Sample Business Contracts

Recitals

Article 1:    Definitions

Article 2:    Grants

Article 3:    Consideration

Article 4:    Reports, Records and Payments

Article 5:    Patent Matters

Article 6:    Governmental Matters

Article 7:    Termination of Agreement

Article 8:    Limited Warranty and Indemnification

Article 9:    Use of Names and Trademarks

Article 10:  Miscellaneous Provisions

Exhibit A:  Inventions Included in This Agreement

Exhibit B:  Patent Applications

Exhibit C:  VA/UC Agreement

"Affiliate" means any corporation or other business entity which is bound in writing by LICENSEE to the terms set forth in this Agreement and in which LICENSEE owns or controls, directly or indirectly, at least twenty percent (20%) of the outstanding stock or other voting rights entitled to elect directors, or in which LICENSEE is owned or controlled directly or indirectly by at least twenty percent (20%) of the outstanding stock or other voting rights entitled to elect directors; but in any country where the local law does not permit foreign equity participation of at least twenty percent (20%), then an "Affiliate" includes any company in which LICENSEE owns or controls or is owned or controlled by, directly or indirectly, the maximum percentage of outstanding stock or voting rights permitted by local law.

"Combination Product" means any product which is a Licensed Product (as defined below) and contains other product(s) or product component(s) that is not an excipient, diluant, adjuvant, buffer and the like and (i) does not use Invention, or Patent Rights (as defined below); (ii) the sale, use or import by itself does not contribute to or induce the infringement of Patent Rights; (iii) is sold separately by LICENSEE, its Sublicensee (as defined below) or an Affiliate; and (iv) enhances the market price of the final product(s) sold, used or imported by LICENSEE, its Sublicensee, or an Affiliate.

"Field" means [***].

"Licensed Method" means any method that uses or is covered by Patent Rights the use of which would constitute, but for the license granted to LICENSEE under this Agreement, an infringement, an inducement to infringe or contributory infringement, of any pending or issued claim within Patent Rights, had LICENSEE not had rights in patents and patent applications claiming Invention.

"Licensed Product" means any service, composition or product that is covered by the claims of Patent Rights, or that is produced by the Licensed Method, or the manufacture, use, sale, offer for sale, or importation of which would constitute, but for the license granted to LICENSEE under this Agreement, an infringement, an inducement to infringe or contributory infringement, of any pending or issued claim within the Patent Rights, had LICENSEE not had rights in patents and patent applications claiming Invention.

"Net Sales" means the total of the gross invoice prices of Licensed Products sold or leased by LICENSEE, Sublicensee, Affiliate, or any combination thereof, less the sum of the following actual and customary deductions where applicable and separately listed: cash, trade, or quantity discounts; sales, use, tariff, import/export duties or other excise taxes imposed on particular sales (except for value-added and income taxes imposed on the sales of Licensed Product in foreign countries); transportation charges; or credits to customers because of rejections or returns. For purposes of calculating Net Sales, transfers to a Sublicensee or an Affiliate of Licensed Product under this Agreement for (i) end use (but not resale) by the Sublicensee or Affiliate shall be treated as sales by LICENSEE at list price of LICENSEE, or (ii) resale by a Sublicensee or an Affiliate shall be treated as sales at the list price of the Sublicensee or Affiliate.

"Patent Rights" means UNIVERSITY's rights in any of the US patent applications listed in Exhibit B disclosing and claiming the Inventions, filed by Inventors and assigned to UNIVERSITY; and continuing applications thereof including divisions, substitutions, and continuations-in-part (but only to extent the claims thereof are enabled by disclosure of the parent application); any patents issuing on said applications including reissues, reexaminations and extensions; and any corresponding foreign applications or patents.

"Sublicense" means an agreement into which LICENSEE enters with a third party that is not an Affiliate for the purpose of (i) granting certain rights; (ii) granting an option to certain rights; or (iii) forbearing the exercise of any rights, granted to LICENSEE under this Agreement. "Sublicensee" means a third party with whom LICENSEE enters into a Sublicense.

"Term" means the period of time beginning on the Effective Date and ending on the expiration date of the longest-lived Patent Rights.

"Territory" means worldwide where Patent Rights exist.

"VA/UC Agreement" means the Cooperative Technology Administration Agreement with an effective date of May 19, 2000, together with any amendments which have been executed by the Effective Date of this Agreement, which such Agreement and such amendments are attached hereto as Exhibit A and are incorporated herein by reference.

The license granted in Paragraph 2.1 includes the right of LICENSEE to grant Sublicense to third parties during the Term but only for as long the license is exclusive.

With respect to Sublicense granted pursuant to Paragraph 2.2(a), LICENSEE shall:

not receive, or agree to receive, anything of value in lieu of cash as consideration from a third party under a Sublicense granted pursuant to Paragraph 2.2(a) without the express written consent of UNIVERSITY;

to the extent applicable, include all of the rights of and obligations due to UNIVERSITY (and, if applicable, the rights and obligations of the US Government under 35 U.S.C. §§ 200-212 and the VA/UC Agreement) and contained in this Agreement;

promptly provide UNIVERSITY with a copy of each Sublicense issued; and

collect and guarantee payment of all payments due, directly or indirectly, to UNIVERSITY from Sublicensees and summarize and deliver all reports due, directly or indirectly, to UNIVERSITY from Sublicensees.

Upon termination of this Agreement for any reason, UNIVERSITY, at its sole discretion, shall determine whether LICENSEE shall cancel or assign to UNIVERSITY any and all Sublicenses; provided, however, that LICENSEE may submit a proposed Sublicense to UNIVERSITY in advance for UNIVERSITY's prior approval, such approval not to be unreasonably withheld or delayed, and if UNIVERSITY approves such Sublicense, and Sublicensee agrees to the terms of this Agreement, then such Sublicense shall also become a direct license between Sublicensee and UNIVERSITY upon termination of this Agreement for any reason.

If LICENSEE grants a license to a third party under its own interest in the Field in any patent rights claiming Invention, LICENSEE shall also concurrently grant a Sublicense under Patent Rights to said third party under this Paragraph.

use the Invention and Patent Rights for educational and research purposes;

publish or otherwise disseminate any information about the Invention at any time; and

allow other nonprofit institutions to use Invention and Patent Rights for educational and research purposes in their facilities.

a license issue fee of [***] dollars (US$[***]) upon execution of this Agreement;

license maintenance fees of [***] dollars (US$[***]) per year and payable on the first anniversary of the Effective Date and annually thereafter on each anniversary; provided however, that LICENSEE's obligation to pay this fee shall end on the date when LICENSEE is commercially selling a Licensed Product;

milestone payments in the amounts payable according to the following schedule or events for each Licensed Product:

Amount

Date or Event

(i)

$[***]

(ii)

$[***]

(iii)

$[***]

(iv)

$[***]

(v)

$[***]

an earned royalty of [***] percent ([***]%) on Net Sales of Licensed Products by LICENSEE and/or its Affiliate(s);

In the event LICENSEE is required to pay royalties to one or more third parties for patent rights necessary to make, use or sell Licensed Products, LICENSEE may deduct $[***] from the earned royalties payable to UNIVERSITY for every $[***] LICENSEE actually pays to said third parties; provided, however, in no event shall the amount payable to UNIVERSITY be less than [***]% of the amount otherwise due.

[***] percent ([***]%) of all sublicense fees received by LICENSEE from its Sublicensees that are not earned royalties;

on each and every sublicense royalty payment received by LICENSEE from its Sublicensees on sales of Licensed Product by Sublicensee, the higher of (i) [***] percent ([***]%) of the royalties received by LICENSEE; or (ii) royalties based on the royalty rate in Paragraph 3.1(d) as applied to Net Sales of Sublicensee;

beginning the calendar year of commercial sales of the first Licensed Product by LICENSEE, its Sublicensee, or an Affiliate and if the total earned royalties paid by LICENSEE under Paragraphs 3.1(d) and (g) to UNIVERSITY in any such year cumulatively amounts to less than [***] dollars (US$[***]) ("minimum annual royalty"), LICENSEE shall pay to UNIVERSITY a minimum annual royalty on or before [***] the difference between amount noted above and the total earned royalty paid by LICENSEE for such year under Paragraphs 3.1(d) and (g); provided, however, that for the year of commercial sales of the first Licensed Product, the amount of minimum annual royalty payable shall be pro-rated for the number of months remaining in that calendar year.

LICENSEE shall, either directly or through its Affiliate(s) or Sublicensee(s):

[***]

If LICENSEE fails to perform any of its obligations specified in Paragraphs 3.3(a)(i)-(ix), then UNIVERSITY shall have the right and option to either terminate this Agreement or change LICENSEE's exclusive license to a

nonexclusive license. This right, if exercised by UNIVERSITY, supersedes the rights granted in Article 2. The VA also has termination rights under Article 7 of the VA/UC Agreement.

The rights of the U.S. Government as provided for in Paragraph 3.5.4 of the VA/UC Agreement apply to LICENSEE under this Agreement.

Royalty Reports.     After the first commercial sale of a Licensed Product anywhere in the world, LICENSEE shall submit to UNIVERSITY quarterly royalty reports on or before each [***]. Each royalty report shall cover LICENSEE's (and each Affiliate's and Sublicensee's) most recently completed calendar quarter and shall show:

the date of first commercial sale of a Licensed Product in each country;

the gross sales, deductions as provided in the definition of Net Sales in Article 1, and Net Sales during the most recently completed calendar quarter and the royalties, in US dollars, payable with respect thereto;

the number of each type of Licensed Product sold;

sublicense fees and royalties received during the most recently completed calendar quarter in US dollars, payable with respect thereto;

the method used to calculate the royalties; and

the exchange rates used.

LICENSEE shall keep, and shall require its Affiliates and Sublicensees to keep, accurate and correct records of all Licensed Products manufactured, used, and sold, and sublicense fees received under this Agreement. Such records shall be retained by LICENSEE for at least [***] ([***]) years following a given reporting period.

All records shall be available during normal business hours for inspection at the expense of UNIVERSITY by UNIVERSITY's Internal Audit Department or by a Certified Public Accountant selected by UNIVERSITY and in compliance with the other terms of this Agreement for the sole purpose of verifying reports and payments or other compliance issues. Such inspector shall not disclose to UNIVERSITY any information other than information relating to the accuracy of reports and payments made under this Agreement or other compliance issues. In the event that any such inspection shows an under reporting and underpayment in excess of [***] percent ([***]%) for any [***] ([***]) period, then LICENSEE shall pay the cost of the audit as well as any additional sum that would have been payable to UNIVERSITY had the LICENSEE reported correctly, plus an interest charge at a rate of [***] percent ([***]%) per year. Such interest shall be calculated from the date the correct payment was due to UNIVERSITY up to the date when such payment is actually made by LICENSEE. For underpayment not in excess of [***] percent ([***]%) for any [***] ([***]) period, LICENSEE shall pay the difference within [***] ([***]) days without interest charge or inspection cost.

UNIVERSITY may provide the VA with all financial information obtained from LICENSEE under Paragraph 4.1 hereof to the extent required under the VA/UC Agreement, and if such information is provided to the VA, UNIVERSITY will require that the VA not disclose it to third parties.

All fees reimbursements and royalties due UNIVERSITY shall be paid in United States dollars and all checks shall be made payable to "The Regents of the University of California", referencing UNIVERSITY's taxpayer identification number, 95-6006144, and sent to UNIVERSITY according to Paragraph 10.1 (Correspondence). When Licensed Products are sold in currencies other than United States dollars, LICENSEE shall first determine the earned royalty in the currency of the country in which Licensed Products were sold and then convert the amount into equivalent United States funds, using the exchange rate quoted in the Wall Street Journal on the last business day of the applicable reporting period.

Royalty Payments.

Royalties shall accrue when Licensed Products are invoiced, or if not invoiced, when delivered to a third party or Affiliate.

LICENSEE shall pay earned royalties quarterly on or before [***]. Each such payment shall be for earned royalties accrued within LICENSEE's most recently completed calendar quarter.

Royalties earned on sales occurring or under sublicense granted pursuant to this Agreement in any country outside the United States shall not be reduced by LICENSEE for any taxes, fees, or other charges imposed by the government of such country on the payment of royalty income, except that all payments made by LICENSEE in fulfillment of UNIVERSITY's tax liability in any particular country may be credited against earned royalties or fees due UNIVERSITY for that country. LICENSEE shall pay all bank charges resulting from the transfer of such royalty payments.

If at any time legal restrictions prevent the prompt remittance of part or all royalties by LICENSEE with respect to any country where a Licensed Product is sold or a sublicense is granted pursuant to this Agreement, LICENSEE shall convert the amount owed to UNIVERSITY into US currency and shall pay UNIVERSITY directly from its US sources of fund for as long as the legal restrictions apply.

In the event that any patent or patent claim within Patent Rights is held invalid in a final decision by a patent office from which no appeal or additional patent prosecution has been or can be taken, or

by a court of competent jurisdiction and last resort and from which no appeal has or can be taken, all obligation to pay royalties based solely on that patent or claim or any claim patentably indistinct therefrom shall cease as of the date of such final decision. LICENSEE shall not, however, be relieved from paying any royalties that accrued before the date of such final decision, that are based on another patent or claim not involved in such final decision

Late Payments. In the event royalty, reimbursement and/or fee payments are not received by UNIVERSITY when due, LICENSEE shall pay to UNIVERSITY interest charges at a rate of [***] percent ([***]%) per year. Such interest shall be calculated from the date payment was due until actually received by UNIVERSITY.

LICENSEE shall diligently prosecute and maintain United States and, if available, foreign patents, and applications in Patent Rights using counsel of its choice. LICENSEE shall provide UNIVERSITY with copies of all relevant documentation relating to such prosecution. The counsel shall take instructions only from LICENSEE, and all patents and patent applications in Patent Rights shall be assigned jointly to UNIVERSITY, the VA and LICENSEE.

LICENSEE shall consider amending any patent application in Patent Rights to include claims reasonably requested by UNIVERSITY.

LICENSEE may elect to terminate its payment obligations with respect to any patent application or patent in Patent Rights upon three (3) months' written notice to UNIVERSITY. LICENSEE shall use reasonable efforts to curtail further Patent Costs for such application or patent when such notice of termination is sent to UNIVERSITY. UNIVERSITY, at its sole discretion and at its sole expense, may continue prosecution and maintenance of said patent application or patent, and LICENSEE shall have no further license with respect thereto. Non-payment of any portion of Patent Costs with respect to any application or patent may be deemed by UNIVERSITY as an election by LICENSEE to terminate all obligations with respect to such application or patent. The UNIVERSITY is not obligated to file, prosecute or maintain Patent Rights outside the Territory at any time or to file, prosecute or maintain Patent Rights to which LICENSEE has terminated its license hereunder.

LICENSEE shall apply for an extension of the term of any patent in Patent Rights if appropriate under the Drug Price Competition and Patent Term restoration Act of 1984 and/or European, Japanese and other foreign counterparts of this law. LICENSEE shall prepare all documents for such application, and shall execute such documents and take any additional action as required in connection herewith.

Patent Infringement.

If LICESNEE learns of the substantial infringement of any patent licensed under this Agreement, then LICENSEE shall call UNIVERSITY's attention thereto in writing and provide UNIVERSITY with reasonable evidence of infringement. Neither party will notify a third party of the infringement of any of UNIVERSITY's Patent Rights without first obtaining the consent of the other party, which consent will not be unreasonably denied. Both parties shall use their best efforts in cooperation with each other to terminate infringement without litigation.

LICENSEE may request that the UNIVERSITY take legal action against the infringement of University's Patent Rights. Such request must be in writing and must include reasonable evidence of infringement and damages to LICENSEE. If the infringing activity has not abated within ninety (90) days following the effective date of request, then the UNIVERSITY or the U.S. Government has the right to:

Legal action, as is decided on, will be at the expense of the party bringing suit and all damages recovered thereby will belong to the party bringing suit, but legal action brought jointly by the UNIVERSITY and/or the U.S.

Government and by LICENSEE and fully participated in by them 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.

Any recovery or settlement received in connection with any suit will first be shared by UNIVERSITY and LICENSEE equally to cover the litigation costs each incurred, and next shall be paid to UNIVERSITY or LICENSEE to cover any litigation costs it incurred in excess of the litigation costs of the other. In any suit initiated by LICENSEE, any recovery in excess of litigation costs will be shared between LICENSEE and UNIVERSITY as follows: (i) for any recovery other than amounts paid for willful infringement: (A) UNIVERSITY will receive [***] percent ([***]%) of the recovery if UNIVERSITY was not a party in the litigation and did not incur any litigation costs; (B) UNIVERSITY will receive [***] percent ([***]%) of the recovery if UNIVERSITY was a party in the litigation, but did not incur any litigation costs, including the provisions of Paragraph 5.2(b) above, or (C) UNIVERSITY will receive [***] percent ([***]%) of the recovery if UNIVERSITY incurred any litigation costs in connection with the litigation; and (ii) for any recovery for willful infringement, UNIVERSITY will receive [***] percent ([***]%) of the recovery. In any suit initiated by UNIVERSITY, any recovery in excess of litigation costs will belong to UNIVERSITY. UNIVERSITY and LICENSEE agree to be bound by all determinations of patent infringement, validity, and enforceability (but no other issue) resolved by any adjudicated judgment in a suit brought in compliance with this Section 5.2.

Each party shall cooperate with the other in litigation proceedings instituted hereunder but at the expense of the party bringing suit. Litigation will be controlled by the party bringing the suit, except that UNIVERSITY may be represented by counsel of its choice in any suit brought by LICENSEE.

Patent Marking.     LICENSEE shall mark all Licensed Products made, used or sold under the terms of this Agreement, or their containers, in accordance with the applicable patent marking laws.

Governmental Approval or Registration.     If this Agreement or any associated transaction is required by the law of any nation to be either approved or registered with any governmental agency, LICENSEE shall assume all legal obligations to do so.

Export Control Laws. LICENSEE shall observe all applicable United States and foreign laws with respect to the transfer of Licensed Products and related technical data to foreign countries, including, without limitation, the International Traffic in Arms Regulations and the Export Administration Regulations.

Preference for United States Industry. If LICENSEE sells a Licensed Product or Combination Product in the US, LICENSEE shall manufacture said product substantially in the US.

If LICENSEE fails to perform or violates any term of this Agreement, then UNIVERSITY may give written notice of default ("Notice of Default") to LICENSEE. If LICENSEE fails to cure the default within sixty (60) days of the Notice of Default, UNIVERSITY may terminate this Agreement and the license granted herein by a second written notice ("Notice of Termination") to LICENSEE. If a Notice of Termination is sent to LICENSEE, this Agreement shall automatically terminate on the effective date of that notice. Termination shall not relieve LICENSEE of its obligation to pay any fees owed at the time of termination and shall not impair any accrued right of UNIVERSITY. The VA also has termination rights under Article 7 of the VA/UC Agreement.

This Agreement will terminate immediately, without the obligation to provide 60 days notice as set forth in Paragraph 7.1(a), if LICENSEE files a claim including in any way the assertion that any portion of UNIVERSITY's Patent Rights is invalid or unenforceable where the filing is by the LICENSEE, a third party on behalf of the LICENSEE, or a third party at the written urging of the LICENSEE.

LICENSEE shall have the right at any time and for any reason to terminate this Agreement upon a ninety (90)-day written notice to UNIVERSITY. Said

notice shall state LICENSEE's reason for terminating this Agreement. The VA also has termination rights under Article 7 of the VA/UC Agreement.

Any termination under Paragraph 7.2(a) shall not relieve LICENSEE of any obligation or liability accrued under this Agreement prior to termination or rescind any payment made to UNIVERSITY or action by LICENSEE prior to the time termination becomes effective. Termination shall not affect in any manner any rights of UNIVERSITY arising under this Agreement prior to termination.

Article 4 (REPORTS, RECORDS AND PAYMENTS);

Paragraph 7.4 (Disposition of Licensed Products on Hand);

Paragraph 8.2 (Indemnification);

Article 9 (USE OF NAMES AND TRADEMARKS);

Paragraph 10.2 hereof (Secrecy); and

Paragraph 10.5 (Failure to Perform).

Disposition of Licensed Products on Hand. Upon termination of this Agreement, LICENSEE may dispose of all previously made or partially made Licensed Product within a period of one hundred and twenty (120) days of the effective date of such termination provided that the sale of such Licensed Product by LICENSEE, its Sublicensees, or Affiliates shall be subject to the terms of this Agreement, including but not limited to the rendering of reports and payment of royalties required under this Agreement.

UNIVERSITY warrants that it has the lawful right to grant this license.

The license granted herein is provided "AS IS" and without WARRANTY OF MERCHANTABILITY or WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE or any other warranty, express or implied. UNIVERSITY and VA make no representation or warranty that the Licensed

Product, Licensed Method or the use of Patent Rights will not infringe any other patent or other proprietary rights.

NEITHER UNIVERSITY NOR THE VA WILL BE LIABLE FOR ANY LOST PROFITS, COSTS OR PROCURING SUBSTITUTE GOODS OR SERVICES, LOST BUSINESS, ENHANCED DAMAGES FOR INTELLECTUAL PROPERTY INFRINGEMENT OR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR OTHER SPECIAL DAMAGES SUFFERED BY LICENSEE, SUBLICENSEES, JOINT VENTURES, AFFILIATES OR DEVELOPMENT PARTNERS ARISING OUT OF OR RELATED TO THIS AGREEMENT FOR ALL CAUSES OF ACTION OF ANY KIND (INCLUDING TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY AND BREACH OF WARRANTY) EVEN IF UNIVERSITY OR THE VA HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

Nothing in this Agreement shall be construed as:

a warranty or representation by UNIVERSITY or VA as to the validity or scope of any Patent Rights;

a warranty or representation that anything made, used, sold or otherwise disposed of under any license granted in this Agreement is or shall be free from infringement of patents of third parties;

an obligation to bring or prosecute actions or suits against third parties for patent infringement except as provided in Paragraph 5.2 hereof;

conferring by implication, estoppel or otherwise any license or rights under any patents of UNIVERSITY or the U.S. Government other than Patent Rights as defined in this Agreement, regardless of whether those patents are dominant or subordinate to Patent Rights; or

an obligation to furnish any know-how not provided in Patent Rights.

LICENSEE shall indemnify, hold harmless and defend the U.S. Government, the UNIVERSITY, its officers, employees, and agents; the sponsors of the research that led to the Invention; and the Inventors of the patents and patent applications in Patent Rights and their employers against any and all claims,

suits, losses, damage, costs, fees, and expenses resulting from or arising out of exercise of this license or any sublicense. This indemnification shall include, but not be limited to, any product liability.

LICENSEE, at its sole cost and expense, shall insure its activities in connection with the work under this Agreement and obtain, keep in force and maintain insurance or an equivalent program of self insurance as follows:

prior to initiation of human clinical trials: comprehensive or commercial general liability insurance (contractual liability included) with limits of at least : (A) each occurrence, five hundred thousand dollars (US$500,000); (B) products/completed operations aggregate, one million dollars (US$1,000,000); (C) personal and advertising injury, five hundred thousand dollars (US$500,000); (D) general aggregate (commercial form only), one million dollars (US$1,000,000);

UNIVERSITY shall notify LICENSEE in writing of any claim or suit brought against UNIVERSITY or U.S. Government in respect of which UNIVERSITY or U.S. Government intends to invoke the provisions of this Article. LICENSEE shall keep UNIVERSITY informed on a current basis of its defense of any claims under this Article.

Nothing contained in this Agreement confers any right to use in advertising, publicity, or other promotional activities any name, trade name, trademark, or other designation of either party hereto or the VA (including contraction, abbreviation or simulation of any of the foregoing). Unless required by law, the use by LICENSEE of the name, "The Regents of the University of California" or the name of any campus of the University Of California or the VA is prohibited, without the express written consent of UNIVERSITY. Unless required by law, the use by LICENSEE of the name "U.S. Department of Veteran Affairs" is prohibited.

UNIVERSITY may disclose to the Inventors the terms and conditions of this Agreement upon their request. If such disclosure is made, UNIVERSITY shall request the Inventors not disclose such terms and conditions to others.

UNIVERSITY or VA may acknowledge the existence of this Agreement and the extent of the grant in Article 2 to third parties, but UNIVERSITY shall not disclose the financial terms of this Agreement to third parties, except where UNIVERSITY is required by law to do so, such as under the California Public Records Act.

Correspondence. Any notice or payment required to be given to either party under this Agreement shall be deemed to have been properly given and effective:

on the date of delivery if delivered in person, or

five (5) days after mailing if mailed by first-class or certified mail, postage paid, to the respective addresses given below, or to such other address as is designated by written notice given to the other party.

Secrecy.

"Confidential Information" shall mean information relating to the Invention and disclosed by UNIVERSITY to LICENSEE during the term of this Agreement, which if disclosed in writing shall be marked "Confidential", or if first disclosed otherwise, shall within thirty (30) days of such disclosure be reduced to writing by UNIVERSITY and sent to LICENSEE:

Licensee shall:

use the Confidential Information for the sole purpose of performing under the terms of this Agreement;

safeguard Confidential Information against disclosure to others with the same degree of care as it exercises with its own data of a similar nature;

not disclose Confidential Information to others (except to its employees, agents or consultants who are bound to LICENSEE by a like obligation of confidentiality) without the express written permission of UNIVERSITY, except that LICENSEE shall not be prevented from using or disclosing any of the Confidential Information that:

LICENSEE can demonstrate by written records was previously known to it;

is now, or becomes in the future, public knowledge other than through acts or omissions of LICENSEE;

is lawfully obtained by LICENSEE from sources independent of UNIVERSITY; or

is required to be disclosed by law or a court of competent jurisdiction; and

The secrecy obligations of LICENSEE with respect to Confidential Information shall continue for a period ending five (5) years from the termination date of this Agreement.

Assignability.  This Agreement may be assigned by UNIVERSITY, but is personal to LICENSEE and assignable by LICENSEE only with the written consent of UNIVERSITY. LICENSEE may assign in connection with the sale or merger of all or substantially all of its assets with or into another party subject to approval by UNIVERSITY. The consent of UNIVERSITY will not be unreasonably withheld or delayed if the assignment is in conjunction with the transfer of all or substantially all of the business of LICENSEE to which this Agreement relates. However, UNIVERSITY will not be deemed to be unreasonable in withholding consent where the assignment is prohibited by State or Federal Law or is likely to cause damage to the UNIVERSITY reputation or is counter to the UNIVERSITY'S stated missions as a public entity.

No Waiver.  No waiver by either party of any breach or default of any covenant or agreement set forth in this Agreement shall be deemed a waiver as to any subsequent and/or similar breach or default.

Failure to Perform.  In the event of a failure of performance due under this Agreement and if it becomes necessary for either party to undertake legal action against the other on account thereof, then the prevailing party shall be entitled to reasonable attorney's fees in addition to costs and necessary disbursements.

Governing Laws.  THIS AGREEMENT SHALL BE INTERPRETED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, but the scope and validity of any patent or patent application shall be governed by the applicable laws of the country of the patent or patent application.

Force Majeure.  A party to this Agreement may be excused from any performance required herein if such performance is rendered impossible or unfeasible due to any catastrophe or other major event beyond its reasonable control, including, without limitation, war, riot, and insurrection; laws, proclamations, edicts, ordinances, or regulations; strikes, lockouts, or other serious labor disputes; and floods, fires, explosions, or other natural disasters. When such events have abated, the non-performing party's obligations herein shall resume.

Headings.  The headings of the several sections are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

Entire Agreement.  This Agreement embodies the entire understanding of the parties and supersedes all previous communications, representations or understandings, either oral or written, between the parties relating to the subject matter hereof.

Amendments.  No amendment or modification of this Agreement shall be valid or binding on the parties unless made in writing and signed on behalf of each party.

Severability.  In the event that any of the provisions contained in this Agreement is held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Agreement, and this Agreement shall be construed as if the invalid, illegal, or unenforceable provisions had never been contained in it.

THE REGENTS OF THE

UNIVERSITY OF CALIFORNIA:

/s/ Jay Lichter, Ph.D.

/s/ Jane C. Moores, Ph.D.

11/5/08                             

10/30/08

PATENT PROSECUTION AND PROTECTION

together with copies of all such foreign patent applications, including on request, copies of all Patent Office Actions.

LICENSING

TERM AND TERMINATION

            To VA:

Director (122)

Technology Transfer Program

Office of Research and Development

U.S. Department of Veterans Affairs

810 Vermont Avenue N.W.

Washington, D.C. 20420

            To University:    

The Regents of the University of California

Office of the President

Office of Technology Transfer (OTT)

1111 Franklin Street, 5^th Floor

Oakland, California 94607-5200

Attention: Executive Director,

                        Research Administration and Technology Transfer

U.S. DEPARTMENT OF VETERANS

AFFAIRS

  THE REGENTS OF THE

  UNIVERSITY OF CALIFORNIA

/s/ John R. Feussner, M.D.

/s/ Alan B. Bennett

  Exhibit B will be amended to include the following patent applications:

THE REGENTS OF THE

UNIVERSITY OF CALIFORNIA:

Title: 

Assistant Vice Chancellor -

1-21-10

(iv) $[***]

[***]

Delete Paragraph 3.1(c)(v):

(v) $[***]

[***]

Replace Paragraph 3.1(c)(v) with the following:

(v) $[***]

(vi) $[***]

(vii) $[***]

(viii) $[***]

OTONOMY, INC.

THE REGENTS OF THE

UNIVERSITY OF CALIFORNIA

By:

/s/ Jay Lichter

By:

/s/ Jane C. Moores, Ph.D.

Name:

Jay Lichter

Name:

Jane C. Moores, Ph.D.

Title:

CEO

Title:

Assistant Vice Chancellor

Date:

June 9, 2010

Date:

6/9/10

OTONOMY, INC:

THE REGENTS OF THE

UNIVERSITY OF CALIFORNIA:

By:

/s/ Paul E. Cayer

By:

/s/ Jane C. Moores, Ph.D.

Name:

Paul E. Cayer

Name:

Jane C. Moores, Ph.D.

Title:

Chief Business Officer

Title:

Assistant Vice Chancellor

Date:

11/7/12

Date:

11/7/12