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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON December 9, 1997
REGISTRATION NO. 333-334765
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 3
TO
FORM SB-2
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
IXION BIOTECHNOLOGY, INC.
(Name of Small Business Issuer in Its Charter)
Delaware 2834 59-3174033
(State or Other (Primary Standard (I.R.S. Employer
Jurisdiction of Industrial Identification No.)
Incorporation or Classification
Organization) Code Number)
12085 Research Drive
Alachua, Florida 32615
904-418-1428
(Address and Telephone Number of Principal Executive Offices and Principal
Place of Business)
Weaver H. Gaines
12085 Research Drive
Alachua, Florida 32615
904-418-1428
(Name, Address and Telephone Number of Agent for Service)
------
Copy to:
Bruce Brashear, Esq.
920 NW 8th Ave., Suite A
Gainesville, FL 32601
352-336-0800
Facsimile No. 352-336-0505
Approximate Date of Proposed Sale to the Public: As soon as practicable
after this Registration Statement becomes effective.
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering.
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering.
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box.
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, check the following box. /X/
<PAGE>
CALCULATION OF REGISTRATION FEE
Title of Each Amount to be Proposed Max Proposed Max Amount of
Class of Registered Offering Aggregate Registration
Securities to Price Per Offering Fee
be Registered Unit (1) Price (1)
Units,
consisting
of 400,000 Units $10.00 $4,000,000 $1,212
(a) One Share
Voting
Common
Stock,
par value
$0.01 per
share
("Common
Stock") 400,000 Shares
(b) .25 Charitable
Benefit
Warrant to
purchase
shares of
Voting
Common Stock
at $20.00 per
share 100,000 Warrants
Voting Common
Stock purchasable
pursuant to
Warrants 100,000 Shares $20.00 $2,000,000 $606
(1) Estimated solely for purposes of calculating the registration fee.
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until the Registration Statement
shall become effective on such date as the Commission, acting pursuant to said
Section 8(a), may determine.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 24. Indemnification of Directors and Officers.
Under Delaware law, a corporation may indemnify any person who was or is
a party or is threatened to be made a party to an action (other than an action
by or in the right of the corporation) by reason of his service as a director
or officer of the corporation, or his service, at the corporation's request,
as a director, officer, employee or agent of another corporation or other
enterprise, against expenses (including attorneys' fees) that are actually and
reasonably incurred by him ("Expenses"), and judgments, fines and amounts paid
in settlement that are actually and reasonably incurred by him, in connection
with the defense or settlement of such action, provided that he acted in good
faith and in a manner he reasonably believed to be in or not opposed to the
corporation's best interests, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe that his conduct was unlawful.
Although Delaware law permits a corporation to indemnify any person referred
to above against Expenses in connection with the defense or settlement of an
action by or in the right of the corporation, provided that he acted in good
faith and in a manner he reasonably believed to be in or not opposed to the
corporation's best interests, if such person has been judged liable to the
corporation, indemnification is only permitted to the extent that the Court of
Chancery (or the court in which the action was brought) determines that,
despite the adjudication of liability, such person is entitled to indemnity
for such Expenses as the court deems proper. The General Corporation Law of
the State of Delaware also provides for mandatory indemnification of any
director, officer, employee or agent against Expenses to the extent such
person has been successful in any proceeding covered by the statute. In
addition, the General Corporation Law of the State of Delaware provides the
general authorization of advancement of a director's or officer's litigation
expenses in lieu of requiring the authorization of such advancement by the
board of directors in specific cases, and that indemnification and advancement
of expenses provided by the statute shall not be deemed exclusive of any other
rights to which those seeking indemnification or advancement of expenses may
be entitled under any bylaw, agreement or otherwise.
The Certificate of Incorporation (the "Certificate") of the Company
provides that, to the fullest extent permitted by applicable law, as amended
from time to time, the Company will indemnify any person who was or is a party
or is threatened to be made a party to an action, suit or proceeding (whether
civil, criminal, administrative or investigative) by reason of the fact that
such person is or was director, officer, employee or agent of the Company or
serves or served any other enterprise at the request of the Company.
In addition, the Certificate provides that a director of the Company
shall not be personally liable to the Company or its stockholders for monetary
damages for breach of the director's fiduciary duty. However, the Certificate
does not eliminate or limit the liability of a director for any of the
following reasons: (i) a breach of the director's duty of loyalty to the
Company or its stockholders; (ii) acts or omissions not in good faith or that
involve intentional misconduct or knowing violation of law; or (iii) a
transaction from which the director derived an improper personal benefit.
The Company intends to purchase and maintain directors' and officers'
insurance as soon as the Board of Directors determines practicable, in amounts
which they consider appropriate, insuring the directors against any liability
arising out of the director's status as a director of the Company regardless
of whether the Company has the power to indemnify the director against such
liability under applicable law.
Item 25. Other Expenses of Issuance and Distribution.
SEC registration fee..........................................$ 1,818
Printing expenses............................................. 20,000
Distribution ................................................. 18,000
Advertising .................................................. 50,000
Fees and expenses of counsel.................................. 30,000
Fees and expenses of accountants.............................. 20,000
Premium on D & O insurance.................................... 25,000
Transfer agent and registrar fees............................. 4,000
Warrant agent fees............................................ 1,500
Blue sky fees and expenses.................................... 40,000
Miscellaneous................................................. 11,394
Total....................................................$221,712
Except for the SEC registration, all of the foregoing expenses have been
estimated. All expenses will be paid by the Company.
Item 26. Recent Sales of Unregistered Securities.
Set forth below is information as to securities sold by Ixion within the
past three years which were not registered under the Securities Act of 1933
(the "Act"). No underwriters were involved in any of the sales so there were
no underwriting discounts or commissions. All outstanding securities are
deemed to be restricted securities for the purposes of the Act. All
certificates representing such issued and outstanding restricted securities of
the Company have been properly legended and the Company has issued "stop
transfer" instructions to its transfer agent with respect to such securities,
which legends and stop transfer instructions are presently in effect unless
such securities have been registered under the Securities Act or have been
transferred pursuant to an appropriate exemption from the registration
provisions of the Securities Act.
(a) On September 30, 1994, two directors and senior officers of the
Company, who may be deemed promoters, converted an aggregate of
$18,000 of cash loans made to the Company under the terms of a
subordinated convertible note agreement into a total of 900,000
shares of Common Stock, at a price of $0.02 per share, and the
Company's tax advisor was issued 5,000 shares of Common Stock in
exchange for services valued at $100 or $0.02 per share. The Company
issued the above securities without registration in reliance upon
the exemption provided by Section 4(2) of the Act as a transaction to
a limited number of sophisticated investors which did not involve a
public offering, general solicitation, or general advertisement.
(b) Restricted shares of Common Stock have been issued to
Members of the Board of Directors, Members of the Scientific
Advisory Board, and key employees under the Company's Board
Retainer Plan as follows:
On September 30, 1994, 5,000 shares of Common Stock to a
director for service as a director valued at $100 or $0.02
per share.
On May 31, 1995, 10,000 shares of Common Stock (5,000 shares
to each of two directors) for services as directors valued
at an aggregate of $7,500 or $.75 per share.
On June 10, 1996, 34,000 shares of Common Stock (5,000
shares to each of two directors, 5,000 shares to each of two
members of the Scientific Advisory Board, for services as
directors or scientific advisors and 14,000 shares of Common
Stock to its Vice President - Research and Development as a
hiring bonus for services to be rendered) valued at an
aggregate of $92,000 (a portion of which is unearned
compensation) or $3.00 per share.
On September 15, 1996, 10,000 shares of Common Stock (5,000
shares to each of two members of the Scientific Advisory
Board) for services as scientific advisors valued at
$100,000 (a portion of which is unearned compensation) or
$10.00* per share.
On October 10, 1996, 5,000 shares of Common Stock to a
member of the Scientific Advisory Board for services as a
scientific advisor valued at $50,000 (a portion of which is
unearned compensation) or $10.00* per share.
On February 11, 1997, 10,000 shares to its Director of
Research, Oxalate Division, as a hiring bonus for services
to be rendered valued at $100,000 (a portion of which is
unearned compensation) or $10.00* per share.
On June 27, 1997, 7,000 shares of Common Stock (1,000 shares
to each of two directors, and 1,000 shares to each of five
members of the Scientific Advisory Board, for services as
directors or scientific advisors) valued at $70,000 (a
portion of which is unearned compensation) or $10.00* per
share.
On July 1, 1997, 3,000 shares to its Associate Director of
Research, Diabetes Division, as a hiring bonus for services
to be rendered (a portion of which is unearned compensation)
valued at $30,000 or $10.00* per share.
The Company issued the above securities without registration
in reliance upon the exemption provided by Section 4(2) of the
Act as a transaction to a limited number of sophisticated
investors which did not involve a public offering, general solicitation,
or general advertisement and the exemption provided by Rule 701
promulgated under the Act.
(c) On October 17, 1994, a director and senior officer of the
Company, who may be deemed a promoter, received 650,000 shares of
Common Stock in exchange for all his interest in certain oxalate
technology and his agreement to an exclusive consulting agreement
with the Company, valued at the price of $13,000 or $0.02 per
share. The Company issued the above securities without registration
in reliance upon the exemption provided by Section 4(2) of the Act
as a transaction to a limited number of sophisticated investors
which did not involve a public offering, general solicitation, or general
advertisement.
(d) On October 31, 1994, a consultant to the Company canceled $1,000
of deferred consulting fees in exchange for 10,000 shares of
Common Stock at the price of $0.10 per share. The Company
issued the above securities without registration in reliance upon
the exemption provided by Section 4(2) of the Act as a transaction to
a limited number of sophisticated investors which did not involve a
public offering, general solicitation, or general advertisement.
(e) On November 10, 1994, 10 members of the immediate families of the
founders of the Company, as well as a partnership whose general
partners include a director and senior officer of the Company and
members of his immediate family, purchased a total of 140,000
shares of Common Stock for a price of $14,000 or $0.10 per share. The
Company issued the above securities without registration in reliance upon
the exemption provided by Section 4(2) of the Act as a transaction to
a limited number of sophisticated investors which did not involve a
public offering, general solicitation, or general advertisement and in
reliance upon the exemption provided by Rule 504 of Regulation D of the
Act as a sale of securities which, together with all sales within 12
months, aggregated less than $1,000,000.
(f) From March 20, 1995 to May 31, 1995, the Company sold an
aggregate of 500,000 shares of Common Stock to 26 accredited
investors and three unaccredited investors for an aggregate of
$375,000 or $.75 per share. The Company issued the above
securities without registration in reliance upon
the exemption provided by Section 4(2) of the Act as a transaction to
a limited number of sophisticated investors which did not involve a
public offering, general solicitation, or general advertisement and in
reliance upon the exemption provided by Rule 504 of Regulation D of the
Act as a sale of securities which, together with all sales within 12
months, aggregated less than $1,000,000.
(g) On September 21, 1995, the Company sold 3,000 shares of
Common Stock (together with 2,000 warrants to purchase Common
Stock at an exercise price of $2.00 per share expiring in 2000) to
an accredited investor for $5,000 in cash and a note due April
1997 for $6,000 or a price of $3.00 per share and $1.00 per
warrant. The Company issued the above securities without registration
in reliance upon the exemption provided by Section 4(2) of the Act as
a transaction to a limited number of sophisticated investors which
did not involve a public offering, general solicitation, or general
advertisement.
(h) Warrants have been issued to an institution in partial payment of
rent for the Company's facilities pursuant to the License
Agreement between the University of Florida Research Foundation,
Inc., and the Company as follows:
On November 11, 1995, the Company issued warrants to
purchase 7,608 shares of Common Stock at an exercise price
of $2.00 per share expiring in 2000 , valued at $1.00 per
warrant.
In August, October, and November, 1996, the Company issued
warrants to purchase an aggregate of 8,022 shares of Common
Stock at an exercise price of $2.00 per share expiring in
2000, valued at $1.35 per warrant.
The Company issued the above securities without registration in reliance
upon the exemption provided by Section 4(2) of the Act as transactions to
a limited number of sophisticated investors which did not involve a
public offering, general solicitation, or general advertisement.
(i) On June 30, 1996, two directors and senior officers of the
Company, who may be deemed promoters, converted an aggregate of
$16,158 of cash loans made to the Company under the terms of a
subordinated convertible note agreement into a total of 21,544
shares of Common Stock, at a price of $.75 per share. The Company
issued the above securities without registration in reliance upon
the exemption provided by Section 4(2) of the Act as a transaction to
a limited number of sophisticated investors which did not involve a
public offering, general solicitation, or general advertisement.
(j) In October and November, 1996, the Company issued an
aggregate of $787,270 of Convertible Unsecured Notes due 2001 to
35 accredited and one unaccredited investors. The Notes are
convertible at any time prior to maturity into a maximum of
323,557 shares of Common Stock at conversion prices ranging from
$4.20 to $2.10. The conversion prices are based on the length of
time the investor holds the Notes prior to conversion.
The Company issued the above securities without registration in reliance
upon the exemption provided by Section 4(2) of the Act as a transaction to
a limited number of sophisticated investors which did not involve a
public offering, general solicitation, or general advertisement and in
reliance upon the exemption provided by Rule 505 of Regulation D of the
Act as a sale of securities which, together with all sales within 12
months, aggregated less than $5,000,000 and were made to fewer than 35
investors.
(k) On February 11, 1997, the Company issued 1,000 shares of Common
Stock to two inventors in exchange for an exclusive license of a
patent entitled "Method for the Selective Control of Weeds, Pests
and Microbes," valued at $7,500 or $7.50 per share. The Company
issued the above securities without registration in reliance upon
the exemption provided by Section 4(2) of the Act as a transaction to
a limited number of sophisticated investors which did not involve a
public offering, general solicitation, or general advertisement.
(l) Warrants have been issued to Brandywine Consultants, Inc.,
pursuant to the Consulting Agreement between the Company and
Brandywine Consultants, Inc., dated December 12, 1996, for
certain milestones as follows:
On June 23, 1997, 3,000 warrants at an exercise price of
$5.00 per share of Common Stock, expiring June 2002.
On October 24, 1997, 3,000 warrants at an exercise price of
$5.00 per share of Common Stock, expiring October 2002.
The Company issued the above securities without registration in reliance
upon the exemption provided by Section 4(2) of the Act as a transaction to
a limited number of sophisticated investors which did not involve a
public offering, general solicitation, or general advertisement.
* Based upon an assumed offering price of $10.00 per share.
Item 27. Exhibits
Exhibit
Number Description
*3.1 Certificate of Incorporation of Registrant
*3.2 Certificate of Amendment to Certificate of Incorporation of
Registrant
*3.3 Certificate of Amendment to Certificate of Incorporation of
Registrant
*3.4 Bylaws of Registrant, as amended and restated
**4.1 Form of Registrant's Common Stock Certificate
**4.2 Form of Registrant's Charitable Benefit Warrant Certificate
**4.3 Charitable Benefit Warrant Agreement
*4.4 Warrant Agreement with Jeffrey W. Seel, dated November 7, 1995
*4.5 Warrant Agreement with the University of Florida Research
Foundation, Inc., dated November 7, 1995
*4.6 Warrant Agreement with the University of Florida Research
Foundation, Inc., dated August 1, 1996
*4.7 Warrant Agreement with the University of Florida Research
Foundation, Inc., dated October 1, 1996
*4.8 Warrant Agreement with the University of Florida Research
Foundation, Inc., dated November 7, 1996
**4.9 Warrant Agreement with Brandywine Consultants, Inc., dated June 23,
1997
**4.10 Warrant Agreement with Brandywine Consultants, Inc., dated October
24, 1997
***5.1 Opinion of Bruce Brashear, Esq. regarding legality
**5.2 Opinion of Thacher Proffitt & Wood regarding certain tax matters
*10.1 Chattel Mortgage Agreement with Carl Therapeutic, Inc., dated as of
January 1, 1996
*10.2 Consulting Agreement with Brandywine Consultants, Inc., dated
December 12, 1996
*10.3 Consulting Agreement with Ammon B. Peck, dated February 21, 1997
*10.4 Consulting Agreement with David C. Peck, dated July 1, 1996
*10.5 Convertible Promissory Note with Weaver H. Gaines, dated March 31,
1993
*10.6 Convertible Promissory Note with David C. Peck, dated October 15,
1993
*10.7 Demand Promissory Note, Bridge Loan with Weaver H. Gaines, dated
April 15, 1996
*10.8 Demand Promissory Note, Bridge Loan with David C. Peck, dated April
15, 1996
*10.9 Deferred Compensation Plan Agreement with Weaver H. Gaines, dated
January 1, 1994
*10.10 Deferred Compensation Plan Agreement with Ammon B. Peck, dated June
1, 1994
*10.11 Deferred Compensation Plan Agreement with David C. Peck, dated
April 1, 1994
*10.12 Agreement to Purchase Shares, dated as of October 10, 1994
*10.13 Note Purchase Agreement, dated as of September 13, 1996
*10.14 Incubator License Agreement with the University of Florida Research
Foundation, Inc., dated June 26, 1995
*10.15 Amendment No. 1, dated July 31, 1996 to Incubator License Agreement
with the University of Florida Research Foundation, Inc.
*10.16 Amendment No. 2, dated October 1, 1996 to Incubator License
Agreement with the University of Florida Research Foundation, Inc.
*10.17 Amendment No. 3, dated November 7, 1996 to Incubator License
Agreement with the University of Florida Research Foundation, Inc.
*10.18 Amendment No. 4, dated January 21, 1997 to Incubator License
Agreement with the University of Florida Research Foundation, Inc.
*10.19 Patent License Agreement with Randy S. Fischer and Roy A. Jensen
for U.S. Patent No. 5,187,071, "Method for the Selective Control of
Weeds, Pests, and Microbes," dated February 11, 1997
10.20 Patent License Agreement with Research Component with the
University of Florida Research Foundation, Inc. relating to
Oxalobacter formigenes, dated January 11, 1995 (1)
10.21 Amendment No. 1 to Patent License Agreement with Research
Component with the University of Florida Research Foundation, Inc.
relating to Oxalobacter formigenes, dated December 20, 1995
10.22 Amendment No. 2 to Patent License Agreement with Research
Component with the University of Florida Research Foundation, Inc.
relating to Oxalobacter formigenes, dated October 9, 1996 (1)
10.23 Patent License Agreement with Research Component with the
University of Florida Research Foundation, Inc. relating to
Pancreatic Stem Cells, dated February 17, 1995 (1)
10.24 Amendment No. 1 to Patent License Agreement with Research
Component with the University of Florida Research Foundation, Inc.
relating to Pancreatic Stem Cells, dated October 9, 1996 (1)
10.25 Patent License Agreement with Milton J. Allison, dated June 23,
1997. (1)
10.26 Sponsored Research Agreement with Genetics Institute, Inc., dated
June 5, 1996 (1)
*10.27 Employment Agreement with Weaver H. Gaines, dated August 31, 1994
*10.28 Employment Agreement with David C. Peck, dated August 31, 1994
*10.29 1994 Stock Option Plan, as amended
**10.30 1994 Board Retainer Plan, as amended
*10.31 Consulting Agreement with Ammon Peck, dated October 6, 1994
*10.32 Amendment No. 5 to Incubator License Agreement
*11.1 Statement regarding computation of earnings per share (included as
Note 3 in Prospectus)
***24.1 Consent of Independent Accountants.
***24.2 Consent of Bruce Brashear, Esq. (included in Exhibit 5.1).
**24.3 Consent of Thacher Proffitt & Wood (included in Exhibit 5.2).
*25. Power of Attorney (included with the signature page to the
registration statement)
***27. Financial Data Schedule
(1) Confidential information has been omitted from these document and filed
separately with the Commission pursuant to a request for Confidential
Treatment.
* Previously filed with Form SB-2 on August 29, 1997.
** Previously filed with Amendment 1 to Form SB-2 on November 7, 1997.
*** Previously filed with Amendment 2 to Form SB-2 on December 2, 1997.
Item 28. Undertakings.
(a) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter had been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
(b) The Registrant hereby undertakes that for purposes of determining
any liability under the Securities Act, (i) the information omitted from the
form of prospectus filed as part of this Registration Statement in reliance
upon Rule 430A and contained in a form of prospectus filed by the Registrant
pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be
deemed to be part of this Registration Statement as of the time it was
declared effective, and (ii) each post-effective amendment that contains a
form of prospectus shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(c) The undersigned Registrant hereby undertakes to file, during any
period in which offers or sales are being made, a post-effective amendment to
this registration statement:
(i) (To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement.
SIGNATURES
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form SB-2 and authorized this
registration statement to be signed on its behalf by the undersigned, in the
city of Alachua, state of Florida, on the Ninth day of December, 1997.
IXION BIOTECHNOLOGY, INC.
By: /S/
Weaver H. Gaines,
Chairman of the Board and Chief
Executive Officer
In accordance with the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities on December 9, , 1997.
SIGNATURE TITLE
Chairman of the Board, Chief Executive Officer,
Weaver H. Gaines and Director
*
* President, Chief Financial Officer and Director
David C. Peck
/S/
Controller
Kimberly A. Ramsey
*
* Director
David M. Margulies
*
* Director
Vincent P. Mihalik
/S/
* (attorney in fact)
Weaver H. Gaines,
NOTE: Certain portions of this document have been omitted based on a request
for confidential treatment. The non-public information has been filed
with the Securities and Exchange Commission. Omitted portions are
designated with asterisks ("*").
Patent License Agreement
With Research Component
University of Florida Research Foundation
and
Ixion Biotechnology, Inc.
January 11, 1995
UF Case No. UF# 1203 "Oxalate Diagnostic Kit and Formyl-CoA Transferase Gene
from Oxalobacter Formigenes"
UF Case No. UF# 0973 "Reducing Oxalate Poisoning in Vertebrates Using
Genetically Engineered Organisms Expressing Cloned Oxalate
Degrading Enzymes"
Patent Application "Materials and Methods for Detection of Oxalate," USSN
08/262,424, filed June 20, 1994
PATENT LICENSE AGREEMENT
WITH RESEARCH COMPONENT
TABLE OF CONTENTS
ARTICLE I - DEFINITIONS 1
ARTICLE II - GRANT 4
ARTICLE III - DUE DILIGENCE 5
ARTICLE IV - ROYALTIES 5
ARTICLE V - REPORTS AND RECORDS 7
ARTICLE VI - PATENT PROSECUTION 8
ARTICLE VII - INFRINGEMENT 8
ARTICLE VIII - PRODUCT LIABILITY 10
ARTICLE IX - DISCLAIMER OF WARRANTIES 11
ARTICLE X - EXPORT CONTROLS 11
ARTICLE XI - NON-USE OF NAMES 11
ARTICLE XII - ASSIGNMENT 12
ARTICLE XIII - TERMINATION 12
ARTICLE XIV - PAYMENTS, NOTICES AND OTHER COMMUNICATIONS 15
ARTICLE XV - MISCELLANEOUS PROVISIONS 16
PREAMBLE
This Agreement is made this 11th day of January 1995, (the "Effective
Date") between the University of Florida Research Foundation, Inc., a not-for-
profit corporation duly organized and existing under the laws of the State of
Florida and having its principal office at 223 Grinter Hall, Gainesville,
Florida, 32611-2037 ("UFRFI"), and Ixion Biotechnology, Inc., a corporation
duly organized under the laws of Delaware, and having its principal office at
One Progress Blvd., Box 26, Alachua, Florida 32615 ("Ixion").
WITNESSETH
WHEREAS, UFRFI is the owner of certain Patent Rights by assignment from
the University of Florida (the "University") relating to UFRFI Case No. UF#
0973 and Case No. UF# 1203, and has the right to grant licenses under said
Patent Rights, subject only to a royalty-free, nonexclusive license heretofore
granted to the United States Government;
WHEREAS, UFRFI desires to have the Patent Rights utilized in the public
interest and is willing to grant a license thereunder;
WHEREAS, Ixion has represented to UFRFI to induce UFRFI to enter into
this Agreement, that Ixion is prepared to undertake the development,
production, manufacture, marketing, and sale of products similar to the
Licensed Products and/or the use of the Licensed Processes and that it shall
commit itself to a thorough, vigorous, and diligent program of exploiting the
Patent Rights commercially so that public utilization and royalty income to
UFRFI shall result;
WHEREAS, Ixion desires to obtain a license under the Patent Rights upon
the terms and conditions of this Agreement; and
WHEREAS, Ixion has certain additional research it desires which the
parties agree should be conducted by the University;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein the parties agree as follows:
ARTICLE I - DEFINITIONS
The following words and phrases have the following meanings:
1.1 "Inventor" means Ammon B. Peck, Ph.D.
1.2 "Ixion" means any of the following:
(a) a related company of Ixion, the voting stock of
which is directly or indirectly at least 50% owned or
controlled by Ixion;
(b) an organization which directly or indirectly
controls more than 50% of the voting stock of Ixion; and
(c) an organization, the majority ownership of which
is directly or indirectly common to the ownership of Ixion.
1.3 "Licensed Know-How" means any technical data, information, or
knowledge within the knowledge and possession of the Inventor on the Effective
Date which is incorporated in or becomes part of the Patent Rights.
1.4 "Licensed Product" means any product or part thereof which:
(a) is covered in whole or in part by an issued,
unexpired claim or a pending claim contained in the Patent
Rights in the country in which any Licensed Product is made,
used, or sold;
(b) is manufactured by using a process which is
covered in whole or in part by an issued, unexpired claim or
a pending claim contained in the Patent Rights in the
country in which any Licensed Process is used or in which
such product or part thereof is used or sold;
(c) is derived from Patent Rights, Licensed Know-
How, or trade secrets related to or described in Patent
Rights; or
(d) is sold, manufactured, or used in any country
under this Agreement.
1.5 "Licensed Process" means any process which:
(a) is covered in whole or in part by an issued,
unexpired claim or a pending claim contained in the Patent
Rights;
(b) is derived from Patent Rights, Licensed Know-
How, or trade secrets related to or described in Patent
Rights; or
(c) is used in any country under this Agreement.
1.6 "Net Sales" means Ixion's, and its sublicensees' gross sales from
the sale or lease of Licensed Products and Licensed Processes produced
hereunder less the sum of the following:
(a) discounts allowed in amounts customary in the
trade and brokers' or agents' commissions, if any, allowed
and paid to independent parties in arms-length transactions;
(b) excise, value-added, or sales taxes, tariff
duties or use taxes directly imposed and with reference to
particular sales;
(c) outbound transportation prepaid or allowed;
(d) amounts allowed or credited on returns; and
(e) packing costs and insurance costs if itemized
separately.
No deductions shall be made for commissions paid to individuals regularly
employed by Ixion and on its payroll, or for cost of collections. Licensed
Products shall be considered "sold" when invoiced.
1.7 "Patent Rights" means all of the following UFRFI intellectual
property:
(a) the United States and foreign patents or patent
applications listed in Appendices A and B;
(b) United States and foreign patents issued from
the applications listed in Appendices A and B and from
divisionals and continuations of these applications;
(c) claims of U.S. and foreign continuation-in-part
applications, and of the resulting patents, which are
directed to subject matter specifically described in the
U.S. and foreign applications listed in Appendices A and B;
(d) claims of all foreign patent applications, and
of the resulting patents, which are directed to subject
matter specifically described in the United States patents
and/or patent applications described in (a), (b), or (c)
above; and
(e) any reissues of United States patents described
in (a), (b), (c), or (d) above.
1.8 "Project Work" means the research work described in the Research
Support Agreement.
1.9 "Research Support Agreement" means that agreement attached hereto
as Exhibit C, with its associated terms and conditions.
1.10 "Territory" means all the countries of the world.
1.11 "University Inventions" means individually and collectively all
inventions, improvements, or discoveries patentable or unpatentable, which are
conceived or made solely by one or more employees of the University, in
performance of the Project Work. All rights and title to University
Inventions developed under the Research Support Agreement belong to the
University and are subject to the terms of such Research Support Agreement.
For the purposes of this section, the "making" of inventions shall be governed
by U.S. laws of inventorship.
1.12 "University Patents" means collectively and individually any and
all United States and foreign patent applications and any and all issued
United States Letters Patents and foreign patents owned by the University for
University Inventions derived during Project Work under the Research Support
Agreement.
ARTICLE II - GRANT
2.1 UFRFI grants to Ixion the exclusive right and license to make,
have made, use, lease, and sell the Licensed Products, and to practice the
Licensed Processes and the Licensed Know-How, in the Territory to the end of
the term for which the Patent Rights are granted unless sooner terminated
according to the terms hereof.
2.2 UFRFI shall not grant any other license to make, have made, use,
lease, or sell Licensed Products or to utilize Licensed Processes during the
period of time commencing with the Effective Date of this Agreement and
terminating with the expiration or termination of this Agreement.
2.3 UFRFI reserves the right to practice under the Patent Rights for
its own noncommercial research purposes.
2.4 Ixion may sublicense others under this Agreement. Each
sublicense
shall be consistent with the terms of this Agreement.
2.5 Any sublicenses granted by Ixion shall provide that the
obligations to UFRFI of this Agreement shall be binding upon the sublicensee
as if it were a party to this Agreement. Ixion shall attach copies of this
Agreement to sublicense agreements.
2.6 Ixion shall forward to UFRFI a copy of any sublicense agreement
within 30 days of its execution and further shall forward to UFRFI annually a
copy of such reports received by Ixion from its sublicensees during the
preceding twelve-month period under the sublicenses as shall be pertinent to a
royalty accounting under said sublicenses.
2.7 The license granted hereunder shall not be construed to confer
any
rights upon Ixion by implication, estoppel, or otherwise as to any technology
not specifically set forth herein.
2.8 Ixion shall not receive from sublicensees anything of value in
lieu of cash payments in consideration for any sublicense under this
Agreement, without the express prior written permission of UFRFI.
2.9 Licensed Products leased or sold in the United States and covered
by Patent Rights or other intellectual property rights that are subject to the
non-exclusive royalty-free license to the United States government will be
manufactured substantially in the United States.
2.10 Ixion shall abide by all rights and limitations of U.S. Code,
Title 35, Chapter 38, and implementing regulations thereof, for all patent
applications and patents invented in whole or in part with federal funding.
ARTICLE III - DUE DILIGENCE
3.1 Ixion shall use its best efforts to bring one or more Licensed
Products or Licensed Processes to market through a thorough, vigorous, and
diligent program for exploitation of the Patent Rights to attain
commercialization of Licensed Products and Licensed Processes.
3.2 In addition, Ixion shall adhere to the following milestones:
(a) Ixion shall deliver to UFRFI on or before a date
90 days from the Effective Date a business plan for the
development of an urine oxalate detection kit. The business
plan (or extract from the business plan) shall show for the
forthcoming fiscal year the amount of money, number and
kind of personnel, and time budgeted for development of such
kit. Ixion shall provide similar plans or extracts to UFRFI
on an annual basis on or before the ninetieth (90th) day
following the close of each fiscal year.
(b) Ixion shall develop a working model on or before
the first anniversary of the Effective Date.
(c) Ixion shall comply with the Research Support
Agreement attached as Exhibit C.
ARTICLE IV - ROYALTIES
4.1 For the rights, privileges and, license granted hereunder, Ixion
shall pay royalties to UFRFI to the end of the term of the Patent Rights or
until this Agreement is terminated as follows:
(a) A License Issue Fee of an amount equal to the
out-of-pocket costs of patenting incurred prior to the
Effective Date, such fee to be paid within 30 days of the
receipt of an invoice therefor by Ixion;
(b) An Additional License Issue Fees of ********, of
which ******** is due immediately upon the execution of this
Agreement and ******** of which is payable on the first
business day on or after the 180th day after the Effective
Date. The Additional License Issue Fee shall be creditable
against any Running Royalties subsequently due under section
4.1 (c) below; and
(c) A Running Royalty in an amount equal to **** of
the Net Sales of the Licensed Products or Licensed Processes
used, leased, or sold by or for Ixion or its sublicensees.
4.2 No multiple royalties shall be payable because any Licensed
Product, its manufacture, use, lease, or sale are or shall be covered by more
than one Patent Rights patent application or Patent Rights patent licensed
under this Agreement.
4.3 Royalty payments shall be paid in United States dollars in
Gainesville, Florida or at such other place as UFRFI may reasonably designate
in writing consistent with the laws and regulations controlling in any foreign
country. If any currency conversion shall be required in connection with the
payment of royalties hereunder, such conversion shall be made by using the
exchange rate prevailing at the Chase Manhattan Bank (N.A.) on the last
business day of the calendar quarterly reporting period to which such royalty
payments relate.
4.4 In the event the royalties set forth herein are higher than the
maximum royalties permitted by the law or regulations of a particular country,
the royalty payable for sales in such country shall be equal to the maximum
permitted royalty under such law or regulations. Notice of said event shall
be provided to UFRFI. An authorized representative of Ixion shall notify
UFRFI, in writing, within 30 days of discovering that such royalties are
approaching or have reached the maximum amount, and shall provide UFRFI with
written documentation regarding the laws or regulations establishing such
maximum.
4.5 In the event that any taxes, withholding or otherwise, are levied
by any taxing authority in connection with accrual or payment of any royalties
payable by Ixion under this Agreement, and Ixion determines in good faith that
it must pay such taxes, Ixion shall have the right to pay such taxes to the
local tax authorities on behalf of UFRFI and payment of the net amount due
after reduction by the amount of such taxes, shall fully satisfy Ixion's
royalty obligations under this Agreement. Ixion shall provide UFRFI with
appropriate receipts or other documentation supporting such payment. Ixion
shall inform UFRFI in writing, within 30 days of notification that taxes will
or have been levied by a taxing authority.
4.6 In the event that a Licensed Product is sold in a combination
package or kit containing other active products, then Net Sales for purposes
of determining royalty payments on the combination package, shall be
calculated using one of the following methods, but in no event shall the
royalties payable to UFRFI be reduced to less than 50% of that provided for in
Section 4.1 above:
(a) by multiplying the net selling price of that combination
package by the fraction A/A+B, where A is the gross selling price,
during the royalty-paying period in question, of the Licensed
Product sold separately, and B is the gross selling price during
the royalty period in question, of the other active products sold
separately; or
(b) in the event that no such separate sales are made of the
Licensed Product or any of the active products in such combination
package during the royalty-paying period in question, Net Sales
for the purposes of determining royalty payments, shall be
calculated by dividing the net selling price of the combination
package by the number of functions performed by the combination
package sold where such package contains active agents other than
those licensed under this Agreement. The parties recognize that
this provision will require consultation and that in the event a
combination package or kit circumstance arises, the parties will
negotiate in good faith to determine the calculation of Net Sales
pursuant to this section.
4.7 If it is necessary for Ixion to take any license(s) in a given
country, under valid third-party patents which would be necessarily infringed
by the practice of Licensed Processes or production of Licensed Products in
that country, then Ixion can deduct up to 25% of the royalties otherwise due
under this Agreement for Net Sales in that country, until such time as Ixion
has recovered an amount equal to the royalties payable to such third parties.
ARTICLE V - REPORTS AND RECORDS
5.1 Ixion shall keep full, true, and accurate books of account
containing all particulars that may be necessary for the purpose of showing
the amounts payable to UFRFI hereunder. Said books of account shall be kept
at Ixion's principal place of business or the principal place of business of
the appropriate division of Ixion to which this Agreement relates. Said books
and the supporting data shall be open at all reasonable times for three years
following the end of the calendar year to which they pertain, to the
inspection of UFRFI or its agents at UFRFI's expense for the purpose of
verifying Ixion's royalty statements.
5.2 Ixion, within 45 days after March 31, June 30, September 30, and
December 31, of each year, shall deliver to UFRFI true and accurate reports,
giving such particulars of the business conducted by Ixion and its
sublicensees during the preceding three-month period under this Agreement as
shall be pertinent to a royalty accounting hereunder. These shall include at
least the following:
(a) number of Licensed Products manufactured and
sold;
(b) total billings for Licensed Products sold;
(c) an accounting for all Licensed Processes used or
sold;
(d) deductions applicable to a determination of Net
Sales;
(e) total royalties due;
(f) names and addresses of all sublicensees of
Ixion; and
(g) a report on any patent extensions sought
pursuant to section 6.1 hereof.
5.3 With each such report submitted, Ixion shall pay to UFRFI the
royalties due and payable under this Agreement. If no royalties shall be due,
Ixion shall so report.
5.4 On or before the 90th day following the close of Ixion's fiscal
year, Ixion shall provide UFRFI with Ixion's year-end balance sheet and an
operating statement for the preceding fiscal year then ended.
5.5 The royalty payments, license fees, and reimbursement for patent-
related expenses set forth in this Agreement shall, if overdue, bear interest
until payment at the monthly rate of 1.0%. The payment of such interest shall
not foreclose UFRFI from exercising any other rights it may have as a
consequence of the lateness of any payment.
ARTICLE VI - PATENT PROSECUTION
6.1 UFRFI shall apply for, seek issuance of, and maintain during the
term of this Agreement the Patent Rights in the United States and in the
foreign countries listed in Appendix B hereto. The prosecution, filing, and
maintenance of all Patent Rights patents and applications shall be the primary
responsibility of UFRFI; provided, however, Ixion shall have reasonable
opportunities to advise UFRFI and shall cooperate with UFRFI in such
prosecution, filing, and maintenance. Ixion shall seek patent extension for
patents licensed under the Patent Rights in the United States and the foreign
countries listed in Appendix B, under such applicable laws and regulations
throughout such countries, where such patent extension rights are available
currently or are available in the future.
6.2 Payment of all fees and costs relating to the filing,
prosecution,
and maintenance of the Patent Rights shall be the responsibility of Ixion
after the Effective Date. UFRFI shall bill Ixion for these costs and fees.
ARTICLE VII - INFRINGEMENT
7.1 Ixion shall inform UFRFI promptly in writing of any alleged
infringement of the Patent Rights by a third party and of any available
evidence thereof.
7.2 During the term of this Agreement, UFRFI shall have the right,
but
shall not be obligated, to prosecute at its own expense any such infringements
of the Patent Rights. If UFRFI prosecutes any such infringement, Ixion agrees
that UFRFI may include Ixion as a co-plaintiff in any such suit, without
expense to Ixion. The total cost of any such infringement action commenced or
defended solely by UFRFI shall be borne by UFRFI and UFRFI shall keep any
recovery or damages for past infringement derived therefrom.
7.3 If within six months after having been notified of any alleged
infringement or such shorter time proscribed by law, UFRFI shall have been
unsuccessful in persuading the alleged infringer to desist or shall not have
brought and shall not be diligently prosecuting an infringement action, or if
UFRFI shall notify Ixion at any time prior thereto of its intention not to
bring suit against any alleged infringer, then, and in those events only,
(a) Ixion shall have the right, but shall not be obligated, to
prosecute at its own expense any infringement of the Patent Rights
(keeping any recovery or damages for past infringements derived
therefrom), and Ixion may, for such purposes, use the name of
UFRFI as co-plaintiff; provided, however, that such right to bring
an infringement action shall remain in effect only for so long as
the license granted herein remains exclusive. No settlement,
consent judgment, or other voluntary final disposition of the suit
may be entered into without the consent of UFRFI, which consent
shall not unreasonably be withheld. Ixion shall indemnify UFRFI
against any order for costs that may be made against UFRFI in such
proceedings.
(b) Payments which are earned under Article IV hereof shall be
waived so long as any such infringement which the parties agree in
good faith is material continues, such waiver not to exceed 50% of
the royalties payable hereunder; provided, however, that such
payments shall not be so waived so long as at least one suit or
action is being prosecuted by UFRFI for infringement of a patent
covering the Patent Rights.
7.4 If Ixion has brought a suit pursuant to section 7.3 above, it
shall have the right for such purpose to join UFRFI as a co-plaintiff at
Ixion's expense. UFRFI independently shall have the right to join any such
suit or action brought by Ixion, and, in such event, shall pay one-half of the
cost of such suit or action from the date of joining. Any damages recovered
by a suit or action in which UFRFI has paid its share of costs shall be first
used to reimburse each party hereto for the cost of such suit or action
(including attorney's fees) actually paid by each party hereto as the case may
be, then to reimburse UFRFI for any payments waived under this Section 7.4,
and the residue, if any, shall be divided equally between the parties hereto.
7.5 In the event that a declaratory judgment action alleging
invalidity or noninfringement of any of the Patent Rights shall be brought
against Ixion, UFRFI, at its option, shall have the right, within 30 days
after commencement of such action, to intervene and take over the sole defense
of the action at its own expense.
7.6 In any infringement suit as either party may institute to enforce
the Patent Rights pursuant to this Agreement, the other party hereto shall, at
the request and expense of the party initiating such suit, cooperate in all
respects and, to the extent possible, have its employees testify when
requested and make available relevant records, papers, information, samples,
specimens, and the like.
ARTICLE VIII - PRODUCT LIABILITY
8.1 Ixion shall at all times during the term of this Agreement and
thereafter, indemnify, defend, and hold UFRFI and the University, their
trustees, officers, employees, and affiliates (the "Indemnitees"), harmless
against all claims and expenses, including legal expenses and reasonable
attorneys' fees, whether arising from a third party claim or resulting from
UFRFI's enforcing this indemnification clause against Ixion, or arising out of
the death of or injury to any person or persons or out of any damage to
property and against any other claim, proceeding, demand, expense, or
liability of any kind whatsoever resulting from the production, manufacture,
sale, use, lease, consumption, or advertisement of the Licensed Products
and/or Licensed Processes or arising from any right or obligation of Ixion
hereunder. This indemnification shall not apply to any liability, damage,
loss, or expense to the extent that it is attributable to the negligence or
intentional wrongdoing of the Indemnitees.
8.2 Ixion shall, at its own expense, provide attorneys reasonably
acceptable to UFRFI to defend against any actions brought or filed against any
party indemnified hereunder with respect to the subject of indemnity contained
herein, whether such actions are rightfully brought.
8.3 At such time as any product, process, or service relating to, or
developed pursuant to, this Agreement is being commercially distributed or
sold (other than for the purpose of obtaining regulatory approvals) by Ixion
or by a licensee, affiliate, or agent of Ixion, Ixion shall, at its sole cost
and expense, procure and maintain policies of comprehensive general liability
insurance naming the Indemnitees as additional insureds. Such comprehensive
general liability insurance shall provide (a) product liability coverage, and
(b) broad form contractual liability coverage for Ixion's indemnification
under sections 8.1 and 8.2 above. If Ixion elects to self-insure, such self-
insurance program must be acceptable to UFRFI.
8.4 Ixion shall provide UFRFI with written evidence of such insurance
upon request, and shall provide UFRFI with written notice at least 45 days
prior to the cancellation, non-renewal, or material change in such
comprehensive general liability insurance; if Ixion does not obtain
replacement insurance providing comparable coverage within such 45 day period,
UFRFI shall have the right to terminate this Agreement.
8.5 Ixion shall maintain such comprehensive general liability
insurance beyond the expiration or termination of this Agreement during (a)
the period that any product, process, or service, relating to, or developed
pursuant to, this Agreement is being commercially distributed or sold (other
than for the purpose of obtaining regulatory approvals) by Ixion or by a
licensee, affiliate, or agent of Ixion, and (b) a reasonable period after the
period referred to in section 8.5 (a) above, which in no event shall be less
than 15 years.
8.6 In the event any such action is commenced or claim made or
threatened against UFRFI or other Indemnitees as to which Ixion is obligated
to indemnify it or them or hold it or them harmless, UFRFI or the other
Indemnitees shall promptly notify Ixion of such event. Ixion shall assume the
defense of, and may settle, that part of any such claim or action or made
against UFRFI (or other Indemnitee) which relates to Ixion's indemnification
and Ixion may take such other steps as may be necessary to protect itself.
Ixion shall not be liable to UFRFI or other Indemnitees on account of any
settlement of any such claim or litigation affected without Ixion's consent.
The right of Ixion to assume the defense of any action shall be limited to
that part of the action commenced against UFRFI or other Indemnitees which
relates to Ixion's obligation of indemnification.
ARTICLE IX - DISCLAIMER OF WARRANTIES
9.1 EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, UFRFI MAKES
NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR
IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS
FOR A PARTICULAR PURPOSE, AND VALIDITY OF PATENT RIGHTS CLAIMS, ISSUED OR
PENDING.
9.2 UFRFI DOES NOT WARRANT THE VALIDITY OF THE PATENT RIGHTS LICENSED
HEREUNDER AND MAKES NO REPRESENTATION WHATSOEVER WITH REGARD TO THE SCOPE OF
THE LICENSED PATENT RIGHTS OR THAT SUCH PATENT RIGHTS MAY BE EXPLOITED BY
IXION OR ANY AFFILIATE OR SUBLICENSEE WITHOUT INFRINGING OTHER PATENTS.
ARTICLE X - EXPORT CONTROLS
Ixion hereby agrees that it shall not sell, transfer, export or reexport
any Licensed Products, Licensed Processes, Licensed Know-How, or related
information in any form, or any direct products of such information, except in
compliance with all applicable laws, including the export laws of any U.S.
government agency and any regulations thereunder, and will not sell, transfer,
export or reexport any such Licensed Products, Licensed Processes, Licensed
Know-How, or information to any persons or any entities with regard to which
there exist grounds to suspect or believe that they are violating such laws.
Ixion shall be solely responsible for obtaining all licenses, permits, or
authorizations required from the United States and any other government for
any such export or reexport. To the extent not inconsistent with this
Agreement, UFRFI agrees to provide Ixion with such assistance as it may
reasonably request in obtaining such licenses, permits, or authorization.
ARTICLE XI - NON-USE OF NAMES
11.1 Ixion shall not use the names of the University or UFRFI nor of
any of either institution's employees, nor any adaptation thereof, in any
advertising, promotional, or sales literature without prior written consent
obtained from UFRFI in each case (such consent not to be unreasonably
withheld), except that Ixion may state that it is licensed by UFRFI under one
or more of the patents and/or applications comprising the Patent Rights.
Requests for consent from UFRFI or the University shall be sent to the
President of UFRFI with a copy to the Director of the Office of Patent,
Copyright and Technology Licensing. UFRFI and the University shall not use the
name of Ixion or its employees, directors, or agents, in any press or
publicity release without prior written consent from the Chairman or President
of Ixion (such consent not to be unreasonably withheld), except that the
University or UFRFI may state that Ixion has been licensed under one or more
of the patents or applications comprising the Patent Rights. Notwithstanding
the foregoing, the University and UFRFI consent to references to them pursuant
to any requirements of applicable law or governmental regulations, provided
that, in the event of any such disclosure, Ixion shall afford UFRFI or the
University the prior opportunity to review the text of such disclosure. Ixion
shall use its best efforts to comply with any reasonable requests by the
University or UFRFI regarding changes.
11.2 Where consent of a party is required under this Article XI, such
consent shall be deemed granted if no written objection (or oral objection,
confirmed immediately in writing) is received by the requesting party on or
before the tenth calendar day following the date a written request for consent
was received by the requested party. For the purposes of this Article XI
only, a item shall be deemed received as follows: (a) if hand delivered, upon
delivery; (b) if sent by electronic mail, upon confirmation by the sending
carrier that the message was deposited to the addressee's mailbox; (c) if sent
by registered mail, return receipt requested, upon signing by the receiving
party; or (d) if sent by ordinary mail in the United States, postage prepaid,
and addressed as set forth in Article XIV, on the fifth calendar day after
deposit in the mail.
ARTICLE XII - ASSIGNMENT
This Agreement is not assignable and any attempt to do so shall be void.
ARTICLE XIII - TERMINATION
13.1 If Ixion shall cease to carry on its business, this Agreement
shall terminate upon notice by UFRFI.
13.2 Should Ixion fail to pay UFRFI royalties due and payable
hereunder, UFRFI shall have the right to terminate this Agreement on 60 days'
notice, unless Ixion shall pay UFRFI within the 60-day period, all such
royalties and interest due and payable. Upon the expiration of the 60-day
period, if Ixion shall not have paid all such royalties and interest due and
payable, the rights, privileges, and license granted hereunder shall
terminate.
13.3 Upon any material breach or default of this Agreement by Ixion,
other than those occurrences set out in sections 13.1 and 13.2 above, which
shall always take precedence in that order over any material breach or default
referred to in this section 13.3, UFRFI shall have the right to terminate this
Agreement and the rights, privileges, and license granted hereunder by 90
days' notice to Ixion. Such termination shall become effective unless Ixion
shall have cured any such breach or default prior to the expiration of the 90-
day period.
13.4 Ixion shall have the right to terminate this Agreement at any
time
on 90 days' written notice to UFRFI, and upon payment of all amounts due UFRFI
through the effective date of the termination.
13.5 Upon termination of this Agreement for any reason, nothing
herein
shall be construed to release either party from any obligation that matured
prior to the effective date of such termination. Ixion and any sublicensee
thereof may, however, after the effective date of such termination, sell all
Licensed Products, and complete Licensed Products in the process of
manufacture at the time of such termination and sell the same, provided that
Ixion shall pay to UFRFI the royalties thereon as required by Article IV of
this Agreement and shall submit the reports required by Article V hereof on
the sales of Licensed Products.
13.6 Upon termination of this Agreement for any reason, any
sublicense
not then in default shall continue in full force and effect except that UFRFI
shall be substituted in place of the sublicensor; provided, however, that the
extent of UFRFI's obligations under such sublicense shall be consistent with
(and not exceeding) its obligations under this Agreement.
13.7 Bankruptcy.
(a) Notice of Assumption or Rejection.
(i) In the event that either party files or has filed against
it a petition under the Federal Bankruptcy Code (11 U.S.C. Sec. 1, et seq.)
(the Bankruptcy Code"), is adjudged bankrupt, or files or has filed against
it a petition for reorganization or arrangement under any law relating to
bankruptcy or similar laws for the protection of debtors, whether under the
laws of the United States and its political subdivisions or otherwise, such
party shall (1) notify the other party t
(ii) If such party does not: (1) within
thirty (30) days after the occurrence of any of the
foregoing events, notify the other party of its
assumption or rejection of this Agreement or file the
petition, or (2) thereafter diligently take all other
action necessary for the approval of the foregoing
ty does not: (1) within
thirty (30) days after the occurrence of any of the
foregoing events, notify the other party of its
assumption or rejection of this Agreement or file the
petition, or (2) thereafter diligently take all other
action necessary for the approval of the foregoing
petition or of such assumption or rejection, such
party shall be deemed to have rejected this Agreement.
Each party acknowledges that, for purposes of Section
365 of the Bankruptcy Code and similar provisions of
any other or future similar laws relating to any
party's assumption or rejection of any executory
contract, a period of 30 days after the date of any
filing or adjudication described above shall
constitute a reasonable time in which such party shall
assume or reject this Agreement and a party shall be
deemed to have not diligently taken all action
necessary for the approval of the foregoing petition
or of such assumption or rejection if such petition,
assumption or rejection is not approved by the
appropriate court within 60 days after the filing of
the petition for such assumption or rejection.
(b) Conditions to Assumption.
No election by any party, or any successor-in-
interest to such party, to assume this Agreement as
contemplated by Section (a) above shall be effective unless
each of the following conditions, each of which each party
acknowledges is commercially reasonable in the context of a
bankruptcy or similar proceeding, has been satisfied by such
party and each of the other parties has acknowledged such
satisfaction in writing:
(1) Cure. Such party has cured, or has
provided the other party adequate assurances that:
(A) Monetary Defaults.
Within ten days from the date of such assumption
such party will cure all monetary defaults under
this Agreement; and
(B) Non-Monetary Defaults.
Within 30 days from the date of such assumption
such party will cure all non-monetary defaults
under this Agreement.
(2) Pecuniary Loss. Such party has
compensated or has provided to the other party
adequate assurances that within ten days from the date
of assumption the other party will be compensated for
any pecuniary loss incurred by the party arising from
any default of such party under this Agreement prior
to the assumption.
(3) Future Performance. Such party has
provided the other party with adequate assurances of
the future performance of such party's obligations
under this Agreement.
(c) Termination.
This Agreement shall terminate upon the
rejection of this Agreement as contemplated by this Section
by any party or successor-in-interest thereto.
(d) No Transfer.
Neither any party's interest in this Agreement
nor any portion thereof shall pass to any trustee, receiver,
or assignee for the benefit of creditors, or any other
person or entity or otherwise by operation of law under the
Bankruptcy Code or the insolvency laws of any state having
jurisdiction of the person or property of such party unless
the other party shall consent to such transfer in writing.
ARTICLE XIV - PAYMENTS, NOTICES AND OTHER COMMUNICATIONS
Any payment, notice or other communication pursuant to this Agreement
shall be sufficiently made or given on the date of mailing if sent to such
party by certified first class mail, postage prepaid, addressed to it at its
address below or as it shall designate by written notice given to the other
party:
In the case of UFRFI:
President
University of Florida Research Foundation, Inc.
223 Grinter Hall
Gainesville, Florida 32611
With a copy to:
Director
Office of Patent, Copyright and Technology Licensing
186 Grinter Hall
Gainesville, Florida 32611
All payments to:
Director
Office of Patent, Copyright and Technology Licensing
186 Grinter Hall
Gainesville, Florida 32611
PLEASE MAKE ALL CHECKS PAYABLE TO:
University of Florida Research Foundation, Inc.
223 Grinter Hall
Gainesville, Florida 32611
In the case of Ixion:
President
Ixion Biotechnology, Inc.
One Progress Blvd., Box 26
Alachua, FL 32615
ARTICLE XV - MISCELLANEOUS PROVISIONS
15.1 This Agreement shall be construed, governed, interpreted, and
applied in accordance with the laws of the State of Florida, except that
questions affecting the construction and effect of any patent shall be
determined by the law of the country in which the patent was granted.
15.2 The parties hereto acknowledge that this Agreement sets forth
the
entire agreement and understanding of the parties hereto as to the subject
matter hereof, and shall not be subject to any change or modification except
by the execution of a written instrument subscribed to by the parties hereto.
15.3 The provisions of this Agreement are severable, and in the event
that any provisions of this Agreement shall be determined to be invalid or
unenforceable under any controlling body of the law, such invalidity or
unenforceability shall not in any way affect the validity or enforceability of
the remaining provisions hereof.
15.4 Ixion agrees to mark the Licensed Products sold in the United
States with all applicable United States patent numbers. All Licensed
Products shipped to or sold in other countries shall be marked in such a
manner as to conform with the patent laws and practice of the country of
manufacture or sale.
15.5 The failure of either party to assert a right hereunder or to
insist upon compliance with any term or condition of this Agreement shall not
constitute a waiver of that right or excuse a similar subsequent failure to
perform any such term or condition by the other party.
15.6 (a) Anything in this Agreement to the contrary notwithstanding,
any and all knowledge, know-how, practices, process or other information of
any kind and in any form (hereinafter referred to as "Confidential
Information") disclosed or submitted, either orally, in writing or in other
tangible or intangible form which is designated as Confidential Information,
to either party by the other shall be received and maintained by the receiving
party in strict confidence and shall not be disclosed to any third party,
except that Ixion may disclose Confidential Information (pursuant to written
confidentiality agreements) to its lawyers, accountants, advisors, investors,
and potential investors. Furthermore, neither party shall use the said
Confidential Information for any purpose other than those purposes specified
in this Agreement. The parties may disclose Confidential Information to the
minimum number of its employees reasonably requiring access thereto for the
purposes of this Agreement provided, however, that prior to making any such
disclosures each such employee shall be apprised of the duty and obligation to
maintain Confidential Information in confidence and not to use such
information for any purpose other than in accordance with the terms and
conditions of this Agreement.
(b) Nothing contained herein will in any way restrict or impair
either parties right to use, disclose, or otherwise deal with any Confidential
Information which at the time of its receipt:
(i) Is generally available in the public domain, or thereafter
becomes available to the public through no act of the receiving party; or
(ii) Was independently known prior to receipt thereof, or made
available to such receiving party as a matter of lawful right by a third
party.
IN WITNESS WHEREOF, the parties have hereunto set their hands and seals
and duly executed this Agreement on the day and year set forth below.
University of Florida Research Foundation, Inc.
By Dated:
Ixion Biotechnology, Inc.
By Dated:
January 11, 1995
Weaver H. Gaines
Chairman and Chief Executive Officer
Acknowledged and Understood:
Ammon B. Peck, Ph. D.
APPENDIX A
UF Case No. UF# 0973
"Reducing Oxalate Poisoning in Vertebrates Using Genetically Engineered
Organisms Expressing Cloned Oxalate Degrading Enzymes"
UF Case No. UF# 1203
"Oxalate Diagnostic Kit and Formyl-CoA Transferase Gene from Oxalobacter
Formigenes"
U.S.S.N. 08/262,424 "Materials and Methods for Detection of Oxalate"
By Ammon B. Peck, Ph. D.
Filed on June 20, 1994
APPENDIX B
Foreign countries in which Patent Rights shall be filed, prosecuted and
maintained in accordance with Article VI:
For UF Case No. UF# 1203 and Case No. UF# 0973
India
No other countries
[Ixion Letterhead]
December 20, 1995
Chris D. McKinney, PH. D.
Director, Office of Technology Licensing
186 Grinter Hall
Gainesville, FL 32611-2037
AMENDMENT NUMBER ONE
Re: Oxalate Patent Licenses between UFRFI and Ixion
Dear Chris:
I refer to the Patent License Agreement between the University of Florida
Research Foundation, Inc., ("UFRFI") and Ixion Biotechnology, Inc. ("Ixion" or
the "Company"), dated January 11, 1995, relating to USSN 08/262,424 (the
"Oxalate License"). Such license requires Ixion to develop a working model
of an urine oxalate detection kit by January 11, 1996. We have determined that
a more promising product is a molecular probe to detect the presence or absence
of Oxalobacter formigenes in the human gut. We expect to have a working model
of that probe by January 11, 1996, and would like to substitute that probe for
the urine oxalate kit referred to in Section 3.2(b) of the Oxalate License.
If this meets with your approval, please sign and return a copy of this
letter.
Best wishes for the holiday season.
Sincerely yours,
/S/
Weaver H. Gaines
Accepted and agreed to:
/s/ Chris D. McKinney
_____________________
NOTE: Certain portions of this document have been omitted based on a request
for confidential treatment. The non-public information has been filed
with the Securities and Exchange Commission. Omitted portions are
designated with asterisks ("*").
This Amendment No. 2 dated October 9, 1996, is between the University
of Florida Research Foundation, Inc., a not-for-profit corporation duly
organized and existing under the laws of the State of Florida and having its
principal office at 223 Grinter Hall, Gainesville, Florida, 32611-2037
("UFRFI"), and Ixion Biotechnology, Inc., a corporation duly organized under
the laws of Delaware, and having its principal office at 12085 Research
Drive, Alachua, Florida 32615 ("Ixion").
WITNESSETH
WHEREAS, UFRFI and Ixion entered into a License Agreement dated January
11, 1995 relating to UF Case No. 1203 "Oxalate Diagnostic Kit and Formyl-CoA
Transferase Gene from Oxalobacter Formigenes," UF Case No. UF#-0973 "Reducing
Oxalate Poisoning in Vertebrates Using Genetically Engineered Organisms
Expressing Cloned Oxalate Degrading Enzymes," and the parent patent
application "Materials and Methods for Detection of Oxalate," USSN 08/262,424,
filed June 20, 1994, and
WHEREAS, UFRFI and Ixion amended Section 3.2(b) of such License
Agreement on December 20, 1995, to substitute the development of a working
model of a molecular probe to detect Oxalobacter formigenes, rather than a
working model of a urine oxalate development kit, as part of Ixion's diligence
obligation (such License Agreement as amended being herein referred to as the
"License Agreement"); and
WHEREAS, UFRFI and Ixion desire to further amend the License Agreement
to the benefit of both parties;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein the parties agree to Amendment No. 2 as follows:
1. Appendix A is amended to read, in its entirety, as attached Appendix
A:
2. Appendix B is amended to read, in its entirety, as attached Appendix
B:
3. Section 1.6 is amended by deleting the words "and its sublicensees'"
such that section 1.6 reads as follows:
1.6 "Net Sales" means Ixion's gross sales from the sale or
lease of Licensed Products and Licensed Processes produced hereunder
less the sum of the following:
(a) discounts allowed in amounts customary in the trade and
brokers' or agents' commissions, if any, allowed and paid to
independent parties in arms-length transactions;
(b) excise, value-added, or sales taxes, tariff duties or use
taxes directly imposed and with reference to particular
sales;
(c) outbound transportation prepaid or allowed;
(d) amounts allowed or credited on returns; and
(e) packing costs and insurance costs if itemized separately.
No deductions shall be made for commissions paid to individuals
regularly employed by Ixion and on its payroll, or for cost of
collections. Licensed Products shall be considered "sold" when
invoiced.
3. Section 4.1(c) is amended by deleting the words "or its
sublicensees" such that section 4.1(c) reads as follows:
(c) A Running Royalty in an amount equal to ******** of
the Net Sales of the Licensed Products or Licensed Processes
used, leased, or sold by or for Ixion; and
4. A new section 4.1 (d) is added as follows:
(d) Sublicense Royalty in an amount equal to ********
******** of the sublicense revenue received by Ixion.
Sublicense revenue received by Ixion shall mean revenue in
the form of license fees, royalties, or other direct
consideration (such as milestone payments made by a
sublicensee), but not research support or collaboration fees
from sublicensees.
IN WITNESS WHEREOF, the parties have hereunto set their hands and
seals and duly executed this Agreement as of the day and year first set forth
above.
University of Florida Research Foundation, Inc. Ixion Biotechnology,
Inc.
By By
Dr. Karen A. Holbrook Weaver H. Gaines
President Chairman and Chief
Executive Officer
APPENDIX A
UF Case No. UF# 0973
"Reducing Oxalate Poisoning in Vertebrates Using Genetically Engineered
Organisms Expressing Cloned Oxalate Degrading Enzymes"
UF Case No. UF# 1203
"Oxalate Diagnostic Kit and Formyl-CoA Transferase Gene from Oxalobacter
Formigenes"
UF Case No. UF# 1447
"Materials and Methods for Detection of Oxalate"
UF Case No. UF# 1458
"Materials and Methods for Detection of Oxalate"
UF Case No. UF# [to be assigned]
"Materials and Methods for Detection of Oxalobacter Formigenes"
USSN 08/262,424 "Materials and Methods for Detection of Oxalate"
By Ammon B. Peck, Ph.D.
Filed on June 20, 1994
USSN 08/464,147 "Materials and Methods for Detection of Oxalate"
By Ammon B. Peck, Ph.D.
Filed on June 5, 1995
USSN 08/493,197 "Materials and Methods for Detection of Oxalate"
By Ammon B. Peck, Ph.D.
Filed on June 20, 1995
USSN 08/[to be assigned] "Materials and Methods for Detection of Oxalobacter"
Saliwanchik & Saliwanchik Docket Number UF 145C2
By Ammon B. Peck, Ph.D.
Filed on September 27, 1996
APPENDIX B
Foreign countries in which Patent Rights shall be file, prosecuted and
maintained in accordance with Article VI:
For UF Case No. UF# 1203 and Case No. UF# 0973
India
No other countries
For UF Case No. UF# 1458
PCT Appl. No. US95/07844
Filed June 20, 1995
Publ. No. WO 95/35377
All subsequent national and PCT filings for patent applications appearing in
Appendix A.
NOTE: Certain portions of this document have been omitted based on a request
for confidential treatment. The non-public information has been filed
with the Securities and Exchange Commission. Omitted portions are
designated with asterisks ("*").
Patent License Agreement
With Research Component
University of Florida Research Foundation
and
Ixion Biotechnology, Inc.
February 1995
UF Case No. UF# -1256 "In vitro-grown Islets of Langerhan for curing diabetes"
Patent Application "In Vitro Growth of Functional Islets of Langerhan," USSN
08/234,071, filed April 28, 1994
PATENT LICENSE AGREEMENT
WITH RESEARCH COMPONENT
TABLE OF CONTENTS
ARTICLE I - DEFINITIONS 1
ARTICLE II - GRANT 4
ARTICLE III - DUE DILIGENCE 5
ARTICLE IV - ROYALTIES 5
ARTICLE V - REPORTS AND RECORDS 7
ARTICLE VI - PATENT PROSECUTION 8
ARTICLE VII - INFRINGEMENT 8
ARTICLE VIII - PRODUCT LIABILITY 10
ARTICLE IX - DISCLAIMER OF WARRANTIES 11
ARTICLE X - EXPORT CONTROLS 11
ARTICLE XI - NON-USE OF NAMES 11
ARTICLE XII - ASSIGNMENT 12
ARTICLE XIII - TERMINATION 12
ARTICLE XIV - PAYMENTS, NOTICES AND OTHER COMMUNICATIONS 15
ARTICLE XV - MISCELLANEOUS PROVISIONS 16
PREAMBLE
This Agreement is made this 17th day of February, 1995, (the "Effective
Date") between the University of Florida Research Foundation, Inc., a not-for-
profit corporation duly organized and existing under the laws of the State of
Florida and having its principal office at 223 Grinter Hall, Gainesville,
Florida, 32611-2037 ("UFRFI"), and Ixion Biotechnology, Inc., a corporation
duly organized under the laws of Delaware, and having its principal office at
One Progress Blvd., Box 26, Alachua, Florida 32615 ("Ixion").
WITNESSETH
WHEREAS, UFRFI is the owner of certain Patent Rights by assignment from
the University of Florida (the "University") relating to UF Case No. UF# -1256
"In vitro-grown Islets of Langerhan for curing diabetes," and has the right to
grant licenses under said Patent Rights, subject only to a royalty-free,
nonexclusive license heretofore granted to the United States Government;
WHEREAS, UFRFI desires to have the Patent Rights utilized in the public
interest and is willing to grant a license thereunder;
WHEREAS, Ixion has represented to UFRFI to induce UFRFI to enter into
this Agreement, that Ixion is prepared to undertake the development,
production, manufacture, marketing, and sale of products similar to the
Licensed Products and/or the use of the Licensed Processes and that it shall
commit itself to a thorough, vigorous, and diligent program of exploiting the
Patent Rights commercially so that public utilization and royalty income to
UFRFI shall result;
WHEREAS, Ixion desires to obtain a license under the Patent Rights upon
the terms and conditions of this Agreement; and
WHEREAS, Ixion has certain additional research it desires which the
parties agree should be conducted by the University;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein the parties agree as follows:
ARTICLE I - DEFINITIONS
The following words and phrases have the following meanings:
1.1 "Inventor" means Ammon B. Peck, Ph.D.
1.2 "Ixion" means any of the following:
(a) a related company of Ixion, the voting stock of
which is directly or indirectly at least 50% owned or
controlled by Ixion;
(b) an organization which directly or indirectly
controls more than 50% of the voting stock of Ixion; and
(c) an organization, the majority ownership of which
is directly or indirectly common to the ownership of Ixion.
1.3 "Licensed Know-How" means any technical data, information, or
knowledge within the knowledge and possession of the Inventor on the Effective
Date which is incorporated in or becomes part of the Patent Rights.
1.4 "Licensed Product" means any product or part thereof which:
(a) is covered in whole or in part by an issued,
unexpired claim or a pending claim contained in the Patent
Rights in the country in which any Licensed Product is made,
used, or sold;
(b) is manufactured by using a process which is
covered in whole or in part by an issued, unexpired claim or
a pending claim contained in the Patent Rights in the
country in which any Licensed Process is used or in which
such product or part thereof is used or sold;
(c) is derived from Patent Rights, Licensed Know-
How, or trade secrets related to or described in Patent
Rights; or
(d) is sold, manufactured, or used in any country
under this Agreement.
1.5 "Licensed Process" means any process which:
(a) is covered in whole or in part by an issued,
unexpired claim or a pending claim contained in the Patent
Rights;
(b) is derived from Patent Rights, Licensed Know-
How, or trade secrets related to or described in Patent
Rights; or
(c) is used in any country under this Agreement.
1.6 "Net Sales" means Ixion's, and its sublicensees' gross sales from
the sale or lease of Licensed Products and Licensed Processes produced
hereunder less the sum of the following:
(a) discounts allowed in amounts customary in the
trade and brokers' or agents' commissions, if any, allowed
and paid to independent parties in arms-length transactions;
(b) excise, value-added, or sales taxes, tariff
duties or use taxes directly imposed and with reference to
particular sales;
(c) outbound transportation prepaid or allowed;
(d) amounts allowed or credited on returns; and
(e) packing costs and insurance costs if itemized
separately.
No deductions shall be made for commissions paid to individuals regularly
employed by Ixion and on its payroll, or for cost of collections. Licensed
Products shall be considered "sold" when invoiced.
1.7 "Patent Rights" means all of the following UFRFI intellectual
property:
(a) the United States and foreign patents or patent
applications listed in Appendices A and B;
(b) United States and foreign patents issued from
the applications listed in Appendices A and B and from
divisionals and continuations of these applications;
(c) claims of U.S. and foreign continuation-in-part
applications, and of the resulting patents, which are
directed to subject matter specifically described in the
U.S. and foreign applications listed in Appendices A and B;
(d) claims of all foreign patent applications, and
of the resulting patents, which are directed to subject
matter specifically described in the United States patents
and/or patent applications described in (a), (b), or (c)
above; and
(e) any reissues of United States patents described
in (a), (b), (c), or (d) above.
1.8 "Project Work" means the research work described in the Research
Support Agreement.
1.9 "Research Support Agreement" means that agreement attached hereto
as Exhibit C, with its associated terms and conditions.
1.10 "Territory" means all the countries of the world.
1.11 "University Inventions" means individually and collectively all
inventions, improvements, or discoveries patentable or unpatentable, which are
conceived or made solely by one or more employees of the University, in
performance of the Project Work. All rights and title to University
Inventions developed under the Research Support Agreement belong to the
University and are subject to the terms of such Research Support Agreement.
For the purposes of this section, the "making" of inventions shall be governed
by U.S. laws of inventorship.
1.12 "University Patents" means collectively and individually any and
all United States and foreign patent applications and any and all issued
United States Letters Patents and foreign patents owned by the University for
University Inventions derived during Project Work under the Research Support
Agreement.
ARTICLE II - GRANT
2.1 UFRFI grants to Ixion the exclusive right and license to make,
have made, use, lease, and sell the Licensed Products, and to practice the
Licensed Processes and the Licensed Know-How, in the Territory to the end of
the term for which the Patent Rights are granted unless sooner terminated
according to the terms hereof.
2.2 UFRFI shall not grant any other license to make, have made, use,
lease, or sell Licensed Products or to utilize Licensed Processes during the
period of time commencing with the Effective Date of this Agreement and
terminating with the expiration or termination of this Agreement.
2.3 UFRFI reserves the right to practice under the Patent Rights for
its own noncommercial research purposes.
2.4 Ixion may sublicense others under this Agreement. Each
sublicense
shall be consistent with the terms of this Agreement.
2.5 Any sublicenses granted by Ixion shall provide that the
obligations to UFRFI of this Agreement shall be binding upon the sublicensee
as if it were a party to this Agreement. Ixion shall attach copies of this
Agreement to sublicense agreements.
2.6 Ixion shall forward to UFRFI a copy of any sublicense agreement
within 30 days of its execution and further shall forward to UFRFI annually a
copy of such reports received by Ixion from its sublicensees during the
preceding twelve-month period under the sublicenses as shall be pertinent to a
royalty accounting under said sublicenses.
2.7 The license granted hereunder shall not be construed to confer
any
rights upon Ixion by implication, estoppel, or otherwise as to any technology
not specifically set forth herein.
2.8 Ixion shall not receive from sublicensees anything of value in
lieu of cash payments in consideration for any sublicense under this
Agreement, without the express prior written permission of UFRFI.
2.9 Licensed Products leased or sold in the United States and covered
by Patent Rights or other intellectual property rights that are subject to the
non-exclusive royalty-free license to the United States government will be
manufactured substantially in the United States.
2.10 Ixion shall abide by all rights and limitations of U.S. Code,
Title 35, Chapter 38, and implementing regulations thereof, for all patent
applications and patents invented in whole or in part with federal funding.
ARTICLE III - DUE DILIGENCE
3.1 Ixion shall use its best efforts to bring one or more Licensed
Products or Licensed Processes to market through a thorough, vigorous, and
diligent program for exploitation of the Patent Rights to attain
commercialization of Licensed Products and Licensed Processes.
3.2 In addition, Ixion shall adhere to the following milestones:
(a) Ixion shall deliver to UFRFI on or before a date
90 days from the Effective Date a business plan for further
research into the development of a product relating to in
vitro grown islets of Langerhan. The business plan (or
extract from the business plan) shall show for the
forthcoming fiscal year the amount of money, number and
kind of personnel, and time budgeted for such product
development. Ixion shall provide similar plans or extracts
to UFRFI on an annual basis on or before the ninetieth
(90th) day following the close of each fiscal year.
(b) Ixion shall comply with the Research Support
Agreement attached as Exhibit C.
ARTICLE IV - ROYALTIES
4.1 For the rights, privileges and, license granted hereunder, Ixion
shall pay royalties to UFRFI to the end of the term of the Patent Rights or
until this Agreement is terminated as follows:
(a) A License Issue Fee of an amount equal to the
out-of-pocket costs of patenting incurred prior to the
Effective Date, such fee to be paid within 30 days of the
receipt of an invoice therefor by Ixion;
(b) An Additional License Issue Fees of ********, due
immediately upon the execution of this Agreement. The
Additional License Issue Fee shall be creditable against
any Running Royalties subsequently due under section 4.1 (c)
below;
(c) A Running Royalty in an amount equal to **********
of the Net Sales of the Licensed Products or
Licensed Processes used, leased, or sold by or for Ixion or
its sublicensees; and
(d) A further ******** upon the filing with the FDA
of an application for a Product License Approval relating to
a Licensed Product or Process, or the expiration of 24
months from the Effective Date, whichever is later. Such
milestone payment is in addition to any Running Royalties
due under section 4.1(c) above.
4.2 No multiple royalties shall be payable because any Licensed
Product, its manufacture, use, lease, or sale are or shall be covered by more
than one Patent Rights patent application or Patent Rights patent licensed
under this Agreement.
4.3 Royalty payments shall be paid in United States dollars in
Gainesville, Florida or at such other place as UFRFI may reasonably designate
in writing consistent with the laws and regulations controlling in any foreign
country. If any currency conversion shall be required in connection with the
payment of royalties hereunder, such conversion shall be made by using the
exchange rate prevailing at the Chase Manhattan Bank (N.A.) on the last
business day of the calendar quarterly reporting period to which such royalty
payments relate.
4.4 In the event the royalties set forth herein are higher than the
maximum royalties permitted by the law or regulations of a particular country,
the royalty payable for sales in such country shall be equal to the maximum
permitted royalty under such law or regulations. Notice of said event shall
be provided to UFRFI. An authorized representative of Ixion shall notify
UFRFI, in writing, within 30 days of discovering that such royalties are
approaching or have reached the maximum amount, and shall provide UFRFI with
written documentation regarding the laws or regulations establishing such
maximum.
4.5 In the event that any taxes, withholding or otherwise, are levied
by any taxing authority in connection with accrual or payment of any royalties
payable by Ixion under this Agreement, and Ixion determines in good faith that
it must pay such taxes, Ixion shall have the right to pay such taxes to the
local tax authorities on behalf of UFRFI and payment of the net amount due
after reduction by the amount of such taxes, shall fully satisfy Ixion's
royalty obligations under this Agreement. Ixion shall provide UFRFI with
appropriate receipts or other documentation supporting such payment. Ixion
shall inform UFRFI in writing, within 30 days of notification that taxes will
or have been levied by a taxing authority.
4.6 In the event that a Licensed Product is sold in a combination
package or kit containing other active products, then Net Sales for purposes
of determining royalty payments on the combination package, shall be
calculated using one of the following methods, but in no event shall the
royalties payable to UFRFI be reduced to less than 50% of that provided for in
Section 4.1 above:
(a) by multiplying the net selling price of that combination
package by the fraction A/A+B, where A is the gross selling price,
during the royalty-paying period in question, of the Licensed
Product sold separately, and B is the gross selling price during
the royalty period in question, of the other active products sold
separately; or
(b) in the event that no such separate sales are made of the
Licensed Product or any of the active products in such combination
package during the royalty-paying period in question, Net Sales
for the purposes of determining royalty payments, shall be
calculated by dividing the net selling price of the combination
package by the number of functions performed by the combination
package sold where such package contains active agents other than
those licensed under this Agreement. The parties recognize that
this provision will require consultation and that in the event a
combination package or kit circumstance arises, the parties will
negotiate in good faith to determine the calculation of Net Sales
pursuant to this section.
4.7 If it is necessary for Ixion to take any license(s) in a given
country, under valid third-party patents which would be necessarily infringed
by the practice of Licensed Processes or production of Licensed Products in
that country, then Ixion can deduct up to 25% of the royalties otherwise due
under this Agreement for Net Sales in that country, until such time as Ixion
has recovered an amount equal to the royalties payable to such third parties.
ARTICLE V - REPORTS AND RECORDS
5.1 Ixion shall keep full, true, and accurate books of account
containing all particulars that may be necessary for the purpose of showing
the amounts payable to UFRFI hereunder. Said books of account shall be kept
at Ixion's principal place of business or the principal place of business of
the appropriate division of Ixion to which this Agreement relates. Said books
and the supporting data shall be open at all reasonable times for three years
following the end of the calendar year to which they pertain, to the
inspection of UFRFI or its agents at UFRFI's expense for the purpose of
verifying Ixion's royalty statements.
5.2 Ixion, within 45 days after March 31, June 30, September 30, and
December 31, of each year, shall deliver to UFRFI true and accurate reports,
giving such particulars of the business conducted by Ixion and its
sublicensees during the preceding three-month period under this Agreement as
shall be pertinent to a royalty accounting hereunder. These shall include at
least the following:
(a) number of Licensed Products manufactured and
sold;
(b) total billings for Licensed Products sold;
(c) an accounting for all Licensed Processes used or
sold;
(d) deductions applicable to a determination of Net
Sales;
(e) total royalties due;
(f) names and addresses of all sublicensees of
Ixion; and
(g) a report on any patent extensions sought
pursuant to section 6.1 hereof.
5.3 With each such report submitted, Ixion shall pay to UFRFI the
royalties due and payable under this Agreement. If no royalties shall be due,
Ixion shall so report.
5.4 On or before the 90th day following the close of Ixion's fiscal
year, Ixion shall provide UFRFI with Ixion's year-end balance sheet and an
operating statement for the preceding fiscal year then ended.
5.5 The royalty payments, license fees, and reimbursement for patent-
related expenses set forth in this Agreement shall, if overdue, bear interest
until payment at the monthly rate of 1.0%. The payment of such interest shall
not foreclose UFRFI from exercising any other rights it may have as a
consequence of the lateness of any payment.
ARTICLE VI - PATENT PROSECUTION
6.1 UFRFI shall apply for, seek issuance of, and maintain during the
term of this Agreement the Patent Rights in the United States and in the
foreign countries listed in Appendix B hereto. The prosecution, filing, and
maintenance of all Patent Rights patents and applications shall be the primary
responsibility of UFRFI; provided, however, Ixion shall have reasonable
opportunities to advise UFRFI and shall cooperate with UFRFI in such
prosecution, filing, and maintenance. Ixion shall seek patent extension for
patents licensed under the Patent Rights in the United States and the foreign
countries listed in Appendix B, under such applicable laws and regulations
throughout such countries, where such patent extension rights are available
currently or are available in the future.
6.2 Payment of all fees and costs relating to the filing,
prosecution,
and maintenance of the Patent Rights shall be the responsibility of Ixion
after the Effective Date. UFRFI shall bill Ixion for these costs and fees.
ARTICLE VII - INFRINGEMENT
7.1 Ixion shall inform UFRFI promptly in writing of any alleged
infringement of the Patent Rights by a third party and of any available
evidence thereof.
7.2 During the term of this Agreement, UFRFI shall have the right,
but
shall not be obligated, to prosecute at its own expense any such infringements
of the Patent Rights. If UFRFI prosecutes any such infringement, Ixion agrees
that UFRFI may include Ixion as a co-plaintiff in any such suit, without
expense to Ixion. The total cost of any such infringement action commenced or
defended solely by UFRFI shall be borne by UFRFI and UFRFI shall keep any
recovery or damages for past infringement derived therefrom.
7.3 If within six months after having been notified of any alleged
infringement or such shorter time proscribed by law, UFRFI shall have been
unsuccessful in persuading the alleged infringer to desist or shall not have
brought and shall not be diligently prosecuting an infringement action, or if
UFRFI shall notify Ixion at any time prior thereto of its intention not to
bring suit against any alleged infringer, then, and in those events only,
(a) Ixion shall have the right, but shall not be obligated, to
prosecute at its own expense any infringement of the Patent Rights
(keeping any recovery or damages for past infringements derived
therefrom), and Ixion may, for such purposes, use the name of
UFRFI as co-plaintiff; provided, however, that such right to bring
an infringement action shall remain in effect only for so long as
the license granted herein remains exclusive. No settlement,
consent judgment, or other voluntary final disposition of the suit
may be entered into without the consent of UFRFI, which consent
shall not unreasonably be withheld. Ixion shall indemnify UFRFI
against any order for costs that may be made against UFRFI in such
proceedings.
(b) Payments which are earned under Article IV hereof shall be
waived so long as any such infringement which the parties agree in
good faith is material continues, such waiver not to exceed 50% of
the royalties payable hereunder; provided, however, that such
payments shall not be so waived so long as at least one suit or
action is being prosecuted by UFRFI for infringement of a patent
covering the Patent Rights.
7.4 If Ixion has brought a suit pursuant to section 7.3 above, it
shall have the right for such purpose to join UFRFI as a co-plaintiff at
Ixion's expense. UFRFI independently shall have the right to join any such
suit or action brought by Ixion, and, in such event, shall pay one-half of the
cost of such suit or action from the date of joining. Any damages recovered
by a suit or action in which UFRFI has paid its share of costs shall be first
used to reimburse each party hereto for the cost of such suit or action
(including attorney's fees) actually paid by each party hereto as the case may
be, then to reimburse UFRFI for any payments waived under this Section 7.4,
and the residue, if any, shall be divided equally between the parties hereto.
7.5 In the event that a declaratory judgment action alleging
invalidity or noninfringement of any of the Patent Rights shall be brought
against Ixion, UFRFI, at its option, shall have the right, within 30 days
after commencement of such action, to intervene and take over the sole defense
of the action at its own expense.
7.6 In any infringement suit as either party may institute to enforce
the Patent Rights pursuant to this Agreement, the other party hereto shall, at
the request and expense of the party initiating such suit, cooperate in all
respects and, to the extent possible, have its employees testify when
requested and make available relevant records, papers, information, samples,
specimens, and the like.
ARTICLE VIII - PRODUCT LIABILITY
8.1 Ixion shall at all times during the term of this Agreement and
thereafter, indemnify, defend, and hold UFRFI and the University, their
trustees, officers, employees, and affiliates (the "Indemnitees"), harmless
against all claims and expenses, including legal expenses and reasonable
attorneys' fees, whether arising from a third party claim or resulting from
UFRFI's enforcing this indemnification clause against Ixion, or arising out of
the death of or injury to any person or persons or out of any damage to
property and against any other claim, proceeding, demand, expense, or
liability of any kind whatsoever resulting from the production, manufacture,
sale, use, lease, consumption, or advertisement of the Licensed Products
and/or Licensed Processes or arising from any right or obligation of Ixion
hereunder. This indemnification shall not apply to any liability, damage,
loss, or expense to the extent that it is attributable to the negligence or
intentional wrongdoing of the Indemnitees.
8.2 Ixion shall, at its own expense, provide attorneys reasonably
acceptable to UFRFI to defend against any actions brought or filed against any
party indemnified hereunder with respect to the subject of indemnity contained
herein, whether such actions are rightfully brought.
8.3 At such time as any product, process, or service relating to, or
developed pursuant to, this Agreement is being commercially distributed or
sold (other than for the purpose of obtaining regulatory approvals) by Ixion
or by a licensee, affiliate, or agent of Ixion, Ixion shall, at its sole cost
and expense, procure and maintain policies of comprehensive general liability
insurance naming the Indemnitees as additional insureds. Such comprehensive
general liability insurance shall provide (a) product liability coverage, and
(b) broad form contractual liability coverage for Ixion's indemnification
under sections 8.1 and 8.2 above. If Ixion elects to self-insure, such self-
insurance program must be acceptable to UFRFI.
8.4 Ixion shall provide UFRFI with written evidence of such insurance
upon request, and shall provide UFRFI with written notice at least 45 days
prior to the cancellation, non-renewal, or material change in such
comprehensive general liability insurance; if Ixion does not obtain
replacement insurance providing comparable coverage within such 45 day period,
UFRFI shall have the right to terminate this Agreement.
8.5 Ixion shall maintain such comprehensive general liability
insurance beyond the expiration or termination of this Agreement during (a)
the period that any product, process, or service, relating to, or developed
pursuant to, this Agreement is being commercially distributed or sold (other
than for the purpose of obtaining regulatory approvals) by Ixion or by a
licensee, affiliate, or agent of Ixion, and (b) a reasonable period after the
period referred to in section 8.5 (a) above, which in no event shall be less
than 15 years.
8.6 In the event any such action is commenced or claim made or
threatened against UFRFI or other Indemnitees as to which Ixion is obligated
to indemnify it or them or hold it or them harmless, UFRFI or the other
Indemnitees shall promptly notify Ixion of such event. Ixion shall assume the
defense of, and may settle, that part of any such claim or action or made
against UFRFI (or other Indemnitee) which relates to Ixion's indemnification
and Ixion may take such other steps as may be necessary to protect itself.
Ixion shall not be liable to UFRFI or other Indemnitees on account of any
settlement of any such claim or litigation affected without Ixion's consent.
The right of Ixion to assume the defense of any action shall be limited to
that part of the action commenced against UFRFI or other Indemnitees which
relates to Ixion's obligation of indemnification.
ARTICLE IX - DISCLAIMER OF WARRANTIES
9.1 EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, UFRFI MAKES
NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR
IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS
FOR A PARTICULAR PURPOSE, AND VALIDITY OF PATENT RIGHTS CLAIMS, ISSUED OR
PENDING.
9.2 UFRFI DOES NOT WARRANT THE VALIDITY OF THE PATENT RIGHTS LICENSED
HEREUNDER AND MAKES NO REPRESENTATION WHATSOEVER WITH REGARD TO THE SCOPE OF
THE LICENSED PATENT RIGHTS OR THAT SUCH PATENT RIGHTS MAY BE EXPLOITED BY
IXION OR ANY AFFILIATE OR SUBLICENSEE WITHOUT INFRINGING OTHER PATENTS.
ARTICLE X - EXPORT CONTROLS
Ixion hereby agrees that it shall not sell, transfer, export or reexport
any Licensed Products, Licensed Processes, Licensed Know-How, or related
information in any form, or any direct products of such information, except in
compliance with all applicable laws, including the export laws of any U.S.
government agency and any regulations thereunder, and will not sell, transfer,
export or reexport any such Licensed Products, Licensed Processes, Licensed
Know-How, or information to any persons or any entities with regard to which
there exist grounds to suspect or believe that they are violating such laws.
Ixion shall be solely responsible for obtaining all licenses, permits, or
authorizations required from the United States and any other government for
any such export or reexport. To the extent not inconsistent with this
Agreement, UFRFI agrees to provide Ixion with such assistance as it may
reasonably request in obtaining such licenses, permits, or authorization.
ARTICLE XI - NON-USE OF NAMES
11.1 Ixion shall not use the names of the University or UFRFI nor of
any of either institution's employees, nor any adaptation thereof, in any
advertising, promotional, or sales literature without prior written consent
obtained from UFRFI in each case (such consent not to be unreasonably
withheld), except that Ixion may state that it is licensed by UFRFI under one
or more of the patents and/or applications comprising the Patent Rights.
Requests for consent from UFRFI or the University shall be sent to the
President of UFRFI with a copy to the Director of the Office of Patent,
Copyright and Technology Licensing. UFRFI and the University shall not use the
name of Ixion or its employees, directors, or agents, in any press or
publicity release without prior written consent from the Chairman or President
of Ixion (such consent not to be unreasonably withheld), except that the
University or UFRFI may state that Ixion has been licensed under one or more
of the patents or applications comprising the Patent Rights. Notwithstanding
the foregoing, the University and UFRFI consent to references to them pursuant
to any requirements of applicable law or governmental regulations, provided
that, in the event of any such disclosure, Ixion shall afford UFRFI or the
University the prior opportunity to review the text of such disclosure. Ixion
shall use its best efforts to comply with any reasonable requests by the
University or UFRFI regarding changes.
11.2 Where consent of a party is required under this Article XI, such
consent shall be deemed granted if no written objection (or oral objection,
confirmed immediately in writing) is received by the requesting party on or
before the tenth calendar day following the date a written request for consent
was received by the requested party. For the purposes of this Article XI
only, a item shall be deemed received as follows: (a) if hand delivered, upon
delivery; (b) if sent by electronic mail, upon confirmation by the sending
carrier that the message was deposited to the addressee's mailbox; (c) if sent
by registered mail, return receipt requested, upon signing by the receiving
party; or (d) if sent by ordinary mail in the United States, postage prepaid,
and addressed as set forth in Article XIV, on the fifth calendar day after
deposit in the mail.
ARTICLE XII - ASSIGNMENT
This Agreement is not assignable and any attempt to do so shall be void.
ARTICLE XIII - TERMINATION
13.1 If Ixion shall cease to carry on its business, this Agreement
shall terminate upon notice by UFRFI.
13.2 Should Ixion fail to pay UFRFI royalties due and payable
hereunder, UFRFI shall have the right to terminate this Agreement on 60 days'
notice, unless Ixion shall pay UFRFI within the 60-day period, all such
royalties and interest due and payable. Upon the expiration of the 60-day
period, if Ixion shall not have paid all such royalties and interest due and
payable, the rights, privileges, and license granted hereunder shall
terminate.
13.3 Upon any material breach or default of this Agreement by Ixion,
other than those occurrences set out in sections 13.1 and 13.2 above, which
shall always take precedence in that order over any material breach or default
referred to in this section 13.3, UFRFI shall have the right to terminate this
Agreement and the rights, privileges, and license granted hereunder by 90
days' notice to Ixion. Such termination shall become effective unless Ixion
shall have cured any such breach or default prior to the expiration of the 90-
day period.
13.4 Ixion shall have the right to terminate this Agreement at any
time
on 90 days' written notice to UFRFI, and upon payment of all amounts due UFRFI
through the effective date of the termination.
13.5 Upon termination of this Agreement for any reason, nothing
herein
shall be construed to release either party from any obligation that matured
prior to the effective date of such termination. Ixion and any sublicensee
thereof may, however, after the effective date of such termination, sell all
Licensed Products, and complete Licensed Products in the process of
manufacture at the time of such termination and sell the same, provided that
Ixion shall pay to UFRFI the royalties thereon as required by Article IV of
this Agreement and shall submit the reports required by Article V hereof on
the sales of Licensed Products.
13.6 Upon termination of this Agreement for any reason, any
sublicense
not then in default shall continue in full force and effect except that UFRFI
shall be substituted in place of the sublicensor; provided, however, that the
extent of UFRFI's obligations under such sublicense shall be consistent with
(and not exceeding) its obligations under this Agreement.
13.7 Bankruptcy.
(a) Notice of Assumption or Rejection.
(i) In the event that either party files or has filed
against it a petition under the Federal Bankruptcy Code (11 U.S.C. ss 1, et
seq.) (the "Bankruptcy Code"), is adjudged bankrupt, or files or has filed
against it a petition for reorganization or arrangement under any law relating
to bankruptcy or similar laws for the protection of debtors, whether under the
laws of the United States and its political subdivisions or otherwise, such
party shall (1) notify the other party thereof within ten days
after the filing of such petition or such adjudication, and (2), within 30
days after the filing of such petition, shall notify the other party of the
party's assumption or rejection of this Agreement, and shall file a petition
with the appropriate court for approval of all other action as may be
necessary to obtain the approval of such petition and of such assumption or
rejection.
(ii) If such party does not: (1) within
thirty (30) days after the occurrence of any of the
foregoing events, notify the other party of its
assumption or rejection of this Agreement or file the
petition, or (2) thereafter diligently take all other
action necessary for the approval of the foregoing
petition or of such assumption or rejection, such
party shall be deemed to have rejected this Agreement.
Each party acknowledges that, for purposes of Section
365 of the Bankruptcy Code and similar provisions of
any other or future similar laws relating to any
party's assumption or rejection of any executory
contract, a period of 30 days after the date of any
filing or adjudication described above shall
constitute a reasonable time in which such party shall
assume or reject this Agreement and a party shall be
deemed to have not diligently taken all action
necessary for the approval of the foregoing petition
or of such assumption or rejection if such petition,
assumption or rejection is not approved by the
appropriate court within 60 days after the filing of
the petition for such assumption or rejection.
(b) Conditions to Assumption.
No election by any party, or any successor-in-
interest to such party, to assume this Agreement as
contemplated by Section (a) above shall be effective unless
each of the following conditions, each of which each party
acknowledges is commercially reasonable in the context of a
bankruptcy or similar proceeding, has been satisfied by such
party and each of the other parties has acknowledged such
satisfaction in writing:
(1) Cure. Such party has cured, or has
provided the other party adequate assurances that:
(A) Monetary Defaults.
Within ten days from the date of such assumption
such party will cure all monetary defaults under
this Agreement; and
(B) Non-Monetary Defaults.
Within 30 days from the date of such assumption
such party will cure all non-monetary defaults
under this Agreement.
(2) Pecuniary Loss. Such party has
compensated or has provided to the other party
adequate assurances that within ten days from the date
of assumption the other party will be compensated for
any pecuniary loss incurred by the party arising from
any default of such party under this Agreement prior
to the assumption.
(3) Future Performance. Such party has
provided the other party with adequate assurances of
the future performance of such party's obligations
under this Agreement.
(c) Termination.
This Agreement shall terminate upon the
rejection of this Agreement as contemplated by this Section
by any party or successor-in-interest thereto.
(d) No Transfer.
Neither any party's interest in this Agreement
nor any portion thereof shall pass to any trustee, receiver,
or assignee for the benefit of creditors, or any other
person or entity or otherwise by operation of law under the
Bankruptcy Code or the insolvency laws of any state having
jurisdiction of the person or property of such party unless
the other party shall consent to such transfer in writing.
ARTICLE XIV - PAYMENTS, NOTICES AND OTHER COMMUNICATIONS
Any payment, notice or other communication pursuant to this Agreement
shall be sufficiently made or given on the date of mailing if sent to such
party by certified first class mail, postage prepaid, addressed to it at its
address below or as it shall designate by written notice given to the other
party:
In the case of UFRFI:
President
University of Florida Research Foundation, Inc.
223 Grinter Hall
Gainesville, Florida 32611
With a copy to:
Director
Office of Patent, Copyright and Technology Licensing
186 Grinter Hall
Gainesville, Florida 32611
All payments to:
Director
Office of Patent, Copyright and Technology Licensing
186 Grinter Hall
Gainesville, Florida 32611
PLEASE MAKE ALL CHECKS PAYABLE TO:
University of Florida Research Foundation, Inc.
223 Grinter Hall
Gainesville, Florida 32611
In the case of Ixion:
President
Ixion Biotechnology, Inc.
One Progress Blvd., Box 26
Alachua, FL 32615
ARTICLE XV - MISCELLANEOUS PROVISIONS
15.1 This Agreement shall be construed, governed, interpreted, and
applied in accordance with the laws of the State of Florida, except that
questions affecting the construction and effect of any patent shall be
determined by the law of the country in which the patent was granted.
15.2 The parties hereto acknowledge that this Agreement sets forth
the
entire agreement and understanding of the parties hereto as to the subject
matter hereof, and shall not be subject to any change or modification except
by the execution of a written instrument subscribed to by the parties hereto.
15.3 The provisions of this Agreement are severable, and in the event
that any provisions of this Agreement shall be determined to be invalid or
unenforceable under any controlling body of the law, such invalidity or
unenforceability shall not in any way affect the validity or enforceability of
the remaining provisions hereof.
15.4 Ixion agrees to mark the Licensed Products sold in the United
States with all applicable United States patent numbers. All Licensed
Products shipped to or sold in other countries shall be marked in such a
manner as to conform with the patent laws and practice of the country of
manufacture or sale.
15.5 The failure of either party to assert a right hereunder or to
insist upon compliance with any term or condition of this Agreement shall not
constitute a waiver of that right or excuse a similar subsequent failure to
perform any such term or condition by the other party.
15.6 (a) Anything in this Agreement to the contrary notwithstanding,
any and all knowledge, know-how, practices, process or other information of
any kind and in any form (hereinafter referred to as "Confidential
Information") disclosed or submitted, either orally, in writing or in other
tangible or intangible form which is designated as Confidential Information,
to either party by the other shall be received and maintained by the receiving
party in strict confidence and shall not be disclosed to any third party,
except that Ixion may disclose Confidential Information (pursuant to written
confidentiality agreements) to its lawyers, accountants, advisors, investors,
and potential investors. Furthermore, neither party shall use the said
Confidential Information for any purpose other than those purposes specified
in this Agreement. The parties may disclose Confidential Information to the
minimum number of its employees reasonably requiring access thereto for the
purposes of this Agreement provided, however, that prior to making any such
disclosures each such employee shall be apprised of the duty and obligation to
maintain Confidential Information in confidence and not to use such
information for any purpose other than in accordance with the terms and
conditions of this Agreement.
(b) Nothing contained herein will in any way restrict or impair
either parties right to use, disclose, or otherwise deal with any Confidential
Information which at the time of its receipt:
(i) Is generally available in the public domain, or thereafter
becomes available to the public through no act of the receiving party; or
(ii) Was independently known prior to receipt thereof, or made
available to such receiving party as a matter of lawful right by a third
party.
IN WITNESS WHEREOF, the parties have hereunto set their hands and seals
and duly executed this Agreement as of the day and year first set forth above.
University of Florida Research Foundation, Inc. Ixion Biotechnology, Inc.
By By
Weaver H. Gaines
Chairman and Chief Executive Officer
Acknowledged and Understood:
Ammon B. Peck, Ph. D.
APPENDIX A
UF Case No. UF# -1256
"In vitro-grown Islets of Langerhan for curing diabetes"
Patent Application "In Vitro Growth of Functional Islets of Langerhan," USSN
08/234,071,
By Ammon B. Peck, Ph. D., filed April 28, 1994
APPENDIX B
Foreign countries in which Patent Rights shall be filed, prosecuted and
maintained in accordance with Article VI:
For UF Case No. UF# - 1256
NOTE: Certain portions of this document have been omitted based on a request
for confidential treatment. The non-public information has been filed
with the Securities and Exchange Commission. Omitted portions are
designated with asterisks ("*").
This Amendment No. 1 dated October 9, 1996, is between the
University of Florida Research Foundation, Inc., a not-for-profit
corporation duly organized and existing under the laws of the
State of Florida and having its principal office at 223 Grinter
Hall, Gainesville, Florida, 32611-2037 ("UFRFI"), and Ixion
Biotechnology, Inc., a corporation duly organized under the laws
of Delaware, and having its principal office at 12085 Research
Drive, Alachua, Florida 32615 ("Ixion").
WITNESSETH
WHEREAS, UFRFI and Ixion entered into a License Agreement
dated February 17, 1995, relating to UF Case No. UF# -1256 "In
vitro-grown Islets of Langerhans for curing diabetes" and the
parent patent application"In Vitro Growth of Functional Islets of
Langerhans," USSN 08/234,071, filed April 28, 1994 (the "License
Agreement") and
WHEREAS, UFRFI and Ixion desire to amend such License
Agreement to the benefit of both parties;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants contained herein the parties agree to Amendment
No. 1 as follows:
1. The definitions used in Amendment No. 1 shall be the
definitions set forth in the License Agreement unless otherwise
indicated.
2. Amend section 1.6 by deleting the words "and its
sublicensees'" such that section 1.6 reads as follows:
1.6 "Net Sales" means Ixion's gross sales from the
sale or lease of Licensed Products and Licensed Processes
produced hereunder less the sum of the following:
(a) discounts allowed in amounts customary in the
trade and brokers' or agents' commissions, if
any, allowed and paid to independent parties in
arms-length transactions;
(b) excise, value-added, or sales taxes, tariff
duties or use taxes directly imposed and with
reference to particular sales;
(c) outbound transportation prepaid or allowed;
(d) amounts allowed or credited on returns; and
(e) packing costs and insurance costs if itemized
separately.
No deductions shall be made for commissions paid to
individuals regularly employed by Ixion and on its payroll,
or for cost of collections. Licensed Products shall be
considered "sold" when invoiced.
3. Amend section 4.1(c) by deleting the words "or its
sublicensees" such that section 4.1(c) reads as follows:
(c) A Running Royalty in an amount equal to ******** of
the Net Sales of the Licensed Products or Licensed Processes
used, leased, or sold by or for Ixion; and
4. Add a new section 4.1 (d) as follows:
(d) Sublicense Royalty in an amount equal to **************
of the sublicense revenue received by Ixion.
Sublicense revenue received by Ixion shall mean revenue in
the form of license fees, royalties, or other direct
consideration (such as milestone payments made by a
sublicensee), but not research support or collaboration fees
from sublicensees; and
5. Renumber old section 4.1 (d) and amend it as follows:
(e) A further ******** upon the filing with the FDA of an
application for a Product License Approval relating to a
Licensed Product or Process, or the expiration of 24 months
from the Effective Date, whichever is later. Such milestone
payment is in addition to any Running Royalties due under
section 4.1(c) or Sublicensee Royalty due under section
4.1(d) above.
6. Appendix A is amended to read, in its entirety, as attached.
7. Appendix B is amended to read, in its entirety, as attached.
IN WITNESS WHEREOF, the parties have hereunto set their hands and seals
and duly executed this Agreement as of the day and year first set forth above.
University of Florida Research Foundation, Inc. Ixion Biotechnology,
Inc.
By By
Dr. Karen A.
Holbrook Weaver H. Gaines
President Chairman and Chief
Executive Officer
APPENDIX A
UF Case No. UF# -1256
"In vitro-grown Islets of Langerhans for curing diabetes"
Patent Application "In Vitro Growth of Functional Islets of Langerhans," USSN
08/234/071
By Ammon B. Peck, Ph.D., filed April 28, 1994
UF Case No. UF# 1376 "In Vitro Growth of Functional Islets of Langerhans and
In Vivo Uses Thereof,"
Patent Application "In Vitro Growth of Functional Islets of Langerhans and In
Vivo Uses Thereof," USSN 08/432,434, by Ammon B. Peck, filed April 28, 1995
UF Case No. UF# - UF Case No. UF# 1484 "In Vitro Growth of Functional Islets
of Langerhans and In Vivo Uses Thereof"
Patent Application "In Vitro Growth of Functional Islets of Langerhans and In
Vivo Uses Thereof," USSN 08/546,746, by Ammon B. Peck, filed October 25, 1995
APPENDIX B
Foreign countries in which Patent Rights shall be filed, prosecuted, and
maintained in accordance with Article VI
UF Case No. # -1376 PCT US95/05303 "In Vitro Growth of Functional Islets of
Langerhans and In Vivo Uses Thereof, "
Publ. No. WO 95/29988
All subsequent national and PCT filings for applications appearing in Appendix
A.
NOTE: Certain portions of this document have been omitted based on a request
for confidential treatment. The non-public information has been filed
with the Securities and Exchange Commission. Omitted portions are
designated with asterisks ("*").
PREAMBLE
This Agreement is made this 23rd day of June 1997, (the "Effective
Date") between Milton J. Allison of Ames, Iowa on behalf of himself and as
sole Trustee of the Milton J. Allison Revocable Trust, an Iowa Trust arising
out of a revocable trust agreement dated May 17, 1994 (collectively and
individually referred to hereafter as "Licensor") and Ixion Biotechnology,
Inc., a corporation duly organized under the laws of Delaware, and having its
principal office at 12085 Research Drive, Alachua, Florida 32615 ("Ixion").
WITNESSETH
WHEREAS, Licensor is the inventor of a discovery disclosed in the United
States Department of Agriculture, Agricultural Research Service ("ARS"),
Invention Disclosure No. 0172.95, dated July 11, 1995, entitled
"Administration of Cells of Oxalobacter Formigenes to the Human Intestinal
Tract to Minimize Absorption of Oxalic Acid," and the associated provisional
patent application entitled "Materials and Methods for Treating or Preventing
Oxalate Related Disease" filed May 23, 1997, and has the right to grant
licenses under his Patent Rights (described below), subject only to a
nonexclusive, nontransferable, irrevocable, paid-up license to practice the
invention or have the invention practiced throughout the world by or on behalf
of the United States Government; and
WHEREAS, on August 16, 1996, Licensor applied to ARS, his former
employer, to retain ownership of patent rights in the subject invention; and
WHEREAS, on November 15, 1996, ARS stated that the record showed no
interest on the part of the Government in applying for patent protection or in
commercializing the subject invention and that, therefore, the Licensor was
entitled to retain ownership of patent rights with regard to human health,
subject to the license to the Government referred to above; and
WHEREAS, on June 23, 1997, Milton J. Allison assigned all his right
title and interest in the above discovery and provisional patent to the Milton
J. Allison Revocable Trust, Milton J. Allison, sole Trustee; and
WHEREAS, Licensor desires to have the Patent Rights utilized and is
willing to grant a license thereunder; and
WHEREAS, Ixion desires to obtain a license under the Patent Rights upon
the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein the parties agree as follows:
ARTICLE I - DEFINITIONS
The following words and phrases have the following meanings:
1.1 "Inventor" means Milton J. Allison, Ph.D.
1.2 "Ixion" means any of the following:
(a) Ixion or a related company of Ixion, the voting
stock of which is directly or indirectly at least 50% owned
or controlled by Ixion;
(b) an organization which directly or indirectly
controls more than 50% of the voting stock of Ixion; and
(c) an organization, the majority ownership of which
is directly or indirectly common to the ownership of Ixion.
1.3 "Licensed Know-How" means any technical data, information, or
knowledge within the knowledge and possession of the Inventor at any time
which is incorporated in or becomes part of the Patent Rights.
1.4 "Licensed Product" means any product or part thereof which:
(a) is covered in whole or in part by an issued,
unexpired claim or a pending claim contained in the Patent
Rights in the country in which any Licensed Product is made,
used, or sold;
(b) is manufactured by using a process which is
covered in whole or in part by an issued, unexpired claim or
a pending claim contained in the Patent Rights in the
country in which any Licensed Process is used or in which
such product or part thereof is used or sold.
1.5 "Licensed Process" means any process which is covered in whole or
in part by an issued, unexpired claim or a pending claim contained in the
Patent Rights.
1.6 "Net Sales" means Ixion's, and its sublicensees' gross sales from
the sale or lease of Licensed Products and Licensed Processes produced
hereunder less the sum of the following:
(a) discounts allowed and brokers' or agents'
commissions, if any, allowed and paid;
(b) excise, value-added, or sales taxes, tariff
duties or use taxes directly imposed and with reference to
particular sales;
(c) outbound transportation prepaid or allowed;
(d) amounts allowed or credited on returns; and
(e) packing costs and insurance costs if itemized
separately.
Licensed Products shall be considered "sold" when payment is received.
1.7 "Patent Rights" means all of the following Licensor intellectual
property:
(a) the United States and foreign patents, patent
applications, or provisional patent applications listed in
Appendices A and B;
(b) United States and foreign patents issued from
the applications listed in Appendices A and B and from
divisionals, continuations, and continuations-in-part of
these applications;
(c) claims of all foreign patent applications, and
of the resulting patents, which are directed to subject
matter specifically described in the United States patents
and/or patent applications described in (a) or (b) above;
and
(d) any reissues of United States patents described
in (a) or (b) above.
1.8 "Territory" means all the countries of the world.
ARTICLE II - GRANT
2.1 Licensor grants to Ixion the exclusive right and license to make,
have made, use, lease, and sell the Licensed Products, and to practice the
Licensed Processes and the Licensed Know-How, in the Territory to the end of
the term for which the Patent Rights are granted or the expiration date of the
last to expire patent hereunder, whichever is later, unless sooner terminated
according to the terms hereof.
2.2 Licensor shall not grant any other license to make, have made,
use, lease, or sell Licensed Products or to utilize Licensed Processes during
the period of time commencing with the Effective Date of this Agreement and
terminating with the expiration or termination of this Agreement.
2.3 Licensor reserves the right to practice under the Patent Rights
for his own noncommercial research purposes.
2.4 Ixion may sublicense others under this Agreement. Each
sublicense
shall be consistent with the terms of this Agreement.
2.5 Any sublicenses granted by Ixion shall provide that the
obligations to Licensor of this Agreement shall be binding upon the
sublicensee as if it were a party to this Agreement. Ixion shall attach
copies of this Agreement to sublicense agreements.
2.6 Ixion shall forward to Licensor a copy of any sublicense
agreement
within 30 days of its execution and further shall forward to Licensor annually
a copy of such reports received by Ixion from its sublicensees during the
preceding twelve-month period under the sublicenses as shall be pertinent to a
royalty accounting under said sublicenses.
2.7 The license granted hereunder shall not be construed to confer
any
rights upon Ixion by implication, estoppel, or otherwise as to any technology
not specifically set forth herein.
ARTICLE III - COMMERCIAL DUE DILIGENCE
3.1 Ixion shall use commercially reasonable efforts to bring one or
more Licensed Products or Licensed Processes to market through a program
intended to attain commercialization of Licensed Products and Licensed
Processes.
ARTICLE IV - ROYALTIES
4.1 For the rights, privileges and, license granted hereunder, Ixion
shall pay royalties to Licensor to the end of the term of the Patent Rights or
the expiration date of the last to expire patent hereunder, whichever is
later, unless sooner terminated according to the terms hereof, as follows:
(a) A License Issue Fee of an amount equal to any
out-of-pocket costs of patenting incurred by Licensor prior
to the Effective Date, such fee to be paid within 30 days of
the receipt of an invoice therefor by Ixion;
(b) An Additional License Issue Fee of ********, due
immediately upon the execution of this Agreement;
(c) A Running Royalty in an amount equal to ***** of
the Net Sales of the Licensed Products or Licensed Processes
used, leased, or sold by or for Ixion or its sublicensees.
4.2 No multiple royalties shall be payable because any Licensed
Product, its manufacture, use, lease, or sale are or shall be covered by more
than one Patent Rights patent application or Patent Rights patent licensed
under this Agreement.
4.3 Royalty payments shall be paid in United States dollars in
Gainesville, Florida or at such other place as Licensor may reasonably
designate in writing consistent with the laws and regulations controlling in
any foreign country. If any currency conversion shall be required in
connection with the payment of royalties hereunder, such conversion shall be
made by using the exchange rate prevailing at the Chase Manhattan Bank (N.A.)
on the last business day of the calendar quarterly reporting period to which
such royalty payments relate.
4.4 In the event the royalties set forth herein are higher than the
maximum royalties permitted by the law or regulations of a particular country,
the royalty payable for sales in such country shall be equal to the maximum
permitted royalty under such law or regulations. Notice of said event shall
be provided to Licensor. Ixion shall notify Licensor, in writing, within 90
days of discovering that such royalties are approaching or have reached the
maximum amount, and shall provide Licensor with written documentation
regarding the laws or regulations establishing such maximum.
4.5 In the event that any taxes, withholding or otherwise, are levied
by any taxing authority in connection with accrual or payment of any royalties
payable by Ixion under this Agreement, and Ixion determines in good faith that
it must pay such taxes, Ixion shall have the right to pay such taxes to the
local tax authorities on behalf of Licensor and payment of the net amount due
after reduction by the amount of such taxes, shall fully satisfy Ixion's
royalty obligations under this Agreement. Ixion shall provide Licensor with
appropriate receipts or other documentation supporting such payment. Ixion
shall inform Licensor in writing, within 90 days of notification that taxes
will or have been levied by a taxing authority.
4.6 In the event that a Licensed Product is sold in a combination
package or kit containing other active products, then Net Sales for purposes
of determining royalty payments on the combination package, shall be
calculated using one of the following methods, but in no event shall the
royalties payable to Licensor be reduced to less than 25% of that provided for
in Section 4.1 above:
(a) by multiplying the net selling price of that combination
package by the fraction A/A+B, where A is the gross selling price,
during the royalty-paying period in question, of the Licensed
Product sold separately, and B is the gross selling price during
the royalty period in question, of the other active products sold
separately; or
(b) in the event that no such separate sales are made of the
Licensed Product or any of the active products in such combination
package during the royalty-paying period in question, Net Sales
for the purposes of determining royalty payments, shall be
calculated by dividing the net selling price of the combination
package by the number of functions performed by the combination
package sold where such package contains active agents other than
those licensed under this Agreement. The parties recognize that
this provision will require consultation and that in the event a
combination package or kit circumstance arises, the parties will
negotiate in good faith to determine the calculation of Net Sales
pursuant to this section.
4.7 If it is necessary for Ixion to take any license(s) in any given
country, under third-party patents in order to practice the Licensed Processes
or produce the Licensed Products in that country, then Ixion can deduct up to
50% of the royalties otherwise due under this Agreement for Net Sales in that
country, until such time as Ixion has recovered an amount equal to the
royalties payable to such third parties.
ARTICLE V - REPORTS AND RECORDS
5.1 Ixion shall keep accurate books of account for the purpose of
showing the amounts payable to Licensor hereunder. Said books of account
shall be kept at Ixion's principal place of business or the principal place of
business of the appropriate division of Ixion to which this Agreement relates.
Said books and the supporting data shall be open at all reasonable times for
one year following the end of the calendar year to which they pertain, to the
inspection of Licensor or its agents at Licensor's expense for the purpose of
verifying Ixion's royalty statements.
5.2 Ixion, within 45 days after December 31 of each year, shall
deliver to Licensor accurate reports, giving such particulars of the business
conducted by Ixion and its sublicensees during the preceding twelve-month
period under this Agreement as shall be pertinent to a royalty accounting
hereunder. These shall include at least the following:
(a) number of Licensed Products manufactured and
sold;
(b) total billings for Licensed Products sold;
(c) an accounting for all Licensed Processes used or
sold;
(d) deductions applicable to a determination of Net
Sales;
(e) total royalties due; and
(f) names and addresses of all sublicensees of
Ixion.
5.3 With each such report submitted, Ixion shall pay to Licensor the
royalties due and payable under this Agreement. If no royalties shall be due,
Ixion shall so report.
5.4 On or before the 90th day following the close of Ixion's fiscal
year, Ixion shall provide Licensor with Ixion's year-end balance sheet and an
operating statement for the preceding fiscal year then ended.
5.5 The royalty payments, license fees, and reimbursement for patent-
related expenses set forth in this Agreement shall, if overdue, bear interest
until payment at the monthly rate of 1.0%. The payment of such interest shall
not foreclose Licensor from exercising any other rights it may have as a
consequence of the lateness of any payment.
ARTICLE VI - PATENT PROSECUTION
6.1 Ixion shall apply for, seek issuance of, and maintain during the
term of this Agreement the Patent Rights in the United States and in the
foreign countries listed in Appendix B hereto to the extent, in its sole
discretion, it deems such actions commercially reasonable. Licensor shall have
reasonable opportunities to advise Ixion and shall cooperate with Ixion in
such prosecution, filing, and maintenance.
6.2 Payment of all fees and costs relating to the filing,
prosecution,
and maintenance of the Patent Rights shall be the responsibility of Ixion
after the Effective Date.
ARTICLE VII - INFRINGEMENT
7.1 Licensor shall inform Ixion promptly in writing of any alleged
infringement of the Patent Rights by a third party and of any available
evidence thereof.
7.2 During the term of this Agreement, Ixion shall have the right,
but
shall not be obligated, to prosecute at its own expense any such infringements
of the Patent Rights. If Ixion prosecutes any such infringement, Licensor
agrees that Ixion may include Licensor as a co-plaintiff in any such suit,
without expense to Licensor. The total cost of any such infringement action
commenced or defended solely by Ixion shall be borne by Ixion and Ixion shall
keep any recovery or damages for past infringement derived therefrom.
7.3 If within six months after having been notified of any alleged
infringement or such shorter time proscribed by law, Ixion shall have been
unsuccessful in persuading the alleged infringer to desist or shall not have
brought and shall not be diligently prosecuting an infringement action, or if
Ixion shall notify Licensor at any time prior thereto of its intention not to
bring suit against any alleged infringer, then, and in those events only,
(a) Licensor shall have the right, but shall not be obligated,
to prosecute at its own expense any infringement of the Patent
Rights (keeping any recovery or damages for past infringements
derived therefrom), and Licensor may, for such purposes, use the
name of Ixion as co-plaintiff. No settlement, consent judgment,
or other voluntary final disposition of the suit may be entered
into without the consent of Ixion, which consent shall not
unreasonably be withheld. Licensor shall indemnify Ixion against
any order for costs that may be made against Ixion in such
proceedings.
(b) Payments which are earned under Article IV hereof shall be
waived so long as any such infringement which the parties agree in
good faith is material continues, such waiver not to exceed 75% of
the royalties payable hereunder.
7.4 If Licensor has brought a suit pursuant to section 7.3 above, it
shall have the right for such purpose to join Ixion as a co-plaintiff at
Ixion's expense. Ixion independently shall have the right to join any such
suit or action brought by Licensor, and, in such event, shall pay one-half of
the cost of such suit or action from the date of joining. Any damages
recovered by a suit or action in which Ixion has paid its share of costs shall
be first used to reimburse each party hereto for the cost of such suit or
action (including attorney's fees) actually paid by each party hereto as the
case may be, then to reimburse Licensor for any payments waived under this
Section 7.4, and the residue, if any, shall be divided equally between the
parties hereto.
7.5 In the event that a declaratory judgment action alleging
invalidity or noninfringement of any of the Patent Rights shall be brought
against Ixion, Licensor, at its option, shall have the right, within 30 days
after commencement of such action, to intervene and take over the sole defense
of the action at its own expense.
7.6 In any infringement suit as either party may institute to enforce
the Patent Rights pursuant to this Agreement, the other party hereto shall, at
the request and expense of the party initiating such suit, cooperate in all
respects and, to the extent possible, have its employees testify when
requested and make available relevant records, papers, information, samples,
specimens, and the like.
ARTICLE VIII - PRODUCT LIABILITY
8.1 Ixion shall at all times during the term of this Agreement and
thereafter, indemnify, defend, and hold Licensor harmless against all claims
and expenses, including legal expenses and reasonable attorneys' fees, whether
arising from a third party claim or resulting from Licensor's enforcing this
indemnification clause against Ixion, or arising out of the death of or injury
to any person or persons or out of any damage to property and against any
other claim, proceeding, demand, expense, or liability of any kind whatsoever
resulting from the production, manufacture, sale, use, lease, consumption, or
advertisement of the Licensed Products and/or Licensed Processes or arising
from any right or obligation of Ixion hereunder. This indemnification shall
not apply to any liability, damage, loss, or expense to the extent that it is
attributable to the negligence or intentional wrongdoing of the Licensor.
8.2 At such time as any product, process, or service relating to, or
developed pursuant to, this Agreement is being commercially distributed or
sold (other than for the purpose of obtaining regulatory approvals) by Ixion
or by a licensee, affiliate, or agent of Ixion, Ixion shall, at its sole cost
and expense, procure and maintain policies of comprehensive general liability
insurance naming Licensor as additional insureds. Such comprehensive general
liability insurance shall provide (a) product liability coverage, and (b)
broad form contractual liability coverage for Ixion's indemnification under
sections 8.1 and 8.2 above. Ixion may elect to self-insure.
8.3 Ixion shall provide Licensor with written evidence of such
insurance upon request, and shall provide Licensor with written notice at
least 45 days prior to the cancellation, non-renewal, or material change in
such comprehensive general liability insurance; if Ixion does not obtain
replacement insurance providing comparable coverage within such 45 day period,
Licensor shall have the right to terminate this Agreement.
8.4 Ixion shall maintain such comprehensive general liability
insurance beyond the expiration or termination of this Agreement during (a)
the period that any product, process, or service, relating to, or developed
pursuant to, this Agreement is being commercially distributed or sold (other
than for the purpose of obtaining regulatory approvals) by Ixion or by a
licensee, affiliate, or agent of Ixion, and (b) a reasonable period after the
period referred to in section 8.5 (a) above, which in no event shall be less
than 15 years.
8.5 In the event any such action is commenced or claim made or
threatened against Licensor or other Indemnitees as to which Ixion is
obligated to indemnify it or them or hold it or them harmless, Licensor or the
other Indemnitees shall promptly notify Ixion of such event. Ixion shall
assume the defense of, and may settle, that part of any such claim or action
or made against Licensor (or other Indemnitee) which relates to Ixion's
indemnification and Ixion may take such other steps as may be necessary to
protect itself. Ixion shall not be liable to Licensor or other Indemnitees on
account of any settlement of any such claim or litigation affected without
Ixion's consent. The right of Ixion to assume the defense of any action shall
be limited to that part of the action commenced against Licensor or other
Indemnitees which relates to Ixion's obligation of indemnification.
ARTICLE IX - DISCLAIMER OF WARRANTIES
9.1 EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, LICENSOR
MAKES NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS
OR IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, AND VALIDITY OF PATENT RIGHTS CLAIMS, ISSUED
OR PENDING.
9.2 LICENSOR DOES NOT WARRANT THE VALIDITY OF THE PATENT RIGHTS LICENSED
HEREUNDER AND MAKES NO REPRESENTATION WHATSOEVER WITH REGARD TO THE SCOPE OF
THE LICENSED PATENT RIGHTS OR THAT SUCH PATENT RIGHTS MAY BE EXPLOITED BY
IXION OR ANY AFFILIATE OR SUBLICENSEE WITHOUT INFRINGING OTHER PATENTS.
ARTICLE X - ASSIGNMENT
10.1 This Agreement is not assignable; provided, however, that in the
event that the Milton J. Allison Revocable Trust is revoked or terminated and
the corpus thereof, including this Agreement reverts to Milton J. Allison,
this Agreement shall be assumed by Milton J. Allison.
ARTICLE XI - TERMINATION
11.1 If Ixion shall cease to carry on its business, this Agreement
shall terminate upon notice by Licensor.
11.2 Should Ixion fail to pay Licensor royalties due and payable
hereunder, Licensor shall have the right to terminate this Agreement on 90
days' notice, unless Ixion shall pay Licensor within the 90-day period, all
such royalties and interest due and payable. Upon the expiration of the 90-
day period, if Ixion shall not have paid all such royalties and interest due
and payable, the rights, privileges, and license granted hereunder shall
terminate.
11.3 Upon any material breach or default of this Agreement by Ixion,
other than those occurrences set out in sections 11.1 and 11.2 above, which
shall always take precedence in that order over any material breach or default
referred to in this section 11.3, Licensor shall have the right to terminate
this Agreement and the rights, privileges, and license granted hereunder by 90
days' notice to Ixion. Such termination shall become effective unless Ixion
shall have cured any such breach or default prior to the expiration of the 90-
day period.
11.4 Ixion shall have the right to terminate this Agreement at any
time
on 90 days' written notice to Licensor, and upon payment of all amounts due
Licensor through the effective date of the termination.
11.5 Upon termination of this Agreement for any reason, nothing
herein
shall be construed to release either party from any obligation that matured
prior to the effective date of such termination. Ixion and any sublicensee
thereof may, however, after the effective date of such termination, sell all
Licensed Products, and complete Licensed Products in the process of
manufacture at the time of such termination and sell the same, provided that
Ixion shall pay to Licensor the royalties thereon as required by Article IV of
this Agreement and shall submit the reports required by Article V hereof on
the sales of Licensed Products.
11.6 Upon termination of this Agreement for any reason, any
sublicense
not then in default shall continue in full force and effect except that
Licensor shall be substituted in place of the sublicensor; provided, however,
that the extent of Licensor's obligations under such sublicense shall be
consistent with (and not exceeding) its obligations under this Agreement.
11.7 Bankruptcy.
(a) Notice of Assumption or Rejection.
(i) In the event that either party files or has filed
against it a petition under the Federal Bankruptcy Code (11 U.S.C. 1, et
seq.) (the "Bankruptcy Code"), is adjudged bankrupt, or files or has filed
against it a petition for reorganization or arrangement under any law relating
to bankruptcy or similar laws for the protection of debtors, whether under the
laws of the United States and its political subdivisions or otherwise, such
party shall (1) notify the other party thereof within ten days
after the filing of such petition or such adjudication, and (2), within 30
days after the filing of such petition, shall notify the other party of the
party's assumption or rejection of this Agreement, and shall file a petition
with the appropriate court for approval of all other action as may be
necessary to obtain the approval of such petition and of such assumption or
rejection.
(ii) If such party does not: (1) within
thirty (30) days after the occurrence of any of the
foregoing events, notify the other party of its
assumption or rejection of this Agreement or file the
petition, or (2) thereafter diligently take all other
action necessary for the approval of the foregoing
petition or of such assumption or rejection, such
party shall be deemed to have rejected this Agreement.
Each party acknowledges that, for purposes of Section
365 of the Bankruptcy Code and similar provisions of
any other or future similar laws relating to any
party's assumption or rejection of any executory
contract, a period of 30 days after the date of any
filing or adjudication described above shall
constitute a reasonable time in which such party shall
assume or reject this Agreement and a party shall be
deemed to have not diligently taken all action
necessary for the approval of the foregoing petition
or of such assumption or rejection if such petition,
assumption or rejection is not approved by the
appropriate court within 60 days after the filing of
the petition for such assumption or rejection.
(b) Conditions to Assumption.
No election by any party, or any successor-in-
interest to such party, to assume this Agreement as
contemplated by Section (a) above shall be effective unless
each of the following conditions, each of which each party
acknowledges is commercially reasonable in the context of a
bankruptcy or similar proceeding, has been satisfied by such
party and each of the other parties has acknowledged such
satisfaction in writing:
(1) Cure. Such party has cured, or has
provided the other party adequate assurances that:
(A) Monetary Defaults.
Within ten days from the date of such assumption
such party will cure all monetary defaults under
this Agreement; and
(B) Non-Monetary Defaults.
Within 30 days from the date of such assumption
such party will cure all non-monetary defaults
under this Agreement.
(2) Pecuniary Loss. Such party has
compensated or has provided to the other party
adequate assurances that within ten days from the date
of assumption the other party will be compensated for
any pecuniary loss incurred by the party arising from
any default of such party under this Agreement prior
to the assumption.
(3) Future Performance. Such party has
provided the other party with adequate assurances of
the future performance of such party's obligations
under this Agreement.
(c) Termination. This Agreement shall terminate
upon the rejection of this Agreement as contemplated by this
Section by any party or successor-in-interest thereto.
(d) No Transfer. Neither any party's interest in
this Agreement nor any portion thereof shall pass to any
trustee, receiver, or assignee for the benefit of creditors,
or any other person or entity or otherwise by operation of
law under the Bankruptcy Code or the insolvency laws of any
state having jurisdiction of the person or property of such
party unless the other party shall consent to such transfer
in writing.
ARTICLE XII - PAYMENTS, NOTICES AND OTHER COMMUNICATIONS
12.1 Any payment, notice or other communication pursuant to this
Agreement shall be sufficiently made or given on the date of mailing if sent
to such party by first class mail, postage prepaid, addressed to it at its
address below or as it shall designate by written notice given to the other
party:
In the case of Licensor:
Milton J. Allison, Ph.D.
1434 Linden Drive
Ames, IA 50010
In the case of Ixion:
President
Ixion Biotechnology, Inc.
12085 Research Drive
Alachua, FL 32615
ARTICLE XIII - MISCELLANEOUS PROVISIONS
13.1 This Agreement shall be construed, governed, interpreted, and
applied in accordance with the laws of the State of Florida, except that
questions affecting the construction and effect of any patent shall be
determined by the law of the country in which the patent was granted.
13.2 This Agreement sets forth the entire agreement and understanding
of the parties hereto as to the subject matter hereof, and shall not be
subject to any change or modification except by the execution of a written
instrument subscribed to by the parties hereto.
13.3 The provisions of this Agreement are severable, and in the event
that any provisions of this Agreement shall be determined to be invalid or
unenforceable under any controlling body of the law, such invalidity or
unenforceability shall not in any way affect the validity or enforceability of
the remaining provisions hereof.
13.4 Ixion agrees to mark the Licensed Products sold in the United
States with all applicable United States patent numbers. All Licensed
Products shipped to or sold in other countries shall be marked in such a
manner as to conform with the patent laws and practice of the country of
manufacture or sale.
13.5 The failure of either party to assert a right hereunder or to
insist upon compliance with any term or condition of this Agreement shall not
constitute a waiver of that right or excuse a similar subsequent failure to
perform any such term or condition by the other party.
13.6 (a) Anything in this Agreement to the contrary notwithstanding,
any and all knowledge, know-how, practices, process or other information of
any kind and in any form (hereinafter referred to as "Confidential
Information") disclosed or submitted, either orally, in writing or in other
tangible or intangible form which is designated as Confidential Information,
to either party by the other shall be received and maintained by the receiving
party in strict confidence and shall not be disclosed to any third party,
except that Ixion may disclose Confidential Information (pursuant to written
confidentiality agreements) to its lawyers, accountants, advisors, investors,
and potential investors. Furthermore, neither party shall use the said
Confidential Information for any purpose other than those purposes specified
in this Agreement. The parties may disclose Confidential Information to the
minimum number of its employees reasonably requiring access thereto for the
purposes of this Agreement provided, however, that prior to making any such
disclosures each such employee shall be apprised of the duty and obligation to
maintain Confidential Information in confidence and not to use such
information for any purpose other than in accordance with the terms and
conditions of this Agreement.
(b) Nothing contained herein will in any way restrict or impair
either parties right to use, disclose, or otherwise deal with any Confidential
Information which at the time of its receipt:
(i) Is generally available in the public domain, or thereafter
becomes available to the public through no act of the receiving party; or
(ii) Was independently known prior to receipt thereof, or made
available to such receiving party as a matter of lawful right by a third
party.
13.7 Licensor will use his best efforts to assist Ixion in the
transfer
of the technology represented by the Patent Rights through consultation,
making available experimental data, or otherwise.
13.8 Milton J. Allison, in his capacity as Trustee and as an
individual, agrees that in the event of the revocation of the Milton J.
Allison Revocable Trust, or the return of the corpus of such Trust to the said
Milton J. Allison, this Agreement shall remain in full force and effect and
shall be binding on the said Milton J. Allison as though he and Ixion were the
sole parties hereto.
IN WITNESS WHEREOF, the parties have hereunto set their hands and seals
and duly executed this Agreement as of the day set forth first above.
Milton J. Allison, Ph.D. Ixion Biotechnology, Inc
By
Weaver H. Gaines
Chairman and Chief Executive Officer
Milton J. Allison Revocable Trust
By
Milton J. Allison, Trustee
APPENDIX A
Invention Disclosure No. 0172.95
"Administration of Cells of Oxalobacter Formigenes to the Human Intestinal
Tract to Minimize Absorption of Oxalic Acid"
Provisional Patent Docket No. IXN-100P
"Materials and Methods for Treating or Preventing Oxalate Related Disease."
By Milton J. Allison, Ph. D.
Filed on May 23, 1997
Any Patent Application arising out of or related to the Provisional Patent
Docket No. IXN-100) or Invention Disclosure No. 0172.95
APPENDIX B
Foreign countries in which Patent Rights shall be filed, prosecuted and
maintained in accordance with Article VI:
Patent application arising out of the Provisional Patent Application (or
series of Provisional Patent Applications) shall be filed under the Patent
Cooperation Treaty and such national filings thereafter as Ixion shall
determine.
NOTE: Certain portions of this document have been omitted based on a request
for confidential treatment. The non-public information has been filed
with the Securities and Exchange Commission. Omitted portions are
designated with asterisks ("*").
SPONSORED RESEARCH AGREEMENT
THIS AGREEMENT is made this _____ day of _______________, 1996 ("Effective
Date") between Genetics Institute, Inc., a Delaware Corporation having its
principal place of business at 87 CambridgePark Drive, Cambridge,
Massachusetts 02140 USA ("GI"), and Ixion Biotechnology, Inc., a Delaware
corporation, having its principal place of business at 12085 Research Drive,
Alachua, FL 32615 ("Ixion").
The parties agree as follows:
1. Definitions. The terms are defined as follows:
1.1 "Affiliate" means any person, corporation or other entity which,
directly or indirectly, controls, is controlled by, or is under
common control with a party and "control" shall mean the direct or
indirect ownership of fifty percent (50%) or more of the
outstanding equity of an entity or the right to receive fifty
percent (50%) or more of the profits of an entity or the right to
control an entity. Notwithstanding the foregoing, American Home
Products Corporation, which holds approximately 63% of the
outstanding equity of GI, shall only become an Affiliate of GI
upon the giving of written notice by GI to Ixion.
1.2 "Improvements" shall have the meaning assigned to it in Section
5.1.
1.3 "Invention" means any invention, improvement, discovery, patent
application, patent, trade secret, know-how, biological material,
data, reagent, or other intellectual property, patentable or
unpatentable, first conceived or reduced to practice in the course
of the Project Work. "Ixion Invention" means any Invention made
solely by employees or consultants of Ixion. "GI Invention" means
any Invention made solely by employees or consultants of GI and
"Joint Invention" means any Invention made jointly by both
parties.
1.4 "IPSC Technology" shall have the meaning assigned to it in
Section 2.
1.5 "Know-How" means all technical and other information relating
to, used in, or arising from the Project Work such as (but without
limitation) data, formulae, specifications, procedures, tests,
genes, plasmids, DNA sequences, vectors, clones, cell lines,
cultures, constructions, assay systems, materials and techniques.
1.6 "Patent Rights" means any patents and patent applications owned
or controlled by a party in connection with an Invention or
relating to any Know-How used in the Project Work.
1.7 "Patent License Agreement" means the Patent License Agreement
between Ixion and the University of Florida Research Foundation
attached hereto as Exhibit A, and any amendments thereto.
1.8 "Project Committee" means a joint committee composed of two
members from each party, including Dr. Peck acting as a consultant
or employee on behalf of Ixion and Dr. Wong as an employee of GI.
1.9 "Program Technology" means that portion of the Know-How
generated by a party or by the parties under the Project Work.
1.10 "Project Work" means the research activities to be conducted by
Ixion as described in Schedule A, as amended by written agreement
of the parties from time to time.
1.11 "Research Support Agreement" means the Research Support
Agreement between Ixion and the University of Florida Research
Foundation attached hereto as Exhibit B.
1.12 "ROFR Rights" shall have the meaning assigned to it in Section
5.2.
1.13 "UF Patent Rights" means all of the patent rights licensed to
Ixion from the University of Florida Research Foundation, Inc.
pursuant to the Patent License Agreement and/or the Research
Support Agreement.
2. Background. Dr. Ammon B. Peck has identified a method for growing in
vitro Islet Progenitor/Stem Cells (also known as "Islet Producing Stem
Cells" in the Research Support Agreement) and related technology (the
"IPSC Technology") which are claimed in the UF Patent Rights. GI is
experienced in cloning and expressing novel proteins, and has the
research and technical capabilities to develop, manufacture and market
recombinant proteins for therapeutic use. Ixion has entered into the
Sponsored Research Agreement and the Patent License Agreement with the
University of Florida and the University of Florida Research Foundation
to fund certain further research of the IPSC Technology by Dr. Peck. GI
wishes to sponsor the Project Work at Ixion directed to: (A) validation
of the IPSC Technology and (B) understanding differentiation of
pancreatic stem cells and/or progenitor cells, as further described in
Schedule A. This may result in Inventions by Ixion employees or
consultants, GI employees or consultants, or inventors representing both
parties in which patent applications may be filed under this Agreement.
3. The Sponsored Research.
3.1 The Project Work. Ixion agrees to conduct the Project Work
described in Schedule A. Dr. Peck shall act as an employee or
consultant to Ixion in Ixion's performance of the Project Work
hereunder. The term for performance of the Project Work shall be
twelve (12) months, unless extended pursuant to Section 3.2.
3.2 Extensions. In order to complete the Project Work, GI may, at
its option, extend the term for performance of the Project Work
for up to two (2) additional six month periods by giving notice of
extension no later than ninety (90) days prior to the expiration
of the then-current term of the Project Work. Separate extensions
may be made for cell transplantation work or work relating to the
understanding of differentiation or extensions for both areas may
be made.
3.3 Records, Communication, Access to Facilities. Ixion shall keep
written records and provide written progress reports (as provided
for below in Section 3.4) and communicate regularly to discuss the
progress of the Project Work. Ixion shall keep separate lab
notebooks dedicated solely to the work being performed in the
course of the Project Work. The Project Committee, which shall be
responsible for overseeing the Project Work, shall meet at least
four times annually and ad hoc as necessary. The Project
Committee will approve the plan for Project Work and any revisions
thereto. Each party will allow the other party access to
laboratories and facilities at which the Project Work is being
carried out and to the dedicated lab notebooks and any other
written records relating to the Project Work as may be reasonably
necessary.
3.4 Research Funding. Ixion shall perform the Project Work in
return for the payments set forth below:
(a) ******** upon execution of this Agreement.
(b) ******** upon invoice following receipt of an interim
written progress report at the end of the fourth month of
the Project Work.
(c) ******** upon invoice following receipt of an interim
written progress report at the end of the eighth month of
the Project Work.
(d) ******** upon invoice following receipt of a final (or
interim, in the event of any extension) written progress
report at the end of the twelfth month of the Project Work.
(e) ******** upon invoice at the beginning of each six month
extension of the term of the Project Work relating to
understanding differentiation.
(f) ******** upon invoice following receipt of each final six
month extension report relating to understanding
differentiation.
(g) ******** upon invoice at the beginning of each six month
extension of the term of the Project Work relating to cell
transplantation.
(h) ******** upon invoice following receipt of each final six
month extension report relating to cell transplantation.
4. Intellectual Property.
4.1 Ownership of Intellectual Property. Ixion shall own all Patent
Rights, Program Technology and Inventions developed solely by its
employees or consultants, and/or shall have exclusive license
rights to all Patent Rights, Program Technology and Inventions
developed solely by employees of the University of Florida
conducting sponsored research pursuant to the Research Support
Agreement. GI shall own all Patent Rights, Program Technology and
Inventions developed solely by its employees or consultants.
Ixion and GI shall jointly own all Patent Rights, Program
Technology and Inventions developed jointly by employees or
consultants of Ixion and by employees or consultants of GI.
Promptly after the making of an Invention by any person or persons
engaged in work on the Project Work, each Party shall disclose
full details of such Invention (whether by GI or Ixion), to the
Project Committee and such person shall make available to the
parties to this Agreement all Know-How relating thereto, subject
to the confidentiality and use restrictions contained in this
Agreement. For the purpose of this Section GI employees and
consultants shall be deemed to be "engaged in work on the Project
Work" to the extent such employees or consultants (a) make
scientific contributions to Ixion hereunder, or (b) use Ixion
Confidential Information.
4.2 GI to File Patent Applications. Any patent applications that in
the reasonable business and legal judgment of GI are considered
necessary to protect the proprietary positions of the parties will
be prepared, filed and paid for by GI. Inventorship will be
determined by legal standards and each named inventor will assign
his or her rights to his or her institution or employer. GI will
use all reasonable efforts to provide Ixion copies of relevant
correspondence relating to these applications in sufficient time
for Ixion, at its own expense, to review and comment. Ixion shall
have full rights of consultation with GI's patent counsel with
respect to any patents or patent applications covering Ixion
Inventions or Joint Inventions and GI shall reasonably consider
Ixion's comments and requests made by Ixion with regard to such
patent applications or issued patents. In the event GI does not
exercise its option for an exclusive license pursuant to Section
5.1 regarding Patent Rights in which Ixion has an ownership
interest, Ixion may elect, upon notice to be given to GI within 30
days, to assume responsibility for the prosecution of such Patent
Rights whereupon Ixion shall become obligated to refund to GI the
reasonable costs and expenses GI has incurred in prosecuting,
maintaining or enforcing such Patent Rights. Ixion may reimburse
GI for any of such costs pertaining to Patent Rights owned jointly
by GI and Ixion in cash or stock in Ixion (valued at fair market
value at the time of reimbursement), at Ixion's option.
Reimbursement of GI by Ixion for solely owned Ixion Patent Rights
shall be in cash, on an installment basis over a period not to
exceed thirty-six (36) months. The rate of reimbursement shall
not exceed the costs Ixion would or has generally incurred for
retention of outside patent counsel on similar patent matters. If
Ixion does not elect to assume prosecution of any such Patent
Rights, Ixion shall assign all right, title and interest in such
inventions to GI and GI shall have no further obligations to Ixion
with respect thereto.
4.3 Prosecution of UF Patent Rights. GI will advise and consult
with Ixion regarding the prosecution of the UF Patent Rights and
shall reimburse Ixion for all reasonable expenses incurred by
Ixion after the Effective Date in connection with such prosecution
in the following countries: United States, European Patent
Convention Countries, Japan, Canada, Mexico, Australia, Korea, and
any other country agreed to in writing by GI. In the event that GI
does not exercise its option for an exclusive license pursuant to
Section 5.1, Ixion shall reimburse GI for any such expenses paid
by GI pursuant to this Section 4.3 in cash, on an installment
basis over a period not to exceed thirty-six (36) months.
4.4 Ixion's Right to File Patent Applications. If GI chooses not
to file or maintain in any country an application or patent or
particular claims thereunder on Inventions jointly developed or
solely developed by Ixion, it shall give notice to Ixion and Ixion
will retain the right to file or maintain such application or
patent in that country at Ixion's expense, as long as the parties
have not previously agreed that the absence of a patent in that
country is mutually beneficial. If GI chooses not to file or
maintain any such patent, then the following rules shall apply:
(a) If the Invention is an Ixion Invention, GI shall forfeit
all rights hereunder to such Invention and patent rights in
any country, including without limitation, its rights under
Section 5 hereof, unless GI reimburses Ixion for all of
Ixion's expenses in filing or maintaining such patent rights
in such country.
(b) If the Invention is a Joint Invention, GI shall forfeit
all rights hereunder (and Ixion shall be the sole owner
thereof) to such Invention and patent rights in any country,
including without limitation, its rights under Sections 4.5
and 5 hereof, unless GI reimburses Ixion for one-half (1/2)
of Ixion's expenses in filing or maintaining such patent
rights in such country during the term of this Agreement.
In addition, if GI ceases to pay for one-half of such
expenses after the term of this Agreement, Ixion shall then
become the sole owner of such Invention.
(c) GI shall have the right to decide to reimburse Ixion
pursuant to paragraph (a) or (b) at any time prior to the
expiration of the option period set forth in Section 5.1
(b). In the event GI so reimburses Ixion, then such
Invention and patent rights shall be included in any license
resulting from the procedures set forth in Section 5.
4.5 Joint Invention License. In the event GI fails to exercise its
option for an exclusive license under Section 5.1 and continues to
reimburse Ixion for one-half of the expenses in filing and
maintaining any particular joint patent right, each party hereby
grants to the other party a worldwide, non-exclusive license, with
the right to sublicense, under and to the granting party's
undivided one-half interest in any such Joint Inventions.
5. Option Rights.
5.1 Option and Exercise Fee.
(a) Ixion grants to GI a first option to obtain an exclusive,
worldwide, royalty-bearing license, with the right to
sublicense, to any or all of Ixion's interests (except to
the extent excluded by Section 4.4) in the IPSC Technology,
the UF Patent Rights, Know-How and any improvements made by
Ixion thereto ("Improvements"), including without
limitation, the Program Technology, Patent Rights, Ixion
Inventions, Joint Inventions and other inventions and
developments made by Ixion during the term for performance
of the Project Work (including extensions thereof) and
regardless of whether such improvements are made in the
course of the GI sponsored Project Work; provided, however,
that with respect to Improvements made outside the course of
the Project Work, only Improvements relating to the
treatment of diabetes shall be included. Upon expiration or
termination of the relevant term for performance of the
Project Work or any extension pursuant to Section 3.2, Ixion
shall disclose to GI in reasonable written detail all such
Improvements made outside the course of performing the
Project Work along with delivery of the applicable final
progress report under Section 3.4. Upon request, Ixion
shall also deliver to GI the cell line, or other biological
materials, reasonably necessary, and solely for the purpose
of, evaluating the offer.
(b) GI's option must be exercised by GI by written notice to
Ixion no later than ninety (90) days following receipt by GI
of the applicable final report under Section 3.4, the
supplemental Improvements information under Subsection
5.1(a), and the biological materials requested by GI under
Subsection 5.1(a). GI shall evaluate the offer during such
ninety (90) day period.
(c) No later than ten (10) days following the exercise of the
option by GI, Ixion shall, in good faith, offer commercial
terms to GI for such license. In the event there are
Improvements relating to the treatment of diabetes made by
Ixion other than in performance of the Project Work, such
Improvements shall be offered as a package with the other
rights, and the rights set forth in Section 5.1 (a) without
such Improvements shall also be offered under separately
identifiable terms and conditions. GI and Ixion shall then
diligently negotiate in good faith and with a view to
entering into a definitive license agreement no later than
ninety (90) days following the expiration of the ninety (90)
day evaluation period or receipt of Ixion's offer, whichever
is later.
(d) If Ixion completed the Project Work on or before 12 months
following the Effective Date, GI shall pay Ixion ********
upon exercise of the option.
(e) In addition, in the event Ixion develops any potential use
of the IPSC Technology, the UF Patent Rights, the Know-How,
or the Improvements which is useful in any area other than
the treatment of diabetes ("Non-Diabetes Technology"), then
if Ixion wishes to have such matter separately considered
for licensing hereunder, it may give notice thereof to GI at
any time. If Ixion does not give such notice, the Non-
Diabetes Technology shall be included in the information
disclosed to GI pursuant to paragraph 5.1(a) and will be
subject to paragraphs 5.1(b) and 5.1.(c). If Ixion gives
such separate notice, GI shall have an option to obtain an
exclusive, worldwide, royalty-bearing license, with the
right to sublicense, to any or all of Ixion's interest in
the Non-Diabetes Technology. GI's option under this
Subsection must be exercised by GI by written notice to
Ixion no later than ninety (90) days following receipt by GI
of (a) the applicable notice, and (b) a disclosure in
reasonable detail of such Non-Diabetes Technology
(including, if requested by GI, any cell lines or biological
materials reasonably necessary, and solely for the purpose
of, evaluating the offer), whichever is later. GI shall
evaluate the offer during such ninety-day period. No later
than ten days following the exercise of the option by GI,
Ixion shall offer commercially reasonable terms to GI for a
license to the Non-Diabetes Technology. GI and Ixion shall
then diligently negotiate in good faith with a view to
entering into a definitive license agreement for the Non-
Diabetes Technology no later than ninety (90) days following
the expiration of the ninety (90) day evaluation period or
receipt of Ixion's offer, whichever is later. If the
parties do not enter into an agreement, GI shall have no
further rights with respect to such matter, and Section 5.2
shall not apply thereto.
5.2 Right of First Refusal.
(a) In the event GI and Ixion are unable to reach agreement
and enter into a definitive license agreement within the
ninety (90) day period for negotiation under Section 5.1(c),
then Ixion shall be free to offer such rights to unrelated
third parties subject to the terms of this Section.
Improvements which are made by Ixion other than in
performance of the Project Work are not subject to the
requirements of this Section, and this Section shall only
apply to the other rights required to be offered by Ixion to
GI under Section 5.1 (the "ROFR Rights").
(b) Ixion shall not license a third party to make, have made,
use, sell or distribute, or otherwise commercialize the ROFR
Rights on terms, taken as a whole, which are more favorable
to such third party than the terms last offered to GI. Both
parties recognize that in evaluating the favorability of
licensing terms, numerous factors need to be taken into
account and given appropriate weight, including without
limitation, the amount of upfront payments, the amount and
timing of subsequent payments, the royalty rate(s), the
definition of territory, the purpose and pricing of equity,
the identity, experience and market position of the other
party in the relevant markets, and the contribution of
patent or other intellectual property rights material to the
commercial success of Ixion. Moreover, GI agrees that
patent rights or other consideration that Ixion receives in
return for the rights granted by Ixion should also be
assigned reasonable value. However, if a reasonable person
is unable to compare a proposed offer to a third party to a
prior offer made to GI by Ixion due to differences in the
structure or terms of the offers for the purpose of
determining whether the proposed third party offer is or is
not more favorable to such third party, then Ixion shall
offer GI such new terms to pursuant to Subsection (c),
below.
(c) At any time before signing an agreement with a third party
on terms, taken as a whole, which are (i) more favorable to
such third party than the last offer to GI, or (ii) cannot
be reasonably compared as described in Subsection (b), Ixion
shall offer such terms to GI, and GI shall have thirty (30)
days to accept such terms by written notice to Ixion and the
parties shall upon such acceptance promptly enter into a
definitive agreement containing such terms.
5.4 No Other Rights. Neither party shall have any rights to the
inventions, patent rights, technology or know-how of the other party
except as expressly set forth herein.
6. Warranties and Restrictions.
6.1 Ownership of Intellectual Property, Absence of Restrictions.
Ixion represents and warrants that, to the best of its knowledge,
all right, title and interest in the IPSC Technology and UF Patent
Rights furnished by them are vested in Ixion or the University of
Florida Research Foundation. Ixion represents and warrants that
the Research Support Agreement and the Patent License Agreement
are in full, force and effect, and that it has the requisite
authority to enter into and perform its obligations and the
activities under this Agreement. Ixion represents and warrants
that it has no knowledge of any obligations or duties to any third
party, including without limitation, the University of Florida or
the University of Florida Research Foundation, or other conflicts
of interest which may conflict with its performance of this
Agreement, and the grant of the option rights hereunder. For the
purpose of this Section, knowledge of Dr. Amon Peck, Mr. Weaver
Gaines, Dr. Sharon Ogden or Dr. Stephen Maddock shall be imputed
to Ixion.
6.2 Exclusivity. Ixion agrees not to perform discovery research on
the IPSC Technology on behalf of any third party during the term
of performing the Project Work and prior to the expiration or
termination of the option rights under Section 5.1, but is not
restricted from collaboration with academic or non-commercial
investigators or otherwise limited with regard to its discovery
research program. Ixion agrees not to perform discovery research
utilizing any Program Technology or Know-How owned solely by GI
except in the course of performing the Project Work. All IPSC
Technology shall be furnished to such academic or non-commercial
investigators under the terms of an agreement which is not
materially different than a form which has been previously
approved in writing by GI.
6.3 University of Florida Agreements. Ixion agrees to fully comply
with the material terms and conditions of the Patent License
Agreement and the Research Support Agreement, and to indemnify and
defend GI against any expenses, costs, claims or liabilities
incurred by GI in connection with any breach thereof by Ixion.
Ixion agrees to immediately notify GI of receipt of any default
notices under such agreements, to provide GI with the opportunity
to intervene and cure such defaults, in GI's sole discretion, and
shall use all reasonable efforts to obtain the consent of the
University of Florida and the University of Florida Research
Foundation that Ixion shall have the right to grant to GI the
right to cure any such defaults by Ixion prior to any termination
thereof.
7. Confidentiality and Publications.
7.1 Confidentiality. The parties will maintain the confidential
information and materials of the other party in confidence for a
period of five (5) years following termination of the performance
of the Project Work, and will not divulge, use or distribute the
information or materials to others without the written permission
of the other disclosing party, except pursuant to the terms and
objectives of this Agreement. This obligation does not apply to
any information that:
(a) was known or used by the receiving party prior to its date
of disclosure to the receiving party, as evidenced by the
prior written records of the receiving party; or
(b) either before or after the date of disclosure to the
receiving party, is lawfully disclosed to the receiving
party by an independent, unaffiliated third party rightfully
in possession of the information which has the right to make
the disclosure; or
(c) either before or after the date of disclosure to the
receiving party, becomes published or generally known to the
public through no fault or omission of the receiving party;
provided that if any such information is required to be disclosed
by the receiving party to comply with applicable laws, the other
party shall be notified and given the opportunity to intervene and
protect its rights, and such disclosure shall be deemed to be
authorized hereunder.
7.2 Publications. The parties agree that any proposed publications
resulting from the Project Work, including abstracts for public
oral presentations, shall be submitted to the other party prior to
submission to a journal or third party. Any proposed submission
will be delayed no more than sixty (60) days for the purposes of
preparing patent applications on information contained therein, if
in the reasonable judgement of GI or Ixion, such patent
applications are considered necessary. If, in the reasonable
judgment of GI or Ixion, the application cannot be completed
within the sixty (60) day period, then GI or Ixion may request a
thirty (30) day extension, which shall not be unreasonably
withheld by the publishing party.
7.3 Authorship. Any publications based on research performed under
this Agreement will acknowledge authorship according to general
scientific procedures for such publications.
8. Termination.
8.1 Termination for Cause. Either party may terminate this
Agreement for cause at any time upon thirty (30) days prior
written notice to the other party, which notice shall specify the
alleged breach in reasonable detail. "Cause" shall mean material
breach by a party of this Agreement where such breach, if curable,
is not remedied within such thirty (30) day period, and the thirty
(30) day period shall have passed after the receipt of such notice
during which the defaulting party fails to cure such specific
breach.
8.2 Effect of Termination. Upon termination, neither Ixion nor GI
shall have any further obligations under this Agreement, except
for (a) liabilities accrued through the date of termination and
(b) the obligations which by their terms survive termination,
including, without limitation, the applicable confidentiality
provisions, shall survive termination. Upon termination of this
Agreement or, in the event that GI does not exercise its option
for an exclusive license pursuant to Section 5.1 upon expiration
of this Agreement, (i) Ixion shall promptly return to GI all
Confidential Information and Know-How of GI and any copies thereof
which are not jointly owned by Ixion; (ii) GI shall promptly
return to Ixion all Confidential Information and Know-How of Ixion
and any copies thereof which are not jointly owned by GI; and
(iii) except as provided in Section 4.5, neither party shall have
any further rights to use any such Confidential Information or
Know-How or any patent rights relating thereto of the other party
for any purpose whatsoever.
9. Miscellaneous.
9.1 Liability for Damages. Each Party will be liable for any
damages incurred by it that occur in the course of this contract
whether resulting from its own negligence or not. EXCEPT FOR THE
EXPRESS WARRANTIES SET FORTH IN THIS AGREEMENT, NEITHER PARTY
MAKES ANY WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT
LIMITED TO THE WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE OR AGAINST INFRINGEMENT WITH RESPECT TO THE
MATERIALS OR INFORMATION FURNISHED BY A PARTY UNDER THIS
AGREEMENT. Neither party will be liable for any consequential,
incidental or special damages except for a breach of Section 7.
9.2 No Publicity. Upon execution hereof, Ixion may issue a press
release describing this Agreement in a form satisfactory to GI in
the exercise of its reasonable judgment. Otherwise, except as
required by law, neither party will originate any publicity
relating to the other party without prior written approval of the
other party, which approval shall not be unreasonably withheld.
9.3 Successors and Assigns. This Agreement will be binding upon and
inure to the benefit of the parties and their respective heirs,
executors, administrators, legal representatives, successors and
assigns.
9.4 Assignment. Neither this Agreement nor any of its contract
rights or obligations may be assigned by a party without the prior
written consent of the other parties, except to a party who
acquires substantially all of the business of the assigning party.
9.5 Applicable Law. This Agreement will be interpreted in
accordance with the laws of the Commonwealth of Massachusetts.
9.6 Entire Agreement. This Agreement supersedes all prior
agreements, written or oral, between the parties relating to the
same subject matter and cannot be modified, changed or discharged,
in whole or in part, except by an agreement in writing signed by
the parties.
9.7 Notice. Any notice or other communication regarding this
Agreement shall be in writing and delivered to the addressee at
the following address:
If to GI:
Genetics Institute, Inc.
87 CambridgePark Drive
Cambridge, MA 02140 USA
ATTN: General Counsel
If to Ixion: Ixion Biotechnology, Inc.
12085 Research Drive
Alachua, FL 32615
ATTN: President
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed in their names by their duly authorized representatives as of the
effective date.
GENETICS INSTITUTE, INC.
By: _________________________________ Date: ___________________
Name: ______________________________
Title: _______________________________
IXION BIOTECHNOLOGY, INC.
By: _________________________________ Date: ___________________
Name: ______________________________
Title: _______________________________
l:\collab\ixionbio.530
Schedule A
This Schedule sets out the details of the Project Work.
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