<PAGE>
CERTAIN CONFIDENTIAL INFORMATION CONTAINED
IN THIS DOCUMENT, MARKED BY BRACKETS
([**]), HAS BEEN OMITTED AND FILED
SEPARATELY WTH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24B-2 OF THE
SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED
EXCLUSIVE LICENSE AGREEMENT
AMONG
THE JOHNS HOPKINS UNIVERSITY
&
ZHEJIANG UNIVERSITY
&
VIACELL, INC.
JHU REF. NO.: 4664
<PAGE>
EXHIBIT 10.4
LICENSE AGREEMENT
THIS LICENSE
AGREEMENT (the "Agreement") is entered into by and among The
Johns Hopkins University, a Maryland
corporation having an address at 3400 N.
Charles Street, Baltimore, Maryland,
21218-2695 (hereinafter referred to as
"JHU"), Zhejiang University having an
address at 232 Wen San Road, Hangzhou,
Zhejiang 310012., P.R. China (hereinafter
referred to as "INSTITUTION") (both
hereinafter collectively referred to as
"LICENSORS"), and ViaCell, Inc., a
Delaware corporation, having an address at
245 First Street, 15th Floor,
Cambridge, MA 02142 (hereinafter referred
to as "COMPANY") (JHU, INSTITUTION,
and COMPANY are hereinafter collectively
referred to as the "Parties"), with
respect to the following:
RECITALS
WHEREAS, as
centers for research and education, JHU and INSTITUTION are
interested in licensing PATENT RIGHTS
(hereinafter defined) in a manner that
will benefit the public by facilitating the
distribution of useful products and
the utilization of new processes, but are
without capacity to commercially
develop, manufacture, and distribute any
such products or processes; and
WHEREAS, a
valuable invention(s) entitled [**] was developed during the
course of research conducted by Dr. Ian
McNiece, a faculty member at JHU, and
Dr. Jinfu Wang, a faculty member at
INSTITUTION (hereinafter collectively
referred to as "Inventors"); and
WHEREAS,
LICENSORS have acquired through assignment all rights, title
and
interest, with the exception of certain
retained rights by the United States
Government, in their interest in said
valuable inventions; and
WHEREAS,
LICENSORS agreed that JHU will take the lead with respect to
commercializing said inventions in
accordance with the terms of the
Interinstitutional Agreement between JHU
and INSTITUTION effective as of May
16th, 2005; and
WHEREAS, COMPANY
has informed LICENSORS, in accordance with the terms of
the Option Agreement effective as of May
16th, 2005, that it desires to acquire
certain rights in such inventions as herein
provided, and to commercially
develop, manufacture, use and distribute
products and processes based upon or
embodying said valuable inventions;
NOW THEREFORE,
in consideration of the premises and the mutual promises and
covenants contained in this Agreement, and
for other good and valuable
consideration, the receipt and sufficiency
of which is hereby acknowledged, the
Parties hereto agree as follows:
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<PAGE>
EXHIBIT 10.4
ARTICLE 1
DEFINITIONS
All references
to particular Exhibits, Articles or Paragraphs shall mean
the Exhibits to, and Paragraphs and
Articles of, this Agreement, unless
otherwise specified. For the purposes of
this Agreement and the Exhibits hereto,
the following words and phrases shall have
the following meanings:
1.1 "AFFILIATED
COMPANY" as used herein in either singular or plural shall
mean any corporation, company, partnership,
joint venture or other entity, which
controls, is controlled by or is under
common control with COMPANY. For purposes
of this Paragraph 1.1, control shall mean
the direct or indirect ownership of at
least fifty- percent (50%) of the voting or
economic interest in said entity.
1.2 "DEVELOPED
PRODUCT(S)" as used herein in either singular or plural
shall mean any materials, compositions,
drugs, other products, methods or
services which are in material part first
identified, discovered or made by
practicing one or more VALID CLAIMS in the
PATENT RIGHTS licensed hereunder.
DEVELOPED PRODUCT(S) shall include all
resultant FDA and other regulatory agency
approved products identified by COMPANY
which are in material part made or
discovered through the use of the PATENT
RIGHTS delivered hereunder. DEVELOPED
PRODUCT(S) excludes LICENSED PRODUCT(S) and
LICENSED SERVICE(S).
1.3 "DEVELOPED
PRODUCT LICENSEE(S)" as used herein in either singular or
plural shall mean any person or entity
other than AFFILIATED COMPANIE(S) to
which COMPANY has granted a license to
DEVELOPED PRODUCT(S).
1.4 "EFFECTIVE
DATE" of this License Agreement shall mean the date the last
Party hereto has executed this
Agreement.
1.5 "EXCLUSIVE
LICENSE" shall mean a grant by LICENSORS to COMPANY of their
entire right and interest in the PATENT
RIGHTS subject to rights retained by the
United States Government, if any, in
accordance with the Bayh-Dole Act of 1980
(established by P.L. 96-517 and amended by
P.L. 98-620, codified at 35 USC
Section 200 et. seq. and implemented
according to 37 CFR Part 401), and subject
to the retained right of LICENSORS to make,
have made, provide and use for their
and The Johns Hopkins Health Systems'
non-commercial purposes PATENT RIGHTS,
LICENSED PRODUCT(S) and LICENSED
SERVICE(S), including the ability to distribute
any biological material, including, but not
limited to, material disclosed
and/or claimed in PATENT RIGHTS, for
nonprofit academic research use to
non-commercial entities, as is customary in
the scientific community.
1.6 "KNOW HOW"
shall mean any unpatented technical information, research
data, designs, formulas, process
information, clinical data and other
information which is owned by LICENSORS and
directly related to PATENT RIGHTS
licensed hereunder and generated in the
laboratories of Dr. Ian McNiece and Dr.
Jinfu Wang prior to the EFFECTIVE DATE and
which
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<PAGE>
EXHIBIT 10.4
LICENSORS have the right to license,
necessary for the exercise or use of the
PATENT RIGHTS in the LICENSED FIELD.
1.7 "LICENSED
FIELD" shall mean [**].
1.8 "LICENSED
PRODUCT(S)" as used herein in either singular or plural shall
mean any process or method, material,
compositions, drug, or other product, the
manufacture, use or sale of which would
constitute, but for the license granted
to COMPANY pursuant to this Agreement, an
infringement of a VALID CLAIM of
PATENT RIGHTS (infringement shall include,
but is not limited to, direct,
contributory, or inducement to
infringe).
1.9 "LICENSED
SERVICE(S)" as used herein in either singular or plural shall
mean the performance on behalf of a third
party of any method or service or the
manufacture of any product or the use of
any product or composition which would
constitute, but for the license granted to
COMPANY pursuant to this Agreement,
an infringement of a VALID CLAIM of the
PATENT RIGHTS, (infringement shall
include, but not be limited to, direct,
contributory or inducement to infringe).
1.10 "NET SALES"
shall mean gross sales revenues and fees billed by
COMPANY, AFFILIATED COMPANY, SUBLICENSEE(S)
and/or DEVELOPED PRODUCT LICENSEE(S)
from the sale or other disposition of
LICENSED PRODUCT(S) or DEVELOPED
PRODUCT(S), less reasonable (and, in each
every case, actually paid or applied)
trade discounts allowed, refunds, returns
and recalls, and sales taxes directly
related to the sale or delivery of LICENSED
PRODUCT(S) and/or DEVELOPED
PRODUCT(S).
In the event that COMPANY, AFFILIATED COMPANY, SUBLICENSEE(S)
and/or
DEVELOPED PRODUCT LICENSEE(S) sells a
LICENSED PRODUCT(S) and/or DEVELOPED
PRODUCT(S) in combination with other
ingredients or substances which are not
LICENSED PRODUCTS, LICENSED SERVICE(S) or
DEVELOPED PRODUCT(S) ("Other Items")
or as part of a kit that contains Other
Items, the NET SALES shall mean the
amount billed by COMPANY, AFFILIATED
COMPANY, SUBLICENSEE(S) and/or DEVELOPED
PRODUCT LICENSEE(S) on sales of the
combination process or product less the
deductions set forth above, multiplied by a
proration factor determined as
follows:
(a) If all
LICENSED PRODUCT(S) or DEVELOPED PRODUCT(S) and Other Items
were
sold separately
during the same or immediately preceding year, the
proration factor
shall be determined by the formula [A / (A+B)], where A is
the aggregate
gross sales price of all LICENSED PRODUCT(S) and/or DEVELOPED
PRODUCT(S)
components during such period when sold separately from the
Other Items, and
B is the aggregate gross sales price of all Other Items
during such
period when sold separately from the LICENSED PRODUCT(S) and/or
DEVELOPED
PRODUCT(S) components; or
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<PAGE>
EXHIBIT 10.4
(b) If the
combination includes Other Items which are not sold separately
(but all
LICENSED PRODUCT(S) and/or DEVELOPED PRODUCT(S) in the
combination
are available
separately), the NET SALES for purposes of royalty payments
will be
calculated by multiplying the NET SALES of the combination by
A/C,
where A is
defined above and C is the invoiced price of the combination.
(c) If all
components of the combination process or product were not sold
separately
during the same or immediately preceding year, the proration
factor shall be
determined by the formula [C / (C+D)], where C is the value
of the LICENSED
PRODUCT(S) and/or DEVELOPED PRODUCT(S) components and D is
the value of the
Other Items, with such value being determined in good
faith by the
parties.
The term "Other
Items" does not include solvents, diluents, carriers,
excipients,
buffers or the like used in formulating a product, or other
non-essential
components required in a process or service.
1.11 "NET
SERVICE REVENUES" shall mean gross service revenues and fees
billed by COMPANY, AFFILIATED COMPANY,
SUBLICENSEE(S) and/or DEVELOPED PRODUCT
LICENSEE(S) for or in connection with the
performance of LICENSED SERVICE(S)
and/or DEVELOPED PRODUCT(S) less reasonable
and appropriate (and, in each every
case, actually paid or applied) trade
discounts allowed, refunds, returns and
recalls, duties and sales and/or use taxes
imposed upon and directly related to
the sale of or fee the LICENSED SERVICE(S)
and/or DEVELOPED PRODUCT(S). In the
event that COMPANY, AFFILIATED COMPANY,
SUBLICENSEE(S) and/or DEVELOPED PRODUCT
LICENSEE(S) sells a LICENSED SERVICE(S)
and/or DEVELOPED PRODUCT(S) in
combination with Other Items or as part of
a kit that contains Other Items, the
NET SERVICE REVENUES for purposes of
royalty payments shall mean the amount
billed by COMPANY, AFFILIATED COMPANY,
SUBLICENSEE(S) and/or DEVELOPED PRODUCT
LICENSEE(S) on sales of the combination
process, service or product less the
deductions set forth above, multiplied by a
proration factor determined as
follows:
(a) If all
LICENSED SERVICE(S) and/or DEVELOPED PRODUCT(S) and Other Items
were sold
separately during the same or immediately preceding year, the
proration factor
shall be determined by the formula [A / (A+B)], where A is
the aggregate
gross sales price of all LICENSED SERVICE(S) and/or DEVELOPED
PRODUCT(S)
components during such period when sold separately from the
Other
-5-
<PAGE>
EXHIBIT 10.4
Items, and B is
the aggregate gross sales price of the Other Items during
such period when sold separately
from the LICENSED SERVICE(S) and/or
DEVELOPED
PRODUCT(S) components; or
(b)If the
combination includes Other Items which are not sold separately
(but all
LICENSED SERVICE(S) and/or DEVELOPED PRODUCT(S) in the
combination
are available
separately), the NET SERVICE REVENUES for purposes of royalty
payments will be
calculated by multiplying the NET SERVICE REVENUE of the
combination by
A/C, where A is defined above and C is the invoiced price of
the
combination.
(c) If all
components of the combination process, service or product were
not sold
separately during the same or immediately preceding year, the
proration factor
shall be determined by the formula [C / (C+D)], where C is
the value of the
LICENSED SERVICE(S) and/or DEVELOPED PRODUCT(S) components
and D is the
value of the Other Items, with such value being determined in
good faith by
the parties.
1.12 "PATENT
RIGHTS" shall mean [**].
1.13
"SUBLICENSEE(S)" as used herein in either singular or plural
shall
mean any person or entity other than an
AFFILIATED COMPANY to which COMPANY has
granted a sublicense under this
Agreement.
1.14 "VALID
CLAIM(S)" as used herein in either singular or plural shall
mean any unexpired issued claim or pending
claim prosecuted in good faith of any
PATENT RIGHTS that has not been (i) finally
rejected, (ii) declared invalid or
unenforceable by a patent office or court
of competent jurisdiction in any
unappealed and unappealable decision or
(iii) admitted to be invalid or
unenforceable through reissue or disclaimer
or otherwise by the holder thereof.
ARTICLE 2
LICENSE GRANT
2.1 GRANT.
Subject to the terms and conditions of this Agreement,
LICENSORS
hereby grant to COMPANY (i) an EXCLUSIVE
LICENSE to develop, make, have made,
use, import, offer for sale and sell the
LICENSED PRODUCT(S) and DEVELOPED
PRODUCT(S), and to provide the LICENSED
SERVICE(S) under the PATENT RIGHTS in
the LICENSED FIELD; and (ii) a non
exclusive license to use KNOW HOW for
COMPANY'S internal research purposes only
to develop and manufacture LICENSED
PRODUCT(S), LICENSEND SERVICE(S) and
DEVELOPED PRODUCT(S) in the LICENSED FIELD.
These Grants shall apply to the COMPANY and
any AFFILIATED COMPANY. If any
AFFILIATED COMPANY exercises rights under
this Agreement, such AFFILIATED
COMPANY shall be bound by all terms and
royalty payments, which shall apply to
the exercise of the rights, to the same
extent as would apply
-6-
<PAGE>
EXHIBIT 10.4
had this Agreement been directly between
LICENSORS and the AFFILIATED COMPANY.
In addition, COMPANY shall remain fully
liable to LICENSORS for all acts and
obligations of AFFILIATED COMPANY such that
acts of the AFFILIATED COMPANY shall
be considered acts of the COMPANY.
2.2 SUBLICENSE.
COMPANY may sublicense others under this Agreement, subject
to the terms and conditions of this
Paragraph. As a condition to its validity
and enforceability, each sublicense
agreement shall: (a) incorporate by
reference the terms and conditions of this
Agreement, (b) be consistent with the
terms, conditions and limitations of this
Agreement, (c) prohibit SUBLICENSEE'S
further sublicense of the rights delivered
hereunder, (d) name LICENSORS as
intended third party beneficiaries of the
obligations of SUBLICENSEE without
imposition of obligation or liability on
the part of LICENSORS or their
Inventors to the SUBLICENSEE, (e)
specifically incorporate Paragraphs 6.2
"Representations by LICENSORS", 7.1
"Indemnification", 10.1 "Use of Name", 10.4
"Product Liability" into the body of the
sublicense agreement, and cause the
terms used therein to have the same meaning
as in this Agreement. JHU shall have
the right to review all such sublicenses
prior to execution for period of ten
(10) days (the "Review Period") of receipt
of the sublicense from COMPANY to
confirm that the sublicense contains the
provisions referenced above.
Notwithstanding the foregoing, although
COMPANY will not enter into any
Sublicense prior to the expiration of the
Review Period, COMPANY's right to
grant sublicenses under the PATENT RIGHTS
shall not be contingent upon COMPANY's
receipt of JHU's prior approval. COMPANY
agrees to provide JHU with a copy of
each executed sublicense agreement promptly
upon its execution (and in any event
within ten (10) days thereafter). To the
extent that any terms, conditions or
limitations of any sublicense agreement are
inconsistent with this Agreement,
those terms, conditions and limitations are
null and void against LICENSORS.
2.3 GOVERNMENT
RIGHTS. The United States Government may have acquired a
nonexclusive, nontransferable, irrevocable,
paid-up license to practice or have
practiced for or on behalf of the United
States the inventions described in
PATENT RIGHTS throughout the world. The
rights granted herein are additionally
subject to: (i) the requirement that any
LICENSED PRODUCT(S) produced for use or
sale within the United States shall be
substantially manufactured in the United
States (unless a waiver under 35 USC
Section 204 or equivalent is granted by the
appropriate United States government
agency), (ii) the right of the United
States government to require JHU, or its
licensees, including COMPANY, to grant
sublicenses to responsible applicants on
reasonable terms when necessary to
fulfill health or safety needs, and, (iii)
other rights acquired by the United
States government under the laws and
regulations applicable to the
grant/contract award under which the
inventions were made.
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<PAGE>
EXHIBIT 10.4
ARTICLE 3
FEES, ROYALTIES, & PAYMENTS
3.1 LICENSE FEE.
COMPANY shall pay to JHU within thirty (30) days of the
EFFECTIVE DATE of this Agreement a license
fee as set forth in Exhibit A. JHU
will not submit an invoice for the license
fee, which is nonrefundable and shall
not be credited against royalties or other
fees.
It is agreed an
understood that if this Agreement is terminated prior to
January 1st, 2006, COMPANY will pay to JHU,
without invoice from JHU, within ten
(10) business days following the
termination date of this Agreement, [**].
Otherwise, this amount is due as indicated
in paragraph 3.2.
3.2 MINIMUM
ANNUAL ROYALTIES. COMPANY shall pay to JHU minimum annual
royalties as set forth in Exhibit A. These
minimum annual royalties shall be
due, without invoice from JHU, as
applicable, either within thirty (30) days of
the date indicated or each anniversary of
the EFFECTIVE DATE, beginning with the
first anniversary. Running royalties
accrued under Paragraph 3.3 and paid to JHU
during the one year period preceding an
anniversary of the EFFECTIVE DATE shall
be credited against the minimum annual
royalties due on that anniversary date.
3.3 RUNNING
ROYALTIES. COMPANY shall pay to JHU a running royalty as set
forth in Exhibit A, for each LICENSED
PRODUCT(S) sold, for each LICENSED
SERVICE(S) provided, and for each DEVELOPED
PRODUCT(S) sold or provided, by
COMPANY, AFFILIATED COMPANIES,
SUBLICENSEE(S), and/or DEVELOPED PRODUCT
LICENSEE(S) based on NET SALES and NET
SERVICE REVENUES for the term of this
Agreement. Such payments shall be made
quarterly. [**].
(a) In order to
insure JHU the full royalty payments contemplated
hereunder, COMPANY agrees that in the event
any LICENSED PRODUCT(S) or DEVELOPED
PRODUCT(S) shall be sold to an AFFILIATED
COMPANY, SUBLICENSEE(S) and/or
DEVELOPED PRODUCT LICENSEE(S) or to a
corporation, firm or association with
which COMPANY shall have any agreement,
understanding or arrangement with
respect to consideration (such as, among
other things, an option to purchase
stock or actual stock ownership, or an
arrangement involving division of profits
or special rebates or allowances) the
royalties to be paid hereunder for such
LICENSED PRODUCT(S) or DEVELOPED PRODUCT(S)
shall be based upon the greater of:
[**].
(b) COMPANY
acknowledges that its agreement to make payments to LICENSORS
under this Paragraph regarding rights,
products and/or services that are not:
(i) included in PATENT RIGHTS, or, (ii) a
LICENSED PRODUCT(S) or LICENSED
SERVICE(S), has been made for purposes of
its own convenience, to be paid
hereunder in lieu of other payments as
might have otherwise been required to be
paid for the license of the rights
delivered hereunder.
3.4 SUBLICENSE
CONSIDERATION. In addition to the running royalty as set
forth under Paragraph 3.3, COMPANY shall
pay to JHU a percentage of
consideration received for sublicenses
-8-
<PAGE>
EXHIBIT 10.4
under this Agreement as set forth in
Exhibit A. This sublicense consideration
shall be due, without the need for invoice
from JHU, within forty-five (45) days
of COMPANY's receipt of consideration from
SUBLICENSEE(S). Such consideration
shall mean consideration of any kind
received by the COMPANY or AFFILIATED
COMPANIES from a SUBLICENSEE(S) and/or
DEVELOPED PRODUCT LICENSEE(S) for the
grant of a sublicense under this Agreement
including transactions related to the
development and manufacture of DEVELOPED
PRODUCT(S), such as upfront fees or
milestone fees and including any premium
paid by the SUBLICENSEE(S) and/or
DEVELOPED PRODUCT LICENSEE(S) over Fair
Market Value for stock of the COMPANY or
an AFFILIATED COMPANY in consideration for
such sublicense. However, not
included in such sublicense consideration
are amounts paid to the COMPANY or an
AFFILIATED COMPANY for running royalties on
LICENSED PRODUCT(S), LICENSED
SERVICE(S) and DEVELOPED PRODUCT(S), profit
sharing or other consideration based
on the level of NET SALES or profits, or
bona fide support for product
development, research work, clinical
studies, reimbursement for patent costs,
and regulatory approvals performed by or
for the COMPANY or AFFILIATED COMPANIES
(including third parties on their behalf),
each pursuant to a specific
agreement. The term "Fair Market Value"
shall mean the average price that the
stock in question is publicly trading at
for twenty (20) days prior to the
announcement of its purchase by the
SUBLICENSEE(S) or DEVELOPED PRODUCT
LICENSEE(S) or if the stock is not publicly
traded, the value of such stock to
be reasonably determined by BOTH PARTIES
.
3.5 MILESTONE
PAYMENTS. COMPANY shall pay to JHU, without invoice from JHU,
the milestone payments as set forth in
Exhibit A. These milestone payments shall
not be deducted from royalty or other
payments due to JHU.
3.6 PATENT
REIMBURSEMENT. COMPANY will reimburse JHU, within thirty (30)
days of the receipt of an invoice from JHU,
for all costs associated with the
preparation, filing, maintenance, and
prosecution of PATENT RIGHTS incurred by
LICENSORS on or before the EFFECTIVE DATE
of this Agreement. In accordance with
Paragraph 4.1 below, COMPANY will reimburse
JHU, within thirty (30) days of the
receipt of an invoice from JHU, for all
costs associated with the preparation,
filing, maintenance, and prosecution of
PATENT RIGHTS incurred by LICENSORS
subsequent to the EFFECTIVE DATE of this
Agreement.
3.7 FORM OF
PAYMENT. All payments under this Agreement shall be made in
U.S. Dollars. Checks are to be made payable
to "The Johns Hopkins University".
Wire transfers may be made through:
Bank of America
New York, NY
[**]
COMPANY shall be
responsible for any and all costs associated with wire
transfers.
3.8 LATE
PAYMENTS. In the event that any payment due hereunder is not
made
when due, the payment shall accrue interest
beginning on the tenth day following
the due date thereof, calculated at the
annual rate of the sum of [**]. Each
such payment when made shall be
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<PAGE>
EXHIBIT 10.4
accompanied by all interest so accrued.
Said interest and the payment and
acceptance thereof shall not negate or
waive the right of JHU to seek any other
remedy, legal or equitable, to which it may
be entitled because of the
delinquency of any payment including, but
not limited to termination of this
Agreement as set forth in Paragraph
9.2.
ARTICLE 4
PATENT PROSECUTION, MAINTENAN
