This Development Agreement involves
Title: PRODUCT DEVELOPMENT AGREEMENT
Governing Law: Delaware Date: 1/18/2011
Industry: Medical Equipment and Supplies Law Firm: Greenberg Traurig;Fulbright Jaworski Sector: Healthcare
PRODUCT DEVELOPMENT AGREEMENT
This PRODUCT DEVELOPMENT AGREEMENT (“ Agreement ”), is made this January 11, 2011 (the “ Effective Date ”) by and between TechniScan, Inc., a Delaware corporation having offices at 3216 South Highland Dr., Suite 200, Salt Lake City, Utah 84106 on behalf of itself and its affiliates (collectively, “TechniScan” ) and Womens3D, Inc., a Delaware corporation, having offices at 4917 S. Congress, Austin, Texas 78745 (“ Womens3D ” and together with TechniScan, each a “ Party ” and collectively, the “ Parties ”).
WHEREAS , Womens3D is a medical device company engaged in a plan to provide women’s health care practices with novel, automated ultrasound breast imaging equipment and web-based 3D reconstruction and review services as an efficient, painless, non-invasive, radiation-free alternative to mammography in diagnosing breast abnormalities.
WHEREAS , TechniScan is a medical device company engaged in the development and commercialization of automated ultrasound imaging systems and owns proprietary information and technology related to the design, development, manufacture and supply of certain hardware and software products.
WHEREAS , TechniScan and Womens3D desire that TechniScan and Womens3D shall design and TechniScan (and in certain cases, TechniScan and Womens3D jointly) shall develop the Products (as defined herein) in accordance with the terms and conditions of this Agreement.
WHEREAS, upon completion of the Product development pursuant to the terms and conditions of this Agreement, Womens3D shall thereafter purchase the Products from TechniScan for license, use and distribution by Womens3D to its Customers (as defined herein) in accordance with the terms and conditions of a Manufacturing Agreement between the Parties (as defined herein in Section 9.2(g)).
NOW, THEREFORE , in consideration of the mutual promises, conditions and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby expressly acknowledged, the Parties hereto agree as follows:
1. Certain Definitions . Capitalized terms used but not otherwise defined in this Agreement shall have the following meanings or such meanings as provided for in the Manufacturing Agreement:
(a) “ Change in Control ” means the occurrence of any one or more of a series of related transactions or events that result in one or more Persons (alone or in a group), who prior to the completion of such transactions did not beneficially own more than 50% of the outstanding voting stock of TechniScan (on an as-voted basis) beneficially owning voting control of TechniScan or any other corporation or Person resulting from or surviving such transactions, upon completion of those transactions.
(b) “ Change Order ” means a written change or modification to the Specifications, Product(s), or the Product Technology that becomes effective after being signed by authorized representatives of both Parties.
(c) “ Competitive Change in Control ” means the occurrence of any one or more of a series of related transactions or events that result in Competitive Acquiring Persons (alone or in a group), who prior to the completion of such transactions did not beneficially own more than 50% of the outstanding voting stock of TechniScan (on an as-voted basis) beneficially owning voting control of TechniScan or any other corporation or Person resulting from or surviving such transactions, upon completion of those transactions; where “ Competitive Acquiring Persons ” means one or more Persons who directly or indirectly competes with Womens3D, as reasonably determined by Womens3D.
(d) “ Customer ” means any Person that owns, operates, leases, manages or engages in the delivery or provision of any women’s healthcare services and products, or desires to own, operate, lease, manage, or engage in any of the foregoing activities within the Field of Use in the Territory that contracts with Womens3D for the Product(s) provided for hereunder.
(e) “ DCAA Rates ” means rates that are consistent with the then current Defense Contract Audit Agency rates, or if there are no Defense Contract Audit Agency rates then in effect, reasonable rates mutually agreed by the Parties.
(f) “Development Budget” means the budget for Initial Development of the Product and the Product Technology through Prototype Phase and through Final Product Phase, to be attached hereto and incorporated herein by reference as Exhibit “C.”
(g) “ Development Schedule ” means the schedule of delivery milestones set forth in Exhibit “A,” to be attached hereto and incorporated herein by reference, as may be amended from time to time upon the mutual written agreement of the Parties hereto.
(h) “ Documentation ” means the documentation created in connection with the development of the Product(s) and the Product Technology, including without limitation any user manuals, warranty information and/or other materials provided by either Party in connection with the development and use of the Product and the Product Technology and as updated by either Party from time to time, whether physical or embodied in Software or onscreen systems, to enable a Customer to use the Product(s) and the Product Technology.
(i) “ Field of Use ” means breast imaging conducted in a Customer’s general practice facility whether through general medical clinics, offices, practices and/or facilities or otherwise, including but not limited to OB/GYN and/or breast cancer or women’s oncology practices, clinics or facilities, but excluding (1) facilities registered with and/or licensed by the United States Food and Drug Administration or any successor agency thereof (“ FDA ”) that derive at least fifty-one percent (51%) of its annual revenue from breast cancer screening and diagnostic imaging under the Mammography Quality Standards Act (“ MQSA ”); and (2) medical practice entity that has a material portion of its annual revenue from conducting cosmetic surgery that involve breast implants.
(j) “Final Product” means the Product and the Product Technology that has been finally approved and developed and is ready for manufacturing and sale to Customers in accordance with the terms hereof.
(k) “Final Product Phase” means the period during which the Parties develop and test the Prototypes to finalize Specifications for the Final Product (including Software) and Product Technology and obtain for the Product and Product Technology all required regulatory approvals, safety certifications and working models in the United States such that, in the reasonable opinion of Womens3D, the Product and the Product Technology are ready for manufacture and sale to Customers in the United States.
(l) “ Force Majeure ” means any events beyond the control of a Party, including, but not limited to: fires, hurricanes, tornadoes, floods, riots, strikes, labor disputes, freight embargoes or transportation delays, shortage of labor, acts of God or of the public enemy or any existing or future laws, rules, regulations, or acts of any federal, state, local or foreign government (including specifically, but not exclusively, any orders, rules or regulations issued by any official or agency of any such government), that would delay or prohibit performance hereunder.
(m) “ Initial Development ” means the initial design and development of the Product (including the Software) and the Product Technology, including but not limited to tooling, testing (including without limitation required FDA testing and approvals, safety tests, and installation and acceptance testing and all other applicable certification tests of the Products) as well as the development and manufacture of the Prototypes.
(n) “Initial Development Fee” means the minimum One Million Five Hundred Thousand Dollars (US $1,500,000.00) to be paid by Womens3D to TechniScan, which shall include (1) the initial amounts (US $250,000.00) paid by Womens3D to TechniScan for the purchase of the TechniScan Pre-Existing Equipment and TechniScan Pre-Existing Software, and (2) such other amounts to be paid by Womens3D on a time and materials basis at the DCAA Rates to be paid by Womens3D in connection with the development of the Product(s) and Product Technology provided for hereunder, including all work to be performed hereunder in developing the Specifications for the Prototype and for any additional Prototypes and for all Initial Development costs, fees and expenses paid, incurred or reimbursed by Womens3D through the Final Product Phase to TechniScan.
(o) “ Intellectual Property Rights ” means: (1) any and all proprietary rights (registered and unregistered) provided under: (A) patent law; (B) copyright law (including moral rights); (C) trademark law, including domain names; (D) design patent or industrial design law; (E) semi-conductor chip or mask work law; or (F) any other statutory provision or common law principle applicable to this Agreement, including trade secret law, which may provide a right in either hardware, software, the Documentation, Confidential Information, ideas, formulae, algorithms, concepts, database, inventions, processes or know-how generally, or the expression or use of such hardware, software, Documentation, Confidential Information, ideas, formulae, algorithms, concepts, inventions, processes or know-how; (2) any and all applications, registrations, licenses, sub-licenses, franchises, agreements or any other evidence of a right in
any of the foregoing anywhere in the world; and (3) all licenses and waivers and benefits of waivers of the intellectual property rights set out in (1)(A) and (1)(B) above.
(p) “ Joint IP ” means any Intellectual Property Rights jointly developed by TechniScan and Womens3D in connection with the development of the Prototype(s) and Product(s) provided for hereunder during the Term hereof.
(q) “ Person(s) ” means any individual, partnership, joint venture, corporation, limited liability company, proprietorship, association, trust, state or the federal government or any agency or department thereof, unincorporated organization or any other entity or governmental body.
(r) “ Pre-Existing TechniScan Technology ” means all know-how, knowledge, expertise and other Intellectual Property Rights owned by or otherwise licensed to TechniScan prior to the execution of this Agreement.
(s) “ Pre-Existing Womens3D Technology ” means all know-how, knowledge, expertise and other Intellectual Property Rights owned by or otherwise licensed to Womens3D prior to the execution of this Agreement.
(t) “ Product(s) ” means an automated ultrasound product (including both reflection ultrasound and reflection and transmission ultrasound; and, in each case, including the Software) to be developed, tested (and in certain cases, as jointly developed and tested by TechniScan and Womens3D) and supplied by TechniScan in accordance with the terms of this Agreement, and as more fully set forth in the Specifications, and such other additional products as mutually agreed upon in writing by the Parties from time to time during the Term hereof.
(u) “Prototype(s)” means up to fifteen (15) prototype(s) of the Product to be made by TechniScan and delivered to Womens3D in accordance with the Specifications for use by Womens3D in connection with tests and approvals (regulatory or otherwise) and Final Product development through the Prototype Phase and the Final Product Phase.
(v) “Prototype Phase” means the development period through the development of Specifications for the Prototype(s) and up to the time of actual delivery by TechniScan to Womens3D of the Prototype(s).
(w) “ Product Technology ” means all systems, software, hardware, processes, works, improvements, enhancements, updates, derivatives and other Intellectual Property Rights developed during the Term of this Agreement to the extent used in or for developing and otherwise building the Product and any Prototypes provided for herein (including any case designs for same), and the TechniScan Software, but exclusive of: (1) the Pre-Existing TechniScan Technology, (2) the Pre-Existing Womens3D Technology, (3) the Joint IP, (4) the TechniScan Pre-Existing Equipment and TechniScan Pre-Existing Software, (5) the Womens3D Technology, and (6) the Third Party Software.
(x) “ Software ” means the source code and object code versions of the software necessary or intended for use with the Products, including the TechniScan Software, Third Party Software, software resulting from Joint IP and Womens3D Technology, any microcode embedded in the Products and/or any standalone software applications and third Party applications, including without limitation, all updates, versions, patches, fixes, upgrades, workarounds or enhancements thereto, which are delivered concurrently with or subsequent to the delivery of the Products.
(y) “ Specifications ” means the design, performance, functional and technical specifications of the Prototypes and the Products, all of which shall be set forth and attached as a part of Exhibit “B” and which shall be developed and incorporated herein by reference within sixty (60) days following the execution of this Agreement, as shall be specified by Womens3D and approved by TechniScan (which approval shall not be unreasonably withheld) as may be amended from time to time upon the mutual written agreement of the Parties hereto.
(z) “ TechniScan Pre-Existing Equipment ” means the complete and latest version of the TechniScan automated ultrasound imaging equipment, controls and system (including all TechniScan Pre-Existing Software), which incorporates all of the latest updates to all such equipment, controls and software, but for the avoidance of doubt is not available for commercial sale or use.
(aa) “ TechniScan Pre-Existing Software ” means such software developed (or licensed by) and otherwise used by TechniScan with, or otherwise provided by TechniScan for use with , the TechniScan Pre-Existing Equipment.
(bb) “ TechniScan Trademarks ” means the TechniScan trademarks to be identified in the Trademark Agreement.
(cc) “Trademark Agreement” means the Trademark and Copyright License Agreement to be mutually agreed upon and entered into by and among the Parties within sixty (60) days following the execution of this Agreement or such later period as mutually agreed by the Parties. Notwithstanding anything in this Agreement to the contrary, the Trademark Agreement shall control with respect to obtaining, maintaining, and/or enforcing trademark and copyright rights, and the ownership of same following expiration and/or termination of this Agreement, the Manufacturing Agreement, and the Trademark Agreement.
(dd) “TechniScan Software ” means the TechniScan owned software developed by or on behalf of TechniScan in connection with a particular Product exclusive of Third Party Software and Womens3D Technology, which shall be owned by TechniScan.
(ee) “ Territory ” means the United States of America (including its territories and possessions) (collectively, “ United States ”) and those countries within the Middle East as listed on Exhibit “D” attached hereto and incorporated herein by reference. The Parties further agree that the territory provided for herein may be expanded upon the written approval and the sole and reasonable discretion of TechniScan on a case by case basis as may be requested from time to time by Womens3D.
(ff) “ Third Party Software ” means all software incorporated in the Products that is licensed from a third Party or that is open source software and that is exclusive of the software in the Womens3D Technology.
(gg) “ Womens3D Technology ” means the software created by or on behalf of Womens3D (but for the avoidance of doubt not including the TechniScan Software), including the software created and provided by Womens3D in accordance with the Development Schedule provided for herein as mutually agreed upon by the Parties to be incorporated as a component part of and in conjunction with the use of the Product(s) and which shall be owned by Womens3D, all Intellectual Property Rights developed solely by Womens3D, all Intellectual Property Rights owned solely by Womens3D or owned partially by Womens3D but not owned partially by TechniScan, and all Intellectual Property Rights licensed to Womens3D from a third party (which, for the avoidance of doubt, is a party other than TechniScan).
(hh) “ Womens3D Trademarks ” means the Womens3D trademarks to be identified in the Trademark Agreement.
2. Development Rights And Obligations
2.1 Product Development . Subject to Womens3D’s payment of the Initial Development Fee in accordance with Section 3.1 below, the Parties agree to the following development terms and conditions:
(a) The Parties will use their best efforts to work together to determine the Development Schedule (including establishing an acceptance process, an acceptance timeline, and a compliance and waiver process for the Product and the Product Technology being developed hereunder), Development Budget and the Specifications for the Prototypes and Products all of which shall be set forth and attached respectively, as Exhibits “A,” “B” and “C” and which shall be developed and incorporated herein by reference within sixty (60) days following the execution of this Agreement, as shall be specified by Womens3D and approved by TechniScan (which approval shall not be unreasonably withheld) as may be amended from time to time upon the mutual written agreement of the Parties hereto. If Womens3D and TechniScan are unable to reach agreement on any of the Development Schedule, Development Budget and/or Specifications during such sixty (60) day period, either Party may cause the dispute to be submitted to Mark Lenox, PhD, Scientific Advisory Board Chairman, Chief Scientific Officer, and Director of Womens3D (“ Dr. Lenox ”) for prompt and final resolution; provided that each Party shall pay its respective costs associated therewith; and provided further that Dr. Lenox shall resolve all disputes in accordance with this Agreement and applicable law; and provided further that if Dr. Lenox is unable to resolve such dispute due to his death, disability, other unavailability or refusal to resolve such dispute, the Parties shall resolve such dispute in accordance with the arbitration provisions set forth in Section 10.7 of this Agreement.
(b) TechniScan shall, upon invoice for the TechniScan Pre-Existing Equipment and TechniScan Pre-Existing Software, with payment due sixty (60) days from the date of invoice, make such TechniScan Pre-Existing Equipment and TechniScan Pre-Existing Software available to Womens3D for use by Womens3D solely as a prototype system and for which Womens3D acknowledges and agrees that such TechniScan Pre-Existing Equipment and
TechniScan Pre-Existing Software is not suitable for commercial use and sale and shall not be used by Womens3D other than for lab, experimental and clinical trials testing within the Field of Use and solely within the United States. For the avoidance of doubt, the TechniScan Pre-Existing Equipment and TechniScan Pre-Existing Software related thereto includes transmission based functionality for which Womens3D acknowledges and agrees that it has no rights with respect thereof.
(c) Womens3D shall have the right to develop and test the TechniScan Pre-Existing Equipment and TechniScan Pre-Existing Software, and the Prototypes and the Products identified and specified in the Development Schedule to be attached hereto as Exhibit “A” and such other new and derivative categories of Products, as set forth in mutually agreed upon Statement(s) of Work incorporated herein or hereafter agreed to by the Parties (“ SOW(s) ”). Except as otherwise specifically provided for herein, Womens3D shall be responsible for all costs and expenses incurred by Womens3D and if Womens3D requests additional work from TechniScan, for all costs and expenses incurred by TechniScan in connection with the development and testing of the Products, but only in accordance with the agreed upon initial Development Budget and which may be updated and amended only by a Change Order or other mutual agreement of both of the Parties from time to time, which updates upon mutual acceptance shall automatically be deemed incorporated and made a part of this Agreement.
(d) TechniScan shall supply to Womens3D all necessary tools, fixtures, moulds, materials, cases and other tooling items necessary to develop and test the TechniScan Product, the Prototypes, the Products and the Product Technology in accordance with the Development Schedule, Development Budget and the Specifications, to complete the testing and obtain the applicable approvals for manufacture and sale of the Final Products and the Product Technology, as described below. Womens3D shall develop and deliver to TechniScan the Specifications for the Prototypes as provided for herein.
(e) Either Party may request that a technical or commercial change be made to the Development Schedule and the Specifications for the development of the Product or the Product Technology. All requested changes shall be submitted to the other Party in writing for review, each Party shall review such requests, and the Parties shall determine the amount of re-work, additional time necessary and additional fees required, if any, to make such changes. All such determinations shall be made only upon the written mutual agreement of the Parties hereto in the form of a Change Order, following which the Parties shall commence implementation of such change, and the Development Schedule and/or Specifications will be amended appropriately to reflect such change accordingly. In the event a change is requested as a result of pending or threatened litigation, regulatory issues, or governmental investigation relating to the Product(s) or the Product Technology, the Parties will agree on an expedited schedule reviewing the requested change. Any reasonable delays associated with a change arising out of a Force Majeure event or an event described in the previous sentence shall not be deemed a Breach of this Agreement or the Manufacturing Agreement. Notwithstanding the foregoing, during the Term hereof, TechniScan may, in the exercise of its reasonable business judgment, undertake modifications to the Specifications for the Prototypes and Products provided for hereunder upon notice in writing to Womens3D that are a result of reasonable changes to address supply chain matters including but not limited to part problems and cost
downs or changes that may otherwise be mandated by regulatory requirements imposed on TechniScan and/or Womens3D.
(f) TechniScan shall provide Womens3D with Documentation, Documentation changes, special test fixtures, and technical support as reasonably requested by Womens3D to design, build, and test the Prototypes and the Product and the Product Technology and to develop the Specifications for each. The Prototypes and the Products to be made by TechniScan and delivered to Womens3D hereunder shall be assembled, tested, and labeled per the Specifications to be set forth on Exhibit “B” and which shall be incorporated herein by reference. After Womens3D submits the initial draft of the Specifications to TechniScan, TechniScan will ensure that the Specifications meet applicable United States regulatory requirements in writing and agrees to deliver those requirements in writing to Womens3D within a reasonable time thereafter. Womens3D shall be responsible for providing TechniScan with all regulatory or other requirements outside of the United States that are covered by the Territory provided for herein as it pertains to the Product, the Prototypes and the Product Technology and Specifications for each, the form of which shall be a reasonable summary thereof.
(g) TechniScan shall deliver to Womens3D a working Prototype or Prototypes in accordance with the Specifications on or before the dates specified in the Development Schedule.
(h) TechniScan shall take commercially reasonable efforts to ensure that materials, equipment and services provided by TechniScan hereto shall be of the best workmanship, and rendered by skilled personnel.
(i) The Products (including the Software) and services will comply with all applicable laws of the United States and any state or country in which the Products are manufactured on behalf of TechniScan or from which the Products are shipped by TechniScan. Womens3D shall be responsible for the Products and/or Prototypes complying with all applicable laws of the United States and any other state or country in which the Products and/or Prototypes are sold, offered for sale, used or imported, subject to the provisions of Section 6. In the event the Products must undergo any additional regulatory tests in order to comply with the applicable laws of any country of destination as designated by a Party hereto, Womens3D shall be responsible for and pay for all such fees and costs required to complete such regulatory tests, if any.
(j) Upon mutual agreement, the Parties may, from time to time identify additional products to be covered by the terms of this Agreement. For the avoidance of doubt, TechniScan grants to Womens3D the right of first refusal to sell products within the Field of Use and the Territory that use both reflection and transmission ultrasound, and TechniScan agrees that it shall not license any person or entity under its Intellectual Property Rights to sell any products within the Field of Use and the Territory that use both reflection and transmission ultrasound without Womens3D’s prior written permission.
2.2 TechniScan Technology Licenses and Royalties . With respect to Products developed hereunder, TechniScan shall be responsible for obtaining the following licenses, and for any required royalty payments or other consideration relating thereto; provided, however, that Womens3D
shall be responsible for reimbursing TechniScan for all fees and royalties incurred in connection with obtaining such licenses during the Term hereof, provided Womens3D is given reasonable notice of any such fees or royalties before they are determined and thereafter permitted to participate in their determination, and apprised of known fees and royalties within a reasonable period of time after execution of this Agreement, such fees and royalties being credited against the Initial Development Fee: !
(a) the specific licenses and license rights identified in Exhibit “F” hereto, as may be amended from time to time by mutual agreement of TechniScan and Womens3D;
(b) any development, manufacture, sale, offer for sale, use or importation license rights required for the processes and equipment used by or on behalf of TechniScan for the development, manufacturing or other production of the Prototypes, Products and Product Technology for use by Womens3D and its Customers within the Field of Use and within the United States.
2.3 Womens3D Technology Licenses and Royalties . Womens3D shall be responsible for obtaining the specific licenses and license rights to be identified in Exhibit “G” hereto and incorporated herein by reference, as may be amended from time to time by mutual agreement between TechniScan and Womens3D and for any required royalty payments or other consideration relating thereto as well as any other specific licenses and license rights that may be required in connection with the use of the Prototypes and/or sale, use, offer for sale or distribution of Products to Womens3D’s Customers in the Territory located outside of the United States.
2.4 Use of Womens3D’s Trademarks and TechniScan Trademarks . All uses of the Womens3D Trademarks and the TechniScan Trademarks shall be in accordance with the Trademark Agreement.
2.5 Manufacture of Products . Upon completion of development of the Product and the Product Technology and testing (including the Software) in accordance with Development Budget, Development Schedule and Specifications or otherwise to Womens3D’s reasonable satisfaction, the Parties hereby acknowledge and agree that TechniScan shall be authorized to manufacture and supply Products to Womens3D in accordance with the terms and conditions of the Manufacturing Agreement.
2.6 Software Development.
(a) Womens3D and TechniScan shall, at the expense of Womens3D, provided all costs and expenses of TechniScan are specifically pre-approved in writing by Womens3D in accordance with the Development Schedule and Development Budget and, for the avoidance of doubt, provided that such costs and expenses of TechniScan will be credited against the Initial Development Fee, develop or otherwise obtain the necessary licenses to develop all Software necessary or intended for use with the Products and Prototypes, as applicable, which shall be in compliance with the Specifications.
(b) Womens3D Software Modifications/Enhancements . In the event Womens3D requests from TechniScan a customized software modification or enhancement to
the software in the Womens3D Technology for use with the Products, TechniScan agrees that as long as it is exclusively developing and manufacturing the Products on behalf of Womens3D (and Womens3D is not in Breach of this Agreement or the Manufacturing Agreement or the Trademark Agreement or the Subscription Agreement), it will endeavor in good faith to provide pricing and such other terms, including a reasonable delivery schedule, to provide the requested customized software modification or enhancement to Womens3D.
(c) Upon delivery by TechniScan of any Software, Womens3D will have the responsibility to test the Software for compliance with the Specifications and to notify TechniScan in writing of any bugs or errors with the Software that cause the Software to not operate in accordance with such mutually agreed upon testing and acceptance procedures. The Parties agree that to the extent they have any dispute over the testing or acceptance procedures relating to the Prototypes or Products developed hereunder, the Parties shall submit such dispute to Dr. Lenox for prompt and final resolution; provided that each Party shall pay its respective costs associated therewith; provided that Dr. Lenox shall resolve all disputes in accordance with this Agreement and applicable law; and provided further if Dr. Lenox is unable to resolve such dispute due to his death, disability, other unavailability or refusal to resolve such dispute, the Parties shall resolve such dispute in accordance with the arbitration provisions set forth in Section 10.7 of this Agreement.
(d) Womens3D hereby grants to TechniScan a worldwide, non-exclusive, royalty-free right and license (including the right to sublicense to others, but only while and only for so long as such sublicensee is performing its services for TechniScan) to make, use, sell, offer to sell, import, modify, perform, display, reproduce and create derivative works from and make improvements and such other enhancements to any Womens3D Technology in order to comply with its obligations under this Agreement and the Manufacturing Agreement and for use with products outside the Territory and the Field of Use, and TechniScan shall own any such derivative works, improvements and other enhancements made by or on behalf of TechniScan alone (and not with Womens3D) and for which TechniScan was not paid by Womens3D; provided that in such instance where such derivative works, improvements and other enhancements are paid for by Womens3D, then Womens3D shall own those derivative works, improvements and other enhancements and TechniScan shall have a worldwide, non-exclusive, royalty-free right and license (including the right to sublicense to others, but only while and only for so long as such sublicensee is performing its services for TechniScan and/or is an end user) to those derivative works, improvements and other enhancements for use with products outside the Territory and the Field of Use.
2.7 Intellectual Property Rights.
(a) Ownership of Pre-Existing Rights .
(i) Pre-Existing Womens3D Technology . Womens3D owns all right, title and interest in and to the Pre-Existing Womens3D Technology. Womens3D hereby grants TechniScan a worldwide, non-exclusive, royalty-free right and license (with the right to sublicense to third parties engaged by TechniScan to perform any part of the work to be performed under this Agreement but only as long as such third Pa