PATENT LICENSE AGREEMENT
This Agreement made and entered into as of the 17th day of January
2007, by and
between:
1. Wellstone Filters,
Inc., having its
registered office in Timberlake, North
Carolina,
USA, a Delaware Corporation, having its principle place of
business at 300
Market Street,
Suite 130-13, Chapel Hill, North
Carolina,
27516, USA,
hereinafter referred to as: WELLSTONE;
And
2. Glycanex BV, having its registered office in Hilversum, The Netherlands, a
Dutch
corporation, having its principle place of business at Koninginneweg
11-13,
1217 KP Hilversum, The Netherlands, hereinafter
referred to
as:
GLYCANEX;
WHEREAS:
GLYCANEX is a Dutch corporation with commercial interest and activities
in the
field of carbohydrate derivatives and materials and products
derived therefrom;
WELLSTONE has licensed and further developed a technology for the purpose of
removing substances from cigarette smoke from Cerami Consulting
Corporation,712
Kitchawan Road
Ossining, NY 10562 pursuant to the license
agreement between
WELLSTONE and Cerami Consulting Corporation (hereinafter referred to as CCC)
dated September 14, 1999.
GLYCANEX desires
to obtain an exclusive license under
the patent rights
of
WELLSTONE licensed from Cerami Consulting Corporation;
WELLSTONE is willing to grant GLYCANEX such license on the terms
and conditions
herein set forth.
NOW, THEREFORE, IT IS AGREED AS FOLLOWS:
1
DEFINITIONS
The following words or phrases shall have the meaning indicated when used
in
this Agreement:
1.1 "Effective Date" and "Effective Date of this Agreement" shall
mean the date
filled in
above.
1.2 "Parties" shall mean WELLSTONE and GLYCANEX (in singular or plural usage,
as indicated by the context).
1.3 "WELLSTONE Patent Rights" shall mean all patents or
applications thereto of
any
country or region, owned or controlled by WELLSTONE on the Effective
Date
of this Agreement or
during the term of this Agreement, as listed in
Exhibit
1, where the making, having made, using or selling of
Licensed
Products
would constitute an infringement thereof, as well as any
divisionals, continuations, continuations-in-part, extensions or reissues
thereof,
any patents granted on any of the foregoing and any foreign
patents or
applications corresponding to any of the foregoing.
1.4 "Licensed
Products" shall
mean any products
produced by
Glycanex, its
Affiliates
and/or sublicensees,
the manufacture or use of any of which are
covered by
WELLSTONE Patent Rights.
1.5 "Field of
Use" shall mean any
use of the WELLSTONE Patent Rights in
Licensed
Products.
1.6 "Licensed Territory" shall mean all territories as specified in
Exhibit 1.
1.7 "Net Sales"
shall mean the gross amount invoiced in
respect to sales of
Licensed
Products in the Field
of Use for the
Licensed Territory less (a)
discounts
actually allowed, (b) credits for claims, allowances,
retroactive
price
reductions or returned goods, (c) prepaid freights, (d) sales taxes
or
other governmental
charges actually paid in connection with the sale
(but
excluding what is
commonly known as income taxes) and (e) commissions
paid to
unaffiliated others in connection with sales of Licensed
Products.
1.8 "Affiliate" shall
mean any corporation,
firm, partnership or other entity
which
directly or indirectly
is owned by or is under common ownership
to
the extent
of at least fifty percent of the equity having the power to
vote
on or
direct the affairs of the entity and any person, firm, partnership,
corporation or other entity actually controlled by, controlled, or under
common
control with a party to this Agreement.
1.9 "Valid and
Unexpired Claim(s)" shall mean one or more issued patent claims
which has
not been disclaimed or abandoned, which has
not expired in the
country of
issue and which has
not been declared
invalid or unenforceable
by the
final judgment of a court of competent jurisdiction from which no
appeal can
be or has been taken.
2 GRANT OF
RIGHTS
2.1 WELLSTONE hereby
grants to GLYCANEX an
exclusive license under WELLSTONE
Patent
Rights in the Licensed
Territory for Licensed Products in the Field
of
Use.
2.2 GLYCANEX may grant sublicense(s) to its Affiliates and/or third
parties for
the rights
described in paragraph .
2.3 GLYCANEX shall alone or in conjunction with Affiliates and/or
third parties
described
in 2.2, engage in
studies of and certification of performance of
the
Licensed Products. Upon signing this Agreement, and on an as needed
basis
throughout the duration of this Agreement, WELLSTONE will provide
all
data,
trade secrets, know-how, formulations, manufacturing techniques and
other
information
to GLYCANEX to support
GLYCANEX as fully as possible in
achieving
maximum commercial exploitation of WELLSTONE Patent Rights.
2.4 GLYCANEX accepts the rights granted herein.
3 ROYALTIES
3.1 In consideration of the rights granted to GLYCANEX, GLYCANEX shall pay
WELLSTONE
a royalty on Net Sales equal to three percent (3
%) to be
initiated
after reaching a sales
royalty threshold
of 500 000 EUR of
Net
Sales by
GLYCANEX. For the sake of calculating the sales royalty
threshold,
net sales
by GLYCANEX to other sublicensees of WELLSTONE in the USA will
be
included.
However, future sales by GLYCANEX to sublicensees of WELLSTONE
in
the USA
will not be subjected to the royalty requirements indicated above.
WELLSTONE
and GLYCANEX will work together in good faith, and as quickly as
possible,
to reach the above stated sales royalty threshold.
4 PAYMENTS
4.1 Licensed Products
shall be considered as sold when invoiced to the
customer.
4.2 Upon reaching the
sales royalty threshold in 3.1, GLYCANEX will reimburse
WELLSTONE
all approved costs, occurring on or after the
date of reaching
the sales
royalty threshold in 3.1, resulting directly from the
prosecution
and
maintenance of WELLSTONE Patent Rights hereunder. Until the sales
royalty
threshold in 3.1 is reached, all costs for maintaining the
WELLSTONE
Patent Rights will be
for the account of WELLSTONE, as further
described
in 7.3 below.
4.3 All payments and royalties due to WELLSTONE shall be paid to
WELLSTONE on a
net
base.
4.4 All royalties and
other payments due hereunder shall be payable in US
Dollars
making reference to "Patent License Agreement WELLSTONE".
4.5 Within thirty
(30) days after the
end of six (6) month
period, GLYCANEX
shall pay
the royalties due
in those six (6) months and as specified
in
statements
made by GLYCANEX, setting forth the Licensed Products sold,
the
Net Sales
Price and the royalties due. All other amounts due to WELLSTONE
shall
be affected by GLYCANEX within thirty (30) days
from the invoice
date.
GLYCANEX shall pay
statutory interest
as well as the costs of
collection
if GLYCANEX exceeds such thirty (30)
days term of payment. All
payments
shall be based
on an average of the preceding twenty (20)
reporting
days using the
exchange rate of such bank for foreign currencies
to
Euros.
4.6 Payment of royalties shall accompany the statements to be submitted in
accordance
with Paragraph 4.7 above.
5 REPORTS, BOOKS
OF ACCOUNT, EXAMINATION
5.1 GLYCANEX shall
keep accurate records
containing all information required
for the
computation and verification of the royalties to be paid
hereunder.
5.2 Further to paragraph within sixty (60) days of the end of each
calendar
year
GLYCANEX shall submit to WELLSTONE a statement showing the total
sales
of
Licensed Products by GLYCANEX, its Affiliates
and its sublicensees
during
that year on a country-by-country basis and the royalties due to
WELLSTONE
and the basis for calculating such
royalties. Such
statements
shall be
certified by a chartered public accountant.
5.3 GLYCANEX shall
permit WELLSTONE or its authorized chartered public
accountant
to inspect such
records from
time to time during the term of
this
Agreement, and for six (6) months thereafter, to the extent necessary
to verify
the royalty reports and payments required by this Agreement. If
WELLSTONE
finds discrepancies to its disadvantage, GLYCANEX agrees
to pay
the
auditing costs incurred by WELLSTONE.
5.4 If at any time the payments due to WELLSTONE hereunder are
blocked or
penalized
by authority of any government, whether by law, decree or
otherwise,
then such payments, as the same become due and payable, shall
be
deposited
in the local currency
in a local bank or other depository
designated
by WELLSTONE to its order. A receipt for such deposit shall
then
accompany
each yearly report in lieu of the payment as required herein.
6 DEVELOPING AND
MARKETING EFFORTS
6.1 GLYCANEX, its
Affiliates and/or sublicensees shall be under a commercially
reasonable
efforts obligation in determining the manner and extent to
which
it shall
develop Licensed
Products or create, promote or maintain a market
for sales
of such.
6.2 GLYCANEX shall not make any use of the name of
WELLSTO
