed to the customer or prepaid; (c) special outbound
packing separately billed to the customer or prepaid; (d) sales, use, turnover,
and similar taxes and customs duties imposed upon and with specific reference to
the particular sales of Licensed Products, excluding income tax of Licensee; (e)
amounts refunded or credited for returned merchandise.
"Product Materials" means any and all raw materials required to manufacture
the Licensed Products or APDN Products.
"Purchase Order" means an order for Licensed Products that APDN submits and
Biowell accepts or an order for APDN Products that Biowell Submits and APDN
accepts, as the case may be. All Purchase Orders will be gathered and controlled
by the terms of this Agreement unless otherwise agreed to in writing by Biowell
and APDN, as the case may be.
1. Grant of Exclusive Right
1.1 Subject to the terms and conditions of this Agreement and for so long as
Biowell is in compliance with all of its obligations hereunder, Licensor hereby
grants an exclusive right for Biowell to: (a) use the Technology in connection
with the manufacture of Licensed Products in the Biowell Territory; and (b) sell
the Licensed Products manufactured by Biowell or APDN Products purchased from
APDN in the Biowell Territory; and (c) sub-license the Technology for the
purpose of manufacturing and selling Licensed Products in the Biowell Territory
(collectively, "Exclusive License"). Except as provided for herein, no express
or implied licenses of any type for the Technology, Product Materials or
Licensed Products shall be granted to Biowell.
1.2 Biowell acknowledges that the Technology is the sole and exclusive property
of Licensor, subject to the license hereby granted. If during the term of this
Agreement, Biowell, any sub-licensee (or any employee, consultant or agent
thereof) or APDN makes any improvements, modifications, or alterations in or to
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the Technology, the Licensed Products, the Product Materials or the mode of
using same related to the business of developing and manufacturing DNA markers
to protect corporate and intellectual property from counterfeiting, fraud,
piracy, product diversion or unauthorized intrusion then such party shall
communicate such improvements, modifications, and alterations to the Licensor
and such party hereby transfers and assigns to Licensor all right, title, and
interest in and to the improvements, modifications and alterations, and such
improvements, modifications and alterations shall become the sole and exclusive
property of Licensor. Any technology or intellectual property developed or
acquired by Biowell that does not relate to the business of developing and
manufacturing DNA markers to protect corporate and intellectual property from
counterfeiting, fraud, piracy, product diversion or unauthorized intrusion shall
be the sole and exclusive property of Biowell.
1.3 Licensor hereby agrees to exclusively license to Biowell within the Biowell
Territory any new improvements, modifications or alterations owned by Licensor
or APDN related to the Technology, the Product Materials or the Licensed
Products in this Agreement (related to the business of developing and
manufacturing DNA markers to protect corporate and intellectual property from
counterfeiting, fraud, piracy, product diversion or unauthorized intrusion)
subject to the Parties' negotiations on terms and conditions mutually agreed on.
1.4 In order to maintain the exclusivity of rights granted to it in this
Agreement, for each specific territory within the Biowell Territory, Biowell
shall make Royalty payments to Licensor as set forth in Section 3.1 below. In
each annual period Biowell shall achieve the Net Sales targets for each
territory within the Biowell Territory as set forth in Exhibit 1 of this
Agreement. Any sales of Licensed Products or APDN Products or any products
utilizing the Product Materials or Technology made by directly by Licensor or
APDN within the Biowell Territory shall count towards the Biowell's Net Sales
target for such territory and Biowell shall not be required to pay any Royalty
(as defined below) payments to Licensor for any such sales. For sales made by
APDN into the Biowell Territory, APDN shall pay Biowell a Royalty equivalent to
ten percent (10.0%) of its Net Sales (calculated by using the definition of Net
Sales set forth in this Agreement). Subject to Section 1.6, Net Sales must be
met in each territory and payment of the required Royalty shall not be
considered sufficient consideration for the retention of rights of exclusivity.
1.5. On each Payment Date (as defined in Section 3.2 below), whether or not
payment is received by Licensor on such Payment Date, or as otherwise may be
agreed per territory in writing between the parties, and for as long as this
Agreement remains in effect, Licensor and Biowell shall review Net Sales. In the
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event Biowell fails to meet its Net Sales obligations for any specific territory
within the Biowell Territory, Licensor reserves the right, at its sole
discretion as deemed reasonable under the circumstances, to:
(i) If Biowell fails to attain its Net Sales target in a specific territory
in any one (1) year period, Licensor may immediately terminate Biowell's
exclusive rights as a licensee in such territory; and
(ii) If Biowell fails to attain its Net Sales target in a specific
territory for two (2) consecutive years, Licensor may terminate all of Biowell's
rights as a licensee granted under this Agreement with respect to such
territory.
1.6. Licensor shall not terminate or limit Biowell's rights, except for
non-performance of its obligations under this Agreement, and as otherwise
provided in this Agreement. In the event Biowell is notified in writing by
Licensor of the non-performance of its obligations under this Agreement at any
time during the period that this Agreement is in effect, Biowell shall be
allowed a cure period of sixty (60) Business Days in which to address
non-performance and to implement a remedy reasonably acceptable to Licensor;
provided, that, in the event that such non-performance is with respect to
payment of Royalties under this Agreement, such cure period shall be reduced to
thirty (30) Business Days. 1.7 Subject to the requirements set forth in Section
1.4, under no circumstances will (i) APDN or any affiliate thereof or (ii) any
sub-licensee approved by Licensor for a territory outside of the Biowell
Territory or any affiliate thereof, market or sell in the Biowell Territory: (1)
any Licensed Products, APDN Products, or any products utilizing the Product
Materials or Technology; (2) any of its products that are competitive with the
Licensed Products, (3) products bearing its name from third parties that are
competitive with the Licensed Products or (4) products packaged or sold under a
private label that are competitive with the Licensed Products; provided, that,
it will not be considered a violation of the terms of this a Agreement in those
cases where APDN, its sub-licensee, or affiliates of either, enter into an
agreement with any multinational corporation or other organization (or a parent
or affiliate thereof) headquartered outside of the Biowell Territory for the
sale, lease or license of Technology, Product Materials, Licensed Products or
APDN Products and such Technology, Product Materials, Licensed Products or APDN
Products are subsequently transported into or used in the Biowell Territory by
such corporation or organization.
1.8 Under no circumstances will (i) Biowell or any affiliate thereof or (ii) any
sub-licensee approved by Licensor for a territory within the Biowell Territory
or any affiliate thereof, market or sell: (1) products bearing its name from
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third parties that are competitive with the Licensed Products or (2) products
packaged or sold under a private label that are competitive with the Licensed
Products; provided, that, it will not be considered a violation of the terms of
this Agreement in those cases where Biowell, its sub-licensee or affiliate of
either, enters into an agreement with a multinational corporation or
organization (or a parent or affiliate thereof) headquartered in the Biowell
Territory for the sale, lease or license of Technology, Product Materials,
Licensed Products or APDN Products and such Technology, Product Materials,
Licensed Products or APDN Products are subsequently transported outside of the
Biowell Territory by such corporation or organization. Biowell shall pay APDN a
Royalty of ten percent (10.0%) of its Net Sales from all sales of Licensed
Products, APDN Products or Product Materials made by Biowell or any sub-licensee
of Biowell outside of the Biowell Territory
1.9 Each party shall provide reasonable telephonic and electronic mail
("e-mail") support to each other party on an as needed basis, during such
party's regular business hours. Upon execution of this Agreement each party
shall appoint a liaison to communicate with each other party, and the parties
shall funnel their inquiries through such appointed liaison so as to minimize
any disruption to the staff of each other party. Each party agrees to provide
each other party with timely written notification containing the name and
contact information for such liaison and when applicable, specific details of
problems to enable such other party to diagnose such problems.
1.10 APDN may build a lab(s) at its own cost for the purpose of manufacturing,
selling, analyzing, and testing the Technology, Product Materials and APDN
Products. During the Initial Term and the Second Term, Biowell agrees to fully
support APDN in these activities. It will provide professional guidance,
technical support, engineering designs, plans, and all other pertinent
documentation and information related to Biowell's facilities, products, and
operations together with training, manuals, budgets, cost data and all other
relevant disclosures. APDN will reimburse Biowell for all costs incurred by
Biowell in providing these support activities.
2. Term
2.1 Unless terminated in accordance with the terms of this Agreement and
provided Biowell meets the performance requirements set forth on Exhibit 1, this
Agreement shall be effective as of the date of execution of this Agreement and
shall remain in effect for the remainder of the year 2005 and the five (5)
calendar year period thereafter ("Initial Term"). In the event that Biowell
meets the performance requirements set forth on Exhibit 1, this Agreement shall
be automatically renewed for an additional five (5) calendar year period
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following the Initial Term ("Second Term"). Upon the expiration of the Second
Term and if Biowell so requests, the Licensor shall negotiate in good faith with
Biowell for further renewal of this Agreement or entering into a new license
agreement under reasonable commercial terms and conditions.
2.2 In the event of circumvention of this Agreement by a party hereto, directly
or indirectly; the circumvented party shall be entitled to a monetary payment
equal to the maximum benefit it should have realized from such a transaction,
plus any and all expenses including but not limited to all legal costs and
expenses incurred to recover the lost revenue.
2.3 In the event of termination not attributable to Biowell, APDN will have the
responsibility to continue to honor this Agreement with Biowell in respect of
assisting Biowell to fulfill any outstanding agreements with Customers of
Biowell.
3. Price and Payment
3.1 In consideration of the license granted to Biowell herein, Biowell shall pay
Licensor a royalty ("Royalty" or "Royalties") equal to ten (10%) percent of the
Net Sales of the Licensee for orders received by it subsequent to the date
hereof. For the purpose of computing Royalties, (i) sales shall be regarded as
made when payments are due under Biowell's normal commercial terms of sale, (ii)
sales by a sub-licensee of Biowell shall be deemed sales by Biowell, (iii) sales
in currencies other than U.S. dollars shall be converted to U.S. dollars at the
foreign official conversion rate effective when payment is due and (iv) any
sales for a financial consideration other than currency shall be subject to
prior approval of Licensor for consideration acceptable to Licensor.
3.2 Royalties shall be paid by Biowell to Licensor on a semi-annual basis,
within thirty (30) days after the end of such six (6) month period during the
Initial term and Second Term; provided, that, with respect to the first payment
of Royalties hereunder, payment shall be made on or prior to January 30, 2006,
based upon Net Sales during the period commencing on the date hereof and ending
on December 31, 2005. Commencing in January, 2006 and for each year of the
Initial Term and the Second Term (and any additional extensions), Biowell shall
pay Royalties to Licensor on or before July 30 and January 30 of each year,
based upon Net Sales from the preceding six (6) month period (each, a "Payment
Date").
3.3 Royalty payments shall be made to Licensor at its offices at the address set
forth above, or by wire transfer of immediately available funds to such banking
institution as Licensor may direct from time to time, in legal tender of the
United States of America.
3.4 In addition to any other remedy available to the Licensor, if any payment
due under this Agreement is delayed for reasons solely attributable to Biowell,
interest shall accrue and be payable, to the extent legally enforceable, on such
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unpaid amounts from and after the date on which the same was due at the rate of
one and one half percent (1.5%) per month or any portion thereof. The obligation
of Biowell to pay any amounts due hereunder shall be absolute, notwithstanding
any claim which Biowell may assert against Licensor. Biowell shall not have the
right to set off, compensate, or make any deduction from such payments
whatsoever.
3.5 Together with payment of the Royalties, during the Term of this Agreement,
Biowell agrees to submit written reports to Licensor stating, in each such
report, (i) the total sales for the Biowell Territory and each territory within
the Biowell Territory, by Biowell and all sub-licensees of Technology, Product
Materials, Licensed Products and APDN Products for the previous six (6) month
period, (ii) the total adjustments to such sales in connection with the
determination of Net Sales for the Biowell Territory and each territory within
the Biowell Territory, and (iii) the Royalty due thereon. In addition, Biowell
shall deliver a written report to Licensor within ninety (90) days after the
date of termination of this Agreement, stating in such report the information
stated above that was not previously reported to Licensor and the Royalty due
thereon, and shall accompany such report with payment of the amount of Royalties
shown to be due therein.
3.6 Biowell agrees to keep, for at least three (3) years after expiration or
termination of this Agreement, full and accurate books of account and records on
Biowell's and all sub-licensee's sales of Technology, Product Materials,
Licensed Products and APDN Products. Biowell also agrees to permit Licensor or
its authorized representative, upon at least ten (10) days prior written notice,
to conduct reasonable audits of Biowell's books, records and inventories to
verify Biowell's performance, the total sales of Biowell and all sub-licensees
from Technology, Product Materials, Licensed Products and APDN Products, the
total adjustments to such sales in connection with the determination of Net
Sales, the Royalty due thereon and the reports due under this Agreement. Unless
otherwise agreed by the parties, such audits shall occur only during business
hours at the offices of Biowell, dusirng the term of this Agreement and during
the three (3) years immediately following the expiration or termination of this
Agreement, and in no event exceed two (2) times per year. If any audit of
Biowell's or any sub-licensee's books and records shows a discrepancy of more
than five percent (5.0%) from payments and/or reports to Licensor, Biowell will
in addition to payment of any unpaid amounts due as disclosed by the audit,
immediately reimburse Licensor for the cost of the audit. A final audit may
occur once during the year immediately succeeding expiration or termination of
this Agreement. Any information provided to Licensor or its accountants pursuant
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hereto shall be treated as Confidential Information (hereinafter defined) of
Biowell to be used only for the purpose of the examination in accordance with
this Agreement and shall not be otherwise disclosed.
4. Biowell Obligations
4.1 Biowell will source, solicit, and attract potential Customers in the Biowell
Territory for purchasing Licensed Products manufactured by Biowell using Product
Materials and APDN Products purchased directly from APDN. Biowell shall promote,
market, sell and sub-license the use of the Technology and the manufacture and
sale of the Licensed Products and the APDN Products in the Biowell Territory to
potential Customers. Biowell shall not bind Licensor or APDN to any express or
implied legal obligation with any third parties, including Biowell's Customers,
while Biowell is performing this Agreement. Biowell shall perform its
obligations under this Agreement on its own behalf as an independent contractor
and not as an agent or representative of APDN or Licensor.
4.2 Biowell will, at its expense or at the expense of its Customers, perform any
and all post-sale servicing of any type for its Customers. APDN shall not be
obligated to perform any support services to Biowell's Customers unless both
parties agree otherwise in writing, and for which services APDN shall charge
Biowell at cost plus ten percent (10.0%) and vice versa..
4.3 If any dispute arises in the Biowell Territory under this Agreement, Biowell
will use its best efforts to limit the potential damages to APDN and Licensor
that could be caused by the dispute. Further, Biowell will inform APDN and
Licensor without undue delay of the nature of the dispute and comply with all
reasonable directions of Licensor in relation thereto.
4.4 Biowell shall have the right to sub-license in the Biowell Territory in
accordance with this Section 4.4. Specifically, Biowell shall have the right to
authorize any third party to receive or utilize any benefit derived by Biowell
under this Agreement. Each such authorization or sub-licensing must be approved
by Licensor, which approval will not be unreasonably withheld and the
sub-licensing agreement must be co-signed by Licensor. Pursuant to the
sub-licensing agreement, a new sub-licensee shall comply in all respects with
the same restrictions placed on Biowell by Licensor in this Agreement. For
purposes of this Agreement, if Licensor consents to a sub-license, Biowell and
sub-licensee shall be referred to as "Biowell". In addition to the Royalties
paid to Licensor hereunder, promptly upon its receipt thereof, Biowell shall pay
Licensor fifty (50.0%) of any fees, payments or consideration of any kind
received by Biowell in connection with the grant of a sublicense.
4.5 Biowell shall have the right to sell in any unlicensed territory on a per
sale basis upon its receipt, prior to any sale, of written authorization from
Licensor. If an opportunity arises in a territory not presently licensed,
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Biowell will seek such authorization, and if granted, Biowell will be required
to pay a Royalty to Licensor for Licensed Products sold in such territory in the
manner set forth herein. 5. Indemnity
5.1 Indemnity against any Third Party Claims. Subject to Article 13 hereof, each
Party ("Indemnifying Party") will indemnify, defend, and hold the other Party,
its officers, directors, agents, employees, and affiliates, ("Indemnity
Parties") harmless from and against any and all liabilities, damages, losses,
expenses, claims, demands, suits, fines or judgments, including reasonable
attorney fees, costs and expenses incidental thereto, which may be suffered by,
accrued against, charged to or recoverable from the Indemnity Parties, arising
out of any third party claim. Promptly after receipt by the Indemnity Parties of
a threat of any action, or a notice of the commencement or filing of any action
against which the Indemnity Party may be indemnified hereunder, the Indemnity
Party shall give written notice thereof to Indemnifying Party; provided, that
failure to give such notice shall not relieve the Indemnifying Party of its
obligations hereunder, except to the extent such failure prejudices the
Indemnifying Party's defense thereof. Indemnifying Party shall have sole control
of the defense and of all negotiations for settlement of such action. The
Indemnifying Party shall be permitted to enter into a settlement hereunder
without the prior written consent of the Indemnity Party provided that the
settlement does not result in any attribution of fault or create any liability
or obligation on the part of the Indemnity Party and the Indemnity Party shall
not enter into any settlement without the prior written consent of the
Indemnifying Party. Nothing herein shall limit, diminish or otherwise affect in
any way the indemnifications made by the parties pursuant to the Asset Purchase
Agreement dated January 28, 2005 and all documents related thereto.
6. Product & Product Materials Ordering Procedure,
Change Orders, & Cancellation
6.1 Agreement to Sell. Biowell, within the limitations contained in this
Agreement, shall sell to APDN or other purchaser licensed by Licensor, such
quantities of Licensed Product and other Product Materials as either may order
in accordance herewith.
6.2 Purchase Orders. For as long as Biowell remains a source of Licensed
Products and Product Materials, purchases thereof shall be initiated by written
or electronically dispatched Purchase Orders referencing the quantity, the
Licensed Product, applicable price, shipping instructions and requested Delivery
Dates. All Purchase Orders for Products and other Product Materials placed
hereunder shall be governed by the terms and conditions of this Agreement unless
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different terms and conditions of the Purchase Order are accepted by Biowell and
acknowledged in writing. Biowell will use commercially reasonble efforts to
accept each Purchase Order issued by APDN or other purchaser licensed by
Licensor. Biowell will ship all Licensed Product or Product Materials within the
"Lead Time" agreed to by the parties prior to the execution of this Agreement,
unless the Purchase Order specifically states a delivery schedule different from
such Lead Time and such delivery schedule is accepted in writing by Biowell.
Biowell shall sell to APDN, or other purchaser licensed by Licensor, all
Licensed Products and Product Materials at a price equal to the lowest price and
on the best terms, including cash discounts for early payment, or any other
discounts, credits or financial incentives then offered by it to any third party
with respect to the sale of a Licensed Product or other Product Material. If
Licensed Products or Product Materials are sold to any third party at a price
that is less than the price then being charged to APDN and/or other purchaser
licensed by Licensor, then such party, on a going forward basis, shall be
entitled to (i) purchase any Licensed Products or Product Materials at such
lower price until such time as Biowell is no longer offering such Licensed
Products or Product Materials at such lower price and (ii) if APDN or any other
purchaser licensed by APDN purchased any Licensed Products or Product Materials
during the period when Biiowell was charging such lower price, Biowell shall
promptly refund or credit to such party the difference between the higher price
and the lower price.
6.3 Purchase Order Information. Purchase Orders shall, to the extent necessary
for Biowell to fulfill the terms thereof, include: (i) description of Licensed
Products and other Product Materials, (ii) quantity of Licensed Products and/or
other Product Materials, (iii) price per unit of Licensed Products and other
Product Materials (iv) total order price, (v) Delivery Date, and (vi) delivery
location. Except as otherwise explicitly provided in this Agreement, any changes
to or rescheduling of an accepted Purchase Order must be mutually agreed and
incorporated into a written Change Order referencing the original Purchase
Order.
6.4 Confirmation. Within seven (7) calendar days of its receipt of the Purchase
Order, Biowell will use its commercially reasonable efforts to send written
notice of acceptance or rejection of the Purchase Order
("Confirmation/Rejection").
6.5 Delivery Terms. All Licensed Products delivered by Biowell shall be FOB
(Taipei, Taiwan, ROC) or other place of shipment as specified in writing by APDN
or other purchaser licensed by Licensor and agreed to by Biowell. Biowell may
ship partial orders provided Biowell notifies APDN or such other purchaser and
both agree prior to shipment. The Purchase Order shall specify the carrier or
means of transportation or routing, and Biowell will comply with such
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instructions. If the order fails to provide shipping instructions, Biowell shall
select the best available carrier, on a commercially reasonable basis.
6.6 Change Orders and Rescheduling. Any modification to a Purchase Order shall
be made in writing by an authorized representative of APDN or other purchaser
licensed by Licensor, as the case may be ("Change Order"), and sent to Biowell,
and such Change Order shall be subject to acceptance or rejection in writing by
Biowell within seven (7) calendar days of its receipt thereof and shall not be
binding until such acceptance. 6.7 APDN agrees to reciprocate to Biowell all
terms and conditions set forth in this entire Section 6 in the event that
Biowell or its sub-licensee desires to purchase APDN Products.
7. Non-competition & Non-solicitation
7.1 During the term of this Agreement, neither APDN, Licensor, or any of their
affiliates shall solicit Customers in the Biowell Territory. APDN, Licensor or
any of their affiliates shall use commercially reasonable efforts to promptly
refer any entity to Biowell that is interested in Licensed Products, Technology,
Product Materials, or APDN Products using or transporting the Licensed Products,
Technology, Product Materials or APDN Products into the Biowell Territory.
During the term of this Agreement, Biowell and its sub-licensees shall not
solicit Customers outside of the Biowell Territory and shall use commercially
reasonable efforts to promptly refer any entity to APDN that is interested in
Licensed Products, Technology, Product Materials, or APDN Products using or
transporting the Licensed Products, Technology, Product Materials or APDN
Products into the APDN Territory.
7.2 During the term of this Agreement, each of Biowell, Licensor and APDN shall
not, without the prior written consent from the other party, directly or
indirectly (including without limitation, through any affiliate of either
party), (i) solicit or request any person who is at the time an employee of or a
consultant of the other party to leave the employment of or terminate such
person's relationship with that party or (ii) employ, hire, engage or be
associated with, or endeavor to entice away from the applicable party any such
person.
7.3 During the term of this Agreement, each of Biowell, Licensor and APDN shall
not, directly or indirectly (including without limitation, through any affiliate
of either party) (i) solicit any existing customer of the other party, (ii)
intentionally attempt to limit or interfere with any business agreement or
13
relationship existing between either party and/or its affiliates with any third
party; or (iii) disparage the business reputation of the other party (or its
management team) or (iv) take any actions that are harmful to the other party's
goodwill with its customers, providers, vendors, employees, the media or the
public, or (v) sell any product that is competitive with the Licensed Products
or the APDN Products or engage directly or indirectly in the conduct of business
with any company considered by the parties hereto to be competitive with the
business as set forth in this Agreement.
7.4 During the two (2) year period following termination of this Agreement,
Biowell shall not, directly or indirectly (including without limitation, through
any affiliate), solicit any entity that shall have been a customer, supplier,
consultant, development or joint venture partner of APDN at any time within two
(2) years prior to terminating this Agreement to cease doing business in whole
or in part with Licensor or APDN, as the case may be, nor may Biowell or any
affiliate do business, directly or indirectly, with any such party during such
two (2) year period.
8. Confidentiality
8.1 Biowell shall not use or divulge or communicate to any person (other than
those whose province it is to know the same or as permitted or contemplated by
this Agreement or with the written approval of the other party or as may be
required by law):
(i) any Confidential Information; or
(ii) any of the terms of this Agreement
8.2 Biowell shall prevent the unauthorized publication or disclosure of any such
Confidential Information, materials or documents and ensure that any person,
subject to the written approval of Licensor, to whom the information, materials
or documents are disclosed is aware that the same is confidential and is covered
by a similar duty to maintain confidentiality. Biowell shall ensure that its
directors, shareholders, employees, consultants, agents or advisors are aware of
and comply with the confidentiality and non-disclosure provisions contained in
this Section and shall indemnify Licensor and APDN as the case may be, against
any loss or damage which Licensor and APDN may sustain or incur as a result of
any breach of the terms hereof by Biowell, its directors, shareholders,
employees, consultants, agents or advisors.
8.3 Licensor and APDN agree to reciprocate to Biowell all terms and conditions
of Confidentiality as set forth in this Agreement.
9. Reservation of Rights
9.1 Biowell shall be permitted to:
(i) make modifications or additions to the Technology, Product Materials,
and Licensed Products in respect to any designs and such modifications or
additions will be considered an improvement to such Technology, Product
Materials or Licensed Products, and such modification and additions shall be
governed as set forth in Sec. 1.2 and 1.3 above;
(ii) discontinue selling Product Materials and Licensed Products if those
products or parts thereof are discontinued or replaced except for those Licensed
Products and Product Materials accepted to be delivered under a confirmed
Purchase Order.
9.2 Licensor and APDN shall be permitted to:
(i) make modifications or additions to the Technology, Product Materials,
and APDN Products in respect to any designs as Licensor may in its discretion
determine; and such modifications or additions will be considered an improvement
14
to the such Technology, Product Materials or APDN Product line and shall be the
sole and exclusive property of Licensor and such Products shall be available for
license to Biowell as set forth in Sec. 1.3 above;
(ii) require Biowell to discontinue selling Licensed Products if those
products or parts thereof are discontinued or replaced, except for those
Licensed Products and Product Materials accepted to be delivered under a
confirmed Purchase Order; and
(iii) require Biowell either not to use or to cease to use any advertising
or promotional material in respect to the Product Materials and Licensed
Products which Licensor considers not to be in Licensor's best interests, upon
ninety (90) days written notice to Biowell.
10. Legal Relationship
10.1 Nothing herein shall contain any facts as to suggest that Licensor and
Biowell are engaging in a joint venture or partnership. Biowell shall have no
authority to bind Licensor or APDN to any legal obligation. Biowell shall only
contract with Customers on its own behalf.
10.2 In the event that Licensor is acquired by another entity, or there is a
change of control within Licensor, this Agreement shall continue to exist, with
all relative rights, privileges, titles, and shall be assigned and transferred
in its entirety to the new or reorganized entity.
11. Termination
11.1 Licensor may terminate this Agreement if Biowell: (a) sells, assigns, or
ceases to carry on, its main business or the business related to this Agreement,
unless the parties mutually agree otherwise; (b) subject to Section 1.6, fails
to meet any material performance requirements set forth on Exhibit 1 during the
then current term of the Agreement; (c) sells any product that is competitive
15
with the Licensed Products or the APDN Products or engaged directly or
indirectly in the conduct of business with any company considered by the parties
hereto to be competitive with the business as set forth in this Agreement, (d)
fails to comply with any of its obligations under this Agreement or the Purchase
Agreement;
11.2 This Agreement may be terminated immediately by Biowell or Licensor upon
written notice to the other party in the event that such other party files any
formal petition in bankruptcy or insolvency, has any formal petition in
bankruptcy or insolvency filed against it and such petition is not discharged
within ninety (90) days of filing, or if such other party makes any general
assignment or composition for the benefit of creditors with respect to any
material portion of its assets, or if such other party has any trustee,
liquidator, receiver or other fiduciary appointed with respect to any material
portion of its business or assets and such trustee, liquidator, receiver or
other fiduciary is not removed within sixty (60) days of appointment, or commits
or suffers any other similar act of bankruptcy or insolvency to occur with
respect to it.
11.3 This Agreement may be terminated by Biowell, upon sixty (60) days prior
written notice to Licensor if Licensor or APDN breaches any of its material
obligations under this Agreement and such breach is not cured within such sixty
(60) day period.
12. Effect of Termination
On the termination of this Agreement:
12.1 The license grant and all rights and obligations of the parties hereunder
shall automatically terminate except for such rights of action as shall have
accrued prior to such termination and any obligation which expressly or by
implication may be intended to come into or continue in force on or after such
termination;
12.2 Biowell shall, (i) at its own expense, return to Licensor or otherwise
dispose of as Licensor may instruct, all technical and promotional materials and
other documents and papers whatsoever sent to Biowell and relating to the
Confidential Information, Technology, Product Materials and Licensed Products or
the business of Licensor or APDN (other than correspondence between the parties,
copies of which shall be delivered to Licensor) and all property of Licensor or
APDN in Biowell's possession or under its control, (ii) immediately cease the
use, marketing, distribution and sale of the Technology, Product Materials,
Licensed Products and APDN Products, (iii) deliver all Customer information to
Licensor, and (iv) cease the use of all trademarks and logos of APDN.
16
13. Exclusion of Liability
13.1 Except as set out in this Agreement, or to the extent required by law, all
conditions, warranties and representations, expressed or implied, in relation to
any Technology, Product Materials and Licensed Products which may be transferred
from Biowell to the Licensor under the Purchase are excluded by Licensor.
13.2 Except as otherwise provided in this Agreement, neither Licensor nor APDN
shall be liable to Biowell, whether for negligence, products liability, breach
of contract, misrepresentation or otherwise, for:
(i) loss or damage incurred by Biowell as a result of third party claims in
relation to Intellectual Property Rights originally transferred from Biowell to
the Licensor under the Purchase Agreement; or
(ii) indirect or consequential damage suffered by a party, including,
without limitation, loss of profits, goodwill, business opportunity or
anticipated saving.
13.3 No party shall be liable to any other party for any loss, damages, expenses
or liabilities arising from an infringement or claim of infringement of third
party rights in the Intellectual Property Rights subsisting in the Technology,
Product Materials and Licensed Products howsoever arising in connection with
this Agreement.
13.4 (i) Biowell warrants that all Licensed Products and Product Materials sold
by Biowell under the terms of this Agreement will be materially free from
defects in workmanship and materials and substantially conform to the relevant
"Specifications", reasonably formulated by Licensor or APDN and set forth on
Schedule A attached hereto, as amended from time to time by Licensor and
consented to by Biowell, under normal use and service for a period of twelve
(12) months after delivery to the carrier for shipment (the "Biowell Warranty
Period"). During the Biowell Warranty Period, a party may notify Biowell if all
or any portion of such Product Materials or Licensed Products contains a
material defect in materials or workmanship, or otherwise fails to conform
substantially to the Specifications. Provided that such notice is received
during the Biowell Warranty Period, Biowell shall promptly (but not later than
thirty (30) days after receiving such notice) correct, at its own expense (which
will include all shipping expenses), any such defect by repairing such defective
Product Materials and/or Licensed Products or, at Biowell 's discretion, by
delivering equivalent Product Materials and/or Licensed Products replacing such
defective Product Materials and Licensed Products. Biowell may inspect and
verify such alleged defect without need to ship the alleged defective items to
Taiwan.
(ii) APDN warrants that all APDN Products sold by APDN under the terms of
this Agreement will be materially free from defects in workmanship and materials
and substantially conform to the relevant "Specifications", reasonably
formulated by Licensor or APDN and set forth on Schedule A attached hereto, as
amended from time to time by Licensor, under normal use and service for a period
17
of twelve (12) months after delivery to the carrier for shipment (the "APDN
Warranty Period"). During the APDN Warranty Period, a party may notify APDN if
all or any portion of such Product Materials or APDN Products contains a
material defect in materials or workmanship, or otherwise fails to conform
substantially to the Specifications. Provided that such notice is received
during the APDN Warranty Period, APDN shall promptly (but not later than thirty
(30) days after receiving such notice) correct, at its own expense (which will
include all shipping expenses), any such defect by repairing such defective
Product Materials and/or APDN Products or, at such party's option, by delivering
equivalent Product Materials and/or APDN Products replacing such defective
Product Materials and APDN Products. APDN may inspect and verify such alleged
defect without need to ship the alleged defective items to an APDN facility.
(iii) The remedies for any breach of warranty as listed in this Section
13.4 shall be the sole and exclusive remedies available to a party at law or in
equity.
13.5 WARRANTY EXCLUSIONS. NEITHER BIOWELL NOR APDN SHALL BE LIABLE UNDER ANY
WARRANTY IF ITS TESTING AND EXAMINATION DISCLOSES THAT THE ALLEGED DEFECT IN THE
LICENSED PRODUCT, APDN PRODUCT OR PRODUCT MATERIAL DOES NOT EXIST (PROVIDED THAT
VERIFIABLE PROOF OF SUCH TESTING AND EXAMINATION IS PROVIDED) OR WAS CAUSED BY
MISUSE, NEGLECT, IMPROPER STORAGE OR INSTALLATION OR TESTING, UNAUTHORIZED
ATTEMPTS TO REPAIR, OR BY ACCIDENT, FIRE, LIGHTNING OR OTHER HAZARD.
13.6 Biowell will be liable for the Licensed Product manufactured by Biowell.
Biowell shall maintain in full force and effect at all times during the term of
this Agreement, comprehensive "occurrence" general liability insurance,
including "occurrence" product liability and contractual liability insurance
coverage with respect to the Licensed Products with minimum limits of liability
of One Million US Dollars (US$ 1,000,000.00) or otherwise agreed in writing by
both Parties. Such insurance will name Licensor and APDN as additional joint
insureds thereon. Biowell will, from time to time upon reasonable request by
APDN and Licensor, promptly furnish or cause to be furnished to APDN and
Licensor evidence in form and substance satisfactory to APDN and Licensor of the
maintenance of the insurance required by this Section, including certificates of
insurance and proof of premium payments. APDN and Licensor's customers are not
required to go to Biowell directly to file a claim of product liability. Biowell
will take all necessary actions to defend APDN and Licensor with respect to any
such claim. All expenses in this matter shall be paid by Biowell or Biowell's
insurance.
18
13.8 APDN will be liable for the APDN Products manufactured by APDN. APDN shall
maintain in full force and effect at all times during the term of this
Agreement, comprehensive "occurrence" general liability insurance, including
"occurrence" product liability and contractual liability insurance coverage with
respect to the Licensed Products with minimum limits of liability of One Million
US Dollars (US$ 1,000,000.00) or otherwise agreed in writing by both Parties.
Such insurance will name Biowell as additional joint insureds thereon. APDN
will, from time to time upon reasonable request by Biowell, promptly furnish or
cause to be furnished to Biowell evidence in form and substance satisfactory to
Biowell of the maintenance of the insurance required by this Section, including
certificates of insurance and proof of premium payments. Customers are not
required to go to APDN directly to file a claim of product liability. APDN will
take all necessary actions to defend Biowell with respect to any such claim. All
expenses in this matter shall be paid by APDN or APDN's insurance.
13.9 EXCEPT FOR THE EXPRESSED WARRANTIES CREATED UNDER THIS AGREEMENT AND EXCEPT
AS SET FORTH OTHERWISE IN THIS AGREEMENT, IN NO EVENT SHALL EITHER PARTY BE
LIABLE TO THE OTHER FOR ANY INCIDENTAL, CONSEQUENTIAL, SPECIAL OR PUNITIVE
DAMAGES OF ANY KIND OR NATURE ARISING OUT OF THIS AGREEMENT OR THE SALE OF
PRODUCTS, WHETHER SUCH LIABILITY IS ASSERTED ON THE BASIS OF CONTRACT, TORT
(INCLUDING THE POSSIBILITY OF NEGLIGENCE OR STRICT LIABILITY), OR OTHERWISE,
EVEN IF THE PARTY HAS BEEN WARNED OF THE POSSIBILITY OF ANY SUCH LOSS OR DAMAGE,
AND EVEN IF ANY OF THE LIMITED REMEDIES IN THIS AGREEMENT FAIL OF THEIR
ESSENTIAL PURPOSE.
13.10. In no event shall the aggregate liability of Biowell or APDN and Licensor
in connection with this Agreement, or any other materials or services provided
under this Agreement, whether arising in contract, tort or under any other legal
theory (including, without limitation, negligence or strict liability), exceed
the total value of the relevant Purchase Order.
13.11. Biowell will be responsible for any warranty claim received from its
customers and shall seek appropriate compensation from APDN for any Products
manufactured or delivered by APDN and its associates concerning the Licensed
Products and Product Materials provided by APDN.
19
14. Intellectual Property Rights
14.1 All Intellectual Property Rights, including without limitation patents,
designs, utility models, copyrights, trade or service marks, Know-How, trade
secrets and other proprietary information, in or relating to the Technology,
Product Materials, APDN Products and Licensed Products and any other products
and services related thereto are and shall remain the sole and exclusive
property of Licensor. Except as otherwise provided in this Agreement, Biowell
shall have no right to use or obtain for its own benefit or grant any licenses
with respect to the Technology, APDN Products, Licensed Products, Product
Materials, or any other related products or services or any of the Intellectual
Property Rights therein or relating thereto.
14.2 Each party shall notify the other party as soon as it receives any
knowledge of any illegal or unauthorized use of any of the Technology, Product
Materials, APDN Products and Licensed Products or any of the Intellectual
Property Rights therein or relating thereto and Biowell will assist Licensor (at
Licensor's expense) in taking all steps necessary to defend Licensor's rights
therein.
14.3 Biowell shall not in any way: (a) disassemble or reverse engineer the
Technology, Product Materials, APDN Products and Licensed Products and any
related products supplied hereunder except as provided for in Sec. 1.2 above;
(b) transfer possession of any Technology, Product Materials, APDN Products and
Licensed Products and any related products supplied hereunder to another party,
except as expressly permitted herein; or (c) use the Technology, Product
Materials, APDN Products and Licensed Products and any related products supplied
hereunder in any way not expressly provided for in this Agreement.
14.4 (a) Subject to the express prior written approval of Licensor, which
approval shall not be unreasonably withheld, Biowell may use the trademarks and
logos of Licensor and APDN for the sole purpose of marketing, reselling and
promoting the Licensed Products in the Biowell Territory under, and during the
term of, this Agreement and (b) Subject to the express prior written approval of
Biowell, which approval shall not be unreasonably withheld, Licensor and APDN
may use the trademarks and logos of Biowell for the sole purpose of marketing,
reselling and promoting the Products during the term of this Agreement. All
Licensed Products, packaging, labeling, advertising, promotional or other
materials to be used by Biowell, which shall bear or display the trademarks
and/or logos of Licensor or APDN, shall be subject to APDN's prior inspection
and approval, which approval shall not be unreasonably withheld, delayed or
conditioned.
15. General
15.1 The interpretation, validity and performance of the Agreement shall be
governed by the laws of the State of Nevada, without regard to its conflicts of
20
laws rules. The Agreement is also subject to the Fair Trade Act in Taiwan and
the Principles for Handling Cases Related to Technology Licensing Agreements.
Any and all claims, disputes or controversies arising under, out of, or in
connection with this Agreement or any breach thereof which cannot be resolved
within sixty (60) Business Days of formal notification of default or dispute as
set forth in Section 15.2 shall be exclusively submitted to binding arbitration.
The arbitration shall be conducted in English language and by the International
Chamber of Commerce which shall administer the arbitration under its commercial
rules. The arbitration shall take place in Honolulu, Hawaii, United States or
other jurisdictions agreed to in writing by the Parties. The parties hereto
irrevocably submit to the exclusive jurisdiction of such entity. The parties
hereby irrevocably waive, to the fullest extent permitted by applicable law, any
objection which they may now or hereafter have to the laying of venue of any
such dispute brought in such venue or any defenses of inconvenient forum in
connection therewith. The arbitrators shall have no authority to change or
modify any provision of this Agreement. Each party shall bear its own expenses
and one-half of the expenses and costs of the arbitrators; provided that the
arbitrators may award expenses and costs (including attorneys' fees) to either
party.
15.2 Notices. All notices and other communications hereunder shall be in writing
and shall be deemed given (i) when personally sent/delivered, by facsimile
transmission (with hard copy to follow) or sent by express courier (charges
prepaid) or (ii) five (5) days following mailing by registered or certified mail
postage prepaid and return receipt requested. Unless another address is
specified in writing, notices, demands and communications to Biowell, Licensor
and APDN shall be sent to the addresses indicated below:
If to Biowell to:
Biowell Technology, Inc.
18F No 959 Chung Cheng Road
Chungho City
Taipai County
Taiwan 235
ROC
with a copy to:
Dr. Jun-Jei Sheu Chairman & CEO
Fax: 011-886-2-22215258
21
If to APDN or Licensor to:
Applied DNA Sciences, Inc.
9229 West Sunset Boulevard, Suite 830
Los Angeles, California 90069
with a copy to:
Peter Brocklesby
President
Fax: 310-860-1303
15.3 This Agreement may be executed in any number of counterparts, each of which
will be an original but all of which together will form one agreement. Delivery
of an executed copy of this Agreement by facsimile transmission will have the
same effect as delivery of an original signed counterpart.
15.4 The failure of either party hereto to insist upon the strict adherence to
any term of this Agreement on any occasion shall not be considered as a waiver
of any right hereunder nor shall it deprive that party of the right to insist
upon the strict adherence to that term or any other term of this Agreement at
some other time.
15.5 This Agreement constitutes the entire agreement between the parties
concerning the subject matter hereof and supersedes all written and oral prior
agreements and understandings with respect thereto. No variation, amendment or
modification of the terms of this Agreement nor any waiver of any of the terms
or provisions hereof shall be valid unless in writing and signed by an
authorized representative of each party.
15.6 If any provision(s) contained herein shall be deemed by any court of
competent jurisdiction or arbitrator to be invalid, illegal or unenforceable for
any reason (including, but not limited to a violation of, or failure to comply
with, the then applicable provisions of the Fair Trade Act and/or the Principles
for Handling Cases Related to Technology Licensing Agreements), then the parties
hereto agree that said provision(s) shall be modified by the court or arbitrator
so as to be enforceable to the maximum extent permitted by law (including the
Fair Trade Act and/or the Principles for Handling Cases Related to Technology
Licensing Agreements) and in such modified form shall be enforced in the manner
contemplated hereby.
15.7 Each of the parties to this Agreement shall be responsible for its own
taxes and expenses whether arising from or in connection with the execution and
delivery of this Agreement or otherwise.
15.8 Each of the parties hereby acknowledge and agree that money damages may not
be an adequate remedy for any breach or threatened breach of any of the
provisions of this Agreement and that, in such event, they may, in addition to
22
any other rights and remedies existing in their favor, apply to any court of
competent jurisdiction for specific performance, injunctive and/or other relief
in aid of arbitration to preserve and protect the rights of the parties pending
action by the arbitration panel.
15.9 This Agreement and all of the provisions hereof shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns, but neither this Agreement nor any of the rights, interests
or obligations hereunder shall be assigned by Biowell, including by operation of
law, without the prior written consent of Licensor. For purposes hereof, an
assignment shall be deemed to have occurred upon (i) any merger or consolidation
of Biowell, which merger or consolidation results in the holders of the issued
and outstanding voting securities of Biowell immediately prior to such
transaction beneficially owning or controlling less than a majority of the
voting securities of the continuing or surviving entity immediately following
such merger or consolidation, (ii) the sale, transfer or other disposition of
all or substantially all of the assets of Biowell, or (iii) the sale, transfer
or other disposition of more than fifty percent (50%) of the issued and
outstanding equity or voting rights of Biowell. Subject to the exercise of its
rights under Section 11.1(a), any assignment of this Agreement or any of the
rights, interests or obligations hereunder in contravention of this Section 15.9
shall be null and void and shall not bind or be recognized by the Licensor or
APDN.
15.10 Force Majeure. Except for payment of monies, neither party shall be liable
for failure to fulfill its obligations under this Agreement or any purchase
order issued hereunder or for delays in delivery due to causes beyond its
reasonable control, including, but not limited to, acts of God, man-made or
natural disasters, earthquakes, fire, riots, flood, material shortages, strikes,
delays in transportation or inability to obtain labor or materials through its
regular sources, lockouts, civil commotions, and other unforeseeable supervening
events; provided that the party claiming any such cause as an excuse for
non-performance must provide written notice thereof to the other party within
fifteen (15) days of the happening of the event that is the basis for the delay
or failure to perform. The time for performance of any such obligation shall be
extended for the time period lost by reason of the delay.
15.11 The provisions of this Section and Sections 3.5, 3.6, 4.2, 5.1, 7.4, 8,
12, 13, 14 and 15.1 will survive the termination of this Agreement
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement in two
copies of which each has received one.
Biowell Technology Inc. APDN (B.V.I.) Inc.
By: /s/ JUN-JEI SHEU By: /s/ PETER BROCKLESBY
---------------- --------------------
Name: Jun-Jei Sheu Name: Peter Brocklesby
Title: Chairman & CEO Title: Authorized Signatory
Date: Date:
Applied DNA Sciences, Inc. Applied DNA Sciences, Inc.
By: /s/ PETER BROCKLESBY By: /s/ ROB HUTCHISON
-------------------- -----------------
Name: Peter Brocklesby Name: Rob Hutchison
Title: President Title: Chairman and CEO
Date: Date: