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LICENSE AGREEMENT
between
OcuSense Inc.
and
The Regents of the University of
California
for
CASE NO. SD2002-180
"Volume Independent Tear Film
Osmometer"
***The following provisions of this Agreement have been
omitted pursuant to a request for confidential treatment and have
been filed separately with the U.S. Securities and Exchange
Commission: Article 3 in its entirety (consisting of four pages)
and a portion of Section 4.3.
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TABLE OF CONTENTS
Article 1: Definitions
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Page 4
Article 2: Grants
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Article 3:
Considerations………………………………………………………………………………………………………………………………………………...………………….……
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Article 4: Reports, Records and Payments
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Article 5: Patent Matters
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Article 6: Governmental Matters
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Article 7: Termination of Agreement
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Article 8: Limited Warranty and Indemnification
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Article 9: Use of Names and Trademarks
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Article 10: Miscellaneous Provisions
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Exhibit A: Certificate of Incorporation
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LICENSE AGREEMENT
THIS AGREEMENT ("Agreement") is
made by and between OcuSense Inc., a Delaware corporation, having
an address at 11959 Mayfield Avenue, #4, Los Angeles, California
90049 ("LICENSEE") and The Regents of The University of California,
a California corporation having its statewide administrative
offices at 1111 Franklin Street, Oakland, California 94607-5200
("UNIVERSITY"), represented by its San Diego campus having an
address at University of California, San Diego, Technology Transfer
& Intellectual Property Services, Mail-code 0910, 9500 Gilman
Drive, La Jolla, California 92093-0910 ("UCSD").
THIS AGREEMENT is effective on
the date of the last signature ("Effective Date").
RECITALS
WHEREAS, the inventions
disclosed in UCSD Case Docket No. SD2002-180 and titled "Volume
Independent Tear Film Osmometer" ("Invention"), were made in the
course of research at UCSD by Benjamin D. Sullivan (hereinafter,
the "Inventor") and are covered by Patent Rights as defined
below;
WHEREAS, the research was
sponsored in part by the Government of the United States of America
and as a consequence this license is subject to overriding
obligations to the Federal Government under 35 U.S.C. §§
200-212 and applicable regulations;
WHEREAS, the Inventor is an
employee of UCSD, and is obligated to assign all of his right,
title and interest in the Invention to UNIVERSITY;
WHEREAS, the founder of LICENSEE
entered into a secrecy agreement (UC Control No.2003-20-0193) with
UNIVERSITY, effective October 21, 2002 ("Secrecy Agreement"), for
the purpose of evaluating the Invention;
WHEREAS, the founder of LICENSEE
entered into a Letter of Intent (UC Control No.2003-30-0222) with
UNIVERSITY, effective November 12, 2002, ("Letter of Intent"), for
the purpose of negotiating this Agreement;
WHEREAS, UNIVERSITY is desirous
that the Invention be developed and utilized to the fullest
possible extent so that its benefits can be enjoyed by the general
public;
WHEREAS, LICENSEE is desirous of
obtaining certain rights from UNIVERSITY to commercially develop,
use, and sell the Invention, and the UNIVERSITY is willing to grant
such rights; and
WHEREAS , LICENSEE understands
that UNIVERSITY may publish or otherwise disseminate information
concerning the Invention at any time and that LICENSEE is paying
consideration thereunder for its early access to the Invention, not
continued secrecy therein.
NOW, THEREFORE , the parties
agree:
ARTICLE 1. DEFINITIONS
The terms, as defined herein, shall have the same
meanings in both their singular and plural forms.
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1.1
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"Affiliate" means any
corporation or other business entity in which LICENSEE owns or
controls, directly or indirectly, at least fifty percent (50%) of
the outstanding stock or other voting rights entitled to elect
directors, or in which LICENSEE is owned or controlled directly or
indirectly by at least fifty percent (50%) of the outstanding stock
or other voting rights entitled to elect directors; but in any
country where the local law does not permit foreign equity
participation of at least fifty percent (50%), then an "Affiliate"
includes any company in which LICENSEE owns or controls or is owned
or controlled by, directly or indirectly, the maximum percentage of
outstanding stock or voting rights permitted by local
law.
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1.2 "Field"
means:
(a) diagnostic use and products that incorporate osmolarity
analysis in ophthalmology and optometry;
(b) osmolarity analysis in the beverage industry;
(c) emergency medicine osmolarity analysis for the following
applications: alcohol intoxication, drug intoxication screening;
head injury, coma, burns; quality control of pharmaceutical
formulations, hospital admixtures, and nutritional support
formulary;
(d) obstetrics/gynecology osmolarity analysis for the following
applications: pre-eclamptic patients, in-vitro
fertilization/intracytoplasmic sperm injection;
(e) internal medicine/endocrinology osmolarity analysis for the
following applications: inappropriate adh syndrome,
hyper/hyponatremia, diabetes insipidus, insulin therapy,
differential diagnosis of polyuria;
(f) pharmacy/quality control osmolarity analysis for the
following applications: quality control of pharmaceutical
preparations, including infant formulas, electrolyte solutions and
other parenterals; cardioplegic fluids; contrast agents; parenteral
preparation; wash solution;
(g) surgery/critical care osmolarity analysis for the following
applications: hypovolemic/hypervolemic shock prevention;
electrolyte/metabolyte imbalance; iv therapy; liver transplant;
glycine uptake;
(h) urology/renal function osmolarity analysis for the following
applications: renal malfunction differential diagnosis, uremia,
osmolal & free water clearance, renal dialysis;
(i) sports medicine osmolarity analysis for the following
applications: athlete hydration;
(j) consumer products osmolarity analysis for the following
applications: car windshield wash;
(k) pharmaceutical/biotechnology osmolarity analysis for the
following applications: quality control of cell lines, tissue
cultures, and media manufacture; and
(1) agriculture osmolarity analysis for the following
applications: plant hydration. Fields for which first commercial
sale has not initiated within 7 years will be excluded.
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1.3
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"Territory" means worldwide
where Patent Rights exist, except for counties where LICENSEE
declines to reimburse UCSD patent costs under Paragraph 5.1
(d).
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1.4
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"Term" means the period of time
beginning on the Effective Date and ending on the later of (i) the
expiration date of the longest-lived Patent Rights; or (ii) the
twenty-first (21st) anniversary of Effective Date.
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1.5
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"Patent Rights" means any of the
following: the US patent application (Serial No. 60/401,432 titled
"Volume Independent Tear Film Osmometer") disclosing and claiming
the Invention, filed by Inventor on or about August 6, 2002 and
assigned to UNIVERSITY; and continuing applications thereof
including divisions, substitutions, and continuations-in-part (but
only to extent the claims thereof are enabled by disclosure of the
parent application); any patents issuing on said applications
including reissues, reexaminations and extensions; and any
corresponding foreign applications or patents.
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1.6
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"Sponsor Rights" means all the
applicable provisions of any license to the United States
Government executed by UNIVERSITY and the overriding obligations to
the Federal Government under 35 U.S.C. §§ 200-212 and
applicable governmental implementing regulations.
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1.7
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"Licensed Method" means any
method that is covered by Patent Rights the use of which would
constitute, but for the license granted to LICENSEE under this
Agreement, an infringement of any pending or issued and unexpired
claim within Patent Rights.
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1.8
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"Licensed Product" means any
services, composition or product that is covered by the claims of
Patent Rights, or that uses or is produced by the Licensed Method,
or the manufacture, use, sale, offer for sale, or importation of
which would constitute, but for the license granted to LICENSEE by
UNIVERSITY herein, an infringement of any pending or issued and
unexpired claim within the Patent Rights.
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1.9
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"Sublicensee" means a third
party to whom LICENSEE grants a sublicense of certain rights
granted to LICENSEE under this Agreement.
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1.10
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"Net Sales" means the total of
the gross invoice prices of Licensed Products sold by LICENSEE, an
Affiliate, or any combination thereof, less the sum of the
following actual and customary deductions where applicable and
separately listed: cash, trade, or quantity discounts; sales, use,
tariff, import/export duties or other excise taxes imposed on
particular sales (except for value-added and income taxes imposed
on the sales of Licensed Products in foreign countries);
transportation charges; or credits to customers because of
rejections or returns. For purposes of calculating Net Sales,
transfers to an Affiliate of Licensed Product under this Agreement
for (i) end use (but not resale) by the Affiliate shall be treated
as sales by LICENSEE at list price of LICENSEE, or (ii) resale by
an Affiliate shall be treated as sales at the list price of the
Affiliate.
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1.11
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"Patent Costs" means all
out-of-pocket expenses for the preparation, filing, prosecution,
and maintenance of all United States and foreign patents included
in Patent Rights. Patent Costs shall also include reasonable
out-of-pocket expenses for patentability opinions, inventorship
determination, preparation and prosecution of patent application,
re-examination, re-issue, interference, and opposition activities
related to patents or applications in Patent Rights.
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ARTICLE 2. GRANTS
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2.1
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License. Subject to the
limitations set forth in this Agreement, UNIVERSITY hereby grants
to LICENSEE, and LICENSEE hereby accepts, an exclusive license
under Patent Rights to make, use, sell, offer for sale, and import
Licensed Products and to practice the Licensed Method in the Field
within the Territory and during the Term.
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2.2
Sublicense.
(a) Subject to the limitations set forth in this
Agreement, UNIVERSITY hereby grants to LICENSEE, and LICENSEE
hereby accepts, the right to sublicense the Patent Rights to
Sublicensees but only for so long as LICENSEE'S license under the
Patent Rights is exclusive.
(b) Notwithstanding any other terms in this
Agreement, LICENSEE shall not sublicense the Patent Rights to any
Affiliate of LICENSEE or to any Affiliate of LICENSEE'S
Affiliates.
(c) With respect to sublicense granted pursuant
to Paragraph 2.2(a), LICENSEE shall:
(1) not receive, or agree to receive, anything of
value in lieu of cash as considerations from a third party under a
sublicense granted pursuant to Paragraph 2.2(a) without the express
written consent of UNIVERSITY;
(2) to the extent applicable, include all of the
rights of and obligations due to UNIVERSITY (and, if applicable,
Sponsor Rights) contained in this Agreement;
(3) promptly provide UNIVERSITY with a copy of
each sublicense issued; and
(4) collect and guarantee payment of all payments
due, directly or indirectly, to UNIVERSITY from Sublicensees and
summarize and deliver all reports due, directly or indirectly, to
UNIVERSITY from Sublicensees.
(d)
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(1)
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LICENSEE shall notify UNIVERSITY of any proposed
grant of a sublicense and the terms thereof. UNIVERSITY shall then
have ten (10) business days to notify LICENSEE that the terms of
such proposed sublicense is acceptable or not acceptable, provided,
however, that if UNIVERSITY does not notify LICENSEE that the terms
are either acceptable or not acceptable, then UNIVERSITY shall be
deemed to accept the proposed terms of such proposed
sublicense.
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(2)
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If a sublicense has been preapproved according to
subparagraph 2.2 (d)(1), upon termination of this Agreement for any
reason, such sublicense shall continue in full force and effect. If
a sublicense has been preapproved according to subparagraph 2.2
(d)(1), upon the license grant in Paragraph 2.1 becoming
nonexclusive such sublicense shall continue in full force and
effect and all of the payments received thereafter by LICENSEE from
such Sublicensee, if any, shall be paid and/or forwarded to
UNIVERSITY.
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(3)
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Unless sublicense has been preapproved according
to subparagraph 2.2 (d)(1), upon termination of this Agreement for
any reason, or upon the license grant in Paragraph 2.1 becoming
nonexclusive, UNIVERSITY, at its sole discretion, shall determine
whether LICENSEE shall cancel or assign to UNIVERSITY any and all
sublicenses.
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2.3 Reservation of
Rights . UNIVERSITY reserves the right
to:
(a) use the
Invention and Patent Rights for educational and research
purposes;
(b) publish or otherwise disseminate any
information about the Invention at any time; and
(c) allow other nonprofit institutions to
use Invention, and Patent Rights for educational and
research purposes in their facilities.
ARTICLE 3. CONSIDERATIONS
***Article 3 in its entirety, which consists of four
pages, has been omitted pursuant to a request for confidential
treatment and has been filed separately with the U.S. Securities
and Exchange Commission.
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ARTICLE 4. REPORTS, RECORDS AND
PAYMENTS
4.1
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