XENOGEN LICENSE AGREEMENT FOR REAL-TIME IN VIVO IMAGING TECHNOLOGY

XENOGEN LICENSE AGREEMENT

FOR REAL-TIME IN VIVO IMAGING TECHNOLOGY

This Xenogen License Agreement For Real-Time In Vivo Imaging   Technology (the “Agreement”) is made by and between Xenogen Corporation, with a principal place of business at 860 Atlantic Avenue, Alameda, CA 94501 (“Xenogen”) and Gene Logic, Inc., a corporation with a principal place of business at 610 Professional Drive, Gaithersburg, Maryland 29879 (“Licensee”) (each a “Party” and collectively, the “Parties”), and is effective as of November 17, 2004 (the “Effective Date”).

RECITALS

WHEREAS , Xenogen owns or Controls the Imaging System (as defined below) and the Xenogen Imaging Technology (as defined below);

WHEREAS , Licensee wishes to obtain a non-exclusive license to use the Xenogen Imaging Technology and the Imaging System (as defined below) in the Field (as defined below) to image bioluminescent cells or organisms in vivo as a method of drug discovery, and preclinical drug development and exogenous agent investigation and research; and

WHEREAS , Xenogen wishes to grant Licensee such a license on the terms and conditions contained in this Agreement.

NOW THEREFORE , in consideration of the mutual promises and covenants herein, the Parties hereby agree as follows.

ARTICLE I

DEFINITIONS

1.1      “ Affiliate ” means any corporation, firm, partnership or other legal entity which, directly or indirectly, is controlled by a Party. For the purposes of this definition only, “control” shall mean (i) the direct or indirect ownership of fifty percent (50%) or more of the outstanding voting securities or capital stock of such entity, or (ii) such other relationship as in fact results in actual control over the management, business and affairs of such entity.

1.2      “ Bioware ^Ò ” is a Xenogen trademark that identifies certain prokaryotic or eukaryotic cells, bacteria and micro-organisms that are genetically engineered to produce light, and are owned or Controlled by Xenogen.

1.3      “ Authorized Site ” means Licensee’s designated research facility where the Imaging System will be installed and used, initially located at 38 Sidney Street, Cambridge, MA. During the Term, Licensee may designate alternate/additional Authorized Sites in accordance with the terms of this Agreement.

1.4     “ Collaboration ” means an agreement between Licensee or an Affiliate and a third party including, without limitation, an academic collaborator, that establishes a collaboration, sponsored research program, joint venture, corporate partnership or other similar type of strategic alliance between Licensee or an Affiliate and such third party that: (a) involves research or development in a specified field or on substance(s) of interest to the parties; (b) includes access to and use of material and proprietary technology and intellectual property of Licensee or an Affiliate other than the Xenogen Imaging Technology; (c) in which Licensee or an Affiliate contributes substantial research or development effort; and (d) under which Licensee or an Affiliate has been granted or retains proprietary rights for significant intellectual property (other than as relates to its own proprietary technologies or improvements thereto), or success-based economic interests (e.g. milestone payments or future royalties from product sales) in the future of the therapeutic entity or other substances or uses generated under the work conducted. For clarity, Licensee acknowledges that the term “Collaboration” does not cover Third Party Service or other arrangements between Licensee and a third party under which: (i) Licensee only performs contract services for such third party on a fee-for-service basis without the rights or interests such as those set forth in (iii) below; (ii) Licensee provides such third party the data or other information resulting from such service; and (iii) with respect to the potential results of such service, Licensee retains no intellectual property rights (other than as relates to its own proprietary technologies or improvements thereto) or success-based economic interests.

1.5      “ Confidential Information ” shall have the meaning set forth in Section 4.1.

1.6      “ Control ” or “ Controlled ” means possession of the ability to grant a license or sublicense as provided for herein without violating the terms of any agreement or other arrangements with any third party or any intellectual property rights of any third party.

1.7      “ Equipment ” means the specific hardware components included in the Imaging System and replacements and substitutions therefor provided by or through Xenogen.

1.8      “ Field ” means pharmaceutical and biotechnological research and development and/or the investigation of the effect of a chemical, biological, or other substance or energy applied to or into the body of an animal conducted by Licensee or an Affiliate for itself and/or in connection with a Collaboration, which includes, but is not limited to, use of the Imaging System, but excluding Third Party Service.

1.9      “ Imaging System ” means Xenogen’s IVIS ^® Imaging System 200 Series (as well as XWS-248, XGI-8, XLS-4 and other accessories on Exhibit B other than the last 4 items), consisting of the Equipment and Software.

1.10      “ Installation Date ” shall have the meaning set forth in Section 2.1.

1.12      “ LPTA ^® Animal Models ” is a Xenogen trademark that identifies certain laboratory animals that are genetically engineered to produce light, and are owned or Controlled by Xenogen. “LPTA” Models shall have the meaning defined in Section 3.4 and LPTA Materials shall have the meaning defined in Section 1.1 of Exhibit C.

1.13      “ Software ” means the object code form of Xenogen’s Living Image ^® image processing and data analysis software, as well as updates and upgrades provided by Xenogen at its sole discretion, and documentation related thereto.

1.14      “ System ” means any imaging system used in connection with the Xenogen Imaging Technology.

1.15      “ Term ” means the term of this Agreement as set forth in Section 8.1.

1.16      “ Third Party Service ” means research conducted by Licensee in support of any relationship or agreement between Licensee and a third-party entity other than services performed by Licensee as part of a Collaboration.

1.17      “ Xenogen Imaging Technology ” means the technology claimed in U.S. Patent Nos. 5,650,135, 6,217,847 and 6,649,143 and all substitutions, continuations, continuations-in-part, divisionals, reissues, extensions, confirmations, and re-examinations thereof. 

ARTICLE II

IMAGING SYSTEM

2.1       Delivery and Operation .

(a)       Imaging System . Within sixty (60) days of the Effective Date, Xenogen shall ship the Imaging System to Licensee and install it at the Authorized Site. The Imaging System will be suitably packed for shipment in Xenogen’s standard containers, marked for shipment to the Authorized Site, and shipped FOB Xenogen’s manufacturing facility in Alameda, California, freight and freight insurance prepaid and added to the invoice. Upon proper installation of the Imaging System and completion of the Initial Training (as described in Section 2.2(a) below), Licensee shall provide Xenogen with written acknowledgement of the foregoing, the date of such acknowledgement to be deemed the "System Installation Date". Upon payment of the purchase price for the initial Imaging System pursuant to Section 3.5(a), the Equipment provided as part of such Imaging System will become the sole property of Licensee.

(b)        Additional Systems . During the Term, Licensee may, but is under no obligation to, order, in writing, from Xenogen additional Imaging Systems (each, an “Additional System”) that Licensee desires to use in accordance with the terms of this Agreement. Upon payment of the purchase price for each Additional System pursuant to Section 3.5(a), the Equipment provided as part of such Additional System will become the sole property of Licensee. Each Additional System includes hardware and software components providing the same or similar functionality as the Imaging System. Xenogen will deliver and install any Additional Systems at the installation location designated by Licensee at the Authorized Site in the manner described in Section 2.1(a) and Section 2.2. The terms and conditions of Sections 2.2 through 2.3 shall apply to Additional Systems in the same manner as they apply to the Imaging System. Unless otherwise agreed to in writing, Additional Systems shall be shipped to Licensee within sixty (60) days after receipt of Licensee’s purchase order for such Additional System, and Xenogen will thereafter install it at the location designated by Licensee at the Authorized Site within fourteen (14) business days after delivery to the installation site. Upon installation of the Additional System and completion of Initial Training (as described in Section 2.2(a) below), Licensee shall provide Xenogen with written acknowledgement of completion of all of the foregoing, the date of such acknowledgement to be deemed the "Installation Date" for each such Additional System.

2.2       Technical Assistance .

(a)       Initial Training . Xenogen shall provide Licensee, without additional charge, reasonable assistance and training in the initial installation and introduction to use of the Imaging System, including assistance and training at the Authorized Site, commencing within fourteen (14) business days after receipt of the Imaging System, unless otherwise agreed by Licensee. Such initial training and assistance at the Authorized Sites shall not exceed a total of three (3) days, in the aggregate, by Xenogen without Xenogen’s further consent and payment to Xenogen for such additional assistance and training. Xenogen anticipates making two technically qualified personnel available at the Authorized Site for an aggregate amount of up to three (3) days in support of the foregoing training and assistance, such training and assistance referred to as the "Initial Training". Licensee may request, and Xenogen may provide in response to such request, additional technical support to Licensee at Xenogen's then current rate for such support (currently $1,250 per day per employee as of the Effective Date) plus associated expenses.

(b)       System Movement . Licensee acknowledges and agrees that Xenogen’s technical assistance may be necessary for reinstallation and set-up in the event that the Imaging System is to be moved from its installed location to other locations within the Authorized Site or from one Authorized Site to another. If Licensee desires to designate an alternate or additional Authorized Site, it may do so provided it notifies Xenogen in writing of such Authorized Site and indicates the approximate date that such Authorized Site is to become effective and the dates on which Xenogen assistance may be required to install and test the system. Xenogen shall acknowledge receipt of such notice and indicate whether it can provide the necessary support at the time requested or propose alternate dates. Except in an emergency, Licensee shall provide any such notice at least two (2) weeks before it intends to make the new Authorized Site active and, provided it has given at least two (2) weeks prior notice, Xenogen shall make commercially reasonable efforts to provide the support requested at the time specified or as soon thereafter as possible. In an emergency, the parties shall work together to schedule re-installation and testing as soon as possible. Licensee may request, and Xenogen may provide in response to such request, such technical assistance to Licensee for such System moves at the fee specified in Exhibit D.

2.3       Software

(a)       License . In consideration for the license fees payable by Licensee hereunder, Xenogen hereby grants to Licensee and its Affiliates for the Term a royalty-free, non-exclusive, non-transferable (except as provided in Section 9.2) license, without the right to sublicense, to use, store and display the Software solely in connection with the practice of the Xenogen Imaging Technology in conjunction with the Imaging System at the Authorized Site on behalf of Licensee or in connection with a Collaboration. Use of the Software and associated computer involves methods and products claimed under U.S. Patent No. 6,614,452 and all substitutions, continuations, continuations-in-part, divisionals, reissues, extensions, confirmations and reexaminations thereof, all of which are covered by the license granted herein. Installation and use of the Software shall be restricted for the Field and to the Equipment and up to five (5) additional computer workstations at the Authorized Site. During the Term, licenses for additional copies of the Software may be requested from Xenogen at its then-applicable retail price.

(b)       Ownership of Software . The Software (including any copyrights related thereto) is and shall remain the sole and exclusive property of Xenogen. Licensee agrees that it will not, without Xenogen’s prior written consent, directly or indirectly, modify, make derivative works, or make any additional copies of the Software, except for one (1) backup copy. Licensee further agrees that it shall not, directly or indirectly, attempt to reverse engineer or decompile the Software or otherwise derive source code from the Software.

(c)       Software Support . Xenogen shall provide maintenance and support of the Software as set forth in Section 2.4(b), except that Xenogen will also provide Licensee with updates to the Software at no additional charge during the term as soon as they become commercially available.

2.4       Limited Warranty and Maintenance and Support .

(a)       Limited Warranty . Xenogen represents and warrants to Licensee that for a period of one (1) year (the “Warranty Period”) after the Installation Date: (i) the Equipment provided to Licensee hereunder shall in all material respects conform to and perform in accordance with its published specifications existing at the time such Equipment is acquired or manufactured by Xenogen; and (ii) the Software will in all material respects conform to and perform in conformance with Xenogen’s then-current specifications for such Software. The foregoing warranty expressly excludes failure to perform due to Misuse of all or any component of the Imaging System, whether Equipment or Software. As used in this Agreement, “Misuse” means, without limitation, (i) any use that is, in any material respect, inconsistent with or in contradiction to the instructions provided with the Imaging System, (ii) intentional damage to or misuse of the Imaging System, and (iii) damage due to negligence in connection with use of the Imaging System. If, Licensee so requests, Xenogen will service the System to repair such Misuse, Xenogen reserves the right to charge the full cost of such service to Licensee, including travel expenses. Xenogen does not warrant that the Software will meet all of Licensee’s requirements or that the use of the Software will be uninterrupted or error-free. Except as expressly provided herein and in the exhibits hereto, Xenogen's sole obligation, and Licensee’s sole remedy, under this Section 2.4 is to use reasonable efforts to promptly correct or replace any non-conforming Equipment and/or Software at Xenogen’s expense, including parts, labor and travel expenses related to maintenance and corrective service during the Warranty Period.

(b)       Maintenance and Support of Imaging System . During the Warranty Period and for no additional consideration, Xenogen will also provide Licensee with its “Standard” Service Program (pursuant to Section 3.1.2 of Xenogen’s IVIS® Imaging System Service and Support Agreement (the “Service Agreement”), attached hereto as Exhibit D) for the Imaging System. Prior to expiration of the foregoing warranty Licensee may purchase maintenance and support for its Imaging System in accordance with the terms set forth in Exhibit D.

2.5       Disclaimer of All Other Warranties . EXCEPT AS EXPRESSLY SET FORTH IN SECTION 2.4(A) AND ELSEWHERE IN THIS AGREEMENT AND IN THE RELATED AGREEMENTS ATTACHED AS EXHIBITS HERETO, XENOGEN MAKES NO WARRANTIES (EXPRESS, IMPLIED, STATUTORY OR OTHERWISE) WITH RESPECT TO THE IMAGING SYSTEM HEREUNDER AND SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, AND ALL WARRANTIES OF NONINFRINGEMENT OF THIRD PARTY INTELLECTUAL PROPERTY RIGHTS. XENOGEN DOES NOT REPRESENT OR WARRANT THAT THE EQUIPMENT OR SOFTWARE WILL BE FREE OF DEFECT, UNINTERRUPTED, ACCURATE, COMPLETE, CURRENT, STABLE, BUG-FREE, ERROR-FREE, OR AVAILABLE AT ANY TIME.

ARTICLE III

TECHNOLOGY LICENSE

3.1       Technology License . In consideration of the license fees payable by Licensee hereunder, Xenogen hereby grants to Licensee and its Affiliates a non-exclusive, non-transferable license, without the right to sublicense, to practice the Xenogen Imaging Technology during the Term solely with the Imaging System and solely within the Field at the Authorized Sites on behalf of Licensee or in connection with a Collaboration. In consideration of the granting of the foregoing license, Xenogen shall provide, without additional charge, not more than a total aggregate of [REDACTED] person hours per calendar year of follow-on technical support to Licensee at the Authorized Site. Licensee may request, and Xenogen will provide in response to such request, additional technical support to Licensee at Xenogen's then current rate for such support plus associated expenses. Each Party will designate an individual to serve as a contact point for the other Party and to address and attempt to resolve technical issues that arise during the Term. Xenogen’s initial contact is Mr. Ben Carter, and Licensee’s initial contact is Dr. Joseph Carroll. Each Party may change its designated contact upon written notice to the other Party.

3.2       Limitations. The licenses granted in Sections 2.3(a) and 3.1 are only for use at the Authorized Site. Licensee may not exercise the licenses granted herein to provide Third Party Service. No other license or rights shall be deemed granted or created by implication, estoppel or otherwise.

3.3       Bioware™ Cells and Microorganisms .

(a)       Transfer and Use . Licensee may request during the Term, and subject to availability Xenogen will provide (and license for use), any of the Bioware identified in Exhibit A, or other models that are offered commercially by Xenogen, at the Authorized Site solely for use in the Field on behalf of Licensee or in connection with a Collaboration according to the terms and conditions herein. Xenogen will deliver such Bioware to Licensee as soon as practicable following receipt of Licensee’s applicable request or purchase order. Licensee may propagate the Bioware received hereunder, as well as Progeny and Derivatives thereof, solely for the purpose of creating additional quantities for Licensee’s use as permitted hereunder. Licensee acknowledges that the Bioware, Bioware Progeny and Bioware Derivatives (collectively, “Bioware Materials”) are experimental in nature and may have unknown characteristics. Xenogen will advise Licensee promptly of any hazards it determines may apply to any of the Bioware and appropriate precautions to be taken in connection therewith. Licensee therefore agrees to use prudence and all reasonable care in the use, handling, storage, transportation and disposition and containment of the Bioware Materials and to maintain them under suitable containment conditions in compliance with all applicable national, state and local laws, regulations, rules and ordinances. 

(b)       Definitions . The term “Bioware Progeny” shall mean and refer to both unmodified descendents and modified descendents of the Bioware received hereunder that occur as a result of a naturally occurring mutation or other spontaneous process. The term “Bioware Derivative” shall mean a substance that is directly or indirectly derived from the Bioware received hereunder or any Progeny thereof, including, without limitation, a product expressed by or generated from the Bioware or Progeny.

(c)       Consideration. During the Term, Bioware cell lines will be priced at a non-refundable initial fee of [REDACTED] per cell line, with a non-refundable annual renewal fee of [REDACTED] per cell line. During the Term, Bioware bacterial strains will be priced at a non-refundable initial fee of [REDACTED] per strain, with a non-refundable annual renewal fee of [REDACTED] per strain. Except for Bioware covered by the payment made under Section 3.5(d) below, Xenogen will invoice Licensee for Bioware upon shipment and annually thereafter.

(d)       Ownership . Licensee agrees that, as between the Parties, the Bioware Materials are and shall be owned and/or controlled exclusively by Xenogen, and that this Agreement creates a bailment by Licensee with respect to any and all such Bioware Materials. In the event that Licensee does not pay the annual renewal fee for any Bioware acquisition when due, Licensee agrees to destroy all such Bioware Materials, and to provide Xenogen with written certification of such destruction executed by an authorized representative of Licensee.

(e)       Limitations . Licensee shall not use the Bioware Materials for any human in vivo use whatsoever, or for any human in vitro diagnostic or therapeutic applications. The Bioware Materials are provided to Licensee for use solely at the Authorized Sites. Licensee shall not transfer the Bioware Materials to any person who is not under the immediate and direct employment of Licensee or to any place other than Licensee’s facilities at the Authorized Sites. Licensee shall not use the Bioware Materials in the performance of or in conjunction with Third Party Service. Except as provided in Section 3.3(a), Licensee shall not attempt to alter or modify the Bioware Materials in any way without the prior written consent of Xenogen, or attempt, directly or indirectly, to re-engineer the Bioware Materials, or extract or transfer any genetic material from the Bioware Materials to another organism. Licensee agrees to maintain a valid license to the Xenogen Imaging Technology so long as the Bioware Materials are being used by Licensee for applications covered by one or more of the claims in the Xenogen Imaging Technology.

(f)       Luciferase . Licensee acknowledges that the mutant recombinant Coleoptera luciferase nucleic acid and protein contained in Bioware cell lines and the LPTA Models is the subject of U.S. Patent Nos. 5,583,024, 5,674,713 and 5,700,673, assigned to The Regents of The University of California and U.S. Patent No. 5,670,356, assigned to Promega Corporation. That material, or any substance that contains or incorporates that material, may not be transferred or licensed to any other party except as expressly provided herein, or be used for commercial purposes by any other party (including Licensee), without the express written consent of The Regents of The University of California and Promega Corporation.

(g)       Limited Replacement . To the extent the Bioware is not living or fails to exhibit sufficient luminescent properties (as described in Xenogen’s technical descriptions of such Bioware) upon delivery to Licensee, and Licensee notifies Xenogen thereof within ten (10) days after receipt, Xenogen shall, at Licensee’s option, either promptly provide replacements to Licensee or refund the amount paid for such Bioware. The foregoing constitutes Licensee’s sole remedy for dissatisfaction with the Bioware Materials or failure of the Bioware to perform in accordance with Xenogen's specifications existing at the time of delivery.

(h)       Other Sources . Licensee is not prohibited from developing or acquiring from any other source other bioluminescent or fluorescent strains ("Other Strains") to be used in the practice of the Xenogen Imaging Technology in accordance with the terms of this Agreement. Licensee agrees that it shall have the sole responsibility for acquiring any third party intellectual property rights necessary to use such Other Strains, including rights to those patents described in Section 3.3(f) above. Xenogen may also agree to develop new Bioware™ cells and/or microorganisms to be provided to Licensee, for fees to be negotiated between the Parties in good faith.

3.4       LPTA ^® Animal Models . Upon Licensee’s request during the Term, and subject to availability, Xenogen will provide Licensee with quantities of specific lines of Xenogen’s LPTA Animal Models identified in Exhibit A, or that otherwise are offered commercially by Xenogen, (“LPTA Models”) for use in the Field in connection with the Imaging System, subject to the terms and conditions of this Agreement and those standard terms and conditions provided at Exhibit C. During the Term, LPTA Models will be priced at a non-refundable fee of [REDACTED] per animal (minimum quantity of twenty animals), or, for breeding pairs, a non-refundable initial fee of [REDAC