<PAGE>
CONFIDENTIAL
LICENSE AGREEMENT
BETWEEN
XENOMETRIX, INC.
AND
ROSETTA INPHARMATICS INC.
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
<PAGE>
LICENSE AGREEMENT
This Agreement (this "AGREEMENT") is made this 12th day of November, 1998 (the
"EFFECTIVE Date"), by and between Xenometrix, Inc. ("XENO"), a Delaware
corporation with principal offices at 2425 North 55th Street, Boulder, CO
80301-5700 and Rosetta Inpharmatics, Inc. ("ROSETTA"), a Delaware corporation
with principal offices at 12040 115th Avenue N.E., Kirkland, WA 98034, to
license certain technology according to the terms and conditions, but subject
to the limitations, set forth in this Agreement.
RECITALS
WHEREAS, XENO is the owner or exclusive licensee of the XENO Patents (as defined
below) and the Harvard Patents (as defined below) relating to certain assays,
technology and intellectual property further described herein, and desires to
non-exclusively license the same to ROSETTA; and
WHEREAS, ROSETTA seeks to obtain certain non-exclusive license rights and
sublicensing rights under the XENO Patents and the Harvard Patents, according to
the terms contained herein;
Now, therefore, in consideration of the foregoing and the covenants and promises
contained herein, the parties agree as follows:
1. DEFINITIONS
1.1. "AFFILIATE" means any corporation or other business entity controlled
by, or in common control of an entity. Control, as used in the context
of a business entity, means the ownership directly or indirectly of
greater than fifty percent (5 0%) of the voting securities of the
person, corporation, or other entity.
1.2. "CONFIDENTIAL INFORMATION" means all information, compounds, data, and
Materials received by either party from the other party pursuant to
this Agreement including, without limitation, technology of each
party, subject to the exceptions set forth in Section 5.1.
1.3. "FIELD" means gene expression profiling and protein expression
profiling, including but not limited to, identifying disturbances of
cell homeostasis and related identified chemicals.
1.4. "HARVARD LICENSE AGREEMENT" means the license agreement between the
President and Fellows of Harvard College ("Harvard") and Venmark
Ltd., now XENO, executed on January 17, 1992, as amended to date,
attached hereto as Exhibit C.
1.5. "HARVARD PATENTS" means all patents and patent, applications listed on
Exhibit A (Mammalian) and Exhibit B (Bacterial) hereto, including but
not limited to any reissues, extensions, substitutions, confirmations,
re-registrations, re-examinations, continuations, divisionals or
continuations-in-part of the foregoing patents and patent
applications, as well as all foreign counterparts or equivalents
thereof.
1.6. "MATERIALS" means any biological or chemical entity for screening or
assays, including reagents, cells, promoters, enhancers, vectors,
plasmids, proteins and fragments thereof, peptides, antigens,
antibodies, antagonists, agonists, inhibitors, and chemicals.
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
<PAGE>
1.7. "XENO PATENTS" means all the patents and patent applications listed on
Exhibits A and B hereto, any patent applications filed prior or
subsequent to the Effective Date that claim the benefit of an early
filing date to any of the patent applications listed in Exhibit A and
Exhibit B, and any reissues, extensions, substitutions, confirmations,
re-registrations, reexaminations, continuations, divisionals or
continuations-in-part of the foregoing patents and patent
applications, as well as all foreign counterparts or equivalents
thereof.
1.8. "THIRD PARTY" means any entity other than (i) ROSETTA and any of its
Affiliates, and (ii) XENO and any of its Affiliates.
2. LICENSES
2.1. GRANT OF LICENSES UNDER THE XENO PATENTS AND THE HARVARD PATENTS FROM
XENO TO ROSETTA.
2.1.1. NON-EXCLUSIVE LICENSE TO XENO PATENTS. XENO hereby grants to
ROSETTA and its Affiliates a non-exclusive, world-wide license
in the Field under XENO's ownership interest in the XENO
Patents to make, use, have made, sell, have sold, offer for
sale, import, export or otherwise exploit any process,
composition of matter or other invention claimed in the
XENO Patents, with right of sublicense to corporate
partners or collaborators of ROSETTA. Such license shall
include the right to grant sublicenses to make, use and
have made the XENO Patents solely in conjunction with
Rosetta's technology for each sublicensee's internal
research purposes and not for the purpose of
commercializing such technology.
2.1.2. NON-EXCLUSIVE SUBLICENSE TO HARVARD PATENTS UNDER THE HARVARD
LICENSE AGREEMENT. XENO hereby grants to ROSETTA and its
Affiliates a non-exclusive, world-wide sublicense in the Field
under XENO's right to sublicense the Harvard Patents in the
Harvard License Agreement to make, use, have made, sell,
have sold, offer for sale, import, export, further
sublicense or otherwise exploit any process, composition of
matter or other invention claimed in the Harvard Patents.
Such license shall include the right to grant sublicenses
to make, use and have made the Harvard Patents solely in
conjunction with Rosetta's technology for each
sublicensee's internal research purposes and not for
commercializing such technology.
3. COMPENSATION
3.1. COMPENSATION FOR THE XENO PATENTS LICENSE AND HARVARD PATENTS
SUBLICENSE.
3.1.1. LICENSES AND RIGHTS. As consideration for the licenses and
rights granted to ROSETTA herein, ROSETTA will pay to XENO:
a) Two Hundred Fifty Thousand Dollars
($250,000.00) upon signing of the Agreement, of which [***] to cure XENO's
existing default under the Harvard License Agreement (the "Default") and
provides documentation of such payment to ROSETTA's reasonable satisfaction,
(ii) obtains a certificate, in a form reasonably acceptable to counsel to
ROSETTA, executed by Harvard stating that XENO is no longer in default under
the Harvard License Agreement and it being acknowledged and understood that
the Holdback will be immediately due and payable upon XENO's satisfaction of
clauses (i) and (ii) of this section 3.1.1 and
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
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<PAGE>
b) An annual running royalty of [***] per
annum, payable within thirty (30) days of end of each calendar year.
4. REPRESENTATIONS AND WARRANTIES; COVENANTS
4.1. REPRESENTATIONS AND WARRANTIES OF ROSETTA AND XENO.
Each party hereby represents and warrants:
CORPORATE POWER. Such party is duly organized and validly
existing and in good standing under the laws of the state
and/or country of its incorporation and has all requisite
corporate power and authority to enter into this Agreement and
to carry out the provisions hereof.
DUE AUTHORIZATION. Such party is duly authorized and has all
corporate power necessary to execute and deliver this
Agreement and to perform its obligations hereunder.
BINDING AGREEMENT. This Agreement is a legal and valid
obligation binding upon such party and enforceable in
accordance with its terms. The execution, delivery and
performance of this Agreement by such party does not conflict
with any agreement, instrument or understanding, oral or
written, to which it is a party or by which it may be bound,
nor violate any law or regulation of any court, governmental
body or administrative or other agency having jurisdiction
over it.
4.2. TITLE; NO INFRINGEMENT. XENO has full title and ownership of the XENO
Patents and XENO has all rights to the XENO Patents and the Harvard
Patents necessary to allow it to perform its obligations as
contemplated in thiso Agreement. The licenses and sublicenses granted
by XENO to ROSETTA under this Agreement will in no way constitute an
infringement or other violation of any copyright, trade secret,
trademark, patent or other proprietary right of any third party.
4.3. NEGATION OF WARRANTIES
EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, XENO MAKES NO
REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER
EXPRESSED OR IMPLIED. EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, THERE ARE NO (a) EXPRESSED OR IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR TO
XENO'S KNOWLEDGE THAT THE USE OF THE XENO PATENTS AND HARVARD
PATENTS AS CONTEMPLATED IN THIS AGREEMENT WILL NOT INFRINGE
ANY PATENT, COPYRIGHT, TRADEMARK, OR OTHER RIGHTS OR (b) ANY
OTHER EXPRESSED OR IMPLIED WARRANTIES.
4.4. HARVARD LICENSE AGREEMENT. XENO hereby represents and warrants that
(a) [***], the Harvard License Agreement has not at the date hereof
expired or been terminated by either XENO or Harvard and that XENO
has not at the date hereof received nor given notice of breach or
termination for breach of the Harvard License Agreement [***]
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
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<PAGE>
neither XENO nor Harvard is in default under the Harvard
License Agreement. XENO covenants to use best efforts to maintain the
Harvard License Agreement from the date of this Agreement through the
term of the Harvard License Agreement, including, but not limited to
(c) complying with its obligations to pay the compensation due for the
Harvard License Agreement and (d) refraining from entering into any
modification or termination of the Harvard License Agreement that
would in anyway affect ROSETTA's rights to the Harvard Patents under
this Agreement. In the event that the Harvard License Agreement is
terminated, the sublicense granted to ROSETTA by XENO pursuant to
Section 2.1.2 with respect to Patent No. 5,811,231, Methods and
Kits in Mammalian Gene Profiling will survive and any further
sublicenses granted by ROSETTA to its sublicensee with respect to
Patent No. 5,811,231, Methods and Kits in Mammalian Gene Profiling
shall survive.
4.5. INFRINGEMENT. ROSETTA hereby agrees to notify XENO immediately of any
claim it receives for alleged patent infringement through use of XENO
Patents Licenses and Rights.
4.6. LICENSE AGREEMENT TO A THIRD PARTY. XENO hereby warrants that during
the term of this Agreement XENO will not license XENO patents and/or
sublicense Harvard License Agreement to a Third Party under financial
and legal conditions substantially more favorable than the terms of
the present Agreement.
5. CONFIDENTIALITY
5.1. CONFIDENTIAL INFORMATION. Except as expressly provided herein, the
parties agree that, for the Term and five (5) years thereafter, the
receiving party shall keep completely confidential and shall not
publish or otherwise disclose to another party and shall not use for
any purpose other than to perform the purposes contemplated by this
Agreement any Confidential Information furnished to it by the
disclosing party hereto pursuant to this Agreement, except that to
the extent that it can be established by the receiving party by
competent proof that such Confidential Information:
(a) was already known to the receiving party, other than under
an obligation of confidentiality, at the time of disclosure;
(b) was generally available to the public or otherwise part of
the public domain at the time of its disclosure to the
receiving party;
(c) became generally available to the public or otherwise part
of the public domain after its disclosure and other than
through any act or omission of the receiving party in breach
of this Agreement;
(d) was lawfully disclosed to the receiving party by a person
other than a party hereto; or
(e) was independently developed by the receiving party.
5.2. PERMITTED USE AND DISCLOSURES. Each party hereto may use or disclose
Confidential Information disclosed to it by the other party to the
extent such use or disclosure is reasonably necessary in filing or
prosecuting patent applications, prosecuting or defending litigation,
complying with applicable law, governmental regulation or court order,
submitting information to tax or other governmental authorities,
making a permitted sublicense or otherwise exercising its rights
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
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<PAGE>
hereunder, provided that if a party is required to make any such
disclosure of another party's Confidential Information, other than
pursuant to a confidentiality agreement, it will give reasonable
advance notice to the latter party of such disclosure and, save to the
extent inappropriate in the case of patent applications, will use
reasonable efforts to secure confidential treatment of such
information prior to its disclosure (whether through protective orders
or otherwise).
5.3. CONFIDENTIAL TERMS. Except as expressly provided herein, each party
agrees not to disclose any material or financial terms of this
Agreement to another party without the consent of the other party, not
to be unreasonably withheld; PROVIDED, HOWEVER, each party reserves
the right to make reasonable disclosures (including the redaction of
material or financial terms) as required by securities or other
applicable laws, or to actual or prospective investors or corporate
partners (including licensees and acquirers), or to accountants,
attorneys and other professional advisors on a need-to-know basis
under circumstances that ensure the confidentiality thereof, or to the
extent required by law. If such Confidential Information is to become
public information by such disclosure the disclosing party must obtain
the written consent of the non-disclosing party in order to obtain
protection of the Confidential Information if necessary.
5.4. PRESS RELEASE. Notwithstanding the foregoing, the parties shall agree
upon a press release to announce the execution of this Agreement.
Thereafter, XENO and ROSETTA may each disclose to Third Parties the
information contained in such press release without the need for
further approval by the other.
6. TERMINATION
6.1.1. This Agreement shall continue until the last expiration date of all
patents licensed under this Agreement and shall survive the
bankruptcy, insolvency or similar event related to either party.
6.1.2. Either party shall have the right to terminate this Agreement at any
time for a material breach of this Agreement by the other party,
provided that the non-breaching party shall have first given ninety
(90) days prior written notice (thirty (30) days in the event of
non-payment of any amounts due under this Agreement) to the
breaching party describing such breach and stating the
non-breaching party's intention to terminate this Agreement if such
breach remains uncured, and the breaching party thereafter fails to
cure same within thirty (30) days.
6.1.3. ROSETTA may terminate this Agreement without cause at any time by
providing written notice to XENO of such termination and such
termination will be effective ninety (90) days thereafter. Any
termination pursuant to this Section 6.1.3 shall not relieve
ROSETTA of any obligation or liability accrued hereunder prior to
such termination, including ROSETTA's obligation to pay royalties
accrued or accruable. The licenses granted hereunder and all
sublicenses granted by ROSETTA under this agreement shall terminate
in the event the Agreement is terminated by ROSETTA or termination
by an arbitrator for an uncured breach by ROSETTA.
7. MISCELLANEOUS
7.1. BINDING EFFECT; ASSIGNMENT. This Agreement shall be binding upon the
parties' respective successors and permitted assigns. Neither party
may assign this Agreement or any of its rights or
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
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<PAGE>
obligations hereunder without the prior written consent of the other
party (not to be unreasonably withheld), and any such attempted
assignment shall be void; PROVIDED, HOWEVER, that ROSETTA and XENO may
assign this Agreement as part of a merger or consolidation in which
the surviving entity assumes all of ROSETTA's and XENO's rights and
obligations hereunder or a sale of substantially all of the assets or
stock of such party to which this Agreement relates. The parties
acknowledge and agree that until the Section 8.4 Amendment is executed
and delivered, in the event that the Harvard License Agreement is
terminated, Harvard shall have the option of having this Agreement
assigned to it or terminating the licenses granted herein.
7.2. EFFECT OF WAIVER. No waiver of any default, condition, provisions or
breach of this Agreement shall be deemed to imply or constitute a
waiver of any other like default, condition, provision or breach of
this Agreement.
7.3. LIMITATION OF LIABILITY. NEITHER PARTY SHALL BE LIABLE TO THE OTHER
FOR ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL, OR INDIRECT DAMAGES
ARISING OUT OF THIS AGREEMENT, HOWEVER CAUSED, UNDER ANY THEORY OF
LIABILITY.
7.4. INDEMNIFICATION. ROSETTA will defend, indemnify and hold XENO, its
officers, directors, employees, Affiliates and agents harmless against
any and all liability, loss, damage, claim or expense (including
attorneys' fees) arising out of (a) a breach of any representation or
warranty or covenant made by ROSETTA in this Agreement or (b) a suit
by a Third Party directly relating to the negligence of ROSETTA in the
performance under this Agreement by ROSETTA; except to the extent such
claim is caused by the negligence or willful misconduct of XENO or a
breach of a representation or warranty of XENO. XENO will defend,
indemnify and hold ROSETTA, its officers, directors, employees,
Affiliates and agents harmless against any and all liability, loss,
damage, claim or expense (including attorneys' fees) arising out of
(x) a breach of any representation or warranty or covenant made by
XENQ in this Agreement or (y) a suit against ROSETTA, its officers,
directors, employees, Affiliates or agents by a Third Party related to
ROSETTA's performance under this Agreement. ROSETTA may, at its
option, conduct the defense in any such suit by a Third Party and XENO
agrees to cooperate fully with such defense.
7.5. LIABILITY INSURANCE. ROSETTA agrees that it shall indemnify, defend,
and hold XENO harmless from any claim, demand or action by any Third
Party arising out of ROSETTA's gross negligence or intentional
misconduct relating to ROSETTA's performance under this Agreement.
ROSETTA agrees to maintain at its expense general liability coverage
at a minimum level of Three Million Dollars ($3,000,000) per
occurrence, to name XENO as an additional insured on ROSETTA's
general liability policy at all times during the term of this
Agreement and to furnish XENO, upon reasonable request,
certificates evidencing such coverage and copies of the applicable
policies.
7.6. PATENT DEFENSE COSTS. XENO will use reasonable efforts, at its
discretion to defend XENO Patents and Harvard Patents at its own
expense against any infringement by a Third Party, and XENO will
notify ROSETTA promptly in writing of any such infringement by a Third
Party known by XENO; PROVIDED, HOWEVER, that (a) ROSETTA, at its
option, may elect to join any such prosecution of a Third Party
infringer initiated by XENO at ROSETTA's expense and (b) XENO will
conduct such prosecution upon the advice and consent of ROSETTA with
respect to material decisions (including litigation strategy
decisions) relating to such prosecution. If XENO
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
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<PAGE>
does not initiate such a prosecution with respect to any individual
instance of Third Party infringement, ROSETTA may, at its own expense,
upon the advice and with the consent of XENO, initiate and control
such prosecution. In the event that ROSETTA is sued by a Third Party
for infringement of a Third Party's patent, XENO hereby agrees, if
ROSETTA so requests, to provide ROSETTA with all reasonable advice or
technical support that ROSETTA may reasonably request at ROSETTA's
expense.
7.7. DILIGENCE. ROSETTA agrees to use reasonable commercial efforts to
fulfill the obligations of the express due diligence provision of the
Harvard License Agreement as it applies to a sublicense under the
Harvard License Agreement.
7.8. FORCE MAJEURE. Neither party shall lose any rights hereunder or be
liable to the other party for damages or losses (except for payment
obligations) on account of failure of performance by the defaulting
party if the failure is occasioned by war, strike, fire, act of God,
earthquake, flood, lockout, embargo, governmental acts or orders or
restrictions, failure of suppliers, or any other reason where failure
to perform is beyond the reasonable control and not caused by the
negligence or intentional conduct or misconduct of the nonperforming
party, and such party has exerted all reasonable efforts to avoid or
remedy such force majeure; PROVIDED HOWEVER, that in no event shall a
party be required to settle any labor dispute or disturbance. -
7.9. AMENDMENT. No modification, supplement to or waiver of this Agreement
or any Addendum hereto or any of their provisions shall be binding
upon a party hereto unless made in writing and duly signed by an
authorized representative of both XENO and ROSETTA. In no event may
the terms of this Agreement be changed, deleted, supplemented or
waived by any notice, purchase order, receipt, acceptance, bill of
lading or other similar form of document. A failure of either party to
exercise any right or remedy hereunder, in whole or in part, or on one
or more occasions, shall not be deemed either a waiver of such right
or remedy to the extent not exercised, or of any other right or
remedy, on such occasion or a waiver of any right or remedy on any
succeeding occasion.
7.10. ENTIRE AGREEMENT. This Agreement, and each Exhibit attached hereto,
and each supplemental written agreement contemplated hereunder, sets
forth the entire understanding and agreement of the parties as to the
subject matter thereof, and there are no other understandings,
representations or promises, written or verbal, not set forth herein
or on which either party has relied. If any provisions of any such
Addendum or supplemental written agreement conflict with any
provisions set forth in this Agreement, the provisions of this
Agreement shall take precedence, unless such Addendum or supplemental
written agreement expressly refers to the specific provision(s) of
this Agreement that it is intended to replace or modify (and which
shall be limited in force and effect to such Addendum or supplemental
written agreement only).
7.11. NOTICES. All Notices under this Agreement shall be given in writing
and shall be addressed to the parties at the following addresses:
FOR XENO:
Stephen J. Sullivan
CEO, President and Director
Xenometrix, Inc.
2425 North 55th Street
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
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<PAGE>
Boulder, Colorado 8030 1-5700
FOR ROSETTA:
President
Rosetta Inpharmatics
12040 115th Avenue NE
Kirkland, WA 98034
Notices shall be in writing and shall be deemed delivered when
received, if delivered by a courier, overnight mail service or the
like, or a week following mailing, if sent by first-class certified or
registered mail, postage prepaid.
7.12. ARBITRATION. The parties recognize that disputes as to certain
matters may from time to time arise during the term of this Agreement
which relate to either party's rights and/or obligations hereunder. It
is the objective of the parties to establish procedures to facilitate
the resolution of disputes arising under this Agreement in an
expedient manner by mutual cooperation and without resort to
arbitration. The parties agree that prior to any arbitration
concerning this Agreement, XENO's CEO and ROSETTA's CEO or COO will
meet in person or by video-conferencing in a good faith effort to
resolve any disputes concerning this Agreement. Within thirty (30)
days of a formal request by either party to the other, any party
may, by written notice to the other, have such dispute referred to
their respective officers designated or their successors, for
attempted resolution by good faith negotiations, such good faith
negotiations to begin within thirty (30) days after such notice is
received. Except as otherwise provided specifically herein, any
controversy or claim under this Agreement shall be solely settled
by arbitration by one arbitrator pursuant to the Commercial
Arbitration Rules of the American Arbitration Association (the
"Association"); provided that the parties shall first use their
best efforts to resolve such dispute by negotiation. The
arbitration shall be conducted in Boulder, Colorado. The arbitrator
shall be selected by the joint agreement of the parties, but if
they do not so agree within twenty (20) days of the date of a
request for arbitration, the selection shall be made pursuant to
the rules of the Association. The decision reached by the
arbitrator shall be conclusive and binding upon the parties hereto
and may be filed with the clerk of any court of competent
jurisdiction, and a judgment confirming such decision may, if
desired by any party to the arbitration, be entered in such court.
Each of the parties shall pay its own expenses of arbitration and
the expenses of the arbitrator(s) shall be equally shared;
PROVIDED, HOWEVER, that if in the opinion of the arbitrator(s) any
claim hereunder or any defense or objection thereto was
unreasonable, the arbitrator(s) may assess, as part of the award,
all or any part of the arbitration expenses (including reasonable
attorneys' fees) against the party raising such unreasonable claim,
defense or objection. Nothing herein set forth shall prevent the
parties from settling any dispute by mutual agreement at any time.
7.13. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Colorado, without regard or
giving effect to its principles of conflict of laws.
7.14. SEVERABILITY AND SURVIVAL. This Agreement is intended to be
severable. If any provision(s) of this Agreement are or become
invalid, are ruled illegal by a court of competent jurisdiction or are
deemed unenforceable under the current applicable law from time to
time in effect during the term hereof, it is the intention of the
parties that the remainder of the Agreement shall not be affected
thereby and shall continue to be construed to the maximum extent
permitted by law at
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
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such time. It is further the intention of the parties that in lieu of
each such provision which is invalid, illegal, or unenforceable, there
shall be substituted or added as part of this .Agreement by such court
of competent jurisdiction a provision which shall be as similar as
possible, in economic and business objectives as intended by the
parties to such invalid, illegal or unenforceable provision, but shall
be valid, legal and enforceable. Unless expressly stated otherwise,
any provision intended by its meaning to survive, will survive the
expiration or any other termination of this Agreement.
7.15. INDEPENDENT CONTRACTORS. The parties hereto are acting as independent
contractors and shall not be considered partners, joint venturers or
agents of the other. Neither shall have the right to act on behalf of,
or to bind, the other.
7.16. HEADINGS. Captions and paragraph headings are for convenience only
and shall not form an interpretative part of this Agreement. Unless
otherwise specifically provided, all references to an Article
incorporate all Articles or subsections thereunder. This Agreement
shall not be strictly construed against either party hereto and maybe
executed in two or more counterparts, each of which will be deemed an
original and the same instrument.
(Signature Page Follows]
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
By: /s/ Stephen J. Sullivan Date: 11/12/98
------------------------------------- ---------------------
Stephen J. Sullivan
CEO and President
For Xenometrix, Inc.
By: /s/ Stephen H. Friend, M.D., Ph.D. Date: 11/12/98
------------------------------------- ---------------------
Stephen H. Friend, M.D., Ph.D.
President, Chief Scientific Officer
for ROSETTA INPHARMATICS, Inc.
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
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EXHIBIT A
<TABLE>
<CAPTION>
PATENT/ FILING DATE COUNTY ISSUE DATE TITLE
APPLICATION #
<S> <C> <C> <C> <C>
[***] [***] [***]
5,811,231 7/21/95 US 9/22/98 Methods and Kits for
Mammalian Gene Profiling
692434 1/21/94 Australia 6/11/98
E160178 1/21/94 Austria 11/12/97
0 680 517 1/21/94 Belgium 11/12/97
2154265 1/21/94 Canada
0 680 517 1/21/94 Denmark 11/12/97
0 680 517 1/21/94 EPC 11/12/97
0 680 517 1/21/94 France 11/12/97
694 06 772,5-08 1/21/94 Germany 11/12/97
980400301 1/21/94 Greece 11/12/97
0 680 517 Hong Kong
E77394 1/21/94 Ireland 11/12/97
20035BE/98 1/21/94 Italy 11/12/97
6-517147 1/21/94 Japan
0 680 517 1/21/94 Luxembourg 11/12/97
0 680 517 1/21/94 Monaco 11/12/97
0 680 517 1/21/94 Netherlands 11/12/97
US94/00583 1/21/94 PCT
0 680 517 1/21/94 Portugal 1/19/98
9601405-5 2/13/96 Singapore
0 680 517 1/21/94 Spain 11/12/97
0 680 517 1/21/94 Sweden 11/12/97
0 680 517 1/21/94 Switzerland 11/12/97
0 680 517 1/21/94 UK 11/12/97
</TABLE>
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
<PAGE>
EXHIBIT B
<TABLE>
<CAPTION>
PATENT/ FILING DATE COUNTY ISSUE DATE TITLE
APPLICATION #
<S> <C> <C> <C> <C>
5,589,337 1/6/95 US 12/31/96 Methods and Diagnostic Kits
for Determining Toxicity
Utilizing Bacterial Stress
Promoters Fused to Report
Genes
651825 7.6.93 EPO 1/14/98
5,585,232 4/21/94 US 12/17/96 Methods and Diagnostics
Kits for Determining
Toxicity Utilizing E.coli
Stress Promoters Fused to
Reporter Genes
9601688-6 2/14/96 Singapore
2,139,667 7/9/93 Canada
6-503562 7/6/93 Japan
95-700038 7/6/93 Korea
07/910793 7/6/92 US
45884/95 7/6/93 Australia
95.004 7/6/93 Norway
</TABLE>
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
<PAGE>
EXHIBIT C
HARVARD LICENSE AGREEMENT
LICENSE AGREEMENT
This Agreement is made and entered into between the President and
Fellows of Harvard College (hereinafter "Harvard") having offices at the
Office for Technology and Trademark Licensing, 124 Mt. Auburn Street, Suite
410, Cambridge, Massachusetts 02138 and Venmark Ltd. (hereinafter
"Licensee"), a New York corporation having offices c/o The Castle Group,
Ltd., 375 Park Avenue, Suite 1501, New York, New York 10022.
Whereas Harvard is the owner by assignment from Dr. Spencer Farr
(the "Inventor") of the entire right, title and interest in the United States
patent Application yet to be filed described in Exhibit A attached hereto
(which Exhibit shall be amended to include the actual Application when such
Application is filed), in the foreign patent applications corresponding
thereto, and in the inventions described and/or claimed therein; and
Whereas Harvard is committed to a policy that ideas or creative
works produced at Harvard should be used for the greatest possible public
benefit; and
Whereas Harvard accordingly believes that every reasonable incentive
should be provided for the prompt introduction of such ideas into public use,
all in a manner consistent with the public interest; and
Whereas Licensee is desirous of obtaining an exclusive worldwide
license in order to practice the above referenced invention covered by Patent
Rights in the United States and in certain foreign countries, and to
manufacture, have manufactured, use and sell in the commercial market the
products made in accordance therewith; and
Whereas Harvard is desirous of granting such a license to Licensee
in accordance with the terms of this Agreement.
Now therefore, in consideration of the foregoing premises, the
parties agree as follows:
ARTICLE 1
DEFINITIONS
1.1 "Patent Rights" shall mean (i) the United States Patent Application
yet to be filed described in Exhibit A attached hereto (which Exhibit
shall be amended to include the actual Application when such
Application is filed), the inventions described and/or claimed
therein, and any substitutions, divisions, continuations,
continuations-in-part, patents issuing thereon r reissues or
re-examinations thereof and any and all foreign patents and patent
applications corresponding thereto; (ii) all patent applications to
the extent assigned to Harvard and to the extent Harvard is able,
under its obligations to third parties, to grant rights to Licensee
and on which Inventor is a named inventor, the inventions described
and/or claimed therein and any substitutions, divisions,
continuations, continuations-in-part, patents issuing thereon or
reissues or re-examinations thereof which relate to the design,
development and/or manufacture of any products incorporating the
technology identified in (i) to the extent that their use would be in
any way dominated by the claims in (i) and any and all foreign patents
and patent applications corresponding thereto; (iii) all patent
applications to the extent assigned to Harvard and to the extent
Harvard is able, under its obligations to third parties, to grant
rights to Licensee and on which Inventor is a named inventor, the
inventions described and/or claimed therein and any substitutions,
divisions, continuations, continuations-in-part, patents issuing
thereon or reissues
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
<PAGE>
or re-examinations thereof which relate to any improvements in the
technology incorporated in (i) or (ii) to the extent that their use
would be in any way dominated by the claims in (i) and any and all
foreign patents and patent applications corresponding thereto. The
foreign patents and patent applications corresponding thereto referred
to in (i), (ii) and (iii) above when filed or issued will be
automatically incorporated in and added to this Agreement and shall
periodically be added to Appendix A attached to this Agreement and
made a part hereof; provided, however, that no failure to periodically
add such foreign patents and/or patent applications thereto shall be
considered to exclude such foreign patents and/or patent applications
from the meaning of "Patent Rights."
1.2 "Licensed Products" shall mean products or components thereof
claimed in Patent Rights or products or components thereof made in accordance
with or by means of Licensed Processes.
1.3 "Licensed Processes" shall mean the processes claimed in Patent
Rights and any and all inventions, designs, drawings, specifications, ideas,
discoveries, trade secrets, know-how, codes, formulas, techniques and data
which have been developed or acquired by the Inventor and to which Harvard
has ownership rights.
1.4 "Net Sales" shall mean the amount billed or invoiced on sales of
Licensed Products or Licensed Processes less:
(a) Customary trade, quantity or cash discounts and
non-affiliated brokers' or agents' commissions
actually allowed and taken;
(b) Amounts repaid or credited by reason of rejection or
return; and/or
(c) To the extent separately stated on purchase orders,
invoices or other documents of sale, taxes levied on
and/or other governmental charges made as to
production, sale, transportation, delivery or use and
paid by or on behalf of Licensee.
In the event of a use or sale of Licensed Products or Licensed Processes
solely for clinical testing or research and development purposes for which
Licensee receives no revenue, then no royalty shall be due or payable to
Harvard pursuant to the Article 3 or otherwise.
1.5 "Affiliates" shall mean any company, corporation, or business in which
Licensee owns or controls at least fifty percent (50%) of the voting
stock.
1.6 "Field" shall mean all potential fields or use of the Patents
Rights, the Licensed Products and the Licensed Processes, including, but not
limited to, molecular biology and toxicology.
1.7 "Sublicensee" shall mean an entity which Licensee has granted
(a) the right to manufacture and market the Licensed Products, or (b) the
right to sublicense the Licensed Processes to others, or (c) the right to
practice the Licensed Processes as part of the business of tasting
toxicological responses of any products on behalf of other entities except
when that right is granted to the purchaser of a kit containing a Licensed
Product to allow such purchaser to use such kit.
ARTICLE 2
GRANT
2.1 Harvard hereby grants to Licensee and Licensee accepts, subject to the
terms and conditions hereof, a worldwide exclusive license in the
Field, under Patent Rights, to make and have made, to use and have
used, to sell and have sold, to distribute and have distributed and to
market and
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and such material has been filed separately with the SEC.
<PAGE>
have marketed the Licensed Products, and to practice the Licensed
Processes, for the life of the Patent Rights. Such license shall
include the right to grant sublicenses, and Licensee agrees to give
Harvard thirty (30) days written notice of the identity of any
sublicensee prior to executing any sublicense agreement with respect
to the Patent Rights. Harvard agrees it will not grant licenses to
others except as required by Harvard's obligations in paragraph 2.2(a)
or as permitted in paragraph 2.2(b). Licensee agrees during the period
of exclusivity of this license in the United States that any Licensed
Product produced for sale in the United States will be manufactured
substantially in the United States.
2.2 The granting and acceptance of this license is subject to the
following conditions:
(a) Harvard's "Statement of Policy in Regard to Inventions,
Patents and Copyrights" dated March 17, 1986, Public Law 96-517, Public Law
98-620, in each case, as in effect on the date the particular patent Right
becomes a Patent Right subject to this Agreement. Any right granted in this
Agreement greater than that permitted under Public Law 96-517 or Public Law
98-620, in each case, as in effect on the date the particular Patent Right
becomes a Patent Rights, subject to this Agreement, shall be subject to
modification as may be required to conform to the provisions of those statutes.
(b) Harvard shall have the right to make and to use, for
its own research purposes only and not for any commercial purpose, the
subject matter described and claimed in Patent Rights.
(c) Licensee shall use reasonable effort to effect
introduction of the Licensed Products into the commercial market as soon as
practicable, consistent with sound and reasonable business practices and
judgments; thereafter, until the expiration of this Agreement, Licensee shall
endeavor to keep Licensed Products reasonably available to the public;
recognizing, however, that this provision shall not affect Licensee's right
to freely determine pricing for the Licensed Products and Licensed Processes.
(d) After giving Licensee six (6) months prior written
detailed notice, Harvard shall have the right to terminate this License as to
a particular country or render this license non-exclusive as to a particular
country at any time after three (3) years from the date of license if, in
Harvard's reasonable judgment, at the end of the six (6) month notice period
Licensee EITHER:
(i) has not put the license subject matter into commercial use in such
country directly or through a sublicense, and is not keeping the
licensed subject matter reasonably available to the public in such
country, OR
(ii) is not demonstrably engaged in research,
development, manufacturing, marketing or licensing program, as
appropriate, directed toward this end in such country.
In making this determination Harvard shall take into account the normal
course of such programs conducted with sound and reasonable business
practices and judgment and shall take into account the reports provided
hereunder by Licensee.
(e) All sublicenses granted by Licensee hereunder shall
include a requirement that the sublicensee use reasonable efforts to bring
the subject matter of the sublicense into the commercial market as soon as
practicable, consistent with sound and reasonable business practices and
judgment. Copies of all sublicense agreements shall be provided to Harvard.
2.3 If this license is terminated with respect to a particular country or
rendered non-exclusive as to a particular country by Harvard in
accordance with Section 2.2 hereof, or if this license is terminated
in accordance with Section 8.2 hereof, Harvard may at its sole option
extend the period of exclusivity, extend the license on a
non-exclusive basis, or, in the case of a termination under Section
2.2 or 8.2, permit the license to terminate.
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and such material has been filed separately with the SEC.
<PAGE>
2.4 Harvard hereby grants to Licensee the right to extend the
licenses granted or to be granted in paragraphs 2.1 and 2.3 to an Affiliate
subject to the terms and conditions hereof.
2.5 All rights reserved to the United States Government and others
under Public Law 96-517 and 98-620, in each case, as in effect on the date
the particular Patent Rights becomes subject to this Agreement shall remain
and shall in no way be affected by this Agreement.
ARTICLE 3
ROYALTIES
3.1 Licensee shall pay to Harvard a non-refundable license fee in the sum
of [***] upon execution of this Agreement. Licensee shall also pay
Harvard [***] within sixty (60) days after a non-temporary order of
the Food and Drug Administration or the Environmental Protection
Agency requiring the use of a Licensed Product or Licensed Process
where Licensee, together with its Affiliates and Sublicensees,
constitutes the market leader in terms of Net Sales of such Licensed
Product or Licensed Process.
3.2 (a) Licensee shall pay to Harvard, during the term of the license
of paragraph 2.1, a royalty of [***]of the Net Sales of all Licensed Products
sold (i.e., sales of kits containing a Licensed Product) by Licensee and its
Affiliates. Licensee shall pay to Harvard, during the term of the license of
paragraph 2.1, a royalty of [***] of the Net Sales of all Licensed Processes
sold (i.e., toxicology tasting services performed for others by employees of
Licensee or its Affiliate) by Licensee and its Affiliates. Licensee shall pay to
Harvard, during the term of the license of paragraph 2.1 and before a patent is
issued with respect to any Paten Right, a royalty of [***] of the
sublicensing income (i.e., royalties and license issue fees) which Licensee and
its Affiliates receive from End-User Sublicensees for sublicenses of the
Licensed Processes. Licensee shall pay to Harvard, during the term of the
license of paragraph 2.1 and after a patent is issued with respect to any Patent
Right, a royalty of [***] of the sublicensing income (i.e., royalties and
license issue fees) which Licensee and its Affiliates receive from End-User
Sublicensees for sublicenses of the Licensed Processes. Licensee shall pay to
Harvard, during the term of the license of paragraph 2.1, a royalty of [***]
of the sublicensing income i.e., royalties and license issue fees) which
Licensee and its Affiliates receive from Sublicensees for sublicenses of the
Licensed Products or Licensed Processes. No multiple royalties shall be due
because the sale or sublicense of any Licensed Product or Licensed Process is
described in more than one sentence of this Section 3.2(a). In the event of any
such overlap, the sentence which most accurately describes the relevant
transaction at issue shall prevail.
(b) If this license is converted to a non-exclusive one as
to a particular country or if other non-exclusive licenses are granted
pursuant to Section 2.3 hereof, the royalty payable by Licensee with respect
to Net Sales of Licensed Products or Licensed Processes the subject of such
non-exclusive license shall not exceed the royalty being paid by other
licensees to Harvard during the tem of the non-exclusive license. On Net
Sales or sublicenses between Licensee and its Affiliates, royalties ahll be
payable on the resale or subsublicense only.
3.3 (a) As further consideration for the licensure of Patent Rights, upon
the closing of the first round of equity investment in License,
Licensee agrees to issue to Harvard shares of Licensee's Class B
Common Stock which shall be convertible into three percent (3%) of
Licensee's Class A Common Stock on a fully diluted basis. The Class B
Common Stock shall have the characteristics, rights, preferences and
privileges set forth in the Certificate of Incorporation of the
Licensee and set forth herein as Exhibit B. Such characteristics,
rights, preferences and privileges shall not be amended without the
consent of Harvard.
(b) In the event that Harvard adopts a policy which requires
Harvard to divest all
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<PAGE>
interests Harvard may have in entities which license technology from Harvard,
then until the Licensee's shares are publicly traded, Harvard may, after giving
Licensee ninety (90) days notice, require that Licensee purchase Harvard's
shares at the last offered price or, if no offered price exists, at a price of
three percent (3%) of the amount invested in Licensee as of that date.
3.4 Harvard shall have the right to terminate this license in the event
that Licensee does not pay to Harvard at least the following amounts
in license maintenance fees and/or minimum royalties:
Third calendar year, 1994 [***]
Next calendar year [***]
Next calendar year and each
year thereafter [***]
ARTICLE 4
REPORTING
4.1 Licensee shall provide written annual reports within sixty (60) days
after June 30 of each calendar year which shall include but not be
limited to: reports of progress on research and development,
regulatory approvals, manufacturing, sublicensing, marketing and sales
during the preceding twelve (12) months as well as plans for the
coming year. If progress differs from that anticipated in the plan
provided under Section 4.1 hereof, Licensee shall explain the reasons
for the difference and propose a modified plan for Harvard's review
and comment. Licensee shall also provide any reasonable additional
data Harvard requires to evaluate Licensee's performance.
4.2 Licensee shall report to Harvard the date of first sale of Licensed
Products (or results of Licensed Processes) in each country within thirty (30)
days of occurrence.
4.3 Licensee agrees to submit to Harvard within sixty (60) days after
the calendar half years ending June 30 and December 31, reports setting forth
for the preceding six (6) month period the amount of the Licensed Products sold
by Licensee, its Affiliates and sublicensees in each country, the Net Sales
thereof, and the amount of royalty due thereon and with each such royalty report
to pay the amount of royalty due. Such report shall be certified as correct by
an officer of Licensee and shall include a detailed listing of all deductions
from Net Sales, sublicensee income or from royalties as specified herein. If no
royalties are due to Harvard for any reporting period, the written report shall
so state. All royalties due hereunder shall be payable in United States dollars.
Conversion of foreign currency to U.S. dollars shall be made at the conversion
rate existing in the United States on the date of royalty payments by Licensee.
Payments which are more than sixty (60) days past due and which are not the
subject of a good faith controversy between the parties hereto shall be subject
to an interest charge of one percent (1%) per month.
4.4 (a) Harvard's Office of Technology and Trademark Licensing ("OTTL")
agrees that at all times, both during the term and after the termination of this
Agreement, it will keep in confidence and trust all information provided to it
hereunder by Licensee or provided to it by any third party pursuant to Section
5.1 hereof (the "Proprietary Information"), and it will not use or disclose any
Proprietary Information or anything directly relating to it without the written
consent of the Licensee. OTTL warrants that OTTL shall not disclose Proprietary
Information to officers or employees of either OTTL or Harvard, except if such
disclosure is necessary to perform its obligations under this Agreement. OTTL
shall be responsible for maintaining adequate internal procedures sufficient to
fulfill its obligations under this Section 4.4. OTTL acknowledges that the
Proprietary Information constitutes a unique and valuable asset of the Licensee,
which is secret and confidential and which will be communicated to OTTL in
confidence and that any disclosure or other use of the Proprietary Information
other than for the sole benefit of the Licensee would be wrongful and would
cause irreparable harm to the Licensee.
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<PAGE>
(b) Notwithstanding the foregoing, the parties agree that, at
all such times, Harvard is free to use or disclose, as the case may be, (i)
information in the public domain not as a result of the breach of this
Agreement, (ii) Harvard's own skill, knowledge, know-how and experience to
whatever extent and in whatever way it wishes, and (iii) information which
Harvard is by law, including Public Law 960517 and 98-620, required to disclose
4.5 Licensee agrees to consult with Harvard regarding its intention to
seek financing from the public markets and to inform Harvard
substantially in advance of its intentions and to copy Harvard on all
drafts of offering memorandums coincidental with Licensee's receipt of
same. In any event, Licensee agrees that it will not seek financing
from the public markets until at least one of the following has
occurred:
(a) Licensee has obtained a cumulative minimum investment of
one million two hundred and fifty thousand dollars ($1,250,000), and such
funds have been allocated for use;
(b) Two years from the execution of this Agreement have
passed;
(c) Approval, recommendation or requirement of use for the
Licensed Products or Licensed Processes has been obtained from any Federal
regulatory agency;
(d) Licensee has in excess of twenty (20) employees; or
(e) Licensee has reduced the Licensed Products or Licensed
Processes to practice in the form of a saleable kit.
ARTICLE 5
RECORD KEEPING
5.1 Licensee shall keep, and shall require its Affiliates and sublicensees
to keep, accurate and correct records of Licensed Products or Licensed
Processes made, used or sold under this Agreement, appropriate to
determine the amount of royalties due hereunder to Harvard. Such
records shall be retained for at least three (3) years following a
given reporting period. On reasonable prior written notice to
Licensee, such records shall be available during normal business
hours for inspection at the expense of Harvard by Harvard's Internal
Audit Department or by a Certified Public Accountant selected by
Harvard and approved by Licensee for the sole purpose of verifying
reports and payments hereunder. Such accountant shall not disclose
to Harvard any information other than information relating to
accuracy of reports and payments made under this Agreement. In the
event that any such inspection shows an underreporting and
underpayment in excess of ten percent (10%) for any twelve (12) month
period, then Licensee shall pay the cost of such examination.
Licensee shall be entitled to receive from Harvard copies of all
reports prepared by or on behalf of Harvard in the exercise by
Harvard of its rights hereunder.
ARTICLE 6
DOMESTIC AND FOREIGN PATENT FILING AND MAINTENANCE
6.1 Subject to the provisions of Section 6.3 hereof, Licensee shall
reimburse Harvard for all reasonable out-of-pocket expenses Harvard has incurred
for the preparation, filing, prosecution and maintenance of Patent Rights and
shall reimburse Harvard for all such future reasonable out-of-pocket expenses.
Harvard shall take responsibility for the preparation, filing, prosecution and
maintenance of any and all patent applications and patents included in Patent
Rights, provided however that Harvard shall first consult with Licensee as to
the preparation, filing, prosecution and maintenance of such patent
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<PAGE>
applications and patents and shall furnish to Licensee copies of documents
relevant to any such preparation, filing, prosecution or maintenance.
6.2 Harvard and Licensee shall cooperate fully in the preparation,
filing, prosecution and maintenance of Patent Rights and of all patents and
patent applications licensed to Licensee hereunder, executing all papers and
instruments or requiring members of Harvard to execute such papers and
instruments so as to enable Harvard to apply for, to prosecute and to maintain
patent applications and patents in Harvard's name in any country. Each party
shall provide to the other prompt notice as to all matters which come to its
attention and which may affect the preparation, filing, prosecution or
maintenance of any such patent applications or patents. Either party may give
notice to the other of any foreign country in which such party wishes to seek
patent protection for all or any part of the Patent Rights. In the case of such
a designation by Licensee (and the provision of reasonable assurance of payment
by it of the expenses to be incurred) Harvard may not refuse to seek such patent
protection in the country so designated.
6.3 Harvard shall submit a written request to Licensee for any
reasonable out-of-pocket expenses incurred by it in complying with Sections 6.1
and 6.2 hereof. Licensee is obligated to reimburse any reasonable expenses
incurred by Harvard for action in support of Patent Rights unless after
providing written notice to Licensee, Harvard is notified in writing in advance
of any such action that such action should not be taken. If, within sixty (60)
days of such request, Licensee elects not to pay the expenses of a patent
application or patent included within Patent Rights, Licensee shall thereby
surrender its rights under such patent or patent application.
ARTICLE 7
INFRINGEMENT
7.1 With respect to any Patent Rights under which Licensee is
exclusively licensed pursuant to this Agreement, Licensee or its sublicensee
shall have the right to prosecute in its own name and at its own expense any
infringement of such patent, so long as such license is exclusive at the time of
the commencement of such action. Harvard agrees to notify Licensee promptly of
each infringement of such patents of which Harvard is or becomes aware. Licensee
shall reimburse Harvard for its reasonable out-of-pocket expenses incurred in
connection with any protection of the non-exclusively licensed Patent Rights pro
rata in the proportion the aggregate amount of such expenses bears to the total
number of non-exclusive licensees of such Patent Rights. Failure by either party
to commence an action which is contemplated by this Section 7.1 shall not
constitute a breach of this Agreement.
7.2 If Licensee or its sublicensee elects to commence an action as
described above or if an action is commenced against the Licensee or its
sublicensee by a third party and Harvard is a legally indispensable party to
such action, Harvard shall have the right either to join the action as a
co-plaintiff or to assign to Licensee all of Harvard's right, title and interest
in each patent which is a part of the Patent Rights and is the subject of such
action (subject to all Harvard's obligations to the government and others having
rights in such patent). In the event Harvard joins the action as a co-plaintiff,
Harvard shall jointly control the action with the Licensee or its sub-licensee.
In the event that Harvard makes such an assignment, such assignment shall be
irrevocable, and such action by Licensee on that patent or patents shall
thereafter be brought or continued without Harvard as a party, if Harvard is no
longer an indispensable party. Notwithstanding any such assignment to Licensee
by Harvard and regardless of whether Harvard is or is not an indispensable
party, Harvard shall cooperate fully with Licensee in connection with any action
commenced by or against Licensee or any sublicensee. In the event that any
patent is assigned to Licensee by Harvard, pursuant to this paragraph, such
assignment shall require Licensee to continue to meet its obligations under this
Agreement as if the assigned patent or patent
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<PAGE>
application were still licensed to Licensee.
7.3 Licensee shall reimburse Harvard for any reasonable out-of-pocket
costs it incurs as part of an action contemplated by this Article 7,
irrespective of whether Harvard shall become a co-plaintiff in any such action
(such reimbursement to be on the pro rata basis set forth in Section 7.1 in the
case of an action relating to non-exclusively licensed Patent Rights); provided,
however, that Licensee shall have no obligation to reimburse Harvard for any
costs which Licensee notifies Harvard will duplicate costs incurred or to be
incurred by Licensee.
7.4 If Licensee or its sublicensee elects to commence an action as
described above, Licensee may reduce, by up to [***] the royalty due to
Harvard earned under the patent subject to suit by [***] of the amount of the
expenses and costs of such action, including attorney fees. In the event that
such [***] expenses and costs exceed the amount of royalties withheld by
Licensee for any calendar year, Licensee may to that extent reduce the royalties
due to Harvard from Licensee in succeeding calendar years, but never by more
than [***] of the royalty due in any one year.
7.5 Recoveries or reimbursements from such action shall first be
applied to reimburse Licensee and Harvard for litigation costs not paid from
royalties (if any) and then to reimburse Harvard for royalties withheld. Any
remaining recoveries or reimbursements shall be shared equally by Licensee and
Harvard.
7.6 In the event that Licensee and its sublicensee, if any, elect not
to exercise their right to prosecute an infringement of the Patent Rights
pursuant to the above paragraphs, Harvard may do so at its own expense,
controlling such action and retaining all recoveries therefrom.
ARTICLE 8
TERMINATION OF AGREEMENT
8.1 This Agreement, unless extended or terminated as provided herein,
shall remain in effect for the life of the last to expire patent in Patent
Rights.
8.2 (a) The following events shall constitute an event of default under
this Agreement (an "Event of Default"):
(i) Licensee shall fail to make any royalty payment
which is not the subject of good faith controversy between the parties
hereto within ten (10) days after the same shall have become due; or
(ii) Licensee shall consent to the appointment of a
receiver, trustee or liquidator of itself or of a substantial part of
its property, or Licensee shall admit in writing its inability to pay
its debts generally as they come due or shall make a general assignment
for the benefit of creditors; or
(iii) Licensee shall file a voluntary petition in
bankruptcy or a voluntary petition or an answer seeking reorganization
in a proceeding under any bankruptcy laws (as now or hereafter in
effect) or an answer admitting the material allegations of a petition
filed against Licensee in any such proceeding; or
(iv) an order, judgment or decree shall be entered
in any proceeding by any court of competent jurisdiction appointing,
without the consent of Licensee, a receiver, trustee or
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<PAGE>
liquidator of Licensee or of any substantial part of its property, or
sequestering any substantial part of its property, and any such order,
judgment or decree of appointment or sequestration shall remain in
force undismissed, unstayed or unvacated for a period of 90 days after
the date of entry thereof;
(v) a petition against Licensee in a proceeding
under applicable bankruptcy laws or other insolvency laws as now or
hereafter in effect, shall be filed and shall not be withdrawn or
dismissed within 90 days thereafter, or if, under the provisions of
any law providing for reorganization or winding-up of corporations
which may apply to Licensee, any court of competent jurisdiction
shall assume jurisdiction, custody or control of Licensee or of any
substantial part of its property and such jurisdiction, custody or
control shall remain in force unrelinquished, unstayed or unterminated
for a period of 90 days;
(vi) failure to make minimum royalty payments under
the Article 3 of this Agreement, or failure to comply with the
reporting and due diligence requirements under Articles 2 and 4 of this
Agreement unremedied after thirty (30) days notice; or
(vii) failure to comply with Article 9.3 of this
Agreement.
(b) The parties acknowledge and agree that no failure by
Licensee to meet any of the other obligations or duties herein set forth of any
kind or nature whatsoever shall be considered a material breach of this
Agreement, an "Event of Default" or the grounds for the termination of this
Agreement by Licensor.
8.3 On the occurrence of an Event of Default, and if such Event of Default
has not been remedied within ninety (90) days after the date of notice
in writing of such Event of Default has been given to the Licensee by
Harvard, Harvard may terminate this Agreement by written notice.
8.4 Any sublicenses granted by Licensee under this Agreement shall provide
for termination or assignment to Harvard, at the option of Harvard, of
Licensee's interest therein upon termination of this Agreement.
8.5 Licensee shall have the right to terminate this Agreement by giving
thirty (30) days advance written notice to Harvard to that effect and
paying a [***]; provided, however, that no such termination fee
shall be payable in the event that any patent or claim included within
the Patent Rights are held invalid or unenforceable. Upon termination,
a final report shall be submitted and any royalty payments and
unreimbursed patent expenses due to Harvard become immediately
payable.
8.6 Sections 4.4, 8.5, 9.2, 9.3 and 9.4 of this Agreement shall
survive termination.
ARTICLE 9
GENERAL
9.1 Harvard represents and warrants that the entire right, title, and
interest in the patent applications or patents comprising the Patent
Rights have been assigned to it and that Harvard has the authority to
issue licenses under said Patent Rights. Harvard does not warrant the
validity of the Patent Rights licensed hereunder and makes no
representations whatsoever with regard to the scope of the licensed
Patent Rights or that such Patent Rights may be exploited by Licensee,
an Affiliate, or sublicensee without infringing other patents however,
Harvard has no reason to believe that the Patent Rights are invalid or
that exploitation by Licensee, an Affiliate or sublicensee of the
Patent Rights will infringe other patents.
9.2 HARVARD EXPRESSLY DISCLAIMS ANY AND ALL IMPLIED OR EXPRESS
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<PAGE>
WARRANTIES AND MAKES NO EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR
FITNESS OF THE TECHNOLOGY, LICENSED PROCESSES OR LICENSED PRODUCTS CONTEMPLATED
BY THIS AGREEMENT.
9.3 (a) Licensee shall indemnify, defend and hold harmless
Harvard and its directors, governing board members, trustees, officers,
faculty, medical and professional staff, employees, students, and agents and
their respective successors, heirs and assigns (the "Indemnitees"), against
any liability, damage, loss or expenses (including reasonable attorneys' fees
and expenses of litigation) incurred by or imposed upon the Indemnitees or
any one of them in connection with claims, suits, actions, demands, judgments
arising out of any theory of product liability (including, but not limited
to, actions in the form of tort, warranty, or strict liability) concerning
any product, process or service made, used or sold pursuant to any right or
license granted under this Agreement. The above indemnification shall apply
whether or not such liability, damage, loss or expense is attributable to the
negligent activities of the Indemnitees.
(b) Licensee agrees, at its own expense, to provide attorneys
reasonably acceptable to Harvard to defend against any actions brought or filed
against any party indemnified hereunder with respect to the subject of indemnity
contained herein, whether or not such actions are rightfully brought.
(c) Beginning at the time as any such product, process or
service is being commercially distributed or sold (other than for the purpose of
obtaining regulatory approvals) by Licensee or by a sublicensee, Affiliate or
agent of Licensee, Licensee shall, at its sole cost and expense, procure and
maintain comprehensive general liability insurance in amounts not less than
$2,000,000 per incident limited to $2,000,000 annual aggregate and naming the
Indemnitees as additional insureds. During clinical trails of any such product,
process or service, Licensee shall, at its sole cost and expense, procure and
maintain comprehensive general liability insurance in amounts not less than
$500,000 per incident limited to $500,000 annual aggregate, naming the
Indemnitees as additional insureds. Such comprehensive general liability
insurance (or self-insurance, as the case may be) shall provide (i) product
liability coverage and (ii) broad form contractual liability coverage for
Licensee's indemnification under this Agreement. If Licensee elects to
self-insure all or part of the limits described above (including deductibles or
retentions which are in excess of $250,000 annual aggregate) such self-insurance
program must be reasonably acceptable to Harvard and the Risk Management
Foundation of the Harvard Medical Institutions, Inc. The minimum amounts of
insurance coverage required shall not be construed to create a limit of
Licensee's liability with respect to its indemnification under this Agreement.
(d) Licensee shall provide Harvard with written evidence of
such insurance upon request of Harvard. Licensee shall provide Harvard with
written notice at least fifteen (15) days prior to the cancellation, non-renewal
or material change of such insurance; if Licensee does not obtain replacement
insurance providing comparable coverage within such fifteen (15) day period,
Harvard shall have the right to require Licensee, its affiliates, and
sublicensees to cease engaging in any business activities relating to the Patent
Rights until proper insurance is obtained.
(e) Licensee shall maintain such comprehensive general
liability insurance beyond the expiration or termination of this Agreement
during (i) the period that any product, process, or service, relating to, or
developed pursuant to, this Agreement is being commercially distributed or sold
by Licensee and (ii) a reasonable period after the period referred to in (e)(i)
above which in no event shall be less than five (5) years.
9.4 Licensee shall not use Harvard's name or any adaptation of
it in any advertising, promotional or sales literature without the prior
written consent of Harvard. Harvard shall not unreasonably withhold its
consent to any disclosure which describes the scope and nature of the
parties'
-10-
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
<PAGE>
participation accurately and appropriately.
9.5 Without the prior written approval of Harvard, the entire
license granted pursuant to this Agreement shall not be transferred by
Licensee to any party other than to a successor to the business interest of
Licensee relating to the Patent Rights. This Agreement shall be binding upon
the successors, legal representatives and assignees of Harvard and Licensee.
9.6 The interpretation and application of the provisions of this
Agreement shall be governed by the laws of the Commonwealth of Massachusetts.
9.7 Licensee agrees to comply with all applicable laws and
regulations. In particular, it is understood and acknowledged that the
transfer of certain commodities and technical data is subject to United
States laws and regulations controlling the export of such commodities and
technical data, including all Export Administration Regulations of the United
States Department of Commerce. These laws and regulations, among other
things, prohibit or require a license for the export of certain types of
technical data to certain specified countries. Licensee hereby agrees and
gives written assurance that it will comply with all United States laws and
regulations controlling the export of commodities and technical data, that it
will be solely responsible for any violation of such by Licensee or its
Affiliates or sublicensees, and that it will defend and hold Harvard harmless
in the event of any legal action of any nature occasioned by such violation.
If to Harvard: Office for Technology and
Trademark Licensing
Harvard University
124 Mt. Auburn Street, Suite 410
Cambridge, MA 02138
If to Licensee: c/o The Castle Group, Ltd.
375 Park Avenue, Suite 1501
New York, NY 10022
or such other address as either party may request in writing.
9.9 Should a court of competent jurisdiction later consider any
provision of this Agreement to be invalid, illegal, or unenforceable, it shall
be considered severed from this Agreement. All other provisions, rights and
obligations shall continue without regard to the severed provision, provided
that the remaining provisions of this Agreement are in accordance with the
intention of the parties.
9.10 In the event of any controversy or claim arising out of or
relating to any provision of this Agreement or the breach thereof, the parties
shall try to settle such conflicts amicably between themselves. Subject to the
limitation stated in the final sentence of this section, any such conflict which
the parties are unable to resolve shall be settled through arbitration conducted
in accordance with the rules of the American Arbitration Association. The demand
for arbitration shall be filed within a reasonable time after the controversy or
claim has arisen, and in no event after the date upon which institution of legal
proceedings based on such controversy or claim would be barred by the applicable
statute of limitation. Such arbitration shall be held in Boston, Massachusetts.
At the request of any party, arbitration proceedings will be conducted in the
utmost secrecy; in such case all documents, testimony and records shall be
received, heard and maintained by the arbitrator in secrecy under seal,
available for the inspection only of the parties and their respective attorneys
and their respective experts who shall agree in advance and in writing to
receive all such information in secrecy until such information shall become
generally known. The award through arbitration shall be final and binding.
Either party may
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* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
<PAGE>
enter any such award in a court for judicial acceptance of the award and an
order of enforcement, as the case may be. Notwithstanding the foregoing,
either party may, without recourse to arbitration, assert against the other
party a third-party claim or cross-claim in any action brought by a third
party, to which the subject matter of this Agreement may be relevant.
9.11 This Agreement constitutes the entire understanding between the
parties and neither party shall be obligated by any condition or
representation other than those expressly stated herein or as may be
subsequently agreed to by the parties hereto in writing.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives.
The effective date of this Agreement is January 17, 1999.
The President and Fellows Venmark Ltd.
of Harvard College
Name: /s/ By: /s/
Title: Joyce Brinton, Director Name: /s/ [illegible]
Office for Technology and
Trademark Licensing
Date: 1/17/92 Title: Chairman and Pres.
Date: January 17, 1992
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* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
<PAGE>
Exhibit A
(To Be Amended)
Entire United States Patent Application, as may be drafted and amended, relating
to the work of [***]
*Confidential Treatment is requested for the language that has been underscored
or marked. Such language has been deleted from the copy filed with the SEC.
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
<PAGE>
XENOMETRIX
2860 Wilderness Place
Boulder, Colorado 80301
Phone: (303) 447-1773
Fax: (303) 447-1758
January 10, 1996
Harvard University
Office of Technology and Trademark Licensing
Attn: Kevin J. Heyeck
124 Mt. Auburn Street, Suite 410 South
Cambridge, MA 02138
Ladies and Gentlemen:
This is our understanding of the agreement reached in recent conversations
between the President and Fellows of Harvard College (Harvard) and
Xenometrix, Inc. (Xenometrix). Harvard and Xenometrix are identified
together as the Parties.
The agreements stated in this letter are contingent on execution of this letter
by both Parties.
Cattox-TM- Amendment Xenometrix agrees that within three days of receipt of this
letter executed by the Parties it will execute the Amendment to the License
Agreement between Xenometrix, Inc. and President and Fellows of Harvard
College dated January 18, 1992 (the Amendment), said Amendment executed by
Harvard on 7/12/95, a copy of which is attached as Exhibit 1. Xenometrix
agrees that by executing the Amendment Xenometrix will be obligated to pay
royalties to Harvard under Article 3 of the License Agreement with respect
to the technology addressed in the Amendment, said technology called the
Cattox-TM- Assay, since the inception of the License Agreement.
Royalty Reports and Payment Xenometrix agrees that it will prepare and deliver
to Harvard royalty reports on the Cattox-TM- Assay from inception of sales
through December 31, 1995 within 21 calendar days of receipt of this letter
executed by the Parties, calculating the royalty due Harvard on 100% of
such sales. Xenometrix will enclose with the reports payment for any
royalty due.
Schiestl Technology Harvard agrees that as of December 31, 1995, Harvard owns no
interest in the patents and patent applications set forth in Exhibit 2 (the
Yeast Del-TM- Assay and the Mammalian Del Assay), except that Harvard
represents that it ownss the continuation-in-part application number [***].
Together, the Yeast Del-TM- Assay and the Mammalian Del Assay are
identified as the Schiestl Technology. Harvard makes no representations
about its ownership of improvements to the Schiestl Technology made after
December 31, 1995.
*Confidential Treatment is requested for the language that has been underscored
or marked. Such language has been deleted from the copy filed with the SEC.
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
<PAGE>
Treck Assay Xenometrix agrees that within three days of receipt of this letter
executed by the Parties it will pay to Harvard [***], the minimum
royalties for 1994 and 1995 on the license agreement between Harvard and
Xenometrix dated 8-3-92 (the Treck License), plus interest calculated from
the original payment dates, as provided under the license. Xenometrix
hereby notifies Harvard that, under the terms of the Treck License as set
forth in paragraph 8.5 of said License, Xenometrix terminates said License
and releases all rights it has to the technology addressed by said License.
Harvard hereby waives the [***] termination fee set forth in paragraph
8.5 of the Treck License.
Sincerely yours, Agreed,
Xenometrix, Inc. The President and Fellows of Harvard
College
/s/
Edson D. de Castro By: /s/
Chief Executive Officer
Title: Joyce Brinton, Director Office for
Technology and Trademark Licensing
Date: 1/10/96 Date: 1/11/96
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*Confidential Treatment is requested for the language that has been underscored
or marked. Such language has been deleted from the copy filed with the SEC.
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
<PAGE>
HARVARD UNIVERSITY
OFFICE FOR TECHNOLOGY AND TRADEMARK LICENSING
AMENDMENT TO THE LICENSE AGREEMENT BETWEEN
XENOMETRIX INC
AND
PRESIDENT AND FELLOWS OF HARVARD COLLEGE
DATED JANUARY 18, 1992
The License Agreement executed on January 18, 1992, between President and
Fellows of Harvard College (HARVARD) and Xenometrix Inc, is hereby amended
to incorporate into PATENT RIGHTS, HARVARD's ownership interest in the
jointly owned, International Patent Application No. [***], and its
priority application, [***].
Upon termination of the License Agreement, or its conversion from exclusive to
non-exclusive, or upon subsequent removal of the above rights from the
License Agreement, the parties agree that each may license their respective
ownership interests in these jointly owned application(s), throughout the
world, without accounting to the other.
The effective date of this amendment shall be January 21, 1993.
Agreed and accepted:
The President and Fellows XENOMETRIX, INC.
of Harvard College
/s/
Signature
Joyce Brinton, Director Office for
Technology and Trademark Licensing Title
Date: 7/1[?]/9[?]
Date
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
<PAGE>
Exhibit 2
Entire Patent Applications and Issued Patents, as may be drafted and amended,
relating to the work of Dr. Robert Schiestl corresponding to:
I. The Yeast Del assay, including:
(a) United States patent 4,997,757 ("Process for Detecting
Potential Carcinogens," issued march 5, 1991), and all
reissues and extensions thereof;
(b) European patent application 324,258 ("Process for Detecting
Potential Carcinogens," published July 19,1989) and all
Letters Patent which may be granted for the invention(s) of
said European patent application, and all extension, renewals,
and continuations thereof, including, but not limited to,
(i) France patent 0324258
(ii) Germany patent P3883364.6
(iii) Sweden patent 88312099.0
(iv) Switzerland patent P324258.4
(v) United Kingdom patent 0324258
(c) Canada patent 1322943 issued October 12, 1993
II. The Mammalian Del assay, including United States patent application
[***] and all Letters Patent of the United States which may be granted
thereon and all reissues and extensions thereof, and all applications for
Letters patent which may hereafter be granted for the invention(s) of said
U.S. patent application in any country or countries foreign to the United
States, and all extensions, renewals, and reissues thereof.
Non-Profiled Document
* Material has been omitted pursuant to a request for confidential treatment,
and such material has been filed separately with the SEC.
