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EXHIBIT 10(g)
NONEXCLUSIVE LICENSE AGREEMENT
BETWEEN
THE UNIVERSITY OF CHICAGO
AND
SUPERCONDUCTIVE COMPONENTS, INC.
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THIS LICENSE AGREEMENT ("License Agreement") is made by and between THE
UNIVERSITY OF CHICAGO ("University"), organized and existing under the laws
of the State of Illinois and acting in its capacity as Operator of Argonne
National Laboratory under Contract No. W-31-109-ENG-38 with the U.S.
Government and SUPERCONDUCTIVE COMPONENTS, INC., ("SCI") a corporation
organized and existing under the laws of the State of Ohio, either of which
may also be referred to individually as a "Party," and collectively as the
"Parties" to this license agreement.
BACKGROUND
The University as Operator of Argonne National Laboratory under Contract
No. W-31-109-ENG-38 with the U.S. Department of Energy (DOE) conducts
research and development at the Laboratory. An invention entitled
"Calcination and Solid State Reaction of Ceramic-Forming Components to
Provide Single-Phase Superconducting Materials Having Fine Particle Size" was
conceived by the University in the course of and under said Contract and is a
Subject Invention under said Contract in accordance with the terms and
conditions thereof.
The University is entitled to elect title to and obtain patents for
Subject Inventions generated under such Contract, and to license patent
rights in such patents in accordance with the terms and conditions of such
Contract and applicable DOE policies. The University elected title to the
invention identified above pursuant to said Contract and obtained issuance of
U.S. Patent No. 5,086,034 claiming the invention.
SCI, a small business, manufactures its products in the United States. SCI
was a collaborator with the University under HTS Pilot Center Agreement #85287
to determine the commercial desirability of the vacuum calcination process
covered by said Subject Invention. SCI desires certain rights in and to said
Subject Invention principally for the manufacture and sale of high temperature
superconducting (HTS) powders and products made from HTS powders.
NOW, THEREFORE, the Parties agree as follows:
1. DEFINITIONS
1.1 "Combination Product" means any product sold as a single unit but which
incorporates both (a) one or more Licensed Products and (b) one or more
products, not themselves Licensed Products, which the seller of the
Combination Product also offers for sale separately from the Combination
Product.
1.1 Effective Date means the date upon which the last Party executed this
License Agreement.
1.2 "Field of Use" means the processing of HTS powder(s).
1.3 "Gross Sales" means:
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(a) with respect to Licensed Products sold for cash other than Licensed
Products sold as an element of a Combination Product, the price
actually charged by SCI in the sale of the Licensed Product, less
returns and allowances as are customary in the trade; and
(b) with respect to Licensed Products sold or otherwise transferred other
than for cash, and with respect to Licensed Products sold for cash as
an element of a Combination Product, and with respect to Licensed
Products used or consumed by SCI in the manufacture of another
product, either
(i) an amount per unit of Licensed Product equal to the average
sale price of the Licensed Product determined in accordance
with clause (a) above for sale to third parties in the same
and the preceding quarterly accounting period, or
(ii) if no sales of the Licensed Product have occurred in the
same and the preceding quarterly accounting period, other
than as an element of a Combination Product, an amount equal
to the price actually charged in the sale of the Combination
Product, less returns and allowances as are customary in the
trade.
1.4 "Licensed Patent(s)" means U.S. Patent No. 5,086,034 and any and all
continuations, continuations-in-part, divisions, patents of addition,
reissues, reexaminations, or extensions of said patent, providing that the
University is the owner thereof.
1.5 "Licensed Product" means any product or composition made or manufactured by
any art, method, or process within the scope of any claim of any Licensed
Patent.
2. GRANT
The University hereby grants to SCI a nonexclusive license in the Licensed
Patent(s), without right to sublicense, in the Field of Use for the term of this
License Agreement.
3. LICENSE FEES & ROYALTIES
In consideration for the license granted in this License Agreement, SCI
shall pay to the University in the manner designated below, the following
amounts:
3.1 Within thirty (30) days of the Effective Date, SCI shall pay to the
University a non-refundable license fee of Three Thousand Dollars ($3,000).
3.2 Within thirty (30) days after the next January 1 following the Effective
Date and within thirty (30) days after each January 1 thereafter for the
term of the License Agreement, SCI shall pay to the University, in the
manner designated below, an earned royalty of one and twenty-five
hundredths percent (1.25%) of Gross Sales of Licensed Products.
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3.3 SCI shall pay to the University interest on any amount not paid when due.
Such interest will accrue from day after the payment was due at a rate of
14% per annum, and the interest payment will be due and payable on the
first day of each month after interest begins to accrue until full payment
of all amounts due the University is made.
4. PATENT MAINTENANCE
The University shall maintain Licensed Patent(s) during the term of this
License Agreement, by timely paying all fees and costs required by 35 United
States Code 41(b) and similar regulations.
5. TERM AND TERMINATION OF THE AGREEMENT
5.1 This License Agreement shall be in full force and effect from the Effective
Date and shall remain in effect for the lives of the Licensed Patent(s)
unless terminated by one of the Parties in accordance with the terms of
this License Agreement.
5.2 If SCI breaches any material term of this License Agreement, the University
may give written notice to SCI of such breach. If SCI fails to take
reasonable steps to cure such breach within ninety (90) days from the date
of delivery of such notice, the University shall have the right to
terminate this License Agreement upon delivery of written termination
notice to SCI.
5.3 SCI may at any time, with or without cause, terminate this License
Agreement upon delivery of a written termination notice to the University.
5.4 Upon termination of this License Agreement pursuant to Paragraph 5.2 or
5.3, all rights granted SCI shall cease, and SCI shall not manufacture,
have manufactured, use, sell, lease, or otherwise transfer any Licensed
Product(s), excepting inventory existing at the time of termination which
shall be subject to the terms of this License Agreement.
5.5 If at any time after the first anniversary of the Effective Date the
University determines that it will no longer pay maintenance fees on
Licensed Patent(s), the University will give SCI at least ninety (90) days
prior written notice of its intention to discontinue such payment. If the
University discontinue such payment, SCI shall be relieved of its
obligations to make payments under Paragraph 3.2 as of the date of receipt
of the University's notice under this Paragraph. SCI may, by written notice
to the University, elect to pay maintenance fees at SCI's sole expense but
in the name of the University.
5.6 Any termination pursuant to Paragraph 5.2 or 5.3 or 5.4 or 5.5 shall not
relieve SCI of any obligation or liability accrued hereunder prior to the
effective date of such termination.
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6. USE OF NAMES, TRADENAMES, AND TRADEMARKS
Nothing contained in this License Agreement shall be construed as
conferring any right to use in advertising, publicity, or other promotional
activities any name, tradename, trademark, or other designation of any Party
hereto or of the U.S. Department of Energy or the U.S. Government, or any of
their employees or officers, and any contraction, abbreviation, or simulation of
any of the foregoing.
7. REPRESENTATIONS, WARRANTIES AND DISCLAIMERS
7.1 The University hereby represents that it is not aware of any third party
rights which may in any way interfere with SCI's exercise of the right and
licenses granted herein.
7.2 Except as expressly set forth herein, nothing in this License Agreement
shall be construed as:
7.2.1 a warranty or representation by the University as to the
validity or scope of any Licensed Patent(s); or
7.2.2 an obligation of the University to bring or prosecute actions or
suits against third parties for infringement of the Licensed
Patent(s); or
7.2.3 conferring by implication, estoppel, or otherwise any license or
right under any intellectual property of the University other
than as expressly set forth herein; or
7.2.4 an obligation of the University to furnish any know-how,
technical assistance or technical data that is unrelated or
unnecessary to the practice of the Licensed Patent(s), or
7.2.5 an obligation of the University to file, prosecute, maintain or
enforce Licensed Patent(s).
7.3 SCI AGREES THAT THE EXPORT OF GOODS AND/OR TECHNICAL DATA FROM THE UNITED
STATES MAY REQUIRE SOME FORM OF EXPORT CONTROL LICENSE FROM THE U.S.
GOVERNMENT AND THAT FAILURE TO OBTAIN SUCH EXPORT CONTROL LICENSE MAY
RESULT IN CRIMINAL LIABILITY UNDER U.S. LAWS.
7.4 NEITHER THE UNIVERSITY, THE UNITED STATES DEPARTMENT OF ENERGY NOR ANY OF
THEIR EMPLOYEES MAKE ANY WARRANTY, EXPRESS OR IMPLIED, OR ASSUMES ANY LEGAL
LIABILITY OR RESPONSIBILITY FOR THE ACCURACY, COMPLETENESS, OR USEFULNESS
OF ANY INFORMATION, APPARATUS, PRODUCT, OR PROCESS DISCLOSED AND COVERED BY
A LICENSE GRANTED UNDER THIS LICENSE AGREEMENT.
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7.5 IN NO EVENT WILL THE UNIVERSITY OR THE DOE BE LIABLE FOR ANY INCIDENTAL,
SPECIAL, OR CONSEQUENTIAL DAMAGES RESULTING FROM EXERCISE OF THIS LICENSE
AGREEMENT OR THE PRACTICE OF THE LICENSED PATENT(S).
8. PRODUCT LIABILITY
8.1 Except for any liability resulting from any negligent act or omission of
the U.S. Government or the University, SCI indemnifies the U.S. Government
and the University, and their officers, employees, and agents, for all
damages, costs, and expenses, including attorneys' fees, arising from
personal injury or property damage to third parties occurring as a result
of the commercialization and utilization of the Licensed Patents by SCI,
including but not limited to, the making, using, selling, or exporting of
products, processes, or services derived therefrom. This indemnification
shall include, but not be limited to, indemnification for any product
liability resulting from the commercialization and utilization of the
Licensed Patents by SCI.
8.2 The indemnity set forth in this Paragraph 8 shall apply only if SCI shall
have been informed as soon and as completely as practical by the University
and/or the U.S. Government of the action alleging such claim and shall have
been given an opportunity, to the maximum extent afforded by applicable
laws, rules, or regulations, to participate in and control its defense, and
the University and/or the U.S. Government shall have provided reasonably
available information and reasonable assistance requested by SCI. No
settlement for which SCI shall be responsible shall be made without SCI's
consent unless required by final decree of a court of competent
jurisdiction.
9. INFRINGEMENT
In the event that any Party to this License Agreement shall learn of the
substantial infringement of any intellectual property rights licensed hereunder,
that Party shall inform the other Party in writing and shall provide the other
Party with available evidence of such infringement.
10. WAIVER
No waiver by any Party hereto of any breach or default of any of the
covenants or agreements herein set forth shall be deemed a waiver as to any
subsequent and/or similar breach or default.
11. ASSIGNABILITY
11.1 This License Agreement is assignable by SCI only with the written consent
of the University, which consent shall not be unreasonably withheld.
11.2 This License Agreement is assignable by the University only with the
written consent of SCI, which consent shall not be unreasonably withheld;
provided, however, in the event
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the University ceases to be the management and operating contractor for the
Argonne National Laboratory, the University may assign this License
Agreement to DOE or to the succeeding management and operating contractor,
as directed by DOE.
12. FORCE MAJEURE
Neither Party shall be responsible for delay or failure in performance of
any of the obligations imposed by this License Agreement, provided such failure
shall be occasioned by fire, flood, explosion, lightning, windstorm, earthquake,
subsidence of soil, court order or government interference, civil commotion,
strike, riot, war, or by any cause of like or unlike nature beyond the control
and without fault or negligence of such Party.
13. NOTICES, PAYMENTS AND REPORTS
13.1 All notices, reports, payments, and requests between the University and SCI
related to this License Agreement shall be in writing and shall be deemed
duly given and effective (a) when actually received by mail or personal
delivery, or (b) when mailed by prepaid registered or certified mail to the
receiving party at the address set forth below, or to such other address as
may be later designated by written notice from either party to the other
party:
The University's Notification Address:
Argonne National Laboratory
c/o Donald Mingesz, Acting Director
Industrial Technology Development Center
9700 S Cass Avenue
Argonne IL 60439
SCI's Notification Address:
13.2 Payments shall be made payable to "Argonne National Laboratory" and
directed to the University's Notification Address.
13.3 SCI shall keep, at its own expense, accurate books of account, using
accepted accounting procedures, detailing all data necessary to calculate
and easily audit any payments due the University from SCI under this
License Agreement. Royalties paid by SCI to the University within the five
(5) year period immediately preceding the start of an audit, and their
supporting books of account shall be subject to audit. Each payment made to
the University shall be accompanied by a written report summarizing, in
sufficient detail to allow the University to verify all payment amounts,
the data used to calculate the amounts paid.
13.4 Upon written request by the University, such books of account shall be made
available for an audit at a reasonable time and place by an agent of the
University's choice. Such agent shall be entitled to make abstracts from
such books for the purpose of verifying the
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payment amounts due or for the purpose of determining SCI's compliance with
other provisions of this Agreement. No more than one such audit shall be
made in one calendar year. The fees and expenses of such examination shall
be borne by the University unless an error in royalties owed to the
University is greater than ten percent (10%) whereupon the fees and
expenses therefor shall be borne by SCI.
14. MISCELLANEOUS
14.1 The headings of the several sections of this License Agreement are included
for convenience of reference only and are not intended to be a part of or
to affect the meaning or interpretation of this License Agreement.
14.2 No amendment or modification of this License Agreement shall be binding on
the Parties unless made in a writing executed by duly authorized
representatives of the Parties.
14.3 In the absence of applicable Federal law, this License Agreement shall be
interpreted and construed in accordance with the laws of the State of
Illinois.
15. ENTIRE AGREEMENT
This License Agreement contains the entire and only agreement between the
Parties respecting the subject matter hereof, and supersedes and cancels all
previous negotiations, agreements, commitments and writings in respect thereto.
IN WITNESS WHEREOF, a duly authorized officer or representative of each of
the Parties has signed duplicate originals of this License Agreement.
UNIVERSITY OF CHICAGO
AS OPERATOR OF SUPERCONDUCTIVE COMPONENTS,
ARGONNE NATIONAL LABORATORY INC.
By: /s/ D.E. Bugielski By: /s/ Edward R. Funk
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D.E. Bugielski Edward R. Funk
Manager, Procurement President
Argonne National Laboratory
Date: 9/30/95 Date: 10/12/95
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