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Confidential Materials omitted and
filed separately with the
Securities and Exchange Commission.
Asterisks denote omissions.
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Exhibit 10.21
COMMAND NO:
DAMD17-04-0024
LICENSE NO.:
LICENSE AGREEMENT
THIS LICENSE AGREEMENT (“
Agreement”), effective as of the “Signature
Date” (as defined below), is made by and between: U.S.
Army Medical Research Institute of Infectious Diseases (
“Licensor” ), a subordinate laboratory of the
United States Army Medical Research and Materiel Command, having a
place of business at 504 Scott Street, Fort Detrick, Maryland
21702-5012 ; and VaxGen Inc. (“ Licensee
”) a Delaware corporation, having a principal place of
business at 1000 Marina Boulevard, Brisbane, California
94005-1841.
ARTICLE I
BACKGROUND
1.1 The
United States of America is the owner by assignment or otherwise of
the entire right, title and interest to inventions more
particularly described and claimed in each of the patents and
patent applications, including provisional applications, as well as
all rights corresponding thereto, listed on Schedule 2.17
– A Existing Patents (collectively, the
“Existing Patents”).
1.2 Under
the authority of 15 United States Code 3701 et seq., 35 United
States Code Section 200-210, and 37 Code of Federal Regulations,
Chapter IV (together with any amendments and the underlying rules
and regulations now or hereafter promulgated collectively, the
“ Federal Technology Transfer Act ” or the
“ FTTA ”), Licensor has custody of inventions
described and claimed in, and the right to issue licenses under,
the Existing Patents.
1.3 Licensor
desires that the inventions described and claimed in the Existing
Patents be brought to the “Point of Practical
Applications” (as defined below) in the shortest possible
time and made available to the public, thereby serving the public
interest and broadening the potential supply base for Licensor and
other U.S. government agencies.
1.4 Licensee
desires to obtain an exclusive license to U.S. patent 6,387,665,
Method of Making a Vaccine for Anthrax, and an exclusive field of
use license to U.S. patent 6,316,006, Asporagenic B.
anthracis Expression System, for the purpose of developing
and commercializing a vaccine against B. antracis. Licensee
understands and acknowledges that any and all inventions and
technology related to or arising out of the Existing Patents would
now and hereafter be subject to and governed by the terms and
conditions of this Agreement.
1
NOW THEREFORE,
in consideration of the premises
noted above, including the above-cited statutory authority, and the
mutual promises, covenants, duties and obligations hereinafter set
forth, and for other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, Licensor and
Licensee, intending to be lawfully bound, do agree as
follows:
ARTICLE II
DEFINITIONS
The terms defined in this Article II
shall have the meanings set forth below throughout this
Agreement.
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2.1
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“
Additional Information ” shall have the meaning
set forth in Article V hereof.
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2.2 “
Affiliate(s) ” means any corporation or other
legal entity that controls, is controlled by, or is under common
control with Licensee. For purposes of this definition,
“control” (including, with correlative meanings, the
terms “controlled by” and “under common control
with”), means, whether de jure or de factor, the ownership,
directly or indirectly, of more than fifty percent (50%) of the
outstanding equity securities of a corporation which are entitled
to vote in the election of its Board of Directors or more than
fifty percent (50%) interest in the net assets or profits of any
entity which is not a corporation. For the purposes of this
definition, Affiliates shall include those Affiliates that are, or
will become, Sublicensees under this Agreement and Licensee shall
initially and continuously identify, designate and update its
relationship with each Sublicensee and each Affiliate on
Schedule 2.2 (Affiliates & Sublicensees) attached
hereto and made a material part hereof, amended or supplemented
from time to time after notice and with approval of Licensor as
contemplated hereunder.
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2.3
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“ Agreement
” means this agreement.
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2.4 “
Bankrupt ” means when any Person shall (a)
apply for or consent to the appointment of, or the taking of
possession by, a receiver, custodian, trustee or liquidator of any
of the assets of same; (b) admit in writing an inability, or be
generally unable, to pay debts as they become due; (c) make a
general assignment for the benefit of creditors; (d) commence a
voluntary case under the federal bankruptcy laws (now or hereafter
in effect); (e) be adjudicated a bankrupt or insolvent; (f) file a
petition seeking to take advantage of any other law providing for
the relief of debtors; (g) acquiesce to, or fail to have dismissed,
within thirty (30) days, any petition filed in any involuntary case
under such bankruptcy laws; or (h) take any action for the purpose
of effecting any of the foregoing.
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2.5
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“ Board ”
means the Board of Directors of Licensee or an Affiliate, as it may
apply.
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2.6 “
Confidential Information ” shall mean (a) any
proprietary or confidential information or material in tangible
form disclosed in accordance with this Agreement that is marked as
“Confidential,” “Proprietary” or the like
at the time it is delivered to the receiving party, (b) proprietary
or confidential information disclosed orally hereunder which is
identified as confidential or proprietary when disclosed and such
disclosure of confidential information is confirmed in writing
within thirty (30) days by the disclosing party, or (c) Trade
Secrets of
2
Licensor regardless of whether or
not so marked or identified. For purposes of this Agreement,
“Confidential Information” shall not include
information that can be established by the receiving party by
competent proof that such information:
(i) was
already known to the receiving party, other than under an
obligation of confidentiality, at the time of
disclosure;
(ii) was
generally available to the public or otherwise part of the public
domain at the time of its disclosure to the receiving
party;
(iii) became
generally available to the public or otherwise part of the public
domain after its disclosure and other than through any act or
omission of the receiving party in breach of this
Agreement;
(iv) was
subsequently lawfully disclosed to the receiving party by a person
other than a party hereto; or
(v) was
lawfully developed independently by the receiving party without
misappropriating confidential information from a third
party.
2.7 “
Development Plan ” means the comprehensive plan
and related exhibits, schedules and agreements prepared for the
sole benefit of Licensor and undertaken by Licensee to
commercialize the Licensed Patent Technology substantially in the
form of Schedule 2.7 ( Development Plan )
attached hereto and made a material part hereof, amended or
supplemented from time to time after notice and with approval of
Licensor.
2.8 “
End User ” means any Person with the right to
use Licensed Products for his/her own personal use or in the
regular conduct of its own business and not for licensing to other
Persons.
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2.9
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“ EU ”
means European Union.
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2.10
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“ Event of
Default ” shall have the meaning used in Article
XI.
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2.11
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“ Existing
Patents ” shall have the meaning used in Article
I.
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2.12
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“ FTTA ”
shall have the meaning used in Article I.
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2.13
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“ Government
” means the federal government of the United States of
America.
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2.14 “
Improvement ” means any revision, translation,
abridgement, condensation, expansion, modification or any other
form in which an invention may be recast, transformed or adapted,
provided any such modification would infringe on one or more valid
claims of a patent or pending patent application of such invention.
For purposes hereof, an Improvement shall also include any
enhancement or derivative work, product, device or invention that
incorporates a preexisting work, product, device or
invention.
3
2.15 “
Intellectual Property Rights ” means, solely
with respect to the Licensor, any or all of the following, in any
and all jurisdictions throughout the world, and all rights in,
arising out of, or associated with: (a) all patents (including
Existing Patents and the Licensed Patent Technology) and
applications therefore, including provisional applications, and all
reissues, divisions, renewals, extensions, reexaminations,
continuations and continuations-in-part thereof
(“Patents”); (b) all rights (other than Patents) in
inventions (whether patentable or not), invention disclosures,
formulations, pre-clinical data, clinical data, laboratory data,
manufacturing processes, processes, methods, techniques, trade
secrets, proprietary information, know-how, technology and
technical data (“Trade Secrets”); (c) all copyrights,
copyright registrations and applications therefore and all other
rights corresponding thereto (“Copyrights”); (d) all
mask works, mask work registrations and applications therefore; (e)
all industrial designs and any registrations and applications
therefore; (f) any other rights in databases and data collections;
(g) any other rights in computer software including all source
code, object code, firmware, development tools, files, records and
data, and all media on which any of the foregoing is recorded; (h)
all know-how and show-how, techniques, design rules, ideas,
concepts, methods, algorithms, formulae, discoveries, compositions,
routines, files, works of authorship, processes, prototypes,
devices and hardware whether or not protectible by Patents,
Copyrights or Trade Secrets, and (i) any similar, corresponding or
equivalent rights or Improvement in which Licensor has property
rights to any and all of the foregoing and any other intellectual
property or proprietary rights, whether or not registrable;
including, without limitation, any and all trademarks, trade names,
domain names, logos and service marks and any similar indications
of origin or branding expressly reserved for use by or identified
with Licensor, unless otherwise stated.
2.16 “
Licensed Field of Use ” means applications or
uses for the Licensed Patent Technology for human use as a vaccine
for the prevention or treatment of anthrax infection.
2.17 “
Licensed Patent Technology ” means all of
Licensor’s rights in but limited to (a) the Existing Patents
listed on Schedule 2.17 – A (Existing Patents)
attached hereto and made a material part hereof, including any
extensions, reissues and reexaminations thereof, and (b) any and
all additional patents and patent applications and ancillary
Intellectual Property Rights identified and listed with the
approval of Licensor on Schedule 2.17 – B (Additional
Patents and Patent Applications [D1] )
attached hereto and made a material part hereof, including any
extensions, reissues and reexaminations thereof. Licensed Patent
Technology shall include any and all divisions, renewals,
continuations, continuations in part and substitutions related to
the patents and patent applications referenced in subsections (a)
and (b) of this Section; all foreign patent applications
corresponding to the foregoing applications; and all U.S. and
foreign patents issuing on any of the foregoing applications,
including extensions, reissues, and reexaminations. Schedule
1.7 – A and B may be supplemented from time to time
as deemed necessary or advisable in the sole discretion of
Licensor.
2.18 “
Licensed Product(s) ” means any and all
products, methods, inventions or devices of any kind and the
information related thereto which either (a) fall within or are
covered by the scope of one or more Valid Claims of the Licensed
Patent Technology; (b) are produced by the practice of a product,
method, invention, device or process that is within the scope of
one or more Valid Claims of the Licensed Patent Technology; or (c)
are produced by, derived or compiled from products, methods,
inventions, devices, substances, techniques, processes, systems,
formulations,
4
or designs described in the Licensed
Patent Technology, in the country of use, manufacture or sale by
Licensee or its Affiliate(s) and Sublicensees.
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2.19
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“ Licensed
Territory ” means worldwide.
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2.20 “
Licensee ” means VaxGen, Inc., 1000 Marina
Boulevard, Brisbane, California 94005-1841.
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2.21
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“ License Fee(s)
” has the meaning set forth in Article IV.
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2.22 “
Licensor : means U.S. Army Medical Research Institute
of Infectious Diseases, a subordinate laboratory of the U.S. Army
Medical Research and Materiel Command, 504 Scott Street, Fort
Detrick, Maryland 21702-5012.
2.23 “
Licensor’s Director ” means the director
of Licensor, or if such post is vacant or has been eliminated, then
the representative within or overseeing Licensor who is authorized
to approve, and execute on behalf of Licensor, this
Agreement.
2.24 “
Licensor’s Representative ” means the
Office of Research and Technology Application, U.S. Army Medical
Research and Materiel Command, Staff Judge Advocate (MRMC-JA), 504
Scott Street, Fort Detrick, Maryland 21702-5012, Attn: USAMRMC
ORTA.
2.25 “
Net Sales ” means the actual gross amount
billed, invoiced, charged or received on sales or transfers of any
Licensed Products by Licensee, its Affiliates and Sublicensees to
any and all Unaffiliated Person(s), or in the event of disposal of
any Licensed Products other than as scrap prior to shipment from
its place of manufacture or predisposal storage, or other than by
sales, the amount billed, invoiced, charged or received on sales or
transfers for a like quantity and quality of Licensed Products to
Unaffiliated Persons on or about the time of such disposal,
less:
(a) trade,
cash and quantity discounts, including charge backs, rebates,
premiums, allowances and any other deduction actually granted to
the Unaffiliated Person (not to exceed the original
billing);
(b) sales
and excise taxes and duties and any other governmental charges
imposed upon the importation, use or sale of the Licensed Products
actually charged to the Unaffiliated Person;
(c) freight,
insurance and other transportation charges actually charged to the
Unaffiliated Person;
(d) amounts
repaid or credited (not to exceed the original billing) by reason
of rejections, defects, outdating, price differences, recalls or
returns, or because of retroactive price reductions, or due to
governmental laws or regulations requiring rebates actually granted
to the Unaffiliated Person; and
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(e)
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actual charges for bad
debts.
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5
For purposes of calculating Net
Sales for any reporting period, any and all deductions used in
calculating Net Sales are allowable only to the extent that they
have already been included in the amounts billed, invoiced, charged
or received or granted on the sales or transfers of Licensed
Products by Licensee or its Affiliates and Sublicensees to
Unaffiliated Persons in bona fide arms’ length transactions.
Calculation of Net Sales shall be in accordance with generally
accepted accounting principles. Sales or transfers of Licensed
Product between or among Licensee and its Affiliates(s) or
Sublicensees shall be excluded from the computations of Net Sales
except where such Affiliate(s) or Sublicensees are End Users, but
Net Sales shall include the subsequent final sales or transfers to
Unaffiliated Persons by such Affiliate(s) or Sublicensees (if not
End Users).
In the case of a Licensed Product
utilizing a combination of properties other than Licensed Product
properties, solely for purposes of determining what percentage of
License Fees are owed to Licensor hereunder Net Sales shall be
multiplied by A/A+B, where A is the invoice price of the Licensed
Product sold separately and B is the invoice price of the active
properties in the combination of properties other than Licensed
Product properties. If the invoice price of the Licensed Product
and/or of the active properties in the combination is (are) not
available and the parties are unable to agree on an alternative
arrangement, then in lieu and stead of the fraction noted above Net
Sales shall be multiplied by X/Y, where X is one (1) and Y is the
total number of active properties included in the
combination.
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2.26
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“ Pass Through
Royalty ” shall have the meaning used in Article
IV.
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2.27 “
Person ” means any natural person or entity
other than Licensee, its Affiliate(s) or Sublicensees including,
without limitation, any individual, partnership (whether general or
limited), limited liability company, corporation, trust, estate,
association, nominee, firm, unincorporated organization or a
government or agency or political subdivision thereof.
2.28 “
Point of Practical Application ” means to
manufacture, practice, or to operate inventions, described and
claimed in the Licensed Patent Technology, under such conditions as
to establish that the inventions are being utilized and that their
benefits are, to the extent permitted by law or Government
regulations, available to the public on reasonable terms within six
(6) years of the Signature Date, and to continue during the term of
this Agreement to make the benefits of the inventions reasonably
accessible to the public, consistent with sound and reasonable
business practices and judgment. If Licensee believes that it will
be unable to make such product available to the public within such
time frame, it shall give notice to Licensor by way of a detailed
explanation specifying the reasons therefore. Licensee may amend
the time period at any time with the written consent of Licensor.
Unless Licensee has failed to perform its duties and obligations
under this Agreement, Licensor shall not unreasonably withhold
approval of any request by Licensee to extend the time period if
such request is supported by a reasonable showing that Licensee has
in accord with the Development Plan taken diligent steps consistent
with sound and reasonable business practices and judgment to
commercialize the Licensed Patent Technology, taking into account
any change in circumstances, scientific developments, or other
factors considered by the parties relevant for adopting a new time
frame.
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2.29
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“ Point of Practical
Application Reports ” shall have the meaning set
forth in Article V.
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2.30 “
Regulatory Authority ” means any US or foreign
governmental department, body, commission, board, bureau, agency or
instrumentality with applicable regulatory jurisdiction.
6
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2.31
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“ Reports
” shall have the meaning set forth in Article V.
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2.32 “
Signature Date ” means the date that this
Agreement is last executed by Licensor’s Director.
2.33 “
Sublicensee ” shall mean a Person who obtains a
sublicense under and pursuant to Article VI of this Agreement.
Licensee shall initially and continuously identify, designate and
update its relationship with each Sublicensee on Schedule 2.2
(Affiliates & Sublicensees) attached hereto and made a
material part hereof, as amended or supplemented from time to time
after notice and with approval of Licensor as contemplated
hereunder.
2.34 “
termination ” and cognate words, such as
“ term ” and “
terminate ,” shall have the meanings set forth
in Article XI.
2.35 “
Unaffiliated Person(s) ” means any Person and
shall include without limitation, an End-User or the joint venture
partner, company or other entity that also has non-controlling
outstanding equity securities of Licensee, an Affiliate or
Sublicensee or has a non-controlling interest in the net assets or
profits of Licensee, an Affiliate or Sublicensee.
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2.36
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“ USFDA ”
means the U.S. Food and Drug Administration.
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2.37
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“ USPTO ”
means the U.S. Patent and Trademark Office.
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2.38 “
Valid Claim ” means: 1) a claim of an issued,
unexpired patent included within the Licensed Patent Technology
which either has not been (a) held unenforceable or invalid by a
court or other governmental agency of competent jurisdiction that
is unappealable or unappealed within the time allowed for appeal,
or (b) admitted to be invalid or unenforceable through reissue,
disclaimer or otherwise; or 2) a claim in a patent application
within the Licensed Patent Technology.
ARTICLE III
LICENSE GRANT
3.1 In
consideration of the payment of all License Fees and subject to
full compliance with the terms and conditions of this Agreement by
Licensee, Licensor grants to Licensee an exclusive license under
the Licensed Patent Technology, with the right to grant and
authorize sublicenses, to develop, to make, have made, import, use,
have used, offer for sale, have sold and sell Licensed Products
throughout the Licensed Territory in the Licensed Field of Use for
the term of this Agreement and for the purpose stated in Article I.
Licensee shall have the right to extend this license to any
Affiliate of its choice, provided that each such extension properly
references and is made subordinate to this Agreement, including
those rights retained by Licensor hereunder, subject to and
consistent with the relevant provisions hereof that apply to
sublicenses, and the approval requirements of the United States
Code, Title 35, Part II, Chapter 18, Section 209 (as amended) and
U.S. Presidential Executive Order No. 12591.
7
3.2 No
right or license is granted or implied to Licensee or to any
Affiliate, Sublicensee or Person claiming through or under Licensee
respecting any licensed patent or licensed patent application other
than that specifically identified herein as the Licensed Patent
Technology and the corresponding Licensed Field of Use. Nothing
herein shall be construed as granting Licensee, by implication,
estoppel or otherwise, any license or other right under or
respecting any unlicensed Intellectual Property Rights of Licensor,
except for those rights expressly granted under the Licensed Patent
Technology and the corresponding Licensed Field of Use. Licensor
specifically retains all residual rights and interests in and to
the Licensed Patent Technology and its unlicensed Intellectual
Property Rights and neither Licensee, its Affiliates or
Sublicensees shall act in a manner that would or could impair or
conflict either with the residual rights and interests of Licensor
or the grant afforded to Licensee hereunder.
3.3 In
full compliance and accordance with the FTTA, Licensee grants to
Licensor a royalty-free, nonexclusive, worldwide license to
practice and have practiced on behalf of the Government, and on
behalf of any foreign government or international organization
pursuant to any existing or future treaty or agreement with the
Government, any patented invention made by Licensee, its Affiliates
or Sublicensees pursuant to the terms of this Agreement for the
term set forth in Article XI of this Agreement.
ARTICLE IV
LICENSE FEES: ROYALTIES AND
PAYMENT OF OTHER INCOME
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4.1
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Licensee shall make payment and
insure payment in full is made of all royalties and fees due and
owing to Licensor as required under this Article IV (collectively
hereinafter the “ License Fee(s) ”) and
specifically described on Schedule 4.1 – License
Fee(s) hereto.
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4.2
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No Licensee Fee shall be payable to
Licensor under this Article IV solely with respect to Licensed
Products distributed to third parties without consideration on a
limited, restricted basis for use in research and/or development or
as promotional samples. Licensee shall maintain and cause to be
maintained records of all such activity with third parties, to be
made available to Licensor upon request.
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4.3
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License Fees shall be payable on Net
Sales of Licensed Product (the manufacture, use or sale of which is
covered by a Valid Claim) on a country-by-country and
Licensed-Product-by-Licensed-Product basis until: (i) the
expiration of the last-to-expire patent included in the Licensed
Patent Technology (including any extensions granted under the
Patent Term Restoration Act or any other statute (as amended)
covering each and every such Licensed Product in each and every
such country; or (ii) if no such patent has issued in such country
in which a patent application is pending, until the seventh
anniversary of the first commercial sale of a Licensed Product in
such country. No multiple royalty shall be payable on a Licensed
Product because the manufacture, use or sale of such Licensed
Product is covered by more than one patent or patent application in
the Licensed Patent Technology.
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4.4
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The parties recognize that other
patents covering the Licensed Patent Technology or Licensed Product
may exist Licensee shall receive a credit against the royalty on
Net Sales otherwise owed or owing to Licensor hereunder for
royalties or equivalent fees paid by Licensee to third parties as
such pertain to the Licensed Product. Any such credit shall not
exceed [**] of
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8
the royalties or equivalent fees
actually paid by Licensee to seek a license under any other patents
and/or other technology from an Unaffiliated Person in an arms
length transaction in order to practice the rights and licenses
granted by Licensor to Licensee hereunder and/or to avoid
infringement during such exercise in any particular country,
provided that in consultation with Licensor any such infringement
determination is made by: (a) a competent court with personal and
subject matter jurisdiction, (b) a mutually acceptable independent
counsel regarding such practice and/or infringement, or (c) mutual
agreement of the parties hereto.
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4.5
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Payments under this Article IV shall
be made in United States dollars and paid by check to “DFAS
ROCK ISLAND.” On a statement accompanying the check, it MUST
be noted that the payment is for royalties or licensing fees, and
each of the patent/patent applications and United States Department
of Army log number(s) shall be listed and specifically referenced.
All [D3] checks for payments under this Article IV should be mailed
to DFAS – ROCK ISLAND OPLOC, ATTN: DFAS-R1-FD, Building 68,
Rock Island, IL 61299-8300, with copies to the Licensor’s
Representative at Office of Research and Technology Applications,
U.S. Army Medical Research and Materiel Command, Staff Judge
Advocate, (MRMC-JA), 504 Scott Street, Fort Detrick, Maryland
21702-5012, ATTN: USAMRMC ORTA. All checks and bank drafts shall be
good funds drawn on United States banks.
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4.6
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For purposes of converting
currencies other than U.S. Dollars to U.S. Dollars, Licensee shall
use the average of the current exchange rate as reported in The
Wall Street Journal under the column headed “Currency
Trading” and subtitled “Exchange Rates” for the
last business day of each month in which License Fees were earned
for the applicable reporting period; provided, however, that if
such rate is not so published, then such conversion rate shall be
the average of the selling rate for such currency, as published by
a leading New York City bank chosen by Licensee and reasonably
acceptable to Licensor, on the last business of each month in which
License Fees were earned for the applicable reporting period. Any
and all loss of exchange, value, taxes or other expenses incurred
in the transfer or conversion of other currency to U.S. Dollars
shall be paid entirely by Licensee.
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4.7
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In the event that Licensee is
unable, as a result of any legal or government restrictions, to
remit License Fees or any other payments due hereunder from any
country in the Licensed Territory in respect of sales in that
country, Licensee shall deposit the appropriate License Fees and
such other payments in an account in a bank in such country agreed
to by Licensor, such agreement not to be unreasonably withheld. For
as long as s
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