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Royalty And Sublicense Income Agreement

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 This Royalty Agreement involves

GELESIS INC | Gelesis LP | Gelesis, Inc | PureTech Ventures, LLC

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Governing Law: Delaware     Date: 4/1/2015

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Exhibit 10.12


This ROYALTY ASSIGNMENT AGREEMENT (the “ Agreement ”), dated as of December 18, 2009, is by and among (i) PureTech Ventures, LLC, a Delaware limited liability company, (“ PureTech ”), (ii) Gelesis, Inc., a Delaware corporation, (“ Gelesis-US ”) and (iii) Gelesis LP (formerly AML-Dienstein B. V.), a Bermudan limited partnership (“ Gelesis-Bermuda ” and collectively with Gelesis-US, “ Gelesis ”).

WHEREAS, PureTech is required to provide certain funding, management services and intellectual property as set forth in (i) the Note Purchase Agreement dated on or about the date hereof by and between Gelesis-US and PureTech and (ii) the Management and Overhead Services Agreement dated on or about the date hereof by and between Gelesis-US and PureTech;

WHEREAS, PureTech will receive certain consideration for such funding, management services and intellectual property, including the potential royalty payments and sublicense payments set forth herein;

NOW, THEREFORE, in consideration of the mutual promises hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows:

1. Definitions . Reference is made to that certain Patent License and Assignment Agreement dated December 9, 2009 (the “ License Agreement ”) by and among Gelesis-Bermuda, One S. R. L., Luigi Ambrosio, Luigi Nicolais and Alessandro Sannino. All capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the License Agreement.

2. Royalties .

(a) Gelesis shall pay to PureTech, during the applicable term described in Section 2(b) below, earned royalties at the following rates:


Type of Licensed Product



A royalty on all Net Sales by Gelesis-Bermuda, its affiliates

or any Sublicensee of Licensed Products that are not FoodProducts:



A royalty on all Net Sales by Gelesis-Bermuda or its

affiliates of Licensed Products that are Food Products:



If the manufacture, use, lease, or sale of any Licensed Product is covered by more than one of the Valid Claims under the Patent Rights in the Field, or any patents in the Improvements or Food IP, multiple royalties shall not be due.

(b) The Parties hereby agree that should intellectual property rights owned by a third party pose as an obstacle to the development or commercialization of any Licensed Product that is not a Food Product (the “ Blocking IP ”), Gelesis-Bermuda or an applicable affiliate of Gelesis-Bermuda shall, after consulting in good faith with PureTech, seek a potential settlement solution with the Blocking IP holder and the royalty rates for Licensed Products that

are not Food Products set forth in Section 2(a) shall be reduced by the amount of such consideration paid for the rights to such Blocking IP; provided, however that in no case shall the royalty rates for Licensed Products that are not Food Products set forth in Section 2(a) be reduced by more than fifty percent (50%) as a result of the application of this Section 2(b).

(c) The obligation of Gelesis to pay royalties pursuant to Section 2(a) shall terminate on a country-by-country basis concurrently with (i) the expiration or termination of the applicable Valid Claim under the Patent Rights in the country in which the Licensed Product is sold, or (ii) the withdrawal, cancellation, or disclaiming of the applicable Valid Claim under the Patent Rights in the country in which the Licensed Product is sold.

3. Sublicense Income . Gelesis shall pay to PureTech ten percent (10%) of Sublicense Income received by Gelesis and its affiliates on Food Products.

4. Reports and Payments . Following the commencement of Gelesis’s obligations to pay any royalties pursuant to Section 2, Gelesis shall deliver to PureTech within sixty (60) days after the end of each calendar quarter a written report showing its computation of royalties due under this Agreement for such calendar quarter. Simultaneously with the delivery of each such report, Gelesis shall tender payment of all amounts shown to be due thereon. The royalty payments due on sales in currencies other than U.S. dollars shall be calculated using the appropriate exchange rate for such currency quoted by the relevant Government Authority as published by the Wall Street Journal on the last business day of the calendar quarter to which such report relates. All amounts due under this Agreement shall be paid to PureTech in U.S. dollars by wire transfer to an account in a bank designated by PureTech, or in such other form and/or manner as PureTech may reasonably request. During the term of this Agreement, PureTech, at its cost, shall have the right from time to time (not to exceed once during each calendar year) to engage a certified public accountant, reasonably acceptable to Gelesis, to inspect, during normal business hours, upon reasonable advance notice (not less than one week), and subject to a written obligation of confidentiality acceptable to Gelesis, such books, records and other supporting data of Gelesis as may be necessary to verify Gelesis’s computation of royalties due under this Agreement.

5. Withholding Taxes . All payments made by Gelesis to PureTech shall be net of withholding taxes.

6. Miscellaneous .

(a) Transfers of Rights under this Agreement . This Agreement, and the rights and obligations of each party hereunder, may not be assigned by any party without the prior written consent of each of PureTech and Gelesis.

(b) Successors and Assigns . The provisions of this Agreement shall inure to the benefit of, and be binding upon, the respective successors, permitted assigns, heirs, executors, and administrators of the parties hereto and shall inure to the benefit of and be enforceable by each party hereto.



(c) Notices . Any notice, demand, request or delivery required or permitted to be given pursuant to the terms of this Agreement shall be in writing and shall be deemed given (i) when delivered personally or when sent by facsimile transmission and confirmed by telephone or electronic transmission report (with a hard copy to follow by mail), (ii) on the next business day after timely delivery to a generally recognized receipted overnight courier (such as FedEx) and (iii) on the third business day after deposit in the U.S. mail (certified or registered mail, return receipt requested, postage prepaid), addressed to the party at such party’s address as set forth on the signature pages hereto or as subsequently modified by written notice delivered as provided herein.

(d) Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware and the laws of the United States applicable therein (without giving effect to any choice or conflict of laws provision or rule that would cause the application of the laws of any other jurisdiction) and shall be treated in all respects as a Delaware contract.

(e) Waivers and Amendments . Except as otherwise expressly set forth in this Agreement, any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only by written agreement of PureTech, Gelesis-US and Gelesis-Bermuda. No waivers of or exceptions to any term, condition or provision of this Agreement, in any one or more instances, shall be deemed to be, or construed as, a further or continuing waiver of any such term, condition or provision.

(f) Delays or Omissions . No delay on the part of any party in exercising any right, power, remedy or privilege hereunder shall operate as a waiver thereof nor shall any waiver on the part of any party of any such right, power, remedy or privilege, nor any single or partial exercise of any such right, power, remedy or privilege, preclude any further exercise thereof or the exercise of any other such right, power, remedy or privilege. All remedies, either under this Agreement, by law, or otherwise afforded to the parties, shall be cumulative and not alternative.

(g) Titles and Subtitles . The titles of the sections and subsections of this Agreement are for convenience of

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