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Sample Business Contracts

License Agreement - Nanogen Inc. and Beckman Coulter Inc.

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     LICENSE AGREEMENT ("Agreement") by and between NANOGEN, INC. a Delaware
corporation, having a place of business at 10398 Pacific Center Court, San
Diego, California 92121 ("Nanogen" as that term is further defined in
Paragraph 1.7 hereof) and BECKMAN COULTER, INC., a Delaware corporation,
having a place of business at 4300 North Harbor Boulevard, Fullerton,
California 92834 ("BCI").

                               R E C I T A L S

1.   BCI, formerly known as Beckman Instruments, Inc., is the owner of a
     license from Massachusetts Institute of Technology under United States
     Letters Patent No. 5,653,939 and its foreign counterparts (the '939 Patent)
     and has the right, pursuant to such license, to grant sublicenses
     thereunder.

II.  Nanogen desires to acquire a sublicense under the '939 Patent.

     NOW THEREFORE, in consideration of the mutual undertakings contained
herein and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties, intending to be legally bound,
agree as follows:

                            ARTICLE 1.0 DEFINITIONS

     The following terms, when they appear in this Agreement with an initial
capital letter and without regard to whether they appear in the singular,
plural or possessive form, shall have the meaning defined below:

1.1    "AFFILIATE" shall mean any corporation or other form of limited
       liability legal person, partnership, or other form of business entity
       controlled by, controlling or under common control with a party hereto.
       As used herein, the word and root "control" in the context of a
       corporation shall mean the ownership, directly or indirectly, of fifty
       percent (50%)

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       or more of the voting shares or other equity interests entitled to vote
       in the election of Directors to the Board of Directors of the
       corporation; and, in the context of any other form of business entity,
       the right to receive fifty percent (50%) or more of the net profits of
       such entity plus the right to at least a fifty percent (50%) interest
       in the management and control of such entity; provided that, if the
       country of incorporation of such limited liability legal person or the
       country of domicile of the other form of business entity requires that
       foreign ownership be less than fifty percent (50%), the maximum
       permitted percentage of foreign ownership shall be substituted in this
       Paragraph 1.1 for fifty percent (50%).

1.2    "DISPOSABLE LICENSED PRODUCT" shall mean any probe array, substrate,
       reagent, kit or component or combination thereof in the Field, the
       manufacture, use or sale of which, but for the licenses granted under
       this Agreement, would infringe a claim in the Patent Rights.

1.3    "FIELD" shall mean systems for detecting hybridization of target
       DNA/RNA to known DNA/RNA, PNA or other nucleic acid probes. The system
       will be used only for high and/or low resolution sequence determination
       and will consist of a micro-fabricated semiconductor device designed to
       be used with an array of probes attached to a solid support, means for
       exposing the array of probes to target DNA/RNA (the sample), means for
       detecting whether or not (and where) hybridization has occurred and
       means for reporting the results. The solid support can be the
       semiconductor device itself or a separate support. High and/or low
       resolution sequence determinations include all reverse dot blot
       applications.

1.4    "INSTRUMENT LICENSED PRODUCT" shall mean any instrument, system or
       component or part thereof in the Field, the manufacture, use or sale
       of which, but for the licenses and rights granted under this Agreement,
       would infringe a claim in the Patent Rights.

1.5    "EFFECTIVE DATE" shall mean the last date in time adjacent the
       signature of the authorized representatives of the parties on the last
       page of this Agreement.

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1.6    "LICENSED PROCESS" shall mean any process, procedure or method, the
       practice or use of which in the Field, but for the licenses and rights
       granted under this Agreement, would infringe a claim in the Patent
       Rights.

1.7    "NANOGEN" shall mean Nanogen Inc. and its subsidiaries and Affiliates.

1.8    "NET SALES" shall mean the [***]

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1.9    "PATENT RIGHTS" shall mean United States Letters Patent No. 5,653,939
       and (a) any and all continuations, divisions and continuations-in-part
       of application Serial No. 794,036 filed November 19, 1991 or Serial
       No. 872,582 filed April 23, 1992, the patents which issue therefrom and
       any reissues or reexaminations of any of the foregoing, and (b) any
       foreign patent applications and the patents which issue therefrom which
       claim priority from either of the foregoing U.S. applications.

                   ARTICLE 2.0 REPRESENTATIONS AND WARRANTIES

     BCI represents and warrants that (a) it is the recipient of a license
under the Patent Rights from Massachusetts Institute of Technology ("MIT"),
(b) the agreement between BCI and MIT contains a representation and warranty,
which provides in relevant part, that MIT is the exclusive owner of the entire
right and title in and to the inventions included in the Patent Rights or that
it has acquired the right to grant licenses to the Patent Rights of the scope
granted to BCI, and (c) BCI has the rights and licenses in the Field provided
for in this Agreement.

                           ARTICLE 3.0 LICENSE GRANT

3.1    GRANT -- BCI, subject to the terms and conditions of this Agreement,
       hereby grants to Nanogen and Nanogen accepts a non-exclusive,
       royalty-bearing, world-wide, non-transferable license in the Field
       under the Patent Rights to make, have made, import, use, offer to sell
       and sell Disposable Licensed Products and Instrument Licensed Products,
       to practice Licensed Processes and to pass on to Nanogen's direct and
       indirect purchasers of Disposable Licensed Products and Instrument
       Licensed Products the right to practice Licensed Processes in the Field.
       For the avoidance of doubt, the foregoing grant of a license to Nanogen
       includes an equal grant to third

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       parties who purchase both Disposable Licensed Products and Instrument
       Licensed Products from Nanogen for their own use and for resale of
       both such Products to others.

3.2    SUBLICENSING -- The license granted to Nanogen under Paragraph 3.1
       does not include the right to grant sublicenses. Notwithstanding the
       foregoing, BCI agrees to enter into good faith discussions with third
       parties identified by Nanogen as potential sublicensees under the Patent
       Rights with the objective of granting such third parties licenses under
       the Patent Rights in the Field under reasonable terms and conditions.
       BCI further agrees that it shall, within forty-five (45) days after being
       notified of the identity of such third party, communicate to Nanogen in
       writing whether BCI will as a condition of a sublicense to such third
       party, require the grant to BCI of options or rights to such third
       party's technology or patents. BCI shall use reasonable commercial
       efforts to complete its negotiations with the third parties promptly and
       in any event consistent with the negotiation efforts and promptness of
       the third party.

3.3    U.S. MANUFACTURE -- Nanogen agrees that it shall manufacture the
       Disposable Licensed Products in the United States.

3.4    PATENT MARKING -- Nanogen shall attach a label or product insert on
       each Disposable Licensed Product and Instrument Licensed Product
       reflecting that such Product is licensed under U.S. Patent NO. 5,653,939.

3.5    NO OTHER LICENSES -- Subject to the next sentence hereof, the license
       granted hereunder is limited to the Patent Rights and nothing in this
       Agreement or the course of dealings between the parties or usage or
       custom in the industry or trade shall be construed to confer any other
       rights or licenses upon Nanogen by implication, estoppel or otherwise.
       Notwithstanding the preceding sentence, (a) BCI is not aware of any
       other patents or patent applications it presently owns or under which
       it has the present right to grant sublicenses which would be infringed
       by the practice of the claims of the Patent Rights in the Field, and
       (b) BCI agrees to and shall grant Nanogen

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       a license under any patent or patent application now or hereafter owned
       by BCI or licensed to BCI with a right to grant sublicenses which has
       claims which would be infringed by the manufacture, use or sale of a
       Disposable Licensed Product or Instrument Licensed Product or the
       practice of a Licensed Process in the Field. The license from BCI to
       Nanogen shall be under commercially reasonable terms and conditions to
       be hereafter negotiated by the parties.

3.6    TERM OF LICENSE -- Subject to Nanogen's adherence to all of the terms
       and conditions of this Agreement, the license of Paragraph 3.1 shall
       commence on the Effective Date and end on the earlier of (a) the
       expiration of the Patent Rights, or (b) a final declaration by a court
       of competent jurisdiction from which no appeal has or can be taken
       that all of the claims of the Patent Rights are invalid.

                          ARTICLE 4.0 PAYMENTS TO BCI

4.1    LICENSE FEE -- Nanogen shall pay to BCI as an initial license fee the
       non-refundable sum of [***]. The initial license fee shall be
       non-refundable and shall not be a credit or advance against future
       Nanogen royalty obligations.

4.2    ROYALTIES -- Nanogen shall pay the following royalties to BCI:

       (a)  The greater of: (i) [***] ($[***]) or (ii) [***] percent ([***]%)
            of the Net Sales for each Instrument Licensed Product sold, leased,
            rented or otherwise provided to a third party by Nanogen and each
            Instrument Licensed Product used by Nanogen, plus,

       (b)  Running royalties equal to [***] percent ([***]%) of: (a) Net
            Sales of Disposable Licensed Products and (b) the Net Sales received
            from the practice of Licensed Processes.

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4.3    TAXES AND DEDUCTIONS - All payments due hereunder shall be paid in
       full, without deduction of taxes or other fees which may be imposed
       by any government or paid by Nanogen. All such taxes and deductions
       shall be the sole responsibility of Nanogen.

4.4    PAYMENTS - All payments due under this Article 4.0 shall be made in
       United States Dollars. Royalties shall be paid to BCI at the address
       in Article 11.0 not later than [***] days after the close of each
       calendar quarter. Any amounts due under this Agreement from Nanogen to
       BCI shall, if overdue, bear interest until payment at the lesser of a per
       annum rate of [***]. The payment of such interest shall not foreclose
       BCI from exercising any other rights it may have as a consequence of
       the lateness of any payment. If any currency conversion shall be required
       in connection with the payment of royalties hereunder, such conversion
       shall be made using the exchange rate shown in the Wall Street Journal on
       the last business day of the calendar quarter to which such royalty
       payments relate.

                      ARTICLE 5.0  ROYALTY REPORTS AND BOOKS

5.1    ROYALTY REPORTS - Nanogen shall, commencing with the calendar quarter
       which includes its first sale of a Disposable Licensed Product or
       Instrument Licensed Product or the practice of a Licensed Process, and
       each calendar quarter thereafter during the term of this Agreement, not
       later than thirty (30) days after the close of such calendar quarter,
       provide to BCI an accounting report which, at a minimum, shall show:
       (a) the number and type of each Disposable Licensed Product and
       Instrument Licensed Product sold or used, (b) the gross sales of
       each Disposable Licensed Product and Instrument Licensed Product and
       the gross amount received from the third parties for the practice of
       Licensed Processes, the type and amount of each deduction made from such
       gross sales and receipts and the resultant Net Sales of each Disposable
       Licensed Product sold or used and each Instrument Licensed Product sold,
       leased or rented and each Licensed Process practiced, (c) the royalties,

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       in U.S. Dollars, payable for such sales, lease, rental or uses, and
       (d) the exchange rate used.

5.2    BOOKS AND RECORDS - Nanogen shall keep or cause to be kept true and
       accurate books, records and accounts in accordance with generally
       accepted accounting principles consistently applied covering Nanogen's
       activities hereunder and containing all information necessary for the
       true and accurate determination of the amounts earned and paid hereunder.
       Nanogen shall, not more than once per year and upon prior reasonable
       written notice from BCI, permit a certified public accountant appointed
       and paid for by BCI (the "Auditor") and reasonably acceptable to Nanogen
       to inspect each Nanogen facility manufacturing Disposable Licensed
       Products, and/or Instrument Licensed Products or practicing Licensed
       Processes and to review the previous three (3) years books, records and
       accounts to verify the amounts earned by BCI and paid by Nanogen
       hereunder. The Auditor shall furnish to both parties reports stating only
       its findings during such inspection as to the accuracy, or the nature and
       extent of any inaccuracy of such books, records, accounts and payments.
       If such Auditor determines an amount earned by BCI which exceeds
       Nanogen's determination by greater than [***] percent [***] then if
       Nanogen disagrees with such Auditor's report, BCI and Nanogen shall
       jointly select and appoint a second independent auditor to issue a
       report verifying the amounts earned by BCI and paid by Nanogen
       hereunder. The fees and expenses of the second independent auditor
       shall be paid by Nanogen. The second independent auditor's report
       shall be considered as final and conclusive and not subject to review
       or dispute.

       5.2.1     Any deficiency identified by the Auditor and, if requested
                 by Nanogen, confirmed by the second auditor, between the
                 amounts actually earned by BCI under this Agreement and the
                 amounts reported to be earned and paid on by Nanogen shall be
                 paid to BCI within [***] days of receipt by Nanogen of the
                 Auditor's (or second auditor's) report. Nanogen shall also
                 pay interest each month on such amount at the lesser of: [***].

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                 If the deficiency between the amount actually due to BCI as
                 reported by the Auditor and, if requested by Nanogen,
                 confirmed by the second auditor and the amount actually paid
                 to BCI by Nanogen is greater than [***] in BCI's favor then
                 Nanogen shall reimburse BCI for the actual and reasonable
                 charges, fees and expenses of the Auditor.

                           ARTICLE 6.0  TERMINATION

6.1    TERMINATION BY BCI - If Nanogen shall at any time be in material
       breach of this Agreement, including but not limited to, default on any
       payment hereunder, or of the making of any report hereunder, or shall
       make any materially false report and should fail to remedy such material
       breach within thirty (30) days after written notice thereof by BCI,
       the latter may, at its option, terminate this Agreement by notice to
       such effect, provided that such termination shall not release Nanogen
       from its obligation to pay BCI royalties or other sums due and accrued
       prior to the date of such termination.

6.2    TERMINATION BY NANOGEN - Nanogen shall have the right upon three (3)
       months prior written notice to BCI to terminate this Agreement in its
       entirety, such surrender being operative to relieve Nanogen, as of the
       effective date of said notice, of all obligation to pay royalties which
       would otherwise have accrued therafter pursuant to this Agreement. Such
       termination or surrender shall not relieve Nanogen of its obligation to
       pay royalties or other sums due and accrued prior to the effective date
       of such notice.

6.3    FAILURE TO ASSERT RIGHTS -  The failure by one of the parties under
       this Agreement to assert its rights for any breach of this Agreement
       shall not be deemed a waiver of such rights. The rights and remedies
       specified herein, except those specified as exclusive, are in addition
       to and shall not restrict any right or remedy either party may have at
       law or in equity for any breach of this Agreement.

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                          ARTICLE 7.0  ASSIGNMENT

     Nanogen may not assign this Agreement in whole or in part without
obtaining the prior written approval of BCI, except that Nanogen shall have
the right to assign this Agreement without the consent of BCI to any
Affiliate or to any purchaser of Nanogen's entire business or of
substantially all of Nanogen's assets relating to the sale of Licensed
Products.

                       ARTICLE 8.0  PRODUCT LIABILITY

HOLD HARMLESS - Nanogen agrees to and shall defend, indemnify and hold BCI
and its officers, directors and employees harmless from and against any
claim, liability, suit or damage (including attorney's fees to consider,
advise and defend and any damages and penalties awarded by a court of
competent jurisdiction or settlement voluntarily paid) based on a claim which
arises out of or is alleged to arise out of injury to persons, including
death, or property resulting from or alleged to have resulted from the
manufacture, use, sale, lease, consumption or advertisement of a Disposable
Licensed Product or Instrument Licensed Product or the practice of Licensed
Processes.

                                  ARTICLE 9.0

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                        ARTICLE 10.0 ROYALTY STACKING

     If, at any time, Nanogen discovers that any Disposable Licensed Product
or Instrument Licensed Product or the use thereof in the Field or the
practice of any Licensed Process infringes claims of an unexpired patent or
patents other than those in the Patent Rights, Nanogen may, if it has not
already done so, negotiate with the owner of such patents for a license on
such terms as Nanogen deems appropriate. Should the license with the owner of
such patents require the payment of royalties or other consideration to such
owner then the royalties otherwise payable under this Agreement shall be
reduced by the dollar amount of the royalties or consideration paid to the
owners of such patents; provided that the maximum amount of such reduction
shall not exceed [***] percent [***] of the Net Sales. For the avoidance of
doubt, if the royalty to be paid by Nanogen to such third party exceeds [***]
percent [***] of the Net Sales the royalty to be paid by Nanogen to BCI under
this Agreement shall be reduced from [***] percent [***] to [***] percent
[***]of Net Sales and in no event shall the royalty payable under this
Agreement be less than [***] percent [***] of Net Sales.

                             ARTICLE 11.0 NOTICES

     All notice and payments required or permitted to be given hereunder
shall be in writing and addressed to the respective parties as follows:

                   If to Nanogen:    Nanogen, Inc.
                                     10398 Pacific Center Court
                                     San Diego, California 92121
                                     Attention: Chief Executive Officer

                   With a copy to:   Nanogen, Inc.
                                     10398 Pacific Center Court
                                     San Diego, California 92121
                                     Attention: General Counsel

                   If to BCI:        Beckman Coulter, Inc.
                                     4300 North Harbor Boulevard
                                     Fullerton, California 92834-3100
                                     Attention: President

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                   With a copy to:   Beckman Coulter, Inc.
                                     4300 North Harbor Boulevard
                                     Fullerton, California 92834-3100
                                     Attention: General Counsel

or such other addresses as may be designated by the respective parties in
writing. A notice shall be deemed given the earlier of the date when actually
received if sent by messenger or facsimile (with notice of receipt in good
order requested and received) or three (3) days after deposit in the United
States registered or certified mail, postage prepaid, and properly addressed.

                        ARTICLE 12.0 SECTION HEADINGS

     Section headings are for convenience only and shall not be construed to
limit or extend the meaning of any portion of this Agreement.

                ARTICLE 13.0 LAW GOVERNING AND CONSTRUCTIONS

13.1     APPLICABLE LAW - This Agreement shall be governed by and construed
         in accordance with the laws of the State of California as if it has
         been delivered in California, and all acts performed or required to
         be performed hereunder have been performed entirely within such
         state, not including, however any conflicts of law rule of
         California which may direct or refer such determination to the laws
         of any other state or country.

13.2     MUTUALITY - This Agreement is the result of negotiation and
         compromise between the parties and neither party shall be prejudiced
         as having been the drafter of the Agreement.

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                         ARTICLE 14.0 MISCELLANEOUS

14.1     Nothing in this Agreement shall be construed as conferring any right
         to use advertising, publicity, or other promotional activities any
         name, trade name, trademark or other designation of either party
         hereto without the express written approval of the other party.

14.2     BCI makes no warranties as to the validity or scope of the Patent
         Rights, or that any manufacture, sale, use, or other disposition of
         the products and processes licensed hereunder will be free from
         infringement of patents, utility models, and/or design patents of
         third parties. Nothing in this Agreement shall be considered as
         conferring any warranty or representation as to the usefulness,
         marketability, or merchantability of any products or processes
         within the scope of the licenses hereunder.

14.3     The Parties will retain the terms of this Agreement in strict
         confidence, except as may be required by regulatory agencies or
         courts, and will then use all reasonable precautions to maintain the
         terms of this Agreement confidential.

14.4     In the event that any provision of this Agreement is held invalid or
         unenforceable for any reason, such enforceability shall not affect
         the enforceability of the remaining provisions of this Agreement,
         and all provisions of this Agreement shall be construed so as to
         preserve the enforceability hereof.

14.5     This Agreement may be executed in any number of counterparts, each
         of which shall be deemed an original but all of which together shall
         constitute one and the same instrument.

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                        ARTICLE 15.0 ENTIRE AGREEMENT

15.1     This instrument contains the entire and only agreement between the
         parties relative to the subject matter hereof and supersedes all
         previous negotiations, representations, undertakings and agreements
         both written and oral heretofore made between the parties as to the
         subject matter. Any representation, promise or condition in
         connection herewith not specifically incorporated herein shall not
         be binding upon either party.

15.2     No modification, renewal, extension, waiver, cancellation or
         termination of this Agreement or of any of the provisions herein
         contained shall be valid until and unless made in writing and signed
         on behalf of the respective parties by duly authorized officers
         thereof.

         IN WITNESS WHEREOF, the parties have respectively caused this
         Agreement to be executed on the dates hereinafter indicated.

BECKMAN COULTER, INC.                  NANOGEN, INC.
BY: /s/ JOHN P. WAREHAM                BY: /s/ HOWARD C. BIRNDORF
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Title: CHIEF EXECUTIVE OFFICER         Title: CHIEF EXECUTIVE OFFICER
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Date: 5-19-00                          Date: 5-19-00
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