Limited Exclusive Patent License Agreement - The Regents of the University of California and Cepheid
LIMITED EXCLUSIVE PATENT LICENSE AGREEMENT
FOR
A MICROFABRICATED
SLEEVE TYPE CHEMICAL REACTION CHAMBER
BETWEEN
THE REGENTS OF THE UNIVERSITY OF CALIFORNIA
AND
CEPHEID
LLNL CASE NO. TL-1355-96
LAWRENCE LIVERMORE NATIONAL LABORATORY
UNIVERSITY OF CALIFORNIA
P.O. BOX 808, L-795, LIVERMORE, CA 94551
INDUSTRIAL PARTNERSHIPS AND COMMERCIALIZATION
MARCH 1997
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TABLE OF CONTENTS
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1. BACKGROUND.............................................................................. 1
2. DEFINITIONS............................................................................. 2
3. LICENSE GRANT........................................................................... 5
4. LICENSE FEES, ROYALTIES, AND PAYMENTS................................................... 6
5. DUE DILIGENCE........................................................................... 7
6. PROGRESS AND ROYALTY REPORTS............................................................ 8
7. BOOKS AND RECORDS....................................................................... 12
8. LIFE OF THE AGREEMENT................................................................... 12
9. TERMINATION............................................................................. 12
10. PATENT PROSECUTION AND MAINTENANCE...................................................... 14
11. PATENT INFRINGEMENT..................................................................... 15
12. USE OF NAMES AND TRADEMARKS............................................................. 17
13. LIMITED WARRANTY........................................................................ 17
14. INDEMNIFICATION AND INSURANCE........................................................... 18
15. WAIVER.................................................................................. 20
16. ASSIGNABILITY........................................................................... 20
17. LATE PAYMENTS........................................................................... 20
18. NOTICES................................................................................. 21
19. DISPUTES AND GOVERNING LAWS............................................................. 22
20. PATENT MARKING.......................................................................... 22
21. GOVERNMENT APPROVAL OR REGISTRATION..................................................... 22
22. EXPORT CONTROL LAWS..................................................................... 23
23. FORCE MAJEURE........................................................................... 23
24. UNITED STATES PREFERENCE................................................................ 23
25. CONFIDENTIALITY......................................................................... 23
26. MISCELLANEOUS........................................................................... 24
EXHIBIT A - LICENSED PATENTS................................................................ 26
EXHIBIT B - LICENSE GRANT................................................................... 27
EXHIBIT C - ISSUE FEE AND ROYALTIES......................................................... 29
EXHIBIT D - MUTUAL NONDISCLOSURE AGREEMENT.................................................. 32
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LIMITED EXCLUSIVE PATENT LICENSE AGREEMENT
FOR
A MICROFABRICATED
SLEEVE TYPE CHEMICAL REACTION CHAMBER
This Agreement effective as of the Effective Date is between The Regents of the
University of California ("THE REGENTS"), under its U.S. Department of Energy
Contract No. W-7405-ENG-48 to manage and operate Lawrence Livermore National
Laboratory ("LLNL"), and Cepheid ("LICENSEE"), a California corporation having
its principal place of business at 3410 Garrett Drive, Santa Clara, CA 95054.
THE REGENTS is a corporation organized and existing under the laws of the State
of California, with its principal office at 300 Lakeside Drive, Oakland, CA
94612-3550. THE REGENTS and LICENSEE are referred to jointly as "Parties".
1. BACKGROUND
1.1 Certain Inventions are described in U.S. Patent Number 5,589,136, its
Continuation in Part (IL-9707B), and PCT/US96/10453 (herein referred to
as "Invention") relating to a sleeve-type chemical reaction chamber that
may be utilized in any chemical reaction system for synthesis or
processing of organic, inorganic, or biochemical reactions, such as the
polymerase chain reaction and/or other DNA reactions which are examples
of a synthetic, thermal-cycling-based reaction. The reaction chamber may
also be used in synthesis instruments, particularly those for DNA
amplification and synthesis. The Invention was made in the course of
research at Lawrence Livermore National Laboratory and is covered by THE
REGENTS' Patent Rights as defined in Article 2 (DEFINITIONS).
1.2 The U.S. Department of Energy (DOE) was a sponsor of the invention
development. Thus, this Agreement is subject to overriding obligations
to the Federal Government under the provisions of the applicable grant
or regulations.
1.3 LICENSEE is a start-up company in San Jose, California, that will sell
Licensed Products and become a supplier of Licensed Products to a
variety of companies for worldwide markets. LICENSEE intends to
specialize in the development and
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manufacture of three types of products: heating cooling optics
micro-modules (HCOM), small thermal cycler instruments containing HCOMs,
and hand-held instruments containing HCOMs. THE REGENTS is willing to
grant rights to the Invention so that it may be developed and used by
LICENSEE to the fullest extent for the benefit of the U.S. economy and
the general public.
1.4 The Parties hope to combine THE REGENTS' Invention with the LICENSEE's
technical and commercial capabilities and inventions for application of
the Invention to the area of nucleic acid amplification and ligand
binding assays.
The Parties agree as follows:
2. DEFINITIONS
2.1 "Affiliate" means any business entity that LICENSEE directly or
indirectly controls, or is under common control with, or is controlled
by at least fifty percent (50%) of the outstanding stock or other voting
rights entitled to elect directors. In any country where local law does
not permit foreign equity participation of at least fifty percent (50%),
then an Affiliate includes any company in which the controlling entity
owns or controls, directly or indirectly, the maximum percentage of that
outstanding stock or voting rights permitted by local law. In this
definition, "control" includes ownership.
2.2 "Joint Venture" means any separate entity established pursuant to an
agreement between a third party and LICENSEE to constitute a vehicle for
conducting business, in which the separate entity manufactures, uses,
purchases, sells, or acquires Licensed Products from LICENSEE.
2.3 "THE REGENTS' Patent Rights" are THE REGENTS' rights in Licensed Patents
under applicable patent laws.
2.4 "Licensed Patents" are:
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2.4.1 the patent and patent applications specified in Exhibit A and
resulting patent;
2.4.2 reissues and continuations of 2.4.1 above; and
2.4.3 foreign patent applications and resulting patents per Article 10
(PATENT PROSECUTION AND MAINTENANCE) of this Agreement.
2.5 "Licensed Products" are products that incorporate or are produced by the
practice of subject matter claimed in Licensed Patents or whose
manufacture, use, sale, export, or offer for sale would constitute an
infringement of any claim in THE REGENTS' Patent Rights but for the
license granted under this Agreement. Licensed Products are considered
sold when invoiced or, if not invoiced, when delivered to a third party.
2.6 "LICENSEE" means Cepheid, and its Affiliates and Joint Ventures.
2.7 "Net Selling Price(s)" as used in this Agreement to compute royalties,
means the gross invoice selling prices of Licensed Products from Sale of
Licensed Products by LICENSEE or a sublicensee to independent third
parties for cash or other form of consideration in accordance with
generally accepted accounting principles limited to the following
deductions (if not already deducted from the gross invoice price and at
rates customary within the industry):
2.7.1 Allowances (actually paid and limited to rejections, returns, and
prompt payment and volume discounts granted to customers of
Licensed Products, whether in cash or Licensed Products in lieu of
cash); and
2.7.2 freight, transport packing, insurance charges associated with
transportation; and
2.7.3 taxes, tariff, or import/export duties based on sales when
included in gross sales, but not value-added taxes or taxes
assessed on income derived from such sales.
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No deductions will be made from Net Selling Price for commissions paid
to individuals whether they be with independent sales agencies or
regularly employed by LICENSEE and on its payroll, or for cost of
collections.
No deductions will be made from Net Selling Price for a service
contract.
Where LICENSEE distributes Licensed Products for end use to itself, an
Affiliate, a Joint Venture, or a sublicensee, then such distribution
will be considered a sale at list price normally charged to independent
third parties, and THE REGENTS will be entitled to collect a royalty on
such sale in accordance with Article 4 (LICENSE FEES, ROYALTIES, AND
PAYMENTS). Where LICENSEE distributes Licensed Products for resale to an
Affiliate, a Joint Venture, or a sublicensee, THE REGENTS will be
entitled to collect a royalty based on the resale Net Selling Price.
The Net Selling Price of Licensed Products that are not sold, but are
otherwise disposed of for value, is the selling price at which LICENSEE
is currently offering for sale products of similar kind and quality,
sold in similar quantities. If LICENSEE is not currently offering
comparable products for sale, then the Net Selling Price will be the
average selling price at which products of similar kind and quality,
sold in similar quantities, are currently offered for sale by other
manufacturers. If comparable products are not currently sold or offered
for sale by others, then the Net Selling Price will be LICENSEE's cost
of manufacture determined by LICENSEE's customary accounting procedures,
plus LICENSEE's standard markup.
2.8 "Net Sales" as used in this Agreement to compute royalties, means the
total Net Selling Prices of Licensed Products sold by LICENSEE or a
sublicensee.
2.9 "Exclusive Field-of-Use" is the exclusive application or use defined in
Exhibit B.
2.10 "Effective Date" means the date of execution by the last signing party.
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2.11 "Ligand-binding Assays" are reactions between antibodies and antigens or
between receptors and their ligands which may be detected by means
including, but not limited to, agglutination, fluorescence quenching,
chemiluminescence, or luminescence quenching.
3. LICENSE GRANT
3.1 Subject to the terms and conditions of this Agreement, THE REGENTS
grants to the LICENSEE a nontransferable, royalty-bearing license to
make, have made, import, use, and sell Licensed Products covered by the
Licensed Patents in the Exclusive Field-of-Use as specified in Exhibit B
where patent rights exist.
3.2 The U.S. Government has a paid-up, royalty-free, non-transferable,
worldwide, irrevocable license for government use to practice or have
practiced by or on behalf of the U.S., Licensed Patents. The U.S.
Government has certain other rights under 35 U.S.C. Sections 200-212 and
applicable regulations.
3.3 THE REGENTS reserves the right to use THE REGENTS' Patent Rights and
associated technology for noncommercial, educational, and research
purposes.
3.4 THE REGENTS also grants to LICENSEE the right to issue royalty-bearing
sublicenses to third parties to make, have made, import, use, and sell
Licensed Products in the Exclusive Field-of-Use, provided LICENSEE has
current exclusive rights under this Agreement at the time of such
sublicenses. LICENSEE must sublicense in the Exclusive Field-of-Use if
LICENSEE cannot adequately supply market requirements.
3.5 Any sublicenses granted by LICENSEE will include all of the rights and
obligations due THE REGENTS that are contained in this Agreement.
3.6 LICENSEE will provide THE REGENTS with a copy of each sublicense issued
hereunder within thirty (30) days after issuance; collect payment of all
royalties due THE REGENTS from the sale of Licensed Product by any
sublicensees; pay THE REGENTS
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the amounts due and collected from sublicensees according to the
schedule set forth in Article 6 (PROGRESS AND ROYALTY REPORTS) of this
Agreement; and summarize and deliver all reports due THE REGENTS from
sublicensees according to the schedule set forth in Article 6 (PROGRESS
AND ROYALTY REPORTS) of this Agreement.
3.7 The sublicenses granted hereunder will be subject to all the applicable
provisions of the license granted back to the United States Government
(see Section 3.2 above).
4. LICENSE FEES, ROYALTIES, AND PAYMENTS
4.1 LICENSEE will pay the University a nonrefundable license issue fee as
set forth in Exhibit C.
4.2 As further consideration for rights granted to LICENSEE hereunder,
LICENSEE will pay to THE REGENTS an earned royalty on Net Sales of
Licensed Products sold by LICENSEE in or outside the United States,
including a minimum annual royalty as defined in Exhibit C. The minimum
annual royalty is due by February 28 of each year and is credited
against earned royalties until consumed for that year.
4.3 LICENSEE will pay THE REGENTS an earned royalty, as defined in Exhibit
C, on all Licensed Products sold by any sublicensee.
4.4 If this Agreement terminates, then all shipments made on or before the
day of termination that have not been billed are considered sold and
subject to royalty. Royalties paid on Licensed Products which are not
accepted by the customer are credited to LICENSEE.
4.5 LICENSEE will pay earned royalties to THE REGENTS no later than February
28, May 31, August 31, and November 30 of each calendar year. Each
payment will be for all royalties accrued within the most recently
completed quarter.
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4.6 LICENSEE will pay in U.S. dollars collectible at par in San Francisco,
California. When Licensed Products are sold for currencies other than
U.S. dollars, earned royalties will first be determined in the foreign
currency of the country in which the Licensed Products were sold and
then converted into equivalent U.S. dollars. The exchange rate is that
rate quoted in the Wall Street Journal on the last business day of the
reporting period and is quoted as local currency per U.S. dollar.
4.7 Royalties for sales occurring in any country outside the U.S. are not
reduced by any value-added taxes, fees, or other charges assessed on
income derived from such sales imposed by the government of such
country. LICENSEE is responsible for all bank transfer charges.
4.8 Not withstanding the provisions of Article 23 (FORCE MAJEURE), if legal
restrictions prevent the LICENSEE from prompt payment of part or all
royalties on sales of a Licensed Product in any country outside the
U.S., LICENSEE will convert the amount owed to THE REGENTS into U.S.
funds and pay THE REGENTS directly from its U.S. source of funds.
4.9 THE REGENTS will not collect royalties on Licensed Products distributed
to or used by the U.S. Government. LICENSEE will reduce the amount
charged for Licensed Products distributed to or used by the U.S.
Government by an amount equal to the royalty otherwise due THE REGENTS.
5. DUE DILIGENCE
5.1 LICENSEE will use reasonable commercial efforts to develop, manufacture
and sell Licensed Products. LICENSEE will use reasonable commercial
efforts to market those products within a reasonable time after this
Agreement is executed and in sufficient quantities to meet market
demands and to comply with the minimum royalties specified in paragraph
C of Exhibit C. LICENSEE must demonstrate a continuing effort to market
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Licensed Products to meet market demands following LICENSEE's first
offer of Licensed Products for sale.
5.2 If LICENSEE is unable to perform the schedule and conditions set forth
in Exhibit B, THE REGENTS will notify LICENSEE of such inability and if
such inability is not cured within sixty (60) days after such notice,
THE REGENTS may terminate this Agreement or change the license grant to
a nonexclusive license.
5.3 LICENSEE will be entitled to exercise prudent and reasonable business
judgment in meeting its due diligence obligations in accordance with
this Agreement. LICENSEE will conduct normal, continuous business
operations. However, if LICENSEE must seek protection under any United
States bankruptcy proceedings, LICENSEE will notify THE REGENTS after
LICENSEE files for bankruptcy, and THE REGENTS will receive that
notification no later than seventy-two (72) hours after the bankruptcy
filing. Bankruptcy will be grounds for termination of this Agreement.
6. PROGRESS AND ROYALTY REPORTS 6.1 Upon execution of this Agreement,
LICENSEE will submit to THE REGENTS a semi-annual progress report
covering LICENSEE activities in meeting the commercialization conditions
set forth in Article 5 (DUE DILIGENCE) and Exhibit B of this Agreement.
The report will include at a minimum the following information:
License Number
Name of Licensee
Date of Report
Reporting period
Summary of work completed
Key scientific discoveries
Summary of work in progress
Current schedule of anticipated events or milestones
Description of Licensed Products
Expected market introduction date of Licensed Products
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A summary of resources (dollar value) spent in the reporting period
Name(s), addresses, and activities of sublicensees, if any
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The report will be due to THE REGENTS according to the following schedule:
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DUE DATE FOR PERIOD
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February 28 July 1 -December 31
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August 31 January 1 - June 30
-----------------------------------------------------------
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6.2 LICENSEE will report to THE REGENTS the first commercial sale of each
type of Licensed Product in the U.S. and in each country outside the
U.S. by LICENSEE or its sublicensees. Such report will include at a
minimum, the following information:
License Number
Name of Licensee or Sublicensee
Date of Report
Company's fiscal year
Date of First Commercial Sale
Place of First Commercial Sale
Description of Licensed Product(s) sold
6.3 After the first commercial sale of a Licensed Product anywhere in the
world by LICENSEE or sublicensees, LICENSEE will submit quarterly
written royalty reports to THE REGENTS on February 28, May 31, August
31, and November 30 of each calendar quarter for sales by LICENSEE or
sublicensees during the most recently completed calendar quarter. If
neither LICENSEE nor sublicensees has sold or used any Licensed Products
during the reporting period, LICENSEE will so state in the royalty
report filed for such period. The royalty report will include at a
minimum the following information:
License Number
Name of Licensee or Sublicensee
Date of Report
What is company's fiscal year?
What is the calendar quarter for this report?
Did earned royalties exceed minimum royalties?
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Report of revenue from commercial contracts and technology access
fees
Report of sales of Licensed Products
Domestic sales:
Products
Domestic sales:
Description of Licensed Product(s)
Unit price (sale and/or use)
Units sold in US
Gross sales in US
Net Sales in US
Royalties due THE REGENTS in $US
Foreign sales:
Country of sales
Description of Licensed Product(s)
Unit price (sale and/or use)
Units sold in each country
Units leased in each country
Gross sales in each country
Net Sales in each country
Monetary exchange rate
Royalties due THE REGENTS in $US
US Government Sales:
Description of Licensed Product(s)
Unit price (sale and/or use)
Units sold
Gross sales
Net Sales in each country
6.4 LICENSEE will provide THE REGENTS with an annual statement of LICENSEE
royalty accounts certified by LICENSEE's Chief Financial Officer, for
each calendar year during the term of this Agreement. LICENSEE will also
provide to THE REGENTS an annual statement of royalty accounts from any
sublicensees certified by sublicensee's Chief Financial Officer for each
calendar year during the term of this Agreement. All such statements
will be due to THE REGENTS on February 28 of the calendar year next
after the year to which such statements relates. Such statements will be
deemed business sensitive information of LICENSEE.
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7. BOOKS AND RECORDS
7.1 LICENSEE will keep books and records accurately showing all Licensed
Products manufactured, used, or sold under this Agreement. LICENSEE will
preserve those books and records for at least five (5) years from the
date of the royalty payment to which they apply. The books and records
will be open for inspection by representatives or agents of THE REGENTS
at all reasonable times, with reasonable notice given by THE REGENTS to
the LICENSEE.
7.2 THE REGENTS will pay the costs incurred by its representatives or agents
to examine the LICENSEE's books and records. If there is an underpayment
to THE REGENTS in the royalty accounting of more than five percent (5%)
of the total royalties due for any such year, then LICENSEE will pay the
reasonable costs incurred for THE REGENTS' examination. All information
obtained in such inspection will be protected as Business Sensitive
Information, and not disseminated to other parties.
7.3 LICENSEE will provide THE REGENTS with an annual audited or certified
financial statement of LICENSEE's balance sheet and operating statement
or annual report. Such statements or annual reports will be due to THE
REGENTS within one hundred twenty (120) days following the close of
LICENSEE's fiscal year to which such statement relates. Such statements
will be deemed business sensitive information of LICENSEE.
8. LIFE OF THE AGREEMENT
Unless terminated by operation of law or by acts of the Parties under
this Agreement, this Agreement is in effect from the Effective Date
until the expiration of the Licensed Patents (on a country-by-country
basis) under this Agreement.
9. TERMINATION
9.1 The right to terminate this Agreement, if exercised by THE REGENTS,
supersedes the rights granted in Article 3 (LICENSE GRANT). If the
LICENSEE should fail to
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perform any material term or covenant of this Agreement, THE REGENTS may
give written notice that if the LICENSEE should fail to remedy with
satisfaction and provide tangible evidence to THE REGENTS that the
deficiency has been cured within sixty (60) days of the effective date
of receipt of the notice, this Agreement will terminate. The LICENSEE's
failure to pay any royalty or other fee within ten (10) business days
after the date(s) required under Exhibit C will be considered to be a
material breach subject to termination of the license.
9.2 Should LICENSEE terminate this Agreement before LICENSEE has paid the
entire Issue Fee due under this Agreement as specified in Exhibit C, the
full remainder of the Issue Fee will be due immediately, unless LICENSEE
terminates as a result of a reduction or narrowing of the claims of the
pending patent application in Licensed Patents such that Licensed
Patents do not cover Licensed Products, in which case the remainder of
the Issue Fee will be forgiven.
9.3 Termination of this Agreement will not relieve the LICENSEE of any other
obligation or liability accrued hereunder prior to such termination, or
rescind any payments due or paid to THE REGENTS hereunder prior to the
time such termination becomes effective. Such termination will not
affect, in any manner, any rights of THE REGENTS arising under this
Agreement prior to such termination.
9.4 LICENSEE may terminate this Agreement by giving written notice to THE
REGENTS and payment of all amounts due THE REGENTS. Notice of
termination is subject to Article 18 (NOTICES), and termination is
effective thirty (30) days from the effective date of that notice.
9.5 Termination will not affect the rights, liabilities, and obligations
accrued under this Agreement as set forth in the following Articles:
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Article 4 License Fees, Royalties, and Payments
Article 7 Books and Records
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<TABLE>
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Article 9 Termination
Article 10 Patent Prosecution and Maintenance
Article 12 Use of Names and Trademarks
Article 14 Indemnification and Insurance
Article 17 Late Payments
Article 22 Export Control Laws
Article 25 Confidentiality
Exhibit D Mutual Nondisclosure Agreement
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9.6 If LICENSEE and sublicensees cease to produce the Licensed Product(s),
this Agreement will terminate upon notice by THE REGENTS.
9.7 Upon termination of this Agreement for any reason during LICENSEE's term
of exclusivity, THE REGENTS, at its sole discretion, will determine
whether any or all sublicenses will be canceled or assigned to THE
REGENTS. Any sublicensee not in default may request a license from THE
REGENTS with terms no greater than provided herein.
9.8 LICENSEE will provide THE REGENTS with a written inventory of all
Licensed Products in process of manufacture or in stock within thirty
(30) days of the effective date of termination by either party. LICENSEE
will dispose of those Licensed Products within one hundred and twenty
(120) days of the effective date of termination. All sales of Licensed
Products are subject to the terms of this Agreement.
10. PATENT PROSECUTION AND MAINTENANCE
10.1 THE REGENTS will diligently prosecute and maintain the U.S. Licensed
Patents using counsel of its choice. The Licensed Patents are held in
the name of THE REGENTS.
10.2 THE REGENTS will pay costs of preparing, filing, prosecuting, and
maintaining the U.S. Licensed Patents.
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10.3 LICENSEE will have the right to request that THE REGENTS obtain patent
protection on Licensed Patents in foreign countries if available.
LICENSEE must notify THE REGENTS within seven (7) months of the filing
of the corresponding United States application of its decision to obtain
foreign patents. This notice concerning foreign filing will be in
writing and must identify the countries desired. The absence of such a
notice to THE REGENTS will be considered an election not to secure
foreign rights.
10.4 After execution of this Agreement, the expense for preparation, filing
and prosecuting of all foreign patent applications filed at LICENSEE's
request, as well as the maintenance of all resulting patents, will be
shared equally among the LICENSEES that request license rights under
such foreign patents. Such patents will be held in the name of THE
REGENTS and will be obtained using counsel of THE REGENTS' choice.
10.5 LICENSEE's obligation to underwrite and to pay foreign patent
prosecution costs will continue for so long as this Agreement remains in
effect, provided, however, that LICENSEE may terminate its obligations
with respect to any given patent application or patent in any country
upon thirty (30) days' written notice to THE REGENTS. THE REGENTS will
use its best efforts to curtail patent costs when such a notice is
received from LICENSEE. THE REGENTS may continue prosecution and/or
maintenance of such application(s) or patent(s) at its sole discretion
and expense; provided, however, that LICENSEE will have no further right
or licenses thereunder.
10.6 THE REGENTS will have the right to file patent applications at its own
expense in any country in which LICENSEE has not elected to secure
patent rights, and such applications and resultant patents will not be
subject to this Agreement.
11. PATENT INFRINGEMENT
11.1 In the event that LICENSEE learns of the infringement of the Licensed
Patents, LICENSEE will call THE REGENTS' attention thereto in writing
and will provide THE REGENTS with reasonable evidence of such
infringement. LICENSEE agrees that
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during the period and in a jurisdiction where LICENSEE has exclusive
rights under this Agreement, LICENSEE will not notify a third party of
the infringement of any Licensed Patents without first obtaining consent
of THE REGENTS. Both parties will use reasonable commercial efforts in
cooperation with each other to terminate such infringement without
litigation.
11.2 LICENSEE may request that THE REGENTS take legal action against the
infringement of THE REGENTS' Patent Rights. Such request will be made in
writing and will include reasonable evidence of such infringement and
damages to LICENSEE. If the infringing activity has not been abated
within ninety (90) days following the effective date of such request,
THE REGENTS will have the right to:
11.2.1 Commence suit on their own account; or
11.2.2 Refuse to participate in such suit, and THE REGENTS will give
notice of their election in writing to LICENSEE by the end of the
one-hundredth (100th) day after receiving notice of such request
from LICENSEE. LICENSEE may thereafter bring suit for patent
infringement, if and only if, THE REGENTS elect not to commence
suit and if the infringement occurred during the period and in a
jurisdiction where LICENSEE has exclusive rights under this
Agreement. However, in the event LICENSEE elects to bring suit in
accordance with this Article 11, THE REGENTS may thereafter join
such suit at its own expense.
11.3 Such legal action as is decided upon will be at the expense of the party
on account of whom suit is brought and all recoveries thereby will
belong to such party, provided, however, that legal action brought
jointly by THE REGENTS and LICENSEE and fully participated in by both
will be at the joint expense of the parties and all recoveries will be
shared jointly by them in proportion to the share of expense paid by
each party.
11.4 Each party agrees to cooperate with the other in litigation proceedings
instituted hereunder but at the expense of the party on account of whom
suit is brought. Such
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litigation will be controlled by the party bringing the suit, except
that THE REGENTS may be represented by counsel of its choice in any suit
brought by LICENSEE.
12. USE OF NAMES AND TRADEMARKS
Neither Party has any right to use any name, trade name, trademark, or
other designation of the other party (including any contraction,
abbreviation, or simulation) in advertising, publicity, or other
commercial promotional activities. The use of the name "LLNL," or "The
Regents of the University of California," or the name of any University
of California campus in advertising, publicity or other commercial
promotional activities is expressly prohibited.
13. LIMITED WARRANTY
13.1 THE REGENTS has the right to grant this license.
13.2 THIS LICENSE AND THE ASSOCIATED LICENSED PATENTS ARE PROVIDED WITHOUT
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR ANY
OTHER WARRANTY, EXPRESS OR IMPLIED. THE REGENTS AND DOE MAKE NO
REPRESENTATION OR WARRANTY THAT LICENSED PRODUCTS WILL NOT INFRINGE ANY
PATENT, COPYRIGHT, OR OTHER PROPRIETARY RIGHT.
13.3 IN NO EVENT WILL THE REGENTS OR DOE BE LIABLE FOR ANY INCIDENTAL,
SPECIAL, OR CONSEQUENTIAL DAMAGES RESULTING FROM EXERCISE OF THIS
LICENSE OR THE USE OF THE LICENSED PATENTS OR LICENSED PRODUCTS.
13.4 Nothing in this Agreement will be interpreted as:
13.4.1 A warranty or representation by THE REGENTS as to the validity or
scope of any of THE REGENTS' rights in Licensed Patents; or
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13.4.2 A warranty or representation that anything made, used, sold, or
otherwise disposed of under any license granted in this Agreement
is or will be free from infringement of patents or copyrights of
third parties; or
13.4.3 Any obligation to bring suit against a third party for patent
infringement; or
13.4.4 Conferring by implication, estoppel, or otherwise any license or
rights under any patents of THE REGENTS other than Licensed
Patents as defined in this Agreement, regardless of whether such
patents are dominant or subordinate to Licensed Patents; or
13.4.5 An obligation to furnish any know-how or improvements not
specifically provided in this Agreement.
14. INDEMNIFICATION AND INSURANCE
14.1 LICENSEE and its sublicensees must indemnify, hold harmless, and defend
THE REGENTS, its officers, employees, and agents; the sponsors of the
research that led to the invention; and the inventors against any
claims, suits, losses, damages, costs, fees, and expenses resulting from
or arising out of exercise of any license granted under this Agreement.
LICENSEE will pay all costs incurred by the University to enforce this
indemnification, including reasonable attorney fees.
14.2 LICENSEE will insure its activities relating to this Agreement at its
own cost with an insurance company acceptable to THE REGENTS. LICENSEE
will obtain, keep in force, and maintain Comprehensive or Commercial
Form General Liability Insurance, including contractual liability and
products liability and maintain coverage as follows:
14.2.1 Prior to first commercial sale:
14.2.1.1 Each occurrence coverage of not less than one million
dollars (USD $1,000,000); and
14.2.1.2 Product Liability Insurance: Completed operations
aggregate coverage of not less than one million dollars
(USD $1,000,000); and
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<PAGE> 21
14.2.1.3 Personal and Advertising Injury: Coverage of not less than
one million dollars (USD $1,000,000); and
14.2.1.4 General Aggregate (Commercial Form Only): Coverage of not
less than two million dollars (USD $2,000,000).
14.2.2 Upon the first commercial sale:
14.2.2.1 Each occurrence coverage of not less than one million
dollars (USD $1,000,000); and
14.2.2.2 Product Liability Insurance: Completed operations
aggregate coverage of not less than five million dollars
(USD $5,000,000); and
14.2.2.3 Personal and Advertising Injury: Coverage of not less than
one million dollars (USD $1,000,000); and
14.2.2.4 General Aggregate (Commercial Form Only): Coverage of not
less than five million dollars (USD $5,000,000).
These coverages will not limit the liability of LICENSEE in any way.
LICENSEE will provide THE REGENTS, upon request, with certificates of
insurance, including renewals, that show compliance with these
requirements. LICENSEE's failure to maintain this insurance will be
considered a material breach of this Agreement.
14.3 If the insurance is written on a claims-made form, coverage must provide
a retroactive date of placement before or coinciding with the Effective
Date of this Agreement.
14.4 LICENSEE will maintain the general liability insurance specified in this
Article during:
14.4.1 the period that the Licensed Products are being commercially
distributed or sold by LICENSEE, and
14.4.2 a reasonable period thereafter, but in no event less than five
(5) years.
14.5 Insurance coverage required under this Article must:
19
<PAGE> 22
14.5.1 Provide for thirty (30) days advance written notice to THE
REGENTS of cancellation or any modification by LICENSEE; and
14.5.2 Indicate that DOE, The Regents of the University of California,
and their officers, employees, students, and agents, are endorsed
on the policy as additional named insureds; and
14.5.3 Include a provision that the coverage is primary and does not
participate with or is in excess of any valid and collectible
insurance, program, or self-insurance carried or maintained by
THE REGENTS.
15. WAIVER
15.1 No provision of this Agreement is deemed waived and no breach excused
unless such waiver or consent is made in writing and signed by the party
to have waived or consented.
15.2 Failure on the part of either Party to exercise or enforce any right of
such Party under this Agreement will not be a waiver by such Party of
any right, or operate to bar the enforcement or exercise of the right at
any time thereafter.
16. ASSIGNABILITY This Agreement is binding on and inures to the benefit of
THE REGENTS, its successors and assigns, but is personal to LICENSEE.
This Agreement is not assignable by the LICENSEE without prior written
consent of THE REGENTS which will not be unreasonably withheld.
17. LATE PAYMENTS
If THE REGENTS does not receive payments or fees when due, LICENSEE will
pay interest charges at the annual rate of ten percent (10%) from the
date on which the payment was originally due.
20
<PAGE> 23
18. NOTICES
Any report, payment, notice, or other communication that either party
receives must be in writing and will be properly given and effective on
the date of delivery if delivered in person, or the fifth (5th) day
after mailing if mailed by first-class certified mail, postage paid, to
the addresses given below (or to an address designated by written notice
to the other party):
In the case of LICENSEE: CEPHEID
3410 Garrett Drive
Santa Clara, CA 95054
Phone: (408) 274-3834
Fax: (408) 274-8818
Attention: President
with a copy to: Heller Ehrman White & McAuliffe
525 University Avenue
11th Floor
Palo Alto, California 94301
Attn: Neil Flanzraich
In the case of THE REGENTS
All correspondence and
reports: LAWRENCE LIVERMORE
NATIONAL LABORATORY
Industrial Partnerships &
Commercialization
7000 East Ave.
P.O. Box 808, L-795
Livermore, CA 94550
Attention: Director, IPAC
Payments and corresponding
copies of royalty reports: LAWRENCE LIVERMORE
NATIONAL LABORATORY
P.O. Box 5517
Livermore, CA 94550
21
<PAGE> 24
19. DISPUTES AND GOVERNING LAWS
The Parties will attempt to jointly resolve any disputes arising from
this Agreement. Such joint resolution may include binding or non-binding
arbitration. If the Parties are unable to resolve a dispute within a
reasonable time, then either party may commence proceedings in a court
of competent jurisdiction. United States federal law will govern this
Agreement to the extent that there is such law. To the extent there is
no applicable federal law, this Agreement and performance hereunder will
be governed by the laws of the State of California, USA, without regard
to the State's conflict of laws provisions. If THE REGENTS institutes
arbitration, the proceedings will take place in Santa Clara County,
California. If LICENSEE institutes arbitration, the proceedings will
take place in Alameda County, California.
20. PATENT MARKING
LICENSEE will mark all Licensed Products and their containers that are
made, used, sold, or otherwise disposed of under this Agreement in
accordance with applicable patent marking laws.
21. GOVERNMENT APPROVAL OR REGISTRATION
If this Agreement or any associated transaction is required by the law
of any nation to either be approved, permitted, or registered with any
governmental agency, LICENSEE assumes all legal obligations to do so.
LICENSEE will notify THE REGENTS if LICENSEE becomes aware that this
Agreement is subject to a United States or foreign government reporting,
permitting, or approval requirement. LICENSEE will make all necessary
findings and pay all costs including fees, penalties, and all other
out-of-pocket costs associated with such reporting, permitting, or
approval process.
22
<PAGE> 25
22. EXPORT CONTROL LAWS
LICENSEE will observe all applicable United States and foreign laws and
regulations concerning the transfer of Licensed Products and related
technical data, including International Traffic in Arms Regulations
(ITAR) and Export Administration Regulations.
23. FORCE MAJEURE
This Agreement is not breached and no liability is created when THE
REGENTS or LICENSEE fails to perform an obligation under this Agreement
if the failure or omission arises from a cause beyond the control of THE
REGENTS or LICENSEE. These causes include, but are not limited to, the
following: Acts of God; acts or omissions of any government or
governmental agency; compliance with requirements, rules, regulations,
or order of any governmental authority or any office, department,
agency, or instrumentality thereof; fire, storm, flood, earthquake;
accident; acts of the public enemy, war, rebellion, insurrection, riot,
sabotage, invasion; quarantine, restriction; transportation embargoes;
or failures or delays in transportation.
24. UNITED STATES PREFERENCE
The parties acknowledge that the market for Licensed Produces is
worldwide. Any Licensed Products for use or sale in the United States
under a United States Patent will be practiced or manufactured
substantially in the United States.
25. CONFIDENTIALITY
25.1 LICENSEE and THE REGENTS respectively will treat and maintain the
proprietary business, patent prosecution, software, engineering
drawings, process and technical information and other business sensitive
information ("Proprietary Information") of the other party in confidence
using at least the same degree of care as that party uses to protect its
own proprietary information of a like nature for a period from the date
of disclosure until five (5) years after date of termination of this
Agreement. This
23
<PAGE> 26
confidentiality obligation will also apply to the information defined as
"Proprietary Information" under the Mutual Nondisclosure Agreement
provided in Exhibit D.
25.2 All Proprietary Information will be labeled or marked proprietary or as
otherwise similarly appropriate by the disclosing party, or if the
Proprietary Information is orally disclosed, it will be identified as
Proprietary Information at the time of disclosure and the disclosing
Party shall, within thirty (30) days thereafter, confirm in writing the
oral disclosure, referencing the date and type of Proprietary
Information disclosed.
25.3 It is understood that THE REGENTS will be free to release to the
inventors and senior administrative officials employed by THE REGENTS
the terms of this Agreement upon their request. If such release is made,
THE REGENTS will request that such terms will be kept in confidence in
accordance with the provisions of Article 25 and not be disclosed to
others. It is further understood that should a third party inquire
whether a license to THE REGENTS' Patent Rights is available THE REGENTS
may disclose the existence of this Agreement and the extent of the grant
in Article 3 (LICENSE GRANT) and Exhibit B to such third party, but will
not disclose the name of LICENSEE, except where THE REGENTS is required
to release such information under either the California Public Records
Act or other applicable law.
26. MISCELLANEOUS
26.1 The headings of the articles are for reference only and do not affect
the interpretation of this Agreement.
26.2 Any amendment or modification of this Agreement must be in writing and
signed on behalf of each party.
26.3 This Agreement and the attached Exhibits A-D embody the entire
understanding of the Parties with respect to the subject matter of this
Agreement, and supersedes all earlier
24
<PAGE> 27
communication, representation, or understandings, either oral or
written, between the Parties with respect to such subject matter.
26.4 If any provision of this Agreement is held to be invalid, illegal, or
unenforceable in any respect, that invalidity, illegality, or
unenforceability will not affect any other provisions of the Agreement.
This Agreement will be construed as if the invalid, illegal, or
unenforceable provision were never in this Agreement.
26.5 Neither Party is an agent of the other and neither will have any power
to contract for the other Party for any purpose.
26.6 THE REGENTS will release information concerning this Agreement if
required by law.
26.7 The exchange of information between the Parties is governed by an
existing Mutual Nondisclosure Agreement which is attached as Exhibit D.
IN WITNESS WHEREOF, both THE REGENTS and the LICENSEE have executed this
Agreement, in duplicate originals, by their respective officers hereunto duly
authorized, on the day and year hereinafter written.
CEPHEID THE REGENTS OF THE
UNIVERSITY OF CALIFORNIA
By: /s/ KURT PETERSEN By: /s/ JEFFREY WADSWORTH
-------------------------------- -----------------------------------
(Signature) (Signature)
Name: Kurt Petersen Name: JEFFREY WADSWORTH
-------------------------------- -----------------------------------
Deputy Director
Title: President Title: Science and Technology
-------------------------------- -----------------------------------
Date: 3/10/97 Date: 3/12/97
-------------------------------- -----------------------------------
25
<PAGE> 28
EXHIBIT A - LICENSED PATENTS
"Licensed Patents" means the patent, patent application and the resulting patent
listed below and any foreign patent applications filed and the resulting
patents.
United States Patent Application
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
U.S. Patent Silicon-Based Sleeve Devices for Issue Date: M. Allen Northrup, Raymond
5,589,136 Chemical Reactions 12/31/96 P. Mariella, Anthony V.
IL-9707 Carrano,
Joseph W. Balch
Continuation in Microfabricated Sleeve Devices M. Allen Northrup
Part for Chemical Reactions Date Filed:
08/763,465 12/12/96
IL-9707B
---------------------------------------------------------------------------------------------
Foreign Patent Application
---------------------------------------------------------------------------------------------
PCT/US96/10453 Silicon-Based Sleeve Devices for Date Filed: Europe
Chemical Reactions 6/17/96 Canada
Japan
Republic of Korea
Singapore
---------------------------------------------------------------------------------------------
</TABLE>
26
<PAGE> 29
EXHIBIT B - LICENSE GRANT
NOTICE
THIS EXHIBIT B CONTAINS FINANCIAL AND COMMERCIAL INFORMATION DEEMED BUSINESS
SENSITIVE. THE PARTIES AGREE NOT TO USE OR TO DISCLOSE THE TERMS OF THIS EXHIBIT
TO ANY THIRD PARTY WITHOUT THE EXPRESS WRITTEN CONSENT OF THE OTHER PARTY,
EXCEPT AS NECESSARY TO ENABLE THE PARTIES TO PERFORM UNDER THIS AGREEMENT OR AS
MAY BE REQUIRED BY THE REGENTS' CONTRACT WITH THE U.S. DEPARTMENT OF ENERGY
UNDER THE SAME RESTRICTIONS.
A. EXCLUSIVE RIGHTS GRANTED
Subject to the terms and conditions of this Agreement, THE REGENTS
grants to the LICENSEE a limited exclusive, nontransferable,
royalty-bearing license to make, have made, import, use, and sell
Licensed Products covered by the Licensed Patents in the Exclusive
Field-of-Use where patent rights exist. If LICENSEE or its sublicensees
lease Licensed Products, LICENSEE must obtain prior written amendment to
this Agreement from THE REGENTS.
"Exclusive Field-of-Use" as used in this Agreement means nucleic acid
amplification methods, including but not limited to PCR, and
Ligand-binding Assays, carried out in 1) a sleeve reaction chamber
without or with integral means of detecting reaction substrates or
products, and which reaction chamber is not coupled to electrophoresis,
and 2) a sleeve reaction chamber with integral means of detecting
reaction substrates or products and which reaction chamber is coupled to
electrophoresis.
B. SUBLICENSING RIGHTS GRANTED
THE REGENTS grants to LICENSEE the right to issue royalty-bearing
sublicenses to third parties to make, have made, import, use, and sell
Licensed Products in the Exclusive Field-of-Use provided LICENSEE has
current exclusive rights under this Agreement at the time of such
sublicenses. LICENSEE must grant sublicenses in the Exclusive
Field-of-Use if LICENSEE cannot meet market demand for the Licensed
Product(s).
C. RIGHTS EXCLUDED
27
<PAGE> 30
"Excluded Field-of-Use" as used in this Agreement means 1) nucleic acid
amplification methods, including but not limited to PCR, and
Ligand-binding Assays, carried out in a sleeve reaction chamber without
integral means of detecting reaction substrates or products, and which
reaction chamber is coupled to electrophoresis, and 2) all other uses
not expressly granted in the Exclusive Field-of-Use.
The right to lease Licensed Products is expressly excluded from this
Agreement.
D. CONDITIONS AND SCHEDULE [MILESTONES]
Within one (1) Year from Effective Date, LICENSEE will have completed
the following: (1) A prototype of a Licensed Product in the Exclusive
Field-of-Use (2) A detailed business plan for marketing and selling such
Licensed Products. By the end of calendar year 1998, LICENSEE will have
Licensed Products available for sale in the Exclusive Field-of-Use.
LICENSEE will achieve gross sales according to the following schedule:
<TABLE>
<CAPTION>
--------------------------------- ------------------------------
GROSS SALES YEARS FROM EFFECTIVE DATE
--------------------------------- ------------------------------
<S> <C>
Greater than $3 million 3
--------------------------------- ------------------------------
Greater than $7 million 4
--------------------------------- ------------------------------
Greater than $10 million 5
--------------------------------- ------------------------------
</TABLE>
LICENSEE agrees to use reasonable commercial efforts to market Licensed
Product(s) and provide THE REGENTS proof thereof by providing THE
REGENTS with an annual progress report in the format specified in
Article 6 (PROGRESS AND ROYALTY REPORTS).
LICENSEE will also provide annually copies of annual reports,
advertisements, catalogs, and information on trade show demonstrations
in which the Licensed Product(s) were featured during the previous year.
28
<PAGE> 31
EXHIBIT C - ISSUE FEE AND ROYALTIES
NOTICE
THIS EXHIBIT C CONTAINS FINANCIAL AND COMMERCIAL INFORMATION DEEMED BUSINESS
SENSITIVE. THE PARTIES AGREE NOT TO USE OR TO DISCLOSE THE TERMS OF THIS EXHIBIT
TO ANY THIRD PARTY WITHOUT THE EXPRESS WRITTEN CONSENT OF THE OTHER PARTY,
EXCEPT AS NECESSARY TO ENABLE THE PARTIES TO PERFORM UNDER THIS AGREEMENT OR AS
MAY BE REQUIRED BY THE REGENTS' CONTRACT WITH THE U.S. DEPARTMENT OF ENERGY
UNDER THE SAME RESTRICTIONS.
A. ISSUE FEE
LICENSEE will pay THE REGENTS a nonrefundable License Issue Fee of [**]
Dollars ($[**]) to be paid in accordance with Article 4 (LICENSE FEES,
ROYALTIES, AND PAYMENTS) and Article 6 (PROGRESS AND ROYALTY REPORTS)
and the following schedule:
<TABLE>
<CAPTION>
----------------------------- ----------------------------------------------------
INSTALLMENT AMOUNT DUE DATE
----------------------------- ----------------------------------------------------
<S> <C>
[**] Within ten (10) days after Effective Date
----------------------------- ----------------------------------------------------
[**] Within sixty (60) days after Effective Date
----------------------------- ----------------------------------------------------
[**] Within one (1) year after Effective Date
----------------------------- ----------------------------------------------------
[**] Within eighteen (18) months after Effective Date
or within thirty (30) days after first commercial
sale, whichever is earlier
----------------------------- ----------------------------------------------------
[**] Within ninety (90) days after first commercial sale
----------------------------- ----------------------------------------------------
</TABLE>
The License Issue Fee is not creditable toward any other fees owed by
LICENSEE to THE REGENTS under this Agreement.
LICENSEE has the option of paying a reduced License Issue Fee of [**]
DOLLARS ($[**]) if LICENSEE pays such Issue Fee in full by the end of
one (1) year after the Effective Date.
B. EARNED ROYALTIES
29
<PAGE> 32
As consideration for this license, LICENSEE and each sublicensee will
pay to THE REGENTS an earned annual royalty as shown below on all
Licensed Products and in accordance with Article 4 (LICENSE FEES,
ROYALTIES, AND PAYMENTS) and Article 6 (PROGRESS AND ROYALTY REPORTS).
<TABLE>
<CAPTION>
------------------------------- --------------------------------- -------------------------
TYPE OF SALES ANNUAL SALES BY LICENSEE ROYALTIES DUE THE
REGENTS ON NET SALES BY
LICENSEE
------------------------------- --------------------------------- -------------------------
<S> <C> <C>
OEM and Direct Sales 0- [**] [**]
including commercial
contracts* or technology
access fees
------------------------------- --------------------------------- -------------------------
OEM and Direct Sales $[**]- [**] [**]
including commercial
contracts* or technology
access fees
------------------------------- --------------------------------- -------------------------
OEM and Direct Sales $[**] and beyond [**]
including commercial
contracts* or technology
access fees
------------------------------------- ---------------------------- --------------------------
</TABLE>
<TABLE>
<CAPTION>
----------------------------------------------------------- ---------------------------------
TYPE OF SALES ROYALTIES DUE
----------------------------------------------------------- ---------------------------------
<S> <C>
Sublicense Fees except for earned or minimum royalties. [**] or [**] of equivalent cash
value
----------------------------------------------------------- ---------------------------------
Sublicensing royalty rate due to THE REGENTS on Net Sales [**]**
by sublicensees
----------------------------------------------------------- ---------------------------------
Sales to federal agency [**]
----------------------------------------------------------- ---------------------------------
</TABLE>
*A commercial contract does not include a contract for a prototype or
preproduction models used to set customer specifications prior to first
commercial sale.
**This royalty will be a [**] percent ([**]) pass through from a
sublicensee to LICENSEE to THE REGENTS. Any royalties over [**] percent
([**]) remain with LICENSEE. Sublicensee sales are not totaled with
LICENSEE sales and have no impact on the calculation of LICENSEE's
royalty rate.
30
<PAGE> 33
If LICENSEE is required to pay a royalty to another party or parties
that in total exceeds [**] percent ([**]) of Net Sales on the
manufacture, use or sale of Licensed Products, LICENSEE may request that
THE REGENTS adjust the royalty rates presented above. THE REGENTS will
consider each such request on a case by case basis.
C. MINIMUM ANNUAL ROYALTIES
Independent of the License Issue Fee required by Paragraph A, LICENSEE
will pay to THE REGENTS a minimum annual royalty for the life of this
Agreement according to the schedule below. This minimum annual royalty
will be paid even if earned royalties required by Paragraph B are less
than the minimum required. The minimum annual royalty is due by February
28 of each year and is credited against earned royalties until consumed
for that year.
<TABLE>
<CAPTION>
------------------------------------------------------------------------------
CALENDAR YEAR MINIMUM ANNUAL ROYALTY
------------------------------------------------------------------------------
<S> <C>
1997 [**]
------------------------------------------------------------------------------
1998 [**]
------------------------------------------------------------------------------
1999 [**]
------------------------------------------------------------------------------
2000 [**]
------------------------------------------------------------------------------
2001 [**]
------------------------------------------------------------------------------
All subsequent calendar years [**]
for the life of this Agreement plus 4% inflation factor each year
------------------------------------------------------------------------------
</TABLE>
31
<PAGE> 34
EXHIBIT D - MUTUAL NONDISCLOSURE AGREEMENT
MUTUAL NONDISCLOSURE AGREEMENT FOR EXCHANGE OF INFORMATION
WITH LAWRENCE LIVERMORE NATIONAL LABORATORY
This Agreement is effective this 16 day of January, 1996, by and between Cepheid
located at San Jose, CA 95148 and THE REGENTS OF THE UNIVERSITY OF CALIFORNIA,
located at 300 Lakeside Drive, Oakland, CA 94612-3550 ("THE REGENTS"), under
its Contract No. W-7405-ENG-48 with the U.S. DEPARTMENT OF ENERGY ("DOE"), as
operators of the LAWRENCE LIVERMORE NATIONAL LABORATORY, located at 7000 East
Avenue, Livermore, CA 94550 ("LLNL").
WHEREAS, THE REGENTS, as operators of LLNL, and Cepheid (hereinafter
individually referred to as the "PARTY", or collectively as the "PARTIES") wish
to exchange certain confidential and proprietary information relating to micro
reactor system and flow cytometry ("PROPRIETARY INFORMATION"), this Agreement
will govern the conditions of mutual disclosure of PROPRIETARY INFORMATION by
the PARTIES.
The PARTIES hereby agree:
(1) To perform all terms of this Agreement and to maintain the PROPRIETARY
INFORMATION in confidence, giving it the same degree of care, but no
less than a reasonable degree of care, as the PARTIES exercise with
their own proprietary information to prevent its unauthorized
disclosure;
(2) To exchange and use the PROPRIETARY INFORMATION solely for the purpose
of [evaluation, testing, and development of potential collaborations,
joint ventures, and/or license of the technology];
(3) That neither PARTY, without the prior written consent of the other,
will disclose any portion of the PROPRIETARY INFORMATION to others
except to their employees, agents, consultants, subcontractors or
Government personnel having a need to know in order to accomplish the
sole purpose stated above, and who are bound by a like obligation of
confidentiality under this Agreement;
(4) That neither PARTY nor DOE will have any obligation or assume any
liability with respect to any portion of the PROPRIETARY
INFORMATION that:
(a) the receiving PARTIES can demonstrate by written record was
previously known to them;
(b) is, or becomes, available to the public through no fault of the
PARTIES;
(c) is lawfully obtained by the PARTIES from a third party and is not
subject to an obligation of confidentiality owed to the third
party; or
(d) is independently developed by or for the receiving PARTY
independent of any disclosure hereunder;
(5) That PROPRIETARY INFORMATION disclosed by the PARTIES will be in
writing and clearly marked "PROPRIETARY INFORMATION" or its
equivalent. If such PROPRIETARY INFORMATION is initially disclosed
orally or by demonstration, the disclosing PARTY will identify it as
PROPRIETARY INFORMATION or its equivalent at the time of disclosure.
The disclosing PARTY will reduce it to writing or other tangible form,
referencing the date and type of PROPRIETARY INFORMATION disclosed,
and mark as PROPRIETARY INFORMATION or its equivalent. The disclosing
PARTY will deliver a copy to the receiving PARTY within thirty (30)
days thereafter. All protections and restrictions as to use and
disclosure will apply during such thirty (30) day period.
(6) That all rights and title to the PROPRIETARY INFORMATION disclosed
under this Agreement will remain the property of the disclosing PARTY
unless otherwise agreed to in writing by the PARTIES.
<PAGE> 35
<TABLE>
<S> <C>
TECHNICAL CONTACT FOR COMPANY: TECHNICAL CONTACT FOR LLNL:
Name: Kurt Petersen Name: M. Allen Northrup
Company: Cepheid Company: Lawrence Livermore
National Laboratory
Address: 3655 Valley Ridge Lane Address: 7000 East Avenue
P.O. Box 808, L-222
San Jose, CA 95148 Livermore, CA 94550
Phone: (408) 274-3834 Phone: (510) 422-1638
Fax: Fax:
</TABLE>
The PARTIES agree that the furnishing of PROPRIETARY INFORMATION does not
constitute any grant or license to the other PARTY for any legal rights now or
hereinafter held by either PARTY.
This Agreement will be subject to, and interpreted in accordance with, the laws
of the State of California.
This Agreement will remain in effect for [two (2)] year(s) from the effective
date first written above, at which time the receiving PARTY will return or
destroy the PROPRIETARY INFORMATION within thirty (30) days of the effective
day. If the PROPRIETARY INFORMATION is destroyed, a certificate of destruction
must be furnished to the disclosing PARTY within the thirty (30) days. The
secrecy and non-use obligations of the receiving PARTY set forth above will
remain in effect for [five (5)] years from the effective date.
The receiving PARTY acknowledges its obligations to control access to technical
data under the U.S. Export Laws and Regulations and agrees to adhere to such
Laws and Regulations with regard to any technical data received under this
Agreement.
Any modification to this Agreement must be in writing and signed by the duly
authorized representative of each PARTY.
CEPHEID THE REGENTS OF THE UNIVERSITY
------------------------------ OF CALIFORNIA, LAWRENCE
(company name) LIVERMORE NATIONAL LABORATORY
By: /s/ KURT PETERSEN By: /s/ RODNEY D. KIEFER
--------------------------- ---------------------------
(signature) (signature)
Name: Kurt Petersen Name: Rodney D. Kiefer
------------------------- -------------------------
(please print) (please print)
Title: President Title: Deputy Director IPAC
------------------------ -----------------------
Date: 1/10/96 Date: 1/16/96
------------------------ ------------------------
RETURN TO: Lawrence Livermore National Laboratory
ATTN: Janice Wallace
7000 East Avenue
P.O. Box 808, L-703
Livermore, CA 94550
cc: (Technical Contact)