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Exhibit 10.7
Patent License
Gemini Research Ltd.
and
Affymetrix, inc.
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Table of Contents
1. INTRODUCTION...................................................... 1
2. DEFINITIONS....................................................... 1
3. GRANT OF LICENSE.................................................. 2
4. OBLIGATIONS OF AFFYMETRIX......................................... 3
5. FINANCIAL PROVISIONS.............................................. 3
6. ACCOUNTS.......................................................... 5
7. INTELLECTUAL PROPERTY PROTECTION AND PROCEEDINGS.................. 5
8. DURATION AND TERMINATION.......................................... 6
9. NATURE OF AGREEMENT............................................... 7
10. APPLICABLE LAW AND JURISDICTION................................... 8
11. NOTICES AND SERVICE............................................... 8
12. MISCELLANEOUS..................................................... 9
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This AGREEMENT is dated ___________ BETWEEN: Gemini Research Ltd. whose
registered office is at 162 Science Park, Milton Road, Cambridge, CB4 4GH,
England ("GEMINI"), and Affymetrix, Inc., a company incorporated in the State of
Delaware, USA whose principal office is at 3380 Central Expressway, Santa Clara,
California 95051, USA ("Affymetrix").
1. INTRODUCTION
1.1. GEMINI is the owner of relating to certain sequences as a gene
family known as COLA1 ("the Gene") which has potential uses in
relation to osteoporosis, in respect of which GEMINI has applied
to obtain patent protection in the United States and elsewhere.
1.2. Affymatrix wishes to obtain a License under GEMINI's patents and
patent applications in relation to the Gene to order to include
genetic sequences relating to the Gene which fall within the
claims of such patents and patent applications in probe arrays,
and GEMINI is willing to grant a License to Affymetrix to do so,
on the terms and conditions of this Agreement.
2. DEFINITIONS
2.1. "Affiliate" means, in relation to either party, a company which
controls that party, or is controlled by that party or by a
company which controls that party; and for these purposes a
company controls another company if, either directly or
indirectly through one or more other companies, it can a)
exercise a majority of the votes attached to the shares in the
other company; or b) appoint or remove a majority of the board of
directors of the other company.
2.2. "Effective Date" means January 1, 1999.
2.3. "Field" *
2.4. "Genetic Sequence" means a DNA sequence comprising all or part
of a gene, the allele of a gene or an Express Sequence Tag (EST).
2.5. "Licensed Patents" means the patent applications and/or patent
details of which are given in the Schedule, any other patent
application made by GEMINI at any time during the Term in any
part of the Territory in respect of the Gene or any Genetic
Sequence relating thereto, any patent obtained in pursuance of
any such application, any extension, reissue, division,
continuation or continuation-in-part of any such application or
patent and any patent of addition, supplementary protection
certificate or similar rights based on any such patent.
2.6. "Licensed Products" means any product within the Field which, but
for the License
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Confidential Treatment Requested and the Redacted
Material has been separately filed with the Commission
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granted under this Agreement, would infringe a Valid Claim of any
of the Licensed Patents in the relevant country or territory.
2.7. "Net Sales Value" means, in relation to any of the Licensed
Products where the Licensed Product is sold by Affymetrix or any
of its Affiliates to a third party (other than to Affymetrix or
any of its Affiliates) on arm's length terms, the grossed amount
invoiced less (i) any value added tax or other sales tax, (ii)
any packaging, packing, freight, warehousing, carriage and
insurance charges, to the extent that any of those items are
included in the amount so invoiced, and after deducting any
allowances for lost or damaged merchandise or returns, but
without deducting (or, to the extent that they have been deducted
from the price, after adding back) any discounts or rebates
granted to the customer on account of the quantity purchased or
promptness of payment or otherwise. Where the Licensed Product is
so sold otherwise than on arm's length terms, but is subsequently
sold on arms length terms, the gross amount invoiced under the
first such arm's length sale, calculated in accordance with sales
on an arms length basis as described above. For purposes of
clarity, Net Sales Value will primarily relate to sales of
Affymetrix probe arrays not associated software license fees,
reagent costs, or technology access fees.
2.8. "Patent" means any patent application or patent, including any
extension, reissue, division, continuation or
continuation-in-part of any such application or patent, and any
patent of addition, supplementary protection certificate or
similar rights based on any patent, and the right to make any
application for any such protection in any part of the world.
2.9. "Quarter" means the period of three months beginning on the
Effective Date, each successive period of three months during the
Term and any shorter period to the date of termination of this
Agreement, and "Quarterly" has a corresponding meaning.
2.10. "Term" means the period during which this Agreement continues in
force pursuant to Section 8.1.
2.11. "Territory" means all countries and territories of the world.
2.12. "Valid Claim" means a claim of any Patent (whether pending or
issued) which has not expired, withdrawn, been abandoned or
surrendered or been refused, revoked or held invalid in an
unappealed or unappealable final decision rendered by a court of
competent jurisdiction in the relevant country or territory.
2.13. "Year" means each period of four consecutive Quarters during the
Term, and any shorter period to the termination of this
Agreement.
3. GRANT OF LICENSE
3.1. GEMINI hereby grants to Affymetrix, subject to the provisions of
this Agreement, an exclusive, worldwide License under the
Licensed Patents to make, have made, import, distribute, use and
sell the Licensed Products.
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3.2. Affymetrix shall be entitled to exercise the rights granted under
Section 3.1 by itself or through any of its Affiliates, provided
that Affymetrix shall at all times during the Term ensure the
observance and performance by every such Affiliate of the
provisions of this Agreement and indemnify GEMINI against any
loss, damages, costs, claims or expenses which are awarded
against or incurred by GEMINI as a result of any breach by such
Affiliate of any of the provisions of this Agreement, as if the
breach had been that of Affymetrix.
3.2. GEMINI reserves to itself all rights in respect of the Gene (or
any Genetic Sequence relating thereto) and the Licensed Patents,
except as expressly provided for under this Agreement.
3.4. Affymetrix agrees to use commercially reasonable efforts to
commercialize Licensed Products within twenty-four (24) months
of the Effective Date. If Affymetrix has not commercialized
such products, Affymetrix and GEMINI shall meet and confer.
If Affymetrix is not able to show to GEMINI reasonable
satisfaction that such commercially reasonable efforts have been
made, then GEMINI may, at its option, convert this license to a
non-exclusive basis.
4. OBLIGATIONS OF AFFYMETRIX
4.1. Affymetrix shall provide GEMINI with a Quarterly report as to the
manufacture and sale of and any other dealings in the Licensed
Products.
4.2. Affymetrix shall use commercially reasonable efforts at all times
during the Term to promote and expand the sale of the Licensed
Products in the Territory and to create and satisfy market demand
for them.
5. FINANCIAL PROVISIONS
5.1. In consideration of the rights granted under this Agreement,
Affymetrix shall, subject to the following provisions, pay to
GEMINI a) the non-refundable and non-creditable sum of * on
the Effective Date; and b) * per year for each of the next
fifteen (15) years (or for so long as the patents remain in
force, whichever is sooner); and c) royalties in respect of
all Licensed Products manufactured by or for Affymetrix or any
of its Affiliates which are sold, or used or otherwise
disposed of on a commercial basis (otherwise than to
Affymetrix or another such Affiliate of Affymetrix) by
Affymetrix in any country or territory at any time during the
Term, at the rate specified in Section 5.2
5.2. The rate referred to in Section 5.1 shall be a percentage of
the * in question calculated as the product of the following
formula:
*
3
Confidential Treatment Requested and the Restated
Material has been separately filed with the Commission
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5.3 If at any time during the Term any of the Genetic Sequences
represented on any of the Licensed Products ceases to be
within a Valid Claim of any of the Licensed Patents (and does
not remain within any other such Valid Claim) in the relevant
country or territory, then that Genetic Sequence shall not be
taken into account in the relevant country or territory for
the purposes of calculating the * in the above formula.
5.4. * of the annual fee set forth in Section 5.1 shall be
creditable against future royalties payable under Section 5.2
5.5. Within 30 days after each Quarter, Affymetrix shall send to
GEMINI a written statement showing the quantity of the Licensed
Products sold or otherwise disposed of on a commercial basis by
Affymetrix or any of its Affiliates (showing separately any
quantity so sold to Affymetrix or any of its Affiliates) during
that Quarter in each country or territory; the Net Sales Value in
respect of that quantity of Licensed Products and any further
information necessary for the calculation of such Net Sales Value
and/or the formula contained in Section 5.2; and the amount of
the royalties payable under Section 5.1 in respect of that
quantity.
5.6. All royalties or other sums payable under this Agreement shall be
paid in pounds sterling or such other currency as GEMINI may
specify in writing from time to time, and where any royalties are
calculated in a currency other than sterling, they shall be
converted into sterling by reference to the relevant foreign
exchange buying rate for the currency in question of Wall Street
Journal at the close of business in California on the last day of
the Quarter or Year to which they relate.
5.7. All royalties or other sums payable under this Agreement are
exclusive of bank charges and value added tax or other applicable
taxes or duties, for which Affymetrix shall be additionally
liable, and shall be paid in cleared funds to such bank account
or in such other manner as GEMINI may specify from time to time,
without any set off, deduction or withholding except any tax
which Affymetrix is required by law to deduct or withhold, and if
Affymetrix is required to make any such tax deduction or
withholding, Affymetrix shall do all things in its power which
may be necessary to enable or assist GEMINI to claim exemption
from or (if that is not possible) a credit for the deduction or
withholding under any applicable double taxation or similar
agreement from time to time in force, and shall from time to time
give GEMINI proper evidence as to the deduction or withholding
and payment over of the tax, deducted or withheld.
5.8. If Affymetrix fails to pay in full any royalties or other sums
payable under this Agreement on the date as within the period
specified for payment, the amount outstanding shall be interest,
both before and after any judgement, at the rate of 2
4
Confidential Treatment Requested and the Restated
Material has been separately filed with the Commission
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(two) per cent, per annum above the base rate of prime in the
United States from time to time from that date or the last day of
that period until that amount is paid in full to GEMINI.
5.9. The period in respect of which royalties shall be payable
pursuant to Section 5.1 is, in respect of each country or
territory in the Territory, the period during which any of the
Patents remains in force in that country or territory.
6. ACCOUNTS
6.1. Affymetrix shall -
6.1.1. keep, and procure that each of its Affiliates keeps, true and
accurate accounts and records in sufficient detail to enable
the amount of all royalties or other sums payable under this
Agreement to be determined;
6.1.2. at the reasonable request of GEMINI from time to time, allow
GEMINI or its agent (or procure that GEMINI or its agent is
allowed) to inspect those accounts and records and, to the
extent that they relate to the calculation of those royalties
or other sums, to take copies of them.
6.1.3. If, following any inspection pursuant to Section 6.1(b),
GEMINI's auditors certify to GEMINI and Affymetrix that the
amount of the royalties paid in respect of any Quarter or Year
pursuant to Section 5.5 falls short of the amount of the
royalties which were properly payable in respect of that
Quarter or Year under Section 5.1, Affymetrix shall within 7
(seven) days of the date of certificate pay the shortfall to
GEMINI and, if the shortfall exceeds 10% (ten per cent) of the
amount properly payable, Affymetrix shall also reimburse to
GEMINI on demand the reasonable costs and expenses of GEMINI
in making the inspection.
7. INTELLECTUAL PROPERTY PROTECTION AND PROCEEDINGS
7.1. GEMINI shall permit Affymetrix to have reasonable input to the
prosecution of any applications for Patent or other forms of
protection subsisting in the Territory in respect of the Gene, or
any Genetic Sequence relating thereto. Gemini shall reasonably
inform Affymetrix of all correspondence with or from the relevant
patent offices.
7.2. GEMINI shall make all necessary filings and pay all requisite
renewal fees to maintain the Licensed Patents in the Territory;
provided that if GEMINI wishes to abandon any of the Licensed
Patents (whether applied for or issued) in any country or
territory, GEMINI shall give a written notice to Affymetrix
offering to assign the same to Affymetrix at the expense of
Affymetrix but otherwise free of charge, and if
7.2.1. Affymetrix accepts the offer in writing within 30 days, GEMINI
shall accordingly assign the Licensed Patent in question to
Affymetrix forthwith; or
7.2.2. Affymetrix does not accept the offer in writing within 30
days, GEMINI shall
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have no further obligation with respect to the Licensed Patent
in question and shall be free to abandon the same; and
7.2.3. any Licensed Patent which is so assigned or abandoned shall
thereafter be deemed not to exist (and not to contain any
Valid Claim) in the relevant country or territory for the
purposes of Section 5.2.
7.3. The parties shall, at the request of either of them and at the
expense of Affymetrix but for no further consideration, enter
into such formal Licenses relating so the Licensed Patents as may
be necessary or desirable in accordance with the relevant law and
practice in each part of the Territory for the protection of
either of the parties or the Licensed Patents.
7.4. Each party shall fully notify the other as soon as practicable
after it becomes aware of -
7.4.1. any actual, threatened or suspected infringement of any of the
Licensed Patents; and
7.4.2. any proceedings commenced against it in which the validity or
GEMINI's ownership of any of the Licensed Patents is
challenged or it is alleged that the use of the Gene or any
Genetic Sequence relating thereto or the Licensed Patents
pursuant to the Agreement infringes the Intellectual Property
or other rights of any third party.
7.5. Each party shall do all such things and execute all such
documents as may reasonably be required of it by the other party
for the purpose of assisting the other party in bringing or
defending any proceedings relating to the Licensed Patents, and
the party receiving the assistance shall, unless otherwise agreed
with the other party, bear the cost of providing it.
8. DURATION AND TERMINATION
8.1. This Agreement shall come into force on the Effective Date and,
unless rightfully terminated earlier for any reason, shall
continue in force for so long as any of the Licensed Patents
remains in force.
8.2 GEMINI may forthwith terminate this Agreement by giving written
notice to Affymetrix if Affymetrix commits any material breach of
this Agreement and, if the breach is capable of remedy, fails to
remedy it within 30 days after being giving a written notice
containing full particulars of the breach and requiring it to be
remedied.
8.3. For the purposes of Section 8.2, a breach shall be considered
capable of remedy if the party in breach can comply with the
provision in question in all respects other than as to the time
of performance.
8.4. The rights given by this Section 8 to terminate this Agreement
for any breach shall not prejudice any other right or remedy of
either party in respect of the breach concerned
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any other
9. NATURE OF AGREEMENT
9.1. Subject to Section 3.2, this Agreement is personal to Affymetrix
which may not assign, mortgage, charge or sub-license any of its
rights or sub-contract or otherwise delegate any of its
obligations under this Agreement except in the Licensed Field.
Affymetrix may assign this Agreement to an entity acquiring
substantially all of the relevant business assets or stock of
Affymetrix.
9.2. Nothing in this Agreement shall create, or be deemed to create, a
partnership, or the relationship of principal and agent, between
the parties.
9.3. This Agreement contains the entire agreement between the parties
with respect to its subject matter and may not be modified except
by an instrument in writing signed by the duly authorised
representatives of the parties.
9.4. GEMINI warrants to Affymetrix that -
9.4.1. it has the authority to enter into this Agreement and to grant
the rights granted under this Agreement;
9.4.2. it has not granted and will not during the Term grant to any
third party any rights which are inconsistent with the rights
granted under this Agreement;
9.4.3. the execution by GEMINI of, and the performance of its
obligations under, this Agreement require no governmental or
other approvals or, if required, all such approvals have been
obtained.
9.5. Affymetrix warrants to GEMINI that -
9.5.1. it has the authority to enter into this Agreement;
9.5.2. the execution by Affymetrix of, and the performance of its
obligations under, this Agreement require no governmental or
other approvals or, if required, all such approvals have been
obtained.
9.6. Each party acknowledges that, in entering into this Agreement, it
does not do so in reliance on any warranty or other provision
except as expressly provided in this Agreement, and any
conditions, warranties or other terms implied by statute or
common law are excluded to the fullest extent permitted by law.
9.7. GEMINI does not give any warranty, representation or undertaking-
9.7.1. as to the efficacy or usefulness of the Gene or any Genetic
Sequence relating thereto or the Licensed Patents; or
9.7.2. as to the volumes or quality of the Licensed Products which
may be manufactured
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through [ILLEGIBLE] sequence relating thereto or the Licensed
Patents; or
9.7.3. that any of the Licensed Patents is or will be valid or
subsisting or that any of the applications within the Licensed
Patents will proceed to grant; or
9.7.4. that the use of the Gene or any Genetic Sequence relating
thereto will not infringe the Intellectual Property or other
rights of any other person.
9.8. GEMINI shall not be liable to Affymetrix by reason of any
representation (unless fraudulent) or the breach of any implied
condition, warranty or other term or any duty at common law or
under any statute, or under any express term of this Agreement,
for any loss, damages, costs, expenses or other claim for
compensation whatsoever, whether occasioned by the negligence of
GEMINI, its servants or agents or otherwise, which arises out of
or in connection with this Agreement, or which in any way relates
to the Gene or any Genetic Sequence relating thereto, or the
manufacture, use or sale of any other dealing in any of the
Licensed Products by or for Affymetrix or any of its Affiliates,
to the extent that the claim is for loss of profits, contracts,
goodwill or anticipated savings or for wasted expenditure, or for
any indirect, special or consequential loss or damages.
9.9. Affymetrix shall indemnify GEMINI against any loss, damages,
costs or expenses which are awarded against or incurred by
GEMINI as a result of any claim or threatened claim concerning
the use by Affymetrix of the Gene or any defect in or otherwise
in connection with the manufacture, use, sale of or any other
dealing in any of the Licensed Products by or for Affymetrix.
9.10. No failure or delay by either party in exercising any of its
rights under this Agreement shall be deemed to be a waiver of
that right, and no waiver by either party of a breach of any
provision of this Agreement shall be deemed to be a waiver of any
subsequent breach of the same or any other provision.
9.11. If any provision of this Agreement is held by any court or other
competent authority to be invalid or unenforceable in whole or in
part, the other provisions of this Agreement and the remainder of
the affected provision shall continue to be valid.
10. APPLICABLE LAW AND JURISDICTION
10.1. Except as provided in Section 10.2, California law shall apply to
the whole of this Agreement, and each party agrees to submit to
the exclusive jurisdiction of the California courts.
10.2. Any question arising out of this Agreement as to the construction
or effect of any of the Licensed Patents shall be decided in
accordance with the laws of the country in which the Licensed
Patent in question has been granted or filed.
11. NOTICES AND SERVICE
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[ILLEGIBLE] authorised by this Agreement to be given by either
party to the other shall be given by -
11.1.1. delivering it by hand; or
11.1.2. sending it by pre-paid air-mail; or
11.1.3. sending it by facsimile transmission or similar means of
communication; to the other party at the address shown in the
introduction.
11.2. For this Agreement, any notice or other information sent by post
in the manner provided by Section 11.1 which is not returned to
the sender as undelivered shall be deemed to have been given on
the tenth day after the envelope containing it was so posted; and
proof that the envelope containing any such notice or other
information was properly addressed, pre-paid, registered and
posted, and that it has not been so returned to the sender, shall
be sufficient evidence that the notice or other information has
been duly given.
11.3. Any notice or other information sent by facsimile transmission or
similar means of communication shall be deemed to have been duly
given on the date of transmission, provided that a confirming
copy of it is sent as provided in Section 11.1 to the other party
at the address given in Section 11.4 within 24 hours after
transmission.
11.4. Service of any legal proceedings concerning or arising out of
this Agreement shall be effected by either party by causing the
document in question to be delivered to the other party at its
registered or principal office, or any other address which is
notified in writing from time to time to the party serving the
proceedings.
12. MISCELLANEOUS
12.1. Each party shall from time to time do all such acts and execute
all such documents as may be reasonably necessary in order to
give effect to the provisions of this Agreement.
12.2. Except as otherwise provided in this Agreement, the parties shall
bear their own costs of and incidental to the preparation,
execution and implementation of this Agreement.
12.3. Neither party shall use the name of the other or make any press
or other public announcement concerning any aspect of this
Agreement without first obtaining the agreement of the other
party to the text of that announcement.
12.4. This Agreement may be executed in more than one counterpart and
shall come into force once each party has executed such a
counterpart in identical form and exchanged it with the other
party.
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GEMINI RESEARCH LTD. AFFYMETRIX, INC.
By: /s/ [ILLEGIBLE] By: /s/ [ILLEGIBLE]
---------------------------- ----------------------------
Title: Chief Executive Officer Title: President and CEO
-------------------------- --------------------------
Date: 11 - 6 - 99 Date: 16 [ILLEGIBLE] 99
--------------------------- ---------------------------
Approved for signature |_|
by AFFX Legal Dept. [ILLEGIBLE]
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LICENSED PATENTS
Title: Determination of collagen genotype
Country Application No. Filing Date Patent/Pub No. Status
UK 9604305.4 29 Feb 1996 Priority Only
World PCT/GB97/00569 28 Feb 1997 WO 97/32041 See nat.phase
Australia 22235/97 28 Feb 1997 Pending
Canada 2 247 171 28 Feb 1997 Pending
European 97905309.7 28 Feb 1997 0 883 694 Pending
Mexico 987040 28 Feb 1997 Pending
New Zealand 331489 28 Feb 1997 Pending
USA 08/808 158 28 Feb 1997 Allowed
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